# EDGAR Filing Document

**Accession Number:** 0001012477
**File Stem:** 0001012477-25-000031
**Filing Date:** 2025-11
**Character Count:** 359597
**Document Hash:** 20a6f5d5d293910f3acfd213ebec1265
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001012477-25-000031.hdr.sgml**: 20251104

**ACCESSION NUMBER**: 0001012477-25-000031

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 76

**CONFORMED PERIOD OF REPORT**: 20250930

**FILED AS OF DATE**: 20251104

**DATE AS OF CHANGE**: 20251104

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** AVADEL PHARMACEUTICALS PLC
- **CENTRAL INDEX KEY:** 0001012477
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 000000000
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-37977
- **FILM NUMBER:** 251449157

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 10 EARLSFORT TERRACE
- **CITY:** DUBLIN 2
- **PROVINCE COUNTRY:** L2
- **ZIP:** D02 T380
- **BUSINESS PHONE:** 636-449-1830

**MAIL ADDRESS:**
- **STREET 1:** 16640 CHESTERFIELD GROVE ROAD
- **STREET 2:** SUITE 200
- **CITY:** CHESTERFIELD
- **STATE:** MO
- **ZIP:** 63005

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** FLAMEL TECHNOLOGIES SA
- **DATE OF NAME CHANGE:** 19960422

?xml version='1.0' encoding='ASCII'? avdl-20250930

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

———————

**FORM 10-Q** 

———————

☒&nbsp;&nbsp;&nbsp;&nbsp;QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2025

OR

☐&nbsp;&nbsp;&nbsp;&nbsp;TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u> to <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>

**Commission File Number: 001-37977**<br>

———————

**AVADEL PHARMACEUTICALS PLC** 

(Exact name of registrant as specified in its charter)

———————

---

| | |
|:---|:---|
| **Ireland** | **98-1341933** |
| (State or Other Jurisdiction of Incorporation) | (I.R.S. Employer Identification No.) |
| **10 Earlsfort Terrace**<br>**Dublin 2 D02 T380**<br>**Ireland** | <br>N/A |
| (Address of Principal Executive Office and Zip Code) | (Zip Code) |

---

**+353-1-901-5201** 

(Registrant's telephone number, including area code)

**N/A**

(Former name, former address and former fiscal year, if changed since last report)

———————

Securities registered pursuant to Section 12(b) of the Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Ordinary Shares, nominal value $0.01 per share | AVDL | The Nasdaq Global Market |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes 🗹 No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes 🗹 No ◻

------

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

---

| | | | |
|:---|:---|:---|:---|
| Large accelerated filer | 🗹 | Accelerated filer | ◻ |
| Non-accelerated filer | ◻ | Smaller reporting company | ◻ |
| | | Emerging growth company | ◻ |

---

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No 🗹

At October 31, 2025, 97,656,664 ordinary shares, nominal value $0.01 each, of the Company were outstanding.

------

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| | | **Page #** |
| **<u>[Cautionary Disclosure Regarding Forward Looking Statements](#icc1379ded5994ac3935e205ec4c99f23_10)</u>** | **<u>[Cautionary Disclosure Regarding Forward Looking Statements](#icc1379ded5994ac3935e205ec4c99f23_10)</u>** | <u>[3](#icc1379ded5994ac3935e205ec4c99f23_10)</u> |
| **<u>[PART I - FINANCIAL INFORMATION](#icc1379ded5994ac3935e205ec4c99f23_13)</u>** | **<u>[PART I - FINANCIAL INFORMATION](#icc1379ded5994ac3935e205ec4c99f23_13)</u>** |  |
| Item 1. | <u>[Financial Statements](#icc1379ded5994ac3935e205ec4c99f23_16)</u> | <u>[5](#icc1379ded5994ac3935e205ec4c99f23_16)</u> |
| Item 2. | <u>[Management's Discussion and Analysis of Financial Condition and Results of Operations](#icc1379ded5994ac3935e205ec4c99f23_97)</u> | <u>[29](#icc1379ded5994ac3935e205ec4c99f23_97)</u> |
| Item 3. | <u>[Quantitative and Qualitative Disclosures About Market Risk](#icc1379ded5994ac3935e205ec4c99f23_118)</u> | <u>[37](#icc1379ded5994ac3935e205ec4c99f23_118)</u> |
| Item 4. | <u>[Controls and Procedures](#icc1379ded5994ac3935e205ec4c99f23_121)</u> | <u>[38](#icc1379ded5994ac3935e205ec4c99f23_121)</u> |
| **<u>[PART II - OTHER INFORMATION](#icc1379ded5994ac3935e205ec4c99f23_124)</u>** | **<u>[PART II - OTHER INFORMATION](#icc1379ded5994ac3935e205ec4c99f23_124)</u>** |  |
| Item 1. | <u>[Legal Proceedings](#icc1379ded5994ac3935e205ec4c99f23_127)</u> | <u>[38](#icc1379ded5994ac3935e205ec4c99f23_127)</u> |
| Item 1A. | <u>[Risk Factors](#icc1379ded5994ac3935e205ec4c99f23_130)</u> | <u>[38](#icc1379ded5994ac3935e205ec4c99f23_130)</u> |
| Item 2. | <u>[Unregistered Sales of Equity Securities and Use of Proceeds](#icc1379ded5994ac3935e205ec4c99f23_133)</u> | <u>[42](#icc1379ded5994ac3935e205ec4c99f23_133)</u> |
| Item 3. | <u>[Defaults Upon Senior Securities](#icc1379ded5994ac3935e205ec4c99f23_136)</u> | <u>[42](#icc1379ded5994ac3935e205ec4c99f23_136)</u> |
| Item 4. | <u>[Mine Safety Disclosures](#icc1379ded5994ac3935e205ec4c99f23_139)</u> | <u>[42](#icc1379ded5994ac3935e205ec4c99f23_139)</u> |
| Item 5. | <u>[Other Information](#icc1379ded5994ac3935e205ec4c99f23_142)</u> | <u>[42](#icc1379ded5994ac3935e205ec4c99f23_142)</u> |
| Item 6. | <u>[Exhibits](#icc1379ded5994ac3935e205ec4c99f23_145)</u> | <u>[43](#icc1379ded5994ac3935e205ec4c99f23_145)</u> |

---

NOTE REGARDING TRADEMARKS

We own various trademark registrations and applications, and unregistered trademarks, including, but not limited to, AVADEL<sup>TM</sup>, LUMRYZ<sup>TM</sup>, RYZUP<sup>TM</sup>, REST-ON<sup>TM</sup>, RESTORE<sup>TM</sup> and REVITALYZ<sup>TM</sup>. Trade names, trademarks and service marks of other companies appearing in this Quarterly Report are the property of their respective holders. Solely for convenience, the trademarks and trade names in this Quarterly Report may be referred to without the® and™ symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend to use or display other companies' trademarks and trade names to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

From time to time, we may use our website, LinkedIn or our X account (@AvadelPharma) to distribute material information. Our financial and other material information is routinely posted to and accessible on the Investors section of our website, available at www.avadel.com. Investors are encouraged to review the Investors section of our website because we may post material information on that site that is not otherwise disseminated by us. Information that is contained in and can be accessed through our website, our LinkedIn posts or our X posts are not incorporated into, and does not form a part of, this Quarterly Report.

------

**Cautionary Disclosure Regarding Forward-Looking Statements**

This Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended, (the "Exchange Act"). Any statements about our expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but are not always, made through the use of words or phrases such as "may," "will," "could," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "projects," "potential," "continue," and similar expressions, or the negative of these terms, or similar expressions. Accordingly, these statements involve estimates, assumptions, risks and uncertainties which could cause actual results to differ materially from those expressed in them.

This Quarterly Report on Form 10-Q contains forward-looking statements that are based on our management's belief and assumptions and on information currently available to our management. These statements relate to future events or our future financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements include, but are not limited to, statements about:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our and Alkermes plc's ("Alkermes") ability to consummate our pending transaction with Alkermes in a timely manner, or at all, and the satisfaction (or waiver) of conditions to the consummation of our pending transaction with Alkermes, including with respect to the approval of the Company's shareholders and required regulatory clearances;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The occurrence of any event, change or other circumstance or condition that could give rise to the termination of our transaction agreement with Alkermes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The effect of the pendency of our transaction with Alkermes on our business relationships, operating results and business generally;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to successfully commercialize LUMRYZ (sodium oxybate) in the United States ("U.S.") for the treatment of cataplexy or excessive daytime sleepiness ("EDS") in patients seven years of age and older with narcolepsy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our plans with respect to our commercial infrastructure and marketing, market access and commercial activities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to maintain and receive additional regulatory approvals for LUMRYZ in any other jurisdictions outside the U.S., and any related restrictions, limitations, and/or warnings in the label of LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations regarding the rate and degree of market acceptance for LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to enter into strategic partnerships for the commercialization, manufacturing and distribution of LUMRYZ in the U.S.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our reliance on a single product, LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations regarding timing of and our ability to execute the pivotal REVITALYZ trial of LUMRYZ in Idiopathic Hypersomnia ("IH");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to seek, maintain and receive additional U.S. regulatory approvals as well as commercialize LUMRYZ for indications beyond narcolepsy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our dependence on a limited number of suppliers for the manufacturing of LUMRYZ and certain raw materials used in LUMRYZ and any failure of such suppliers to produce LUMRYZ or deliver sufficient quantities of such raw materials, which could have a material adverse effect on our business, including commercialization of LUMRYZ in the U.S.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to finance our operations on acceptable terms, either through the raising of capital including the incurrence of convertible or other indebtedness, issuance of equity or royalty-based financings, or through strategic financing or commercialization partnerships;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations regarding the pricing and reimbursement and the extent to which patient financial assistance programs are utilized for LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations about the potential market size and market participation for LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations regarding the continued profitability of LUMRYZ;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our expectations regarding our cash runway to support the commercialization of LUMRYZ in the U.S.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The potential impacts of tariffs, inflation and rising interest rates on our business and future operating results;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Our ability to hire and retain key members of our leadership team and other personnel;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The potential impacts due to global political instability and conflicts, such as terrorism, civil unrest, war and natural disasters in foreign countries on our business, financial condition and results of operations; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Competition existing today or that may arise in the future.

These forward-looking statements are neither promises nor guarantees of future performance due to a variety of risks and uncertainties and other factors more fully discussed in the "Risk Factors" sections in Part I, Item 1A of the Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 3, 2025, Part II, Item 1A in this

------

Quarterly Report on Form 10-Q, and the risk factors and cautionary statements described in our subsequent filings with the SEC. Given these uncertainties, readers should not place undue reliance on our forward-looking statements. These forward-looking statements speak only as of the date on which the statements were made and are not guarantees of future performance. Except as required by law, we assume no obligation to update these forward-looking statements publicly, or to revise any forward-looking statements to reflect events or developments occurring after the date of this Quarterly Report, even if new information becomes available in the future.

**Introductory Note**

On October 22, 2025, we announced that we entered into a transaction agreement (the "Transaction Agreement") by and between us and Alkermes plc ("Alkermes"). Under the terms of the Transaction Agreement, Alkermes will acquire us (the "Transaction") pursuant to a court-sanctioned scheme of arrangement under Chapter 1 of Part 9 of the Companies Act 2014 of Ireland (the "Scheme"), or under certain circumstances, subject to the terms of the Transaction Agreement, a takeover offer (as such term is defined in the Irish Takeover Panel Act, 1997, Takeover Rules, 2022) rather than the Scheme. As a result of the Scheme, we will become a wholly owned subsidiary of Alkermes. The Transaction is subject to customary closing conditions, including, among other things (a) the approval by our shareholders of the Scheme, (b) the sanction by the Irish High Court of the Scheme and delivery of the court order to the Irish Registrar of Companies, and (c) the receipt of required antitrust clearances in the United States. We expect the Transaction to close in the first quarter of 2026.

------

**PART I – FINANCIAL INFORMATION**

**ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;FINANCIAL STATEMENTS** 

**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)**

*(In thousands, except per share data)*

*(Unaudited)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
| | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Net product revenue | $77467 | $50025 | $198107 | $118707 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of products sold | (4116) | 6155 | 7827 | 10465 |
| &nbsp;&nbsp;&nbsp;Gross profit | 81583 | 43870 | 190280 | 108242 |
| &nbsp;&nbsp;&nbsp;Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses | 27010 | 3803 | 35619 | 10922 |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 52636 | 40394 | 146841 | 136422 |
| &nbsp;&nbsp;&nbsp;Total operating expense | 79646 | 44197 | 182460 | 147344 |
| &nbsp;&nbsp;&nbsp;Operating income (loss) | 1937 | (327) | 7820 | (39102) |
| &nbsp;&nbsp;&nbsp;&nbsp;Investment and other income, net | 532 | 610 | 895 | 3114 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (2415) | (2820) | (7008) | (8128) |
| &nbsp;&nbsp;&nbsp;Income (loss) before income taxes | 54 | (2537) | 1707 | (44116) |
| &nbsp;&nbsp;&nbsp;&nbsp;Income tax provision (benefit) | 34 | 88 | (3058) | (327) |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $20 | $(2625) | $4765 | $(43789) |
| &nbsp;&nbsp;&nbsp;Net income (loss) per share - basic | $0.00 | $(0.03) | $0.05 | $(0.46) |
| &nbsp;&nbsp;&nbsp;Net income (loss) per share - diluted | $0.00 | $(0.03) | $0.05 | $(0.46) |
| &nbsp;&nbsp;&nbsp;Weighted average number of shares outstanding - basic | 97104 | 96300 | 96812 | 94720 |
| &nbsp;&nbsp;&nbsp;Weighted average number of shares outstanding - diluted | 101276 | 96300 | 99830 | 94720 |

---

*See accompanying notes to unaudited condensed consolidated financial statements.*

------

**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)**

*(In thousands)*

*(Unaudited)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
| | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $20 | $(2625) | $4765 | $(43789) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income (loss), net of tax: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation income |  | 429 | 1088 | 119 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net other comprehensive income (loss), net of income tax expense of $0, $0, $0, and $0 respectively | 70 | (16) | (84) | (754) |
| &nbsp;&nbsp;&nbsp;Total other comprehensive income (loss), net of tax | 70 | 413 | 1004 | (635) |
| &nbsp;&nbsp;&nbsp;Total comprehensive income (loss) | $90 | $(2212) | $5769 | $(44424) |

---

*See accompanying notes to unaudited condensed consolidated financial statements.*

------

**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED BALANCE SHEETS**

*(In thousands, except per share data)*

---

| | | |
|:---|:---|:---|
| | **September 30, 2025** | **December 31, 2024** |
|  | *(Unaudited)* |  |
| &nbsp;&nbsp;&nbsp;**ASSETS** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $79813 | $51371 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Marketable securities | 11764 | 22406 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable, net | 42444 | 34097 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | 23905 | 20298 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 14300 | 6036 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 172226 | 134208 |
| &nbsp;&nbsp;&nbsp;&nbsp;Property and equipment, net | 467 | 453 |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating lease right-of-use assets | 2544 | 1702 |
| &nbsp;&nbsp;&nbsp;&nbsp;Goodwill | 16836 | 16836 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | 7375 | 11037 |
| &nbsp;&nbsp;&nbsp;Total assets | $199448 | $164236 |
| &nbsp;&nbsp;&nbsp;**LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current portion of operating lease liability | $740 | $582 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 12581 | 7328 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | 44156 | 40651 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current liabilities | 5010 | 273 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 62487 | 48834 |
| &nbsp;&nbsp;&nbsp;&nbsp;Long-term operating lease liability | 1810 | 1122 |
| &nbsp;&nbsp;&nbsp;&nbsp;Royalty financing obligation | 34828 | 35249 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other non-current liabilities | 2098 | 5183 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 101223 | 90388 |
| &nbsp;&nbsp;&nbsp;&nbsp;Shareholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred shares, nominal value of $0.01 per share; 50,000 shares authorized; zero issued and outstanding at September 30, 2025 and December 31, 2024 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ordinary shares, nominal value of $0.01 per share; 500,000 shares authorized; 97,235 issued and outstanding at September 30, 2025 and 96,518 issued and outstanding at December 31, 2024 | 972 | 965 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Additional paid-in capital | 910391 | 891791 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (789562) | (794328) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (23576) | (24580) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 98225 | 73848 |
| &nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $199448 | $164236 |

---

 *See accompanying notes to unaudited condensed consolidated financial statements.*

------

**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY**

*(In thousands)*

*(Unaudited)*

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Ordinary shares** | **Ordinary shares** | **Preferred shares** | **Preferred shares** | | | | |
| | **Shares** | **Amount** | **Shares** | **Amount** | **Additional**<br>**paid-in capital** | **Accumulated**<br>**deficit** | **Accumulated<br>other<br>comprehensive**<br>**loss** | **Total<br>shareholders'**<br>**equity** |
| **Balance, December 31, 2024** | 96518 | $965 |  | $— | $891791 | $(794328) | $(24580) | $73848 |
| &nbsp;&nbsp;&nbsp;Net loss |  |  |  |  |  | (4920) |  | (4920) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income |  |  |  |  |  |  | 268 | 268 |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 60 | 1 |  |  | 281 |  |  | 282 |
| &nbsp;&nbsp;&nbsp;Vesting of restricted shares | 8 |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Employee share purchase plan share issuance | 46 |  |  |  | 408 | 1 |  | 409 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 4183 |  |  | 4183 |
| **Balance, March 31, 2025** | 96632 | $966 |  | $— | $896663 | $(799247) | $(24312) | $74070 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 9665 |  | 9665 |
| &nbsp;&nbsp;&nbsp;Other comprehensive income |  |  |  |  |  |  | 666 | 666 |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 145 | 1 |  |  | 980 |  |  | 981 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 5327 |  |  | 5327 |
| **Balance, June 30, 2025** | 96777 | $967 |  | $— | $902970 | $(789582) | $(23646) | $90709 |
| &nbsp;&nbsp;&nbsp;Net income |  |  |  |  |  | 20 |  | 20 |
| &nbsp;&nbsp;&nbsp;Other comprehensive income |  |  |  |  |  |  | 70 | 70 |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 313 | 3 |  |  | 1954 |  |  | 1957 |
| &nbsp;&nbsp;&nbsp;Vesting of restricted shares | 72 | 1 |  |  | (1) |  |  |  |
| &nbsp;&nbsp;&nbsp;Employee share purchase plan share issuance | 73 | 1 |  |  | 549 |  |  | 550 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 4919 |  |  | 4919 |
| **Balance, September 30, 2025** | 97235 | $972 |  | $— | $910391 | $(789562) | $(23576) | $98225 |

---

------

**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY**

*(In thousands)*

*(Unaudited)*

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Ordinary shares** | **Ordinary shares** | **Preferred shares** | **Preferred shares** | | | | |
| | **Shares** | **Amount** | **Shares** | **Amount** | **Additional paid-in**<br>**capital** | **Accumulated**<br>**deficit** | **Accumulated<br>other<br>comprehensive**<br>**loss** | **Total<br>shareholders'**<br>**equity** |
| **Balance, December 31, 2023** | 89825 | $898 | 5194 | $52 | $855452 | $(745496) | $(23167) | $87739 |
| &nbsp;&nbsp;&nbsp;Net loss |  |  |  |  |  | (27342) |  | (27342) |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss |  |  |  |  |  |  | (589) | (589) |
| &nbsp;&nbsp;&nbsp;Issuance of common stock under at-the-market offering program, net of issuance costs | 640 | 6 |  |  | 9244 |  |  | 9250 |
| &nbsp;&nbsp;&nbsp;Amortization of deferred issuance costs |  |  |  |  | (3) |  |  | (3) |
| &nbsp;&nbsp;&nbsp;Conversion of preferred stock into ordinary shares | 5194 | 52 | (5194) | (52) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 390 | 3 |  |  | 3353 |  |  | 3356 |
| &nbsp;&nbsp;&nbsp;Employee share purchase plan share issuance | 48 | 1 |  |  | 583 |  |  | 584 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 5389 |  |  | 5389 |
| **Balance, March 31, 2024** | 96097 | $960 |  | $— | $874018 | $(772838) | $(23756) | $78384 |
| &nbsp;&nbsp;&nbsp;Net loss |  |  |  |  |  | (13822) |  | (13822) |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss |  |  |  |  |  |  | (459) | (459) |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 107 | 1 |  |  | 722 |  |  | 723 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 5462 |  |  | 5462 |
| **Balance, June 30, 2024** | 96204 | $961 |  | $— | $880202 | $(786660) | $(24215) | $70288 |
| &nbsp;&nbsp;&nbsp;Net loss |  |  |  |  |  | (2625) |  | (2625) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income |  |  |  |  |  |  | 413 | 413 |
| &nbsp;&nbsp;&nbsp;Exercise of stock options | 69 | 1 |  |  | 399 |  |  | 400 |
| &nbsp;&nbsp;&nbsp;Employee share purchase plan share issuance | 65 | 1 |  |  | 776 |  |  | 777 |
| &nbsp;&nbsp;&nbsp;Share-based compensation expense |  |  |  |  | 5410 |  |  | 5410 |
| **Balance, September 30, 2024** | 96338 | $963 |  | $— | $886787 | $(789285) | $(23802) | $74663 |

---

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**AVADEL PHARMACEUTICALS PLC**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

*(In thousands)* 

*(Unaudited)*

---

| | | |
|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
|  | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;**Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net income (loss) | $4765 | $(43789) |
| &nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 3008 | 2013 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation expense | 14429 | 16261 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Acquired in-process research & development expense | 20000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other adjustments | (1048) | (1052) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net changes in assets and liabilities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (8347) | (24999) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (4042) | (5255) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (1562) | (1615) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable & other current liabilities | 5067 | (3516) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | (1495) | 9680 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets and liabilities | (4105) | (2508) |
| &nbsp;&nbsp;&nbsp;Net cash provided by (used in) operating activities | 26670 | (54780) |
| &nbsp;&nbsp;&nbsp;**Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchases of property and equipment | (190) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of marketable securities | 57738 | 298829 |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchases of marketable securities | (46918) | (261962) |
| &nbsp;&nbsp;&nbsp;&nbsp;Upfront license payment for acquired in-process research & development | (15000) |  |
| &nbsp;&nbsp;&nbsp;Net cash (used in) provided by investing activities | (4370) | 36867 |
| &nbsp;&nbsp;&nbsp;**Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from issuance of shares off the at-the-market offering program |  | 9250 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from stock option exercises and employee share purchase plan | 4179 | 5840 |
| &nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 4179 | 15090 |
| &nbsp;&nbsp;&nbsp;Effect of foreign currency exchange rate changes on cash and cash equivalents | 1963 | 238 |
| &nbsp;&nbsp;&nbsp;Net change in cash and cash equivalents | 28442 | (2585) |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents at January 1, | 51371 | 31167 |
| &nbsp;&nbsp;Cash and cash equivalents at September 30, | $79813 | $28582 |
| &nbsp;&nbsp;&nbsp;Supplemental disclosures of cash flow information: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest paid | $6414 | $3305 |

---

*See accompanying notes to unaudited condensed consolidated financial statements.*

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**AVADEL PHARMACEUTICALS PLC**

**NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

*(In thousands, except per share data)* 

**NOTE 1: Summary of Significant Accounting Policies**

***Nature of Operations.*** Avadel Pharmaceuticals plc (Nasdaq: AVDL) ("Avadel," the "Company," "we," "our," or "us") is a biopharmaceutical company. The Company is registered as an Irish public limited company. The Company's headquarters are in Dublin, Ireland with operations in Dublin, Ireland and St. Louis, Missouri, United States ("U.S.").

LUMRYZ is an extended-release formulation of sodium oxybate indicated to be taken once at bedtime for the treatment of cataplexy or excessive daytime sleepiness ("EDS") in patients seven years of age and older with narcolepsy.

LUMRYZ was approved by the U.S. Food and Drug Administration ("FDA") on May 1, 2023 for the treatment of cataplexy or EDS in adults with narcolepsy. The FDA also granted Orphan Drug Exclusivity ("ODE") to LUMRYZ for treatment of cataplexy or EDS in adults with narcolepsy for a period of seven years until May 1, 2030. In June 2023, the Company commercially launched LUMRYZ in the U.S for the treatment of cataplexy or EDS in adults living with narcolepsy. LUMRYZ was approved by the FDA for use in the treatment of cataplexy or EDS in the pediatric narcolepsy population seven years of age and older on October 16, 2024, and was granted ODE for this patient population through October 16, 2031.

The FDA required implementation of a Risk Evaluation and Mitigation Strategy ("REMS") to help ensure the benefits of the drug outweigh the risks of serious adverse outcomes resulting from inappropriate prescribing, misuse, abuse, and diversion of the same. Under the LUMRYZ REMS, healthcare providers who prescribe the drug must be specially certified, pharmacies that dispense the drug must be specially certified, and the drug must be dispensed only to patients who have enrolled in the LUMRYZ REMS and completed all REMS requirements, including documentation of safe use conditions.

The Company has initiated a pivotal trial in Idiopathic Hypersomnia ("IH"), REVITALYZ, which is a double-blind, placebo-controlled, randomized withdrawal, multicenter Phase 3 study designed to evaluate the efficacy and safety of LUMRYZ, in treating IH. LUMRYZ was granted Orphan Drug Designation ("ODD") from the FDA for the treatment of IH on June 5, 2025.

On August 30, 2025, the Company entered into an exclusive global license agreement (the "License Agreement") with XWPharma Ltd. ("XWPharma") for the development and commercialization of valiloxybate, a GABAB receptor agonist, in all indications, including the treatment of sleep disorders, such as narcolepsy and IH. Under the terms of the License Agreement, XWPharma grants the Company an exclusive global license to develop, manufacture and commercialize valiloxybate worldwide, excluding mainland China, Hong Kong and Macau. See *Note 3: License Agreement* for additional details.

As of the date of this Quarterly Report, the Company's only commercialized product is LUMRYZ. In addition to the aforementioned valiloxybate drug candidate, the Company continues to evaluate opportunities to expand its product portfolio.

***Transaction Agreement with Alkermes***

On October 22, 2025, the Company announced it had entered into a transaction agreement (the "Transaction Agreement") with Alkermes plc ("Alkermes"). Under the terms of the Transaction Agreement, Alkermes will acquire Avadel (the "Transaction") pursuant to a court-sanctioned scheme of arrangement under Chapter 1 of Part 9 of the Companies Act 2014 of Ireland (the "Scheme"), or under certain circumstances, subject to the terms of the Transaction Agreement, a takeover offer (as such term is defined in the Irish Takeover Panel Act, 1997, Takeover Rules, 2022) rather than the Scheme. As a result of the Scheme, the Company will become a wholly owned subsidiary of Alkermes.

At the effective time of the Scheme (the "Effective Time"), holders of the Company's ordinary shares nominal value $0.01 per share (the "Company Shares"), will be entitled to receive $18.50 in cash per Company Share (the "Cash Consideration") and a non-transferable contingent value right entitling the holders to a potential additional cash payment of $1.50 per Company Share, contingent upon achievement of the specified milestones set forth in the CVR Agreement (as defined below) (such contingent value rights, the "CVRs" and, together with the Cash Consideration, the "Consideration"). The Transaction has been recommended by the Company's board of directors (the "Company Board") to the Company's shareholders and by the board of directors of Alkermes to the shareholders of Alkermes.

The Transaction is subject to customary closing conditions, including, among other things (a) the approval by the Company's shareholders of the Scheme, (b) the sanction by the Irish High Court of the Scheme and delivery of the court order to the Irish Registrar of Companies, and (c) the receipt of required antitrust clearances in the United States. The Company expects the Transaction to close in the first quarter of 2026. Additional information about the transaction agreement and the Transaction is set forth in the Company's Form 8-K filed with the SEC on October 22, 2025.

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***Liquidity.*** The accompanying unaudited condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the U.S. ("U.S. GAAP") applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

The adequacy of the Company's cash resources depends on the outcome of certain business conditions including the Company's ongoing LUMRYZ commercialization activities, the Company's cost structure, and other factors set forth in "Risk Factors" within Part I, Item 1A of the Company's Annual Report on Form 10-K filed with SEC on March 3, 2025 (the "Annual Report on Form 10-K") and within Part II, Item 1A in this Quarterly Report on Form 10-Q.

*Ordinary Shares*

Effective April 15, 2024, the Company's ordinary shares, nominal value $0.01 per share ("ordinary shares"), became directly listed on the Nasdaq Stock Market. The Company caused a mandatory exchange of its American Depositary Shares ("ADSs") for the underlying ordinary shares on a one-for-one basis. Accordingly, the Bank of New York Mellon ("BNY Mellon"), as Depositary for the ADSs, issued a notice of termination of its American Depository Receipt program ("ADR Program") of ADSs to the registered holders of ADSs according to the requirements under the deposit agreement dated January 3, 2017 (the "Deposit Agreement") among the Company, BNY Mellon and holders of ADSs. The Deposit Agreement terminated on July 15, 2024.

*At-the-Market Offering Program*

On May 8, 2024, the Company entered into an Open Market Sale Agreement<sup>SM</sup> (the "Sales Agreement") with Jefferies LLC ("Jefferies") pursuant to which the Company may offer and sell its ordinary shares, from time to time, with respect to an at-the-market offering program ("ATM Program") under which Jefferies will act as sales agent. The Sales Agreement provides that Jefferies will be entitled to aggregate compensation for its services of an amount up to 3.0% of the gross proceeds of any ordinary shares sold through Jefferies under the Sales Agreement.

The ordinary shares will be offered and sold pursuant to the Company's shelf registration statement on Form S-3 (File No. 333-289355), filed with the SEC on August 7, 2025, as supplemented by the prospectus supplement included therein (the "2025 Prospectus Supplement"). This registration statement replaced the previous shelf registration statement on Form S-3 (File No. 333-267198), filed with the SEC on August 31, 2022, as amended, which was set to expire on September 12, 2025. The Company may offer and sell ordinary shares having an aggregate offering price of up to $100,000 under the 2025 Prospectus Supplement.

The Company did not issue or sell ordinary shares under the at-the-market offering program during the nine months ended September 30, 2025. In connection with the Company's entry into the Transaction Agreement, it suspended sales under the ATM Program.

***Basis of Presentation.*** The unaudited condensed consolidated balance sheet as of September 30, 2025 and the interim unaudited condensed consolidated financial statements presented herein, have been prepared in accordance with U.S. GAAP, the requirements of Form 10-Q and Article 10 of Regulation S-X and, consequently, do not include all information or footnotes required by U.S. GAAP for complete financial statements or all the disclosures normally made in an Annual Report on Form 10-K. Accordingly, the unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and footnotes included in the Annual Report on Form 10-K.

Certain prior year amounts have been reclassified within the notes to the unaudited condensed consolidated financial statements to condense line items of the same nature to conform with the current year presentation.

The unaudited condensed consolidated financial statements include the accounts of the Company and subsidiaries and reflect all adjustments (consisting only of normal recurring adjustments) that are, in the opinion of management, necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the dates and periods presented. All intercompany accounts and transactions have been eliminated. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period.

***Research and Development ("R&D").*** R&D expenses consist primarily of costs related to outside services, personnel expenses, clinical studies, upfront payments for acquired in-process research and development ("IPR&D"), milestone payments incurred prior to regulatory approval of products, and other R&D expenses. Outside services and clinical studies costs relate primarily to services performed by clinical research organizations and related clinical or development manufacturing costs, materials and

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supplies, filing fees, regulatory support, and other third-party fees. Personnel expenses relate primarily to salaries, benefits and share-based compensation. Other R&D expenses primarily include overhead allocations consisting of various support and facilities-related costs. R&D expenditures are charged to operations as incurred. Raw materials used in the production of pre-clinical and clinical products are expensed as R&D costs.

***Share-based Compensation.*** The Company accounts for share-based compensation based on the estimated grant-date fair value. The fair value and requisite service period of market-based performance non-qualified stock options ("market-based NQSOs") is determined using the Monte Carlo valuation methodology on the date of grant. For market-based NQSOs, the Company uses a straight-line method to recognize compensation expense over the award's requisite service period, net of estimated forfeiture rates.

***Recent Accounting Guidance Not Yet Adopted***

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures,* to enhance the transparency and decision usefulness of income tax disclosures. The ASU is effective for annual periods beginning after December 15, 2024. Adoption of ASU 2023-09 will not have a material effect on the Company's financial position or results of operations.

In November 2024, the FASB issued ASU 2024-03, *Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)*, to require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The ASU is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. The Company is currently evaluating the impact adopting ASU 2024-03 will have on its financial statement disclosures.

**NOTE 2: Revenue Recognition**

The Company's source of net product revenue during the three and nine months ended September 30, 2025 and 2024 consists solely of sales of LUMRYZ in the U.S.

For the three and nine months ended September 30, 2025 and 2024, three customers accounted for 100% of sales. The following table presents a summary of the percentage of total gross sales to customers:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
|<br>**Sales by Customer:** | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;Caremark | 41% | 43% | 43% | 46% |
| &nbsp;&nbsp;&nbsp;Accredo | 41% | 39% | 41% | 37% |
| &nbsp;&nbsp;&nbsp;Optum | 18% | 18% | 16% | 17% |

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**NOTE 3: License Agreement**

On August 30, 2025, Company entered into an exclusive global license agreement with XWPharma for the development and commercialization of valiloxybate, a GABAB receptor agonist, in all indications, including the treatment of sleep disorders, such as narcolepsy and IH. Under the terms of the License Agreement, XWPharma grants the Company an exclusive global license to develop, manufacture and commercialize valiloxybate worldwide, excluding mainland China, Hong Kong and Macau.

XWPharma received an upfront payment of $15,000 during the quarter ended September 30, 2025, and will receive an additional upfront payment of $5,000 from the Company in the fourth quarter of 2025. XWPharma is eligible to receive milestone payments associated with certain development milestones of up to $30,000. XWPharma may receive up to an aggregate of $155,000 in performance-based tiered sales milestones for first achievement of annual net sales up to $750,000. For first achievement of annual net sales exceeding $750,000 and up to $3,500,000, XWPharma may receive certain performance-based sales milestone payments equal to 10% of each of those sales milestones. In addition, XWPharma may receive tiered royalties ranging from high-single digit to mid-teens, as a percentage of annual net sales of the licensed products, and also an additional $10,000 milestone payment after the first commercial sale in the U.S. for each indication beyond narcolepsy and IH following the FDA's approval for same.

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The Company accounted for the License Agreement as an asset acquisition under ASC Topic 805, *Business Combinations*, as substantially all of the fair value of the gross assets acquired was concentrated in a single identifiable IPR&D asset, valiloxybate. There was no material value assigned to any other assets or liabilities acquired in the acquisition. The IPR&D asset has no alternative future use and, as such, the $20,000 total upfront payments discussed above were recorded as a charge to R&D expense during the three months ended September 30, 2025.

The Company has not recorded any of the contingent consideration payments as a liability in the accompanying unaudited condensed consolidated balance sheets as none of the future events which would trigger a milestone or royalty payment were considered probable of occurring as of September 30, 2025.

Unless earlier terminated, the term of the License Agreement will continue until expiration of the last royalty term for the applicable product in the applicable country.

**NOTE 4: Fair Value Measurement**

The Company is required to measure certain assets and liabilities at fair value, either upon initial recognition or for subsequent accounting or reporting. For example, the Company uses fair value extensively when accounting for and reporting certain financial instruments, when measuring certain contingent consideration liabilities and in the initial recognition of net assets acquired in a business combination. Fair value is estimated by applying the hierarchy described below, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement.

ASC 820, *Fair Value Measurements and Disclosures*, defines fair value as a market-based measurement that should be determined based on the assumptions that marketplace participants would use in pricing an asset or liability. When estimating fair value, depending on the nature and complexity of the asset or liability, the Company may generally use one or each of the following techniques:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Income approach, which is based on the present value of a future stream of net cash flows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities.

As a basis for considering the assumptions used in these techniques, the standard establishes a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 1 - Quoted prices for identical assets or liabilities in active markets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 2 - Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Level 3 - Unobservable inputs that reflect estimates and assumptions.

The following table summarizes the financial instruments measured at fair value on a recurring basis classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation in the accompanying unaudited condensed consolidated balance sheets:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **As of September 30, 2025** | **As of September 30, 2025** | **As of September 30, 2025** | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** |
|<br>**Fair Value Measurements:** | **Level 1** | **Level 2** | **Level 3** | **Level 1** | **Level 2** | **Level 3** |
| &nbsp;&nbsp;Marketable securities (see *Note 5*) |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Government securities - U.S. | $11764 | $— | $— | $22406 | $— | $— |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $11764 | $— | $— | $22406 | $— | $— |

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A review of fair value hierarchy classifications is conducted on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification for certain financial assets or liabilities. During the periods ended September 30, 2025 and December 31, 2024, there were no transfers in and out of Level 3. During the three and nine months ended September 30, 2025 and 2024, the Company did not recognize any allowances for credit losses.

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Some of the Company's financial instruments, such as cash and cash equivalents, accounts receivable and accounts payable, are reflected in the unaudited condensed consolidated balance sheets at carrying value, which approximates fair value due to their short-term nature.

*Royalty Financing Obligation*

As of September 30, 2025 and December 31, 2024, the carrying value of the royalty financing obligation under the Royalty Purchase Agreement ("RPA") approximated its fair value and was measured using estimates of forecasted net product revenue based on current contractual and statutory requirements, specific known market events and trends, industry data, historical trends, current and expected patient demand and forecasted customer buying and payment patterns (Level 3 inputs). See *Note 7: Royalty Financing Obligation* for additional information regarding the Company's royalty financing obligation.

**NOTE 5: Marketable Securities** 

The Company has investments in available-for-sale debt securities which are recorded at fair market value. The change in the fair value of available-for-sale debt investments is recorded as accumulated other comprehensive loss in shareholders' equity, net of income tax effects. As of September 30, 2025 and December 31, 2024, the Company considered any decreases in fair value on its marketable securities to be driven by factors other than credit risk, including market risk.

The following tables show the Company's available-for-sale securities' adjusted cost, gross unrealized gains, gross unrealized losses and fair value by significant investment category as of September 30, 2025 and December 31, 2024:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **September 30, 2025** | **September 30, 2025** | **September 30, 2025** | **September 30, 2025** |
|<br>**Marketable Securities:** | **Adjusted Cost** | **Unrealized Gains** | **Unrealized Losses** | **Fair Value** |
| &nbsp;&nbsp;&nbsp;&nbsp;Government securities - U.S. | $11684 | $80 | $— | $11764 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $11684 | $80 | $— | $11764 |

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| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
|<br>**Marketable Securities:** | **Adjusted Cost** | **Unrealized Gains** | **Unrealized Losses** | **Fair Value** |
| &nbsp;&nbsp;&nbsp;&nbsp;Government securities - U.S. | $22242 | $164 | $— | $22406 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $22242 | $164 | $— | $22406 |

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The Company determines realized gains or losses on the sale of marketable securities on a specific identification method. The Company reflects these gains and losses as a component of investment and other income, net in the accompanying unaudited condensed consolidated statements of income (loss).

The Company recognized gross realized gains of $99 and no gross realized losses for three months ended September 30, 2025. The Company recognized gross realized gains of $410 and no gross realized losses for the nine months ended September 30, 2025.

The Company recognized gross realized gains of $331 and no gross realized losses for three months ended September 30, 2024. The Company recognized gross realized gains of $1,438 and no gross realized losses for the nine months ended September 30, 2024.

The following table summarizes the estimated fair value of the Company's investments in marketable debt securities, accounted for as available-for-sale debt securities and classified by the contractual maturity date of the securities as of September 30, 2025:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Maturities** | **Maturities** | **Maturities** | **Maturities** | **Maturities** |
|<br>**Marketable Debt Securities:** | **Less than 1 Year** | **1-5 Years** | **5-10 Years** | **Greater than 10 Years** | **Total** |
| &nbsp;&nbsp;&nbsp;Government securities - U.S. | $11764 | $— | $— | $— | $11764 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | $11764 | $— | $— | $— | $11764 |

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The Company has classified its investment in available-for-sale marketable debt securities as current assets in the unaudited condensed consolidated balance sheets as the securities need to be available for use, if required, to fund current operations. There are no restrictions on the sale of any securities in the Company's investment portfolio.

**NOTE 6: Inventories**

The principal categories of inventories were comprised of the following:

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| | | |
|:---|:---|:---|
| **Inventory:** | **September 30, 2025** | **December 31, 2024** |
| &nbsp;&nbsp;&nbsp;Raw materials and supplies | $7476 | $5199 |
| &nbsp;&nbsp;&nbsp;Work in process | 4519 | 4963 |
| &nbsp;&nbsp;&nbsp;Finished goods | 11910 | 10136 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total | $23905 | $20298 |

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**NOTE 7: Royalty Financing Obligation**

On March 29, 2023, the Company and Avadel CNS Pharmaceuticals, LLC entered into the RPA with RTW Investments, L.P. ("RTW") for up to $75,000 of royalty financing in two tranches. The first tranche of $30,000 became available upon satisfaction of certain conditions which included the Company's first shipment of LUMRYZ. The second tranche became available to use, at the Company's election, when the Company achieved quarterly net revenue of $25,000 prior to the quarter ending June 30, 2024. The Company allowed the second tranche to expire on August 31, 2024 and paid a one-time commitment fee of $2,000 to RTW in accordance with the terms of the RPA.

On August 1, 2023, the Company received the first tranche of $30,000. The Company is required to make quarterly royalty payments calculated as 3.75% of worldwide net product revenue of LUMRYZ, up to a total payback of $75,000.

The RPA is recorded as a royalty financing obligation on the unaudited condensed consolidated balance sheets based on the Company's evaluation of the terms of the RPA. The accounts receivable and inventory balances of LUMRYZ are pledged as collateral for the RPA. There are no subjective acceleration clauses or provisions, and there are no covenants in violation or other clauses that would cause the full amount of the royalty financing obligation to be callable unless a change of control is consummated, as defined in the RPA. As provided under the terms of the RPA following the announcement of the Transaction Agreement, RTW notified the Company of its intent to exercise its put option, as defined in the RPA, which is contingent on the closing of the Transaction Agreement with Alkermes. Given that the put option is effective only if the Transaction closes and any amounts due under the RPA are payable only after the Transaction closes, the royalty financing obligation remains a long-term obligation in the Company's unaudited condensed consolidated balance sheets.

The Company imputes interest using the effective interest method and records interest expense based on the unamortized royalty financing obligation. The Company's estimate of the interest rate under the RPA is based primarily on forecasted net revenue and the calculated amounts and timing of net royalty payments to reach the total payback of $75,000. As of September 30, 2025 and December 31, 2024 the effective interest rate is estimated as 25.2%. The Company accounts for changes in the imputed interest rate resulting from changes in forecasted net product revenue using the prospective method.

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The following table shows the activity within the royalty financing obligation account:

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| | | |
|:---|:---|:---|
| **Royalty Financing Obligation:** | **September 30, 2025** | **December 31, 2024** |
| Royalty financing obligation – beginning balance | $37139 | $33490 |
| Accretion of imputed interest expense on royalty financing obligation | 7008 | 10830 |
| Less: royalty payments made to RTW | (6414) | (5181) |
| Less: one-time payment for expiration of second tranche |  | (2000) |
| Royalty financing obligation – ending balance | 37733 | 37139 |
| Less: royalty payable to RTW classified within accrued expenses | (2905) | (1890) |
| Royalty financing obligation, non-current | $34828 | $35249 |

---

The accretion of imputed interest expense is reflected as interest expense in the unaudited condensed consolidated statements of income (loss). For the three months ended September 30, 2025 and 2024, the total interest expense related to the royalty financing obligation was $2,415 and $2,820, respectively. For the nine months ended September 30, 2025 and 2024, the total interest expense related to the royalty financing obligation was $7,008 and $8,128, respectively.

**NOTE 8: Income Taxes** 

For the three months ended September 30, 2025 and 2024, the income tax provision was $34 and $88, respectively. The decrease in provision for income taxes recorded was primarily driven by a decrease in interest expense on uncertain tax positions.

For the nine months ended September 30, 2025 and 2024, the income tax benefit was $3,058 and $327, respectively. The increase in the income tax benefit recorded was primarily driven by the release of uncertain tax positions during the nine months ended September 30, 2025 due to the expiration of their statute of limitations.

The Company's cumulative loss position was significant negative evidence in assessing the need for a valuation allowance on its deferred tax assets. Given the weight of objectively verifiable historical losses from operations, the Company has recorded a full valuation allowance on its deferred tax assets. The Company will be able to reverse the valuation allowance when it has shown its ability to generate taxable income on a consistent basis in future periods. The valuation allowance does not have an impact on the Company's ability to utilize any net operating losses or other tax attributes to offset cash taxes payable as these items are still eligible to be used.

*One Big Beautiful Bill Act*

H.R.1, the One Big Beautiful Bill Act ("OBBBA") was signed into law on July 4, 2025. The OBBBA contains a broad range of tax reform provisions affecting U.S. businesses. The legislation did not have a material impact to the Company's financial position, results of operations, and cash flows during the three and nine months ended September 30, 2025.

**NOTE 9: Other Assets and Liabilities** 

Various other assets and liabilities are summarized as follows:

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| | | |
|:---|:---|:---|
| **Prepaid Expenses and Other Current Assets:** | **September 30, 2025** | **December 31, 2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Prepaid and other expenses | $13502 | $5154 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 798 | 882 |
| &nbsp;&nbsp;Total  | $14300 | $6036 |

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---

| | | |
|:---|:---|:---|
| **Other Non-Current Assets:** | **September 30, 2025** | **December 31, 2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Right of use assets at contract manufacturing organizations | $7153 | $10700 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other | 222 | 337 |
| &nbsp;&nbsp;Total  | $7375 | $11037 |

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---

| | | |
|:---|:---|:---|
| **Accrued Expenses:** | **September 30, 2025** | **December 31, 2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Reserves for variable consideration | $16437 | $14218 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued professional fees and other | 10980 | 12019 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued compensation | 8834 | 6515 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued upfront license fee for acquired IPR&D | 5000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued royalties | 2905 | 7899 |
| &nbsp;&nbsp;Total  | $44156 | $40651 |

---

---

| | | |
|:---|:---|:---|
| **Other Non-Current Liabilities:** | **September 30, 2025** | **December 31, 2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Tax liabilities | $2098 | $5151 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other |  | 32 |
| &nbsp;&nbsp;Total  | $2098 | $5183 |

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**NOTE 10: Share-Based Compensation**

***Market-based Performance NQSOs***

On March 5, 2025, the Company granted options to purchase a total of 466 ordinary shares with market conditions to executive officers. The options shall vest in four equal increments if the volume-weighted average price of the Company's ordinary shares during any 30-calendar day period over the five years after the grant date exceeds $11.00, $14.00, $17.00 and $19.09, respectively. The weighted average grant-date fair value per share of the market-based NQSOs was $6.15. A total of 233 market-based NQSOs vested during the three and nine months ended September 30, 2025. As of September 30, 2025, 233 market-based NQSOs were still outstanding.

Share-based compensation expense related to market-based NQSOs was approximately $900 for the three months ended September 30, 2025 and $2,200 for the nine months ended September 30, 2025.

**NOTE 11: Net Income (Loss) Per Share** 

Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted average number of shares outstanding during each period. Diluted income (loss) per share is calculated by dividing income (loss) by the diluted number of shares outstanding during each period. Except where the result would be anti-dilutive to net income (loss), diluted net income (loss) per share would be calculated assuming the conversion of the Company's preferred shares, the exercise of outstanding equity compensation awards, and ordinary shares expected to be issued under the Company's Employee Share Purchase Plan ("ESPP").

The dilutive effect of the stock options, restricted share awards, preferred shares and ordinary shares expected to be issued under the Company's ESPP has been calculated using the treasury stock method.

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A reconciliation of basic and diluted net income (loss) per share, together with the related shares outstanding in thousands is as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
|<br>**Net Income (Loss) Per Share:** | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $20 | $(2625) | $4765 | $(43789) |
| &nbsp;&nbsp;&nbsp;Weighted average shares: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Basic shares | 97104 | 96300 | 96812 | 94720 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Effect of dilutive securities—employee and director equity awards outstanding and preferred shares | 4172 |  | 3018 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Diluted shares | 101276 | 96300 | 99830 | 94720 |
| &nbsp;&nbsp;&nbsp;Net income (loss) per share - basic | $0.00 | $(0.03) | $0.05 | $(0.46) |
| &nbsp;&nbsp;Net income (loss) per share - diluted  | $0.00 | $(0.03) | $0.05 | $(0.46) |

---

Potential ordinary shares of 1,353 and 1,437 were excluded from the calculation of weighted average shares for the three months ended September 30, 2025 and 2024, respectively, and 3,313 and 1,168 were excluded from the calculation of weighted average shares for the nine months ended September 30, 2025 and 2024, respectively, because their effect was considered to be anti-dilutive. For the three and nine months ended September 30, 2024, the effects of dilutive securities were entirely excluded from the calculation of net loss per share as a net loss was reported in these periods.

**NOTE 12: Comprehensive Loss** 

The following table shows the components of accumulated other comprehensive loss, net of tax effects:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
|<br>**Accumulated Other Comprehensive Loss:** | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;&nbsp;&nbsp;Foreign currency translation adjustment: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beginning balance | $(23656) | $(24431) | $(24744) | $(24121) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net other comprehensive income |  | 429 | 1088 | 119 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Balance at September 30, | $(23656) | $(24002) | $(23656) | $(24002) |
| &nbsp;&nbsp;&nbsp;&nbsp;Unrealized gain on marketable debt securities, net |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beginning balance | $10 | $216 | $164 | $954 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net other comprehensive income (loss), net of income tax expense of $0, $0, $0, and $0, respectively | 70 | (16) | (84) | (754) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Balance at September 30, | $80 | $200 | $80 | $200 |
| &nbsp;&nbsp;Accumulated other comprehensive loss at September 30, | $(23576) | $(23802) | $(23576) | $(23802) |

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The effect on the Company's unaudited condensed consolidated financial statements of amounts reclassified out of accumulated other comprehensive loss was immaterial for all periods presented.

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**NOTE 13: Commitments and Contingencies** 

***Litigation***

The Company is subject to potential liabilities generally incidental to its business arising out of present and future lawsuits and claims related to product liability, personal injury, contract, commercial, intellectual property, tax, employment, compliance and other matters that arise in the ordinary course of business. The Company accrues for potential liabilities when it is probable that future costs (including contingent fees and expenses) will be incurred and such costs can be reasonably estimated. At September 30, 2025 and December 31, 2024, there were no contingent liabilities with respect to any litigation, arbitration or administrative or other proceeding that are reasonably likely to have a material adverse effect on the Company's consolidated financial position, results of operations, cash flows or liquidity.

*First Jazz Complaint*

On May 12, 2021, Jazz Pharmaceuticals, Inc. ("Jazz") filed a formal complaint (the "First Complaint") initiating a lawsuit in the United States District Court for the District of Delaware (the "Court") against Avadel Pharmaceuticals plc, Avadel US Holdings, Inc., Avadel Management Corporation, Avadel Legacy Pharmaceuticals, LLC, Avadel Specialty Pharmaceuticals, LLC, and Avadel CNS Pharmaceuticals, LLC (collectively, the "Avadel Parties"). In the First Complaint, Jazz alleges the sodium oxybate product ("Proposed Product") described in the NDA owned by Avadel CNS Pharmaceuticals, LLC ("Avadel CNS") will infringe at least one claim of U.S. Patent No. 8731963, 10758488, 10813885, 10959956 and/or 10966931 (collectively, the "patents-in-suit"). The First Complaint further includes typical relief requests such as preliminary and permanent injunctive relief, monetary damages and attorneys' fees, costs and expenses.

On June 3, 2021, the Avadel Parties timely filed their Answer and Counterclaims (the "Avadel Answer") with the Court in response to the First Complaint. The Avadel Answer generally denies the allegations set forth in the First Complaint, includes numerous affirmative defenses (including, but not limited to, non-infringement and invalidity of the patents-in-suit), and asserts a number of counterclaims seeking i) a declaratory judgment of non-infringement of each patent-in-suit, and ii) a declaratory judgment of invalidity of each patent-in-suit.

On June 18, 2021, Jazz filed its Answer ("Jazz Answer") with the Court in response to the Avadel Answer. The Jazz Answer generally denies the allegations set forth in the Avadel Answer and sets forth a single affirmative defense asserting that Avadel has failed to state a claim for which relief can be granted.

On June 21, 2021, the Court issued an oral order requiring the parties to i) confer regarding proposed dates to be included in the Court's scheduling order for the case, and ii) submit a proposed order, including a proposal for the length and timing of trial, to the Court by no later than July 21, 2021.

On July 30, 2021, the Court issued a scheduling order establishing timing for litigation events including i) a claim construction hearing date of August 2, 2022, and ii) a trial date of October 30, 2023.

On October 18, 2021, consistent with the scheduling order, Jazz filed a status update with the Court indicating that Jazz did not intend to file a preliminary injunction with the Court at this time. Jazz further indicated that it would provide the Court with an update regarding whether preliminary injunction proceedings may be necessary after receiving further information regarding the FDA's action on Avadel CNS's NDA.

On January 4, 2022, the Court entered an agreed order dismissing this case with respect to Avadel Pharmaceuticals plc, Avadel US Holdings, Inc., Avadel Specialty Pharmaceuticals, LLC, Avadel Legacy Pharmaceuticals, LLC, and Avadel Management Corporation. A corresponding order was entered in the two below cases on the same day.

On February 25, 2022, Jazz filed an amended Answer to the Avadel Parties' Counterclaims (the "Jazz First Amended Answer"). The Jazz First Amended Answer is substantially similar to the Jazz Answer except insofar as it adds an affirmative defense for judicial estoppel and unclean hands. Corresponding amended answers were filed in the two below cases on the same day.

On June 23, 2022, Avadel CNS filed a Renewed Motion for Judgment on the Pleadings, with respect to its counterclaim against Jazz seeking to have U.S. Patent No. 8731963 (the "REMS Patent") delisted from the Orange Book and seeking to have the motion resolved concurrent with the parties' *Markman* hearing on August 31, 2022. On July 7, 2022, Jazz filed a response styled as Objections to Avadel CNS' Motion for Judgment on the Pleadings. On July 14, 2022, Avadel CNS replied to Jazz's response, and on July 21, 2022, Avadel CNS requested oral argument on its delisting motion simultaneous with the *Markman* 

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hearing. On August 24, 2022, the Court ordered Jazz to respond substantively to Avadel CNS' motion, which Jazz did on August 26, 2022. Avadel CNS filed its reply on August 28, 2022.

On August 23, 2022, the *Markman* hearing was postponed. On September 7, 2022, the case was reassigned to a new judge, and the *Markman* hearing was held on October 25, 2022. At the *Markman* hearing, Avadel CNS reiterated its request for an expedited hearing on the Renewed Motion for Judgment on the Pleadings for the delisting of the REMS Patent. On October 28, 2022, the Court granted Avadel CNS' request and scheduled the hearing for November 15, 2022.

The Court held the *Markman* hearing on November 15, 2022 and issued a claim construction ruling on November 18, 2022. Also, on November 18, 2022 the Court granted Avadel's Renewed Motion for Judgment on the Pleadings and ordered Jazz to request delisting of the REMS Patent from the Orange Book. On November 22, 2022, Jazz appealed that decision and on December 14, 2022, the Federal Circuit issued a stay of the delisting order until further notice. Oral argument was held February 14, 2023. On February 24, 2023, the United States Court of Appeals for the Federal Court affirmed the previous ruling from the Court, ordering the delisting of the REMS Patent from the Orange Book, which has since occurred. On March 7, 2023, in response to a joint stipulation filed by the parties, the Court issued an order dismissing Jazz's infringement claims against the Avadel Parties relating to the REMS Patent as well as Avadel Parties' noninfringement and invalidity counterclaims relating to the REMS Patent.

On March 15, 2023, the parties submitted a Stipulation and Proposed Order Modifying the Case Schedule to accommodate additional claim construction proceedings. On April 26, 2023, the parties filed their Supplemental Joint Claim Construction Brief.

On July 3, 2023, the Court issued a modified scheduling order establishing a new trial date of February 26, 2024.

On July 21, 2023, in response to a Court order, the parties submitted a Stipulation and Proposed Order Modifying the Case Schedule with an updated proposed schedule to accommodate additional claim construction proceedings. On August 4, 2023, the Court entered a modified version of the parties' proposed schedule, which was revised on August 28, 2023. The parties' Second Supplemental Joint Claim Construction Brief was filed on October 10, 2023, and a *Markman* hearing regarding the disputed terms occurred on November 1, 2023. The Court issued its claim construction order on December 15, 2023.

On August 15, 2023, Avadel renewed its request to consolidate this litigation with the litigation described in the Avadel Complaint below. On November 3, 2023, the Court denied that request.

On November 30, 2023, the parties filed cross motions for summary judgment. The parties filed opposition briefs on December 15, 2023. The parties filed reply briefs on December 22, 2023. On February 14, 2024, the Court denied the parties' summary judgment motions. On February 15, 2024, the Court held its Pretrial Conference. Trial was held from February 26, 2024 to March 1, 2024 (the "February Patent Trial"). On March 4, 2024, the jury returned a verdict of no infringement for U.S. Patent No. 10758488 and infringement of U.S. Patent No. 11147782, with damages of $234.

On March 19, 2024, the Court issued a Supplemental Scheduling Order setting a June 4, 2024 hearing on Jazz's request for a permanent injunction or ongoing royalty. Briefing on Jazz's request closed on May 20, 2024, and the hearing was held June 4, 2024. On August 27, 2024, the Court issued an opinion and order enjoining Avadel from infringing claim 24 of U.S. Patent No. 11147782. That injunction excluded certain categories of conduct, including permitting Avadel to continue making, using and selling LUMRYZ for the treatment of narcolepsy and for use in ongoing clinical trials and studies. The August 27, 2024 opinion and order also granted Jazz's motion for an ongoing royalty, pending additional briefing on the appropriate royalty rate. That briefing closed on September 23, 2024. On August 28, 2024, Avadel filed a notice of appeal concerning the August 27, 2024 injunction (the "Patent Appeal"). On September 3, 2024, Avadel moved in District Court to stay the August 27, 2024 injunction pending appeal. Briefing on that motion closed on September 16, 2024. On September 24, 2024, the District Court denied Avadel's motion to stay the injunction pending appeal. On September 15, 2025, the Court issued an opinion and order requiring Avadel CNS to pay a future ongoing royalty of 3.85% on sales of LUMRYZ to Jazz through expiration of Jazz's U.S. Patent No. 11147782 on February 18, 2036.

On September 6, 2024, Avadel moved the U.S. Court of Appeals for the Federal Circuit to stay the injunction pending appeal. Briefing on that motion closed on September 27, 2024. On October 2, 2024, the Federal Circuit granted Avadel's motion in part, staying the injunction with respect to Avadel's initiating new clinical trials or studies.

On September 10, 2024, the Federal Circuit entered a briefing schedule concerning the Patent Appeal. On September 30, 2024, Avadel filed its opening brief. Jazz filed its response brief on November 7, 2024. Avadel filed its reply brief on November 18, 2024. On October 2, 2024, the Federal Circuit placed the Patent Appeal on the February 2025 oral argument calendar. On February 7, 2025, the Federal Circuit heard oral argument in the Patent Appeal. On May 6, 2025, the Federal Circuit issued an

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opinion reversing or vacating important aspects of the District Court's injunction. In particular, the Federal Circuit reversed the portions of the District Court's injunction that prohibited Avadel from offering open-label extensions to trial participants using LUMRYZ and from initiating new clinical trials or studies with LUMRYZ. The Federal Circuit also vacated the portion of the injunction that prohibited Avadel from applying for FDA approval of LUMRYZ for any indication beyond narcolepsy.

On June 17, 2025, Jazz filed a renewed motion for permanent injunction. On July 29, 2025, Avadel filed its answering brief opposition to Jazz's motion. Jazz's reply brief was filed August 19, 2025. On September 8, 2025, the Court entered an order denying Jazz's motion.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Second Jazz Complaint* 

On August 4, 2021, Jazz filed another formal complaint (the "Second Complaint") initiating a lawsuit in the Court against the Avadel Parties. In the Second Complaint, Jazz alleges the Proposed Product described in the NDA owned by Avadel CNS will infringe at least one claim of U.S. Patent No. 11077079. The Second Complaint further includes typical relief requests such as preliminary and permanent injunctive relief, monetary damages and attorneys' fees, costs and expenses.

On September 9, 2021, the Avadel Parties timely filed their Answer and Counterclaims (the "Second Avadel Answer") with the Court in response to the Second Complaint. The Second Avadel Answer generally denies the allegations set forth in the Second Complaint, includes numerous affirmative defenses (including, but not limited to, non-infringement and invalidity of the patent-in-suit), and asserts a number of counterclaims seeking i) a declaratory judgment of non-infringement of the patent-in-suit, and ii) a declaratory judgment of invalidity of the patent-in-suit.

On October 22, 2021, the Court issued an oral order stating that this case should proceed on the same schedule as the case filed on May 12, 2021.

On September 7, 2022, the case was reassigned to a new judge.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Third Jazz Complaint*

On November 10, 2021, Jazz filed another formal complaint (the "Third Complaint") initiating a lawsuit in the Court against the Avadel Parties. In the Third Complaint, Jazz alleges the Proposed Product described in the NDA owned by Avadel CNS will infringe at least one claim of U.S. Patent No. 11147782. The Third Complaint further includes typical relief requests such as preliminary and permanent injunctive relief, monetary damages and attorneys' fees, costs and expenses. This case will proceed on the same schedule as the cases associated with the First and Second Complaints above.

On December 21, 2021, the Court entered a revised schedule for the First, Second and Third Complaints, setting a new claim construction date of August 31, 2022.

On January 7, 2022, Avadel CNS timely filed its Answer and Counterclaims (the "Third Avadel Answer") with the Court in response to the Third Complaint. The Third Avadel Answer generally denies the allegations set forth in the Third Complaint, includes numerous affirmative defenses (including, but not limited to, non-infringement and invalidity of the patent-in-suit), and asserts a number of counterclaims seeking i) a declaratory judgment of non-infringement of the patent-in-suit, and ii) a declaratory judgment of invalidity/unenforceability of the patent-in-suit.

On September 7, 2022, the case was reassigned to a new judge.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Fourth Jazz Complaint*

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On July 15, 2022, Jazz filed another formal complaint (the "Fourth Complaint") initiating a lawsuit in the Court against Avadel CNS. In the Fourth Complaint, Jazz alleges the Proposed Product described in the NDA owned by Avadel CNS will infringe at least one claim of the REMS Patent, which was asserted in the First Complaint. The FDA required Avadel CNS to file a Paragraph IV certification against the REMS Patent, which Avadel CNS did under protest, consistent with its Renewed Motion for Judgment on the Pleadings for the delisting of the REMS Patent from the Orange Book, which was later ordered to be delisted in the above First Jazz Complaint action. Avadel CNS provided the required notice of its Paragraph IV certification to Jazz, and Jazz reasserted the REMS Patent in a separate action following receipt of that notice. The Fourth Complaint further includes typical relief requests such as preliminary and permanent injunctive relief, monetary damages and attorneys' fees, costs and expenses.

On September 7, 2022, the case was reassigned to a new judge.

On September 21, 2022, Jazz served the Fourth Complaint. On October 21, 2022, Avadel CNS timely filed its Answer and Counterclaims (the "Fourth Avadel Answer") with the Court in response to the Fourth Complaint. The Fourth Avadel Answer generally denies the allegations set forth in the Fourth Complaint, includes numerous affirmative defenses (including, but not limited to, non-infringement and invalidity of the patent-in-suit), and asserts a number of counterclaims for i) a declaratory judgment of non-infringement of the patent-in-suit, ii) a declaratory judgment of invalidity/unenforceability of the patent-in-suit, iii) delisting of the patent-in-suit from the Orange Book; iv) monopolization under the Sherman Antitrust Act of 1890 (the "Sherman Act"); and v) attempted monopolization under the Sherman Act.

On December 9, 2022, Jazz filed a Motion to Dismiss Avadel's Antitrust Counterclaims. Avadel filed its opposition brief on December 27, 2022, and Jazz filed its reply brief on January 6, 2022. On January 11, 2023, Avadel filed a request for oral argument on the motion. On May 24, 2024, the Court denied Jazz's Motions to Dismiss. On June 7, 2024, Jazz filed its Answer to Avadel's Counterclaims.

On March 6, 2023, the parties filed a stipulation of dismissal, dismissing Jazz's claims with respect to the REMS Patent and Avadel CNS's related non-infringement and invalidity counterclaims. The Court entered that stipulation on March 7, 2023.

On May 19, 2023, the Court issued a scheduling order establishing timing for litigation events including i) completion of fact discovery by March 14, 2024, and ii) a deadline for case dispositive motions of September 20, 2024. On January 23, 2024, the parties submitted a stipulation to extend the case schedule. On January 24, 2024, the Court ordered an extension of the case schedule, including i) completion of fact discovery by June 20, 2024 and ii) a deadline for case dispositive motions by January 31, 2025. On January 24, 2024, the Court issued an order setting a pretrial conference for October 30, 2025 and a 5-day trial to begin on November 3, 2025. On April 22, 2024, the parties submitted a stipulation extending certain pretrial deadlines, including i) extending completion of fact discovery to September 27, 2024 and ii) extending the deadline for case dispositive motions to April 4, 2025.

On June 29, 2023, Jazz filed a Motion to Stay the case, pending resolution of its Motion to Dismiss. Briefing on that Motion to Stay closed on August 10, 2023. On March 13, 2024, Jazz filed a Supplemental Motion to Stay, pending the resolution of the post-trial briefing and any appeals from the February Patent Trial. On May 24, 2024, the Court denied Jazz's Motions to Stay. On June 7, 2024, Jazz filed a Motion for Reargument or in the Alternative to Certify an Appeal. Avadel filed its opposition brief on June 28, 2024. Jazz filed its reply brief on July 12, 2024. On September 25, 2024, Jazz sought leave to file a supplemental brief in support of its Motion to Stay. On October 4, 2024, the Court granted leave to Jazz to file its supplemental brief, which Jazz filed on October 7, 2024. Avadel filed its response on October 21, 2024. Jazz filed its reply on October 28, 2024.

On April 25, 2025, the parties filed Cross-Motions for Summary Judgment. The parties' response briefs opposing the respective Motions for Summary Judgment are due May 23, 2025. The parties' reply briefs were filed June 13, 2025. On September 15, 2025, the Court entered an order denying Jazz's Motions for Summary Judgment. On October 2, 2025, the Court entered an order denying Avadel's Motions for Summary Judgment.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Avadel Complaint* 

On April 14, 2022, Avadel CNS and Avadel Pharmaceuticals plc (collectively the "Avadel Plaintiffs") filed a formal complaint (the "Avadel Complaint") initiating a lawsuit in the Court against Jazz and Jazz Pharmaceuticals Ireland Ltd. (collectively, the "Jazz Parties"). In the Avadel Complaint, the Avadel Plaintiffs allege that the Jazz Parties breached certain confidential

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disclosure agreements and misappropriated certain of the Avadel Plaintiffs' trade secrets. The Avadel Complaint further includes typical relief requests such as injunctive relief, monetary damages and attorneys' fees, costs and expenses, as well as seeking correction of inventorship of certain Jazz patents, for which the Jazz Parties claim ownership, to include former Avadel Plaintiffs' scientists.

On June 2, 2022, Jazz answered the Avadel Complaint. The Answer generally denies the allegations set forth in the Avadel Complaint and includes various affirmative defenses.

On July 8, 2022, Jazz filed a Motion for Judgment on the Pleadings seeking to have all Counts dismissed for failure to state a claim upon which relief can be granted. The Avadel Plaintiffs' response to that Motion was filed with the Court on July 29, 2022. Jazz's reply was filed with the Court on August 5, 2022. On February 2, 2023, the Court held a hearing on Jazz's Motion for Judgment on the Pleadings.

On September 7, 2022, the case was reassigned to a new judge.

On February 2, 2023, the Court held a hearing on Jazz's Motion for Judgment on the Pleadings.

On July 18, 2023, the Court denied Jazz's Motion for Judgment on the Pleadings.

On August 15, 2023, the parties submitted competing proposed scheduling orders, and Avadel requested consolidation with the above First Jazz Complaint litigation. That request for consolidation was denied on November 3, 2023.

On November 17, 2023, the parties submitted an updated joint proposed scheduling order. On January 30, 2024, the parties agreed to a 6-week stay of discovery and submitted a proposed stipulation extending certain case deadlines to accommodate the same. On February 9, 2024, the parties submitted an updated proposed scheduling order consistent with that stipulation, setting the close of fact discovery for August 9, 2024 and a trial date of December 15, 2025.

On March 19, 2024, Jazz filed a Motion to Stay, pending the resolution of the post-trial briefing and any appeals from the February Patent Trial. On May 24, 2024, the Court denied Jazz's Motions to Stay.

On May 10, 2024, the Court issued a scheduling order establishing timing for litigation events including i) completion of fact discovery by August 9, 2024, ii) a deadline for case dispositive motions of May 30, 2025, and iii) a 5-day jury trial beginning December 15, 2025. On June 11, 2024, the Court entered a stipulation by the parties extending certain case deadlines, including i) extending close of fact discovery to November 1, 2024 and ii) dispositive motions to July 18, 2025.

On July 3, 2024, Jazz filed an Amended Answer to the Avadel Complaint. The Amended Answer generally denies the allegations set forth in the Avadel Complaint and includes various affirmative defenses.

On September 6, 2024, Avadel and Jazz stipulated to stay proceedings pending the resolution of the Patent Appeal above, which the Court entered on September 9, 2024. Following resolution of the Patent Appeal above, the stay was lifted. On July 14, 2025, Jazz filed a renewed motion to stay pending the resolution of post-trial motions and appeal from the February Patent Trial. On July 28, 2025, Avadel filed its answering brief in opposition. Jazz's reply brief was filed August 4, 2025.

On July 16, 2025, the Court entered a scheduling order establishing timing for litigation events including i) a close of fact discovery of May 15, 2026, ii) a close of expert discovery February 26, 2027, iii) dispositive motions due April 2, 2027 and iv) a trial date of February 7, 2028.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Second Avadel Complaint*

On January 3, 2025, Avadel CNS and Flamel Ireland Limited ("Flamel") filed a formal complaint (the "Second Avadel Complaint") initiating a lawsuit in the Court against the Jazz Parties. In the Second Avadel Complaint, Avadel CNS and Flamel allege that the Jazz parties infringe one or more claims of U.S. Patent No. 12167991 through, inter alia, the sale of XYWAV® in conjunction with its FDA-approved labeling. The Second Avadel Complaint includes typical requests for monetary damages and attorneys' fees, as well as costs and expenses.

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The Jazz Parties filed their Answer on June 11, 2025.

On September 23, 2025, the Court entered a scheduling order establishing timing for litigation events including i) a close of fact discovery September 11, 2026, ii) a close of expert discovery March 12, 2027, iii) dispositive motions due April 22, 2027, and iv) a trial date of September 11, 2028.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Third Avadel Complaint*

On January 14, 2025, Avadel CNS and Flamel filed a formal complaint (the "Third Avadel Complaint") initiating a lawsuit in the Court against the Jazz Parties. In the Third Avadel Complaint, Avadel CNS and Flamel allege that the Jazz parties infringe one or more claims of U.S. Patent No. 12186298 through, inter alia, the sale of XYWAV® in conjunction with its FDA-approved labeling. The Third Avadel Complaint includes typical requests for monetary damages and attorneys' fees, as well as costs and expenses.

The Jazz Parties filed their Answer on June 11, 2025.

On September 23, 2025, the Court entered a scheduling order establishing timing for litigation events including i) a close of fact discovery September 11, 2026, ii) a close of expert discovery March 12, 2027, iii) dispositive motions due April 22, 2027, and iv) a trial date of September 11, 2028.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Fourth Avadel Complaint*

On February 25, 2025, Avadel CNS and Flamel filed a formal complaint (the "Fourth Avadel Complaint") initiating a lawsuit in the Court against the Jazz Parties. In the Fourth Avadel Complaint, Avadel CNS and Flamel allege that the Jazz parties infringe one or more claims of U.S. Patent Nos. 12226388 and 12226389 through, inter alia, the sale of XYWAV® in conjunction with its FDA-approved labeling. The Fourth Avadel Complaint includes typical requests for monetary damages and attorneys' fees, as well as costs and expenses.

The Jazz Parties filed their Answer on June 11, 2025.

On September 23, 2025, the Court entered a scheduling order establishing timing for litigation events including i) a close of fact discovery September 11, 2026, ii) a close of expert discovery March 12, 2027, iii) dispositive motions due April 22, 2027, and iv) a trial date of September 11, 2028.

On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Fifth Avadel Complaint*

On April 8, 2025, Avadel CNS and Flamel filed a formal complaint (the "Fifth Avadel Complaint") initiating a lawsuit in the Court against the Jazz Parties. In the Fifth Avadel Complaint, Avadel CNS and Flamel allege that the Jazz parties infringe one or more claims of U.S. Patent No. 12,263,150 through, inter alia, the sale of XYWAV® in conjunction with its FDA-approved labeling. The Fifth Avadel Complaint includes typical requests for monetary damages and attorneys' fees, as well as costs and expenses.

The Jazz Parties filed their Answer on June 11, 2025.

On September 23, 2025, the Court entered a scheduling order establishing timing for litigation events including i) a close of fact discovery September 11, 2026, ii) a close of expert discovery March 12, 2027, iii) dispositive motions due April 22, 2027, and iv) a trial date of September 11, 2028.

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On October 21, 2025, the parties reached a settlement with respect to this pending case (see *Note 15: Subsequent Events - Settlement Agreement* for details regarding the settlement). On October 24, 2025, the parties filed a joint stipulation of dismissal with prejudice, which the Court entered on October 27, 2025.

*Jazz's Administrative Procedure Act Complaint*

On June 22, 2023, Jazz filed an Administrative Procedure Act suit against the FDA, the U.S. Department of Health and Human Services, the Secretary of Health and Human Services and the Commissioner of Food and Drugs (the "Federal Defendants") in the United States District Court for the District of Columbia (the "DC Court") related to the NDA for LUMRYZ. This suit alleges that the FDA's approval of LUMRYZ was an unlawful agency action and asks the DC Court to set aside FDA's approval of LUMRYZ. On June 28, 2023, the DC Court granted Avadel CNS's unopposed motion to intervene in the case to defend the FDA's decision. On August 14, 2023, the Court entered a scheduling order establishing timing for litigation events including early summary judgment briefing closing December 22, 2023. On September 22, 2023, Jazz filed its Motion for Summary Judgment. On October 20, 2023, the FDA and Avadel filed their Cross Motions for Summary Judgment. Briefing on the parties' motions closed January 4, 2024. On February 14, 2024, the Court set hearing for oral argument on the parties' motions for February 27, 2024. On February 21, 2024, the Court rescheduled the oral argument to April 9, 2024. On April 2, 2024, the Court rescheduled the oral argument to May 10, 2024. On May 10, 2024, the Court heard oral argument on the parties' motions. On October 30, 2024, the Court granted FDA and Avadel's Motions for Summary Judgment with respect to the sole count in Jazz's complaint and denied Jazz's Motion for Summary Judgment regarding the same.

On November 15, 2024, Jazz filed a notice of appeal concerning the Court's October 30, 2024 ruling (the "APA Appeal"). On January 31, 2025, Jazz filed its opening brief in the APA Appeal. FDA filed its response brief March 17, 2025. Avadel filed its response brief March 24, 2025. Jazz filed its reply brief April 7, 2025. On May 5, 2025, the D.C. Circuit heard oral argument in the APA Appeal. On June 27, 2025, the D.C. Court of Appeals, in a unanimous decision, affirmed the D.C. Court's ruling and upheld the FDA's approval of LUMRYZ.

***Material Commitments***

Other than commitments disclosed in *Note 13: Contingent Liabilities and Commitments* to the Company's consolidated financial statements included in the Annual Report on Form 10-K, there were no other material commitments outside of the normal course of business.

***License Agreement***

The Company has entered the License Agreement under which it is obligated to make contingent payments. See *Note 3: License Agreement* for additional details.

**NOTE 14: Segment Information**

The Company has determined that it operates in one segment, the development and commercialization of pharmaceutical products, including controlled-release therapeutic products based on its proprietary polymer-based technology. The Company's Chief Operating Decision Maker is the Chief Executive Officer ("CEO"). The CEO reviews profit and loss information on a consolidated basis to assess performance and make overall operating decisions as well as resource allocations.

All products are included in one segment because the Company's products have similar economic and other characteristics, including the nature of the products and production processes, type of customers, distribution methods and regulatory environment.

The following table provides information about the Company's significant expenses provided to the CEO and includes the reconciliation to income (loss) before income taxes:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** |
| | **2025** | **2024** | **2025** | **2024** |
| &nbsp;&nbsp;Net product revenue | $77467 | $50025 | $198107 | $118707 |
| &nbsp;&nbsp;Cost of products sold | (4116) | 6155 | 7827 | 10465 |
| Gross profit | 81583 | 43870 | 190280 | 108242 |
| Operating expenses: |  |  |  |  |
| &nbsp;&nbsp;Research and development expenses | 27010 | 3803 | 35619 | 10922 |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | 19853 | 18328 | 54941 | 68577 |
| &nbsp;&nbsp;&nbsp;Selling and marketing expenses | 27701 | 17344 | 75827 | 53733 |
| &nbsp;&nbsp;&nbsp;Other segment items\* | 5082 | 4722 | 16073 | 14112 |
| Total operating expenses | 79646 | 44197 | 182460 | 147344 |
| Operating income (loss) | 1937 | (327) | 7820 | (39102) |
| &nbsp;&nbsp;Investment and other income, net | 532 | 610 | 895 | 3114 |
| &nbsp;&nbsp;Interest expense | (2415) | (2820) | (7008) | (8128) |
| Income (loss) before income taxes | $54 | $(2537) | $1707 | $(44116) |

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\*For the three and nine months ended September 30, 2025 and 2024, the other segment items category includes quality and regulatory expenses and medical affairs expenses.

**NOTE 15: Subsequent Events**

***Settlement Agreement***

On October 21, 2025, Avadel CNS entered into a Settlement and License Agreement (the "Settlement Agreement") with Jazz to resolve the First Complaint, Second Complaint, Third Complaint, Fourth Complaint, Avadel Complaint, Second Avadel Complaint, Third Avadel Complaint, Fourth Avadel Complaint and Fifth Avadel Complaint (collectively, the "Lawsuits") described in *Note 13: Commitments and Contingencies*.

The Settlement Agreement provides for, among other things, (i) a payment by Jazz of $90,000 (the "Settlement Payment") to Avadel CNS, which was timely paid, and a waiver by Jazz of its right to receive royalties and/or damages on sales of LUMRYZ through September 30, 2025; (ii) dismissal of the Lawsuits with prejudice, which occurred on October 27, 2025, following the Settlement Payment; (iii) the payment by Avadel CNS to Jazz of royalties with respect to (1) LUMRYZ sold for narcolepsy at a rate of 3.85% of net sales, (2) LUMRYZ for indications (including any indications related to idiopathic hypersomnia) other than cataplexy or excessive daytime sleepiness in patients with narcolepsy at a rate of 10% of net sales, and (3) LUMRYZ sold for other certain indications as set forth in the Settlement Agreement; (iv) a grant by Jazz to Avadel CNS of a worldwide, non-exclusive, perpetual, irrevocable, non-terminable, non-transferrable (except as expressly provided in the Settlement Agreement) royalty-bearing license, without the right to sublicense (except as provided in the Settlement Agreement), to any past, present, or future patents that could be asserted against LUMRYZ for any indication; (v) agreement by Jazz not to challenge the approval or approvability of LUMRYZ; and (vi) a grant by Avadel CNS to Jazz of a worldwide, non-exclusive, perpetual, irrevocable, non-terminable, non-transferrable (except as expressly provided in the Settlement Agreement), royalty-free, fully paid-up covenant not to sue, without the right to sublicense (except as expressly provided in the Settlement Agreement), Avadel CNS' patents in connection with XYWAV and XYREM. Royalties payable by Avadel CNS under the Settlement Agreement are subject to certain adjustments as set forth therein.

The parties have also agreed to, among other things, a customary mutual release of all claims arising out of or relating to the Lawsuits.

In settling the Lawsuits, Avadel CNS is not admitting any liability, and entry into the Settlement Agreement does not constitute an admission of liability or fault or an admission regarding the accuracy of any allegation made by the plaintiffs or plaintiffs' counsel.

Pursuant to the Settlement Agreement, the Company reversed approximately $9,500 of estimated royalties previously recorded in cost of products sold up to June 30, 2025 related to Patent No. 11147782, following Jazz's waiver of its rights to receive royalties and damages on prior sales of LUMRYZ through September 30, 2025.

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The Company will recognize a gain during the three months ended December 31, 2025 in conjunction with the Settlement Payment received on October 27, 2025, net of approximately $32,700 in legal fees and expenses that were contingent on a monetary settlement.

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**ITEM 2.&nbsp;&nbsp;&nbsp;&nbsp;MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS** 

**Management's Discussion and Analysis**

*(In thousands, except per share data)*

*(Unaudited)*

***You should read the discussion and analysis of our financial condition and results of operations set forth in this Item 2 together with our unaudited condensed consolidated financial statements and the related notes appearing elsewhere in this Quarterly Report on Form 10-Q. Some of the information contained in this discussion and analysis or set forth elsewhere in this Quarterly Report on Form 10-Q, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties, and reference is made to the "Cautionary Note Regarding Forward-Looking Statements" set forth immediately following the **Table of Contents** of this Quarterly Report on Form 10-Q for further information on the forward looking statements herein. In addition, you should read the "Risk Factors" section in Part I, Item 1A of our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 3, 2025 and Part II, Item 1A in this Quarterly Report on Form 10-Q for a discussion of additional important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis and elsewhere in this Quarterly Report.***

**<u>Overview</u>** 

***General Overview***

Avadel Pharmaceuticals plc (Nasdaq: AVDL) ("Avadel," the "Company," "we," "our," or "us") is a biopharmaceutical company. LUMRYZ is an extended-release formulation of sodium oxybate indicated to be taken once at bedtime for the treatment of cataplexy or excessive daytime sleepiness ("EDS") in patients seven years of age and older with narcolepsy.

On August 30, 2025, we entered into an exclusive global license agreement (the "License Agreement") with XWPharma Ltd. ("XWPharma") for the development and commercialization of valiloxybate, a GABAB receptor agonist, in all indications, including the treatment of sleep disorders, such as narcolepsy and idiopathic hypersomnia ("IH"). Under the terms of the License Agreement, XWPharma grants the Company an exclusive global license to develop, manufacture and commercialize valiloxybate worldwide, excluding mainland China, Hong Kong and Macau.

As of the date of this Quarterly Report, LUMRYZ is the only commercial product in our portfolio. In addition to the aforementioned valiloxybate drug candidate, we continue to evaluate opportunities to expand our product portfolio.

***LUMRYZ***

LUMRYZ was approved by the U.S. Food and Drug Administration ("FDA") on May 1, 2023 for the treatment of cataplexy or EDS in adults with narcolepsy. The FDA also granted seven years of Orphan Drug Exclusivity ("ODE") to LUMRYZ for the treatment of cataplexy or EDS in adults with narcolepsy due to a finding of clinical superiority of LUMRYZ relative to currently marketed oxybate treatments. In particular, the FDA found that LUMRYZ makes a major contribution to patient care over currently marketed, twice-nightly oxybate treatments by providing a once-nightly dosing regimen that avoids nocturnal arousal to take a second dose. The ODE will continue until May 1, 2030. In June 2023, we announced the U.S. commercial launch of LUMRYZ for the treatment of cataplexy or EDS in adults living with narcolepsy. LUMRYZ was approved by the FDA for use in the treatment of cataplexy or EDS in the pediatric narcolepsy population seven years of age and older on October 16, 2024, and was granted ODE for this patient population through October 16, 2031.

The FDA required implementation of a REMS to help ensure the benefits of the drug outweigh the risks of serious adverse outcomes resulting from inappropriate prescribing, misuse, abuse, and diversion of the same. Under the LUMRYZ REMS, healthcare providers who prescribe the drug must be specially certified, pharmacies that dispense the drug must be specially certified, and the drug must be dispensed only to patients who have enrolled in the LUMRYZ REMS and completed all REMS requirements, including documentation of safe use conditions.

Numerous LUMRYZ-related U.S. patents have been issued having expiration dates spanning from mid-2037 to early-2042, and there are additional patent applications currently in development and/or pending at the U.S. Patent and Trademark Office ("USPTO"), as well as foreign patent offices. We currently have 31 U.S. patents listed for LUMRYZ in FDA's Orange Book.

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We believe LUMRYZ has the potential to demonstrate improved dosing compliance, safety, and patient satisfaction over other treatment options for cataplexy or EDS in patients with narcolepsy.

Avadel has initiated a pivotal trial in IH, REVITALYZ, which is a double-blind, placebo-controlled, randomized withdrawal, multicenter Phase 3 study designed to evaluate the efficacy and safety of LUMRYZ, in treating IH. We expect to enroll approximately 150 adults in the study who are diagnosed with IH. On July 31, 2024, we announced that the first patient was dosed in this study. We expect to complete enrollment by the end of 2025 and to report data and to submit a supplemental New Drug Application in 2026.

The primary objective of REVITALYZ is to demonstrate reduction in daytime sleepiness as measured by the primary endpoint, change in total score of the Epworth Sleepiness Scale at week 14. Secondary endpoints will evaluate the effect of LUMRYZ on additional efficacy parameters including patient and clinician global impression of change, IH severity, and a measure of the functional outcomes of sleep.

LUMRYZ was granted Orphan Drug Designation ("ODD") from the FDA for the treatment of IH on June 5, 2025. Specifically, ODD was granted based on the plausible hypothesis that LUMRYZ may be clinically superior to the same drug(s) already approved for the same indication, because LUMRYZ may provide a major contribution to patient care due to its once-nightly dosing for patients with IH, a chronic sleep disorder that requires potentially lifelong treatment.

***Settlement Agreement with Jazz***

On October 21, 2025, our subsidiary, Avadel CNS Pharmaceuticals, LLC ("Avadel CNS"), entered into a Settlement and License Agreement (the "Settlement Agreement") with Jazz Pharmaceuticals, Inc. to resolve the previously disclosed actions captioned Jazz Pharmaceuticals, Inc. v. Avadel CNS Pharmaceuticals, LLC, C.A. No. 21-691; Jazz Pharmaceuticals, Inc. et al v. Avadel CNS Pharmaceuticals, LLC, C.A. No. 21-1138; Jazz Pharmaceuticals, Inc. et al v. Avadel CNS Pharmaceuticals, LLC, C.A. No. 21-1594; Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al, C.A. No. 22-487; Avadel CNS Pharmaceuticals, LLC v. Jazz Pharmaceuticals, Inc., C.A. No. 22-941; Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc., et al, C.A. No. 25-09; Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al, C.A. No. 25-57; Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc., et al, C.A. No. 25-221; and Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al, C.A. No. 25-435, each brought in the United States District Court for the District of Delaware (collectively the "Lawsuits"). For additional information about the Lawsuits, see *Note 13: Commitments and Contingencies - Litigation* and *Note 15: Subsequent Events – Settlement Agreement* to our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

***Transaction Agreement with Alkermes***

On October 22, 2025, we announced we had entered into a transaction agreement (the "Transaction Agreement") with Alkermes plc ("Alkermes"). Under the terms of the Transaction Agreement, Alkermes will acquire Avadel (the "Transaction") pursuant to a court-sanctioned scheme of arrangement under Chapter 1 of Part 9 of the Companies Act 2014 of Ireland (the "Scheme"), or under certain circumstances, subject to the terms of the Transaction Agreement, a takeover offer (as such term is defined in the Irish Takeover Panel Act, 1997, Takeover Rules, 2022) rather than the Scheme. As a result of the Scheme, we will become a wholly owned subsidiary of Alkermes.

At the effective time of the Scheme (the "Effective Time"), holders of our ordinary shares nominal value $0.01 per share (the "Company Shares"), will be entitled to receive $18.50 in cash per Company Share (the "Cash Consideration") and a non-transferable contingent value right entitling the holders to a potential additional cash payment of $1.50 per Company Share, contingent upon achievement of the specified milestones set forth in the CVR Agreement (as defined below) (such contingent value rights, the "CVRs" and, together with the Cash Consideration, the "Consideration"). The Transaction has been recommended by our board of directors (the "Company Board") and the board of directors of Alkermes.

The Transaction is subject to customary closing conditions, including, among other things (a) the approval by our shareholders of the Scheme, (b) the sanction by the Irish High Court of the Scheme and delivery of the court order to the Irish Registrar of Companies, and (c) the receipt of required antitrust clearances in the United States. We expect the Transaction to close in the first quarter of 2026. Additional information about the transaction agreement and the Transaction is set forth in our filings with the SEC.

***Key Business Trends and Highlights*** 

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In operating our business and monitoring our performance, we consider a number of performance measures, as well as trends affecting our industry as a whole, which include the following:

&nbsp;&nbsp;&nbsp;&nbsp;• **Healthcare and Regulatory Reform:** Various health care reform laws in the U.S. may impact our ability to successfully commercialize our products and technologies. The success of our commercialization efforts may depend on the extent to which the government health administration authorities, the health insurance funds in the E.U. Member States, private health insurers and other third-party payers in the U.S. will reimburse consumers for the cost of healthcare products and services.

&nbsp;&nbsp;&nbsp;&nbsp;**• Competition and Technological Change:** Competition in the pharmaceutical and biotechnology industry continues to be intense and is expected to increase. We compete with academic laboratories, research institutions, universities, joint ventures, and other pharmaceutical and biotechnology companies, including other companies developing niche branded or generic specialty pharmaceutical products or drug delivery platforms. Furthermore, major technological changes can happen quickly in the pharmaceutical and biotechnology industries. Such rapid technological change, or the development by our competitors of technologically improved or differentiated products, could render our products, product candidates, or drug delivery platforms obsolete or noncompetitive.

&nbsp;&nbsp;&nbsp;&nbsp;**• Pricing Environment for Pharmaceuticals:** The pricing environment continues to be in the political spotlight in the U.S. As a result, the need to obtain and maintain appropriate pricing for pharmaceutical products may become more challenging due to, among other things, the attention being paid to healthcare cost containment and other austerity measures in the U.S. and worldwide.

&nbsp;&nbsp;&nbsp;&nbsp;• **Generics Playing a Larger Role in Healthcare:** Generic pharmaceutical products will continue to play a large role in the U.S. healthcare system. LUMRYZ may face competition from manufacturers of generic twice-nightly sodium oxybate formulations. In January 2023, Hikma Pharmaceuticals plc, announced that it launched an authorized generic version of Jazz Pharmaceuticals plc's ("Jazz") Xyrem (sodium oxybate). In July 2023, Amneal Pharmaceuticals, Inc. announced that it launched an authorized generic version of Jazz's Xyrem (sodium oxybate). Further, in September 2025, Amneal Pharmaceuticals, Inc. announced that it received FDA approval of its sodium oxybate oral solution 500 mg/mL Abbreviated New Drug Application which references Jazz's Xyrem (sodium oxybate).

&nbsp;&nbsp;&nbsp;&nbsp;**• Access to and Cost of Capital:** Similar to other businesses in our industry and at our stage of development, we will continue to rely on external sources of capital to fund our business. The process of raising capital and the associated cost of such capital for a company of our financial profile can be difficult and potentially expensive. If the need were to arise to raise additional capital, access to that capital may be difficult, expensive and/or dilutive and, as a result, could create liquidity challenges for us.

&nbsp;&nbsp;&nbsp;&nbsp;• **History of Net Loss from Operations:** LUMRYZ is the only commercial product in our portfolio. We will continue to incur substantial expenses to expand our commercialization of LUMRYZ and to further the clinical development of the valiloxybate drug candidate. While we were profitable in the quarters ended June 30, 2025 and September 30, 2025, we have a recent history of generating losses from operations. We expect to remain profitable but could incur losses in the future if revenue and gross profit from sales of LUMRYZ are insufficient to generate operating income.

***Financial Highlights***

Highlights of our consolidated results for the three and nine months ended September 30, 2025 are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;• Net product revenue was $77,467 and $198,107 during the three and nine months ended September 30, 2025, respectively, compared to net product revenue of $50,025 and $118,707 for the three and nine months ended September 30, 2024. The increase in net product revenue is driven by the early phases of LUMRYZ launch in the prior period and patient uptake throughout launch.

&nbsp;&nbsp;&nbsp;&nbsp;• Gross profit was $81,583 and $190,280 during the three and nine months ended September 30, 2025, respectively, compared to gross profit of $43,870 and $108,242 for the three and nine months ended September 30, 2024, respectively. Cost of products sold decreased during the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024. During the three months ended September 30, 2025, we reversed approximately $9,500 of estimated royalties previously recorded in cost of products sold up to June 30, 2025 related to Patent No. 11147782, following Jazz's waiver of its rights to receive royalties and damages on prior sales of LUMRYZ through September 30, 2025 pursuant to the Settlement Agreement, offset by higher sales of LUMRYZ.

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&nbsp;&nbsp;&nbsp;&nbsp;• Total operating expense was $79,646 and $182,460 for the three and nine months ended September 30, 2025, respectively, compared to total operating expense of $44,197 and $147,344 for the three and nine months ended September 30, 2024, respectively. Selling, general and administrative expenses increased $10,419 during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, driven by higher employee related costs and costs associated with the commercialization of LUMRYZ, partially offset by decreased legal costs. Research and development expenses increased $24,697 during the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024 primarily due to the $20,000 upfront license fees to XWPharma, development costs of the valiloxybate drug candidate, and clinical work to evaluate the efficacy and safety of LUMRYZ given as a once-at-bedtime dose in treating IH.

&nbsp;&nbsp;&nbsp;&nbsp;• Operating income was $1,937 and $7,820 for the three and nine months ended September 30, 2025, respectively, compared to operating loss of $327 and $39,102 for the three and nine months ended September 30, 2024, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;• Diluted net income per share was $0.00 and $0.05 for the three and nine months ended September 30, 2025, respectively, compared to diluted net loss per share of $0.03 and $0.46 in the same periods last year, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;• Cash, cash equivalents and marketable securities increased $17,800 to $91,577 at September 30, 2025 from $73,777 at December 31, 2024. The $17,800 increase in cash, cash equivalents and marketable securities during the nine months ended September 30, 2025 was driven primarily by net cash provided by operating activities of $26,670, proceeds from stock option exercises and employee share purchase plan issuances of $4,179, partially offset by upfront payment for XWPharma license of $15,000.

**<u>Critical Accounting Estimates</u>** 

Our unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. To prepare these financial statements, management makes estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the disclosures of contingent assets and liabilities. Actual results could be significantly different from these estimates.

Our significant accounting policies are described in Note 1 of the audited consolidated financial statements included in our Annual Report on Form 10-K. The SEC suggests companies provide additional disclosure on those accounting policies considered most critical. The SEC considers an accounting policy to be critical if it is important to our financial condition and results of operations and requires significant judgments and estimates on the part of management in its application. Our estimates are often based on complex judgments, probabilities and assumptions that management believes to be reasonable, but that are inherently uncertain and unpredictable. It is also possible that other professionals, applying reasonable judgment to the same facts and circumstances, could develop and support a range of alternative estimated amounts. For a complete discussion of our critical accounting policies, see the "Critical Accounting Estimates" section of the Management's Discussion & Analysis in our Annual Report on Form 10-K filed with the SEC on March 3, 2025.

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**<u>Results of Operations</u>** 

The following is a summary of our financial results (in thousands, except per share amounts) for the three months ended September 30, 2025 and 2024:

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| | | | |
|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Change** |
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Comparative Statements of Income (Loss)** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;&nbsp;Net product revenue | $77467 | $50025 | 54.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of products sold | (4116) | 6155 | (166.9)% |
| &nbsp;&nbsp;&nbsp;Gross profit | 81583 | 43870 | 86.0% |
| &nbsp;&nbsp;&nbsp;Operating expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses | 27010 | 3803 | 610.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 52636 | 40394 | 30.3% |
| &nbsp;&nbsp;&nbsp;Total operating expense | 79646 | 44197 | 80.2% |
| &nbsp;&nbsp;&nbsp;Operating income (loss) | 1937 | (327) | (692.4)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Investment and other income, net | 532 | 610 | (12.8)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (2415) | (2820) | (14.4)% |
| &nbsp;&nbsp;&nbsp;Income (loss) before income taxes | 54 | (2537) | (102.1)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Income tax provision | 34 | 88 | (61.4)% |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $20 | $(2625) | (100.8)% |
| &nbsp;&nbsp;&nbsp;Net income (loss) per share - diluted | $0.00 | $(0.03) | (100.0)% |

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The following is a summary of our financial results (in thousands, except per share amounts) for the nine months ended September 30, 2025 and 2024:

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| | | | |
|:---|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Comparative Statements of Income (Loss)** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;&nbsp;Net product revenue | $198107 | $118707 | 66.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of products sold | 7827 | 10465 | (25.2)% |
| &nbsp;&nbsp;&nbsp;Gross profit | 190280 | 108242 | 75.8% |
| &nbsp;&nbsp;&nbsp;Operating expenses: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses | 35619 | 10922 | 226.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | 146841 | 136422 | 7.6% |
| &nbsp;&nbsp;&nbsp;Total operating expense | 182460 | 147344 | 23.8% |
| &nbsp;&nbsp;&nbsp;Operating income (loss) | 7820 | (39102) | (120.0)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Investment and other income, net | 895 | 3114 | (71.3)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (7008) | (8128) | (13.8)% |
| &nbsp;&nbsp;&nbsp;Income (loss) before income taxes | 1707 | (44116) | (103.9)% |
| &nbsp;&nbsp;&nbsp;&nbsp;Income tax benefit | (3058) | (327) | 835.2% |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $4765 | $(43789) | (110.9)% |
| &nbsp;&nbsp;&nbsp;Net income (loss) per share - diluted | $0.05 | $(0.46) | (110.9)% |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Change** |
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Gross Profit:** | **2025** | **2025** | **2024** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;&nbsp;Net product revenue | $| 77467 | $| 50025 | 54.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of products sold | (4116) | (4116) | 6155 | 6155 | (166.9)% |
| &nbsp;&nbsp;&nbsp;Gross profit | $| 81583 | $| 43870 | 86.0% |
| &nbsp;&nbsp;&nbsp;Gross profit as a percentage of net product revenue | 105% | 105% | 88% | 88% |  |

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Net product revenue increased $27,442 during the three months ended September 30, 2025. The increase in net product revenue is driven by continual increases in the number of patients treated with LUMRYZ. As of September 30, 2025, approximately 3,400 patients were on LUMRYZ, compared to approximately 2,300 patients as of September 30, 2024. Cost of products sold decreased $10,271 during the three months ended September 30, 2025 as compared to the same period in the prior year. During the three months ended September 30, 2025, we reversed approximately $9,500 of estimated royalties previously recorded in cost of products sold up to June 30, 2025 related to Patent No. 11147782, following Jazz's waiver of its rights to receive royalties and damages on prior sales of LUMRYZ through September 30, 2025 pursuant to the Settlement Agreement, offset by higher sales of LUMRYZ. Cost of products sold in the three months ended September 30, 2024 included approximately $3,600 of estimated royalties.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Gross Profit:** | **2025** | **2025** | **2024** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;&nbsp;Net product revenue | $| 198107 | $| 118707 | 66.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of products sold | 7827 | 7827 | 10465 | 10465 | (25.2)% |
| &nbsp;&nbsp;&nbsp;Gross profit | $| 190280 | $| 108242 | 75.8% |
| &nbsp;&nbsp;&nbsp;Gross profit as a percentage of net product revenue | 96% | 96% | 91% | 91% |  |

---

Net product revenue increased $79,400 during the nine months ended September 30, 2025. The increase in net product revenue is driven by continual increases in the number of patients treated with LUMRYZ. As of September 30, 2025, approximately 3,400 patients were on LUMRYZ, compared to approximately 2,300 patients as of September 30, 2024. Cost of products sold decreased $2,638 during the nine months ended September 30, 2025 as compared to the same period in the prior year. During the nine months ended September 30, 2025, we reversed approximately $9,500 of estimated royalties previously recorded in cost of products sold up to June 30, 2025 related to Patent No. 11147782, following Jazz's waiver of its rights to receive royalties and damages on prior sales of LUMRYZ through September 30, 2025 pursuant to the Settlement Agreement, offset by higher sales of LUMRYZ. Cost of products sold in the nine months ended September 30, 2024 included approximately $3,600 of estimated royalties. Further, prior period cost of products sold included a portion of inventory purchased or produced that was expensed as research and development prior to FDA approval.

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| | | | |
|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Change** |
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Research and Development Expenses:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Research and development expense | $27010 | $3803 | 610.2% |

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Research and development expenses increased $23,207 or 610.2% during the three months ended September 30, 2025 as compared to the same period in the prior year. This increase was driven primarily by the $20,000 upfront license fees to XWPharma and development costs of the valiloxybate drug candidate.

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| | | | |
|:---|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Research and Development Expenses:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Research and development expense | $35619 | $10922 | 226.1% |

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Research and development expenses increased $24,697 or 226.1% during the nine months ended September 30, 2025 as compared to the same period in the prior year. This increase was driven primarily by the $20,000 upfront license fees to XWPharma, development costs of the valiloxybate drug candidate, and costs associated with the Phase 3 REVITALYZ clinical trial for LUMRYZ in treating IH.

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| | | | |
|:---|:---|:---|:---|
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **Change** |
| | **Three Months Ended September 30,** | **Three Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Selling, General and Administrative Expenses:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | $52636 | $40394 | 30.3% |

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Selling, general and administrative expenses increased $12,242 or 30.3% during the three months ended September 30, 2025 as compared to the same period in the prior year. This increase was driven by LUMRYZ commercial costs, including higher employee related costs of $5,700 due to increased headcount and recruiting, higher patient and market access of $2,600, higher selling and marketing costs of $2,400, and higher business development of $1,000.

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| | | | |
|:---|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Selling, General and Administrative Expenses:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Selling, general and administrative expenses | $146841 | $136422 | 7.6% |

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Selling, general and administrative expenses increased $10,419 or 7.6% during the nine months ended September 30, 2025 as compared to the same period in the prior year. This increase was driven by LUMRYZ commercial costs, including higher employee related costs of $11,200 due to increased headcount and recruiting, higher patient and market access of $7,500, higher selling and marketing costs of $3,500, higher medical education of $2,100, and higher business development of $1,600. The increase was offset by lower legal costs of $10,600 and nonrecurring fees associated with terminating our American Depository Receipt program ("ADR Program") of American Depositary Shares ("ADSs") in the prior year of $5,500.

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| | | | |
|:---|:---|:---|:---|
| | | | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Investment and Other Income, Net:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Investment and other income, net | $895 | $3114 | (71.3)% |

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Investment and other income, net decreased $2,219 or 71.3% during the nine months ended September 30, 2025 as compared to the same period in 2024. This decrease was driven primarily by lower interest income of $1,400 and higher foreign exchange losses of $800.

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| | | | |
|:---|:---|:---|:---|
| | | | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Income Tax Benefit:** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Income tax benefit | $3058 | $327 | 835.2% |
| &nbsp;&nbsp;&nbsp;Percentage of income (loss) before income taxes | 179.1% | (0.7)% |  |

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Income tax benefit increased $2,731 or 835.2% during the nine months ended September 30, 2025 as compared to the same period in 2024. This increase was primarily driven by the release of uncertain tax positions during the nine months ended September 30, 2025 due to the expiration of their statute of limitations.

**<u>Liquidity and Capital Resources</u>** 

On October 22, 2025, we announced that we had entered into the Transaction Agreement with Alkermes. We have agreed to various covenants and agreements, including, among others, agreements to conduct our business in the ordinary course consistent with past practice during the period between the execution of the Transaction Agreement and the closing of the Transaction. Outside of certain limited exceptions, we may not take, authorize, commit, resolve, or agree to do certain actions without Alkermes' consent, including: (i) acquiring businesses and disposing of significant assets; (ii) making capital expenditures or incurring liabilities above specified thresholds; (iii) issuing equity; (iv) incurring indebtedness for borrowed money; and (v) repurchasing outstanding ordinary shares or other equity securities. We do not believe these restrictions will prevent us from being able to fund our operations, working capital needs or capital expenditure requirements. The following discussion assumes that the Transaction is not consummated and we continue to operate as an independent entity.

Our cash flows from operating, investing and financing activities, as reflected in the unaudited condensed consolidated statements of cash flows, are summarized in the following table:

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| | | | |
|:---|:---|:---|:---|
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **Change** |
| | **Nine Months Ended September 30,** | **Nine Months Ended September 30,** | **2025 vs. 2024** |
|<br>**Net cash provided by (used in):** | **2025** | **2024** | $**%** |
| &nbsp;&nbsp;&nbsp;Operating activities | $26670 | $(54780) | 148.7% |
| &nbsp;&nbsp;&nbsp;Investing activities | (4370) | 36867 | (111.9)% |
| &nbsp;&nbsp;&nbsp;Financing activities | 4179 | 15090 | (72.3)% |

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***Operating Activities***

Net cash provided by operating activities was $26,670 for the nine months ended September 30, 2025. Net cash used in operating activities was $54,780 for the nine months ended September 30, 2024. Net cash provided by operating activities for the nine months ended September 30, 2025 was driven by net income of $4,765 and favorable adjustments of $36,389 primarily related to acquired IPR&D expense, share-based compensation expense, and depreciation and amortization, offset by unfavorable changes in working capital of $14,484. For the nine months ended September 30, 2024, net cash used in operating activities was driven by net loss of $43,789 and unfavorable changes in working capital of $28,213, offset by favorable non-cash adjustments of $17,222 driven primarily by share-based compensation expense.

***Investing Activities***

Net cash used in investing activities was $4,370 for the nine months ended September 30, 2025. Net cash provided by investing activities was $36,867 for the nine months ended September 30, 2024. Net cash used in investing activities for the nine months ended September 30, 2025 consisted of the upfront payment for the XWPharma license of $15,000, offset by the net proceeds received from the excess of sales over purchases of marketable securities of $10,820. Net cash provided by investing activities for the nine months ended September 30, 2024 was due to net proceeds received from the excess of sales over purchases of marketable securities of $36,867.

***Financing Activities***

Net cash provided by financing activities for the nine months ended September 30, 2025 of $4,179 was a result of proceeds from stock option exercises and employee share purchase plan issuances. Net cash provided by financing activities for the nine months ended September 30, 2024 of $15,090 was a result of net proceeds of $9,250 from the sale of ADSs through the at-the-market offering program ("ATM Program") and $5,840 of proceeds from stock option exercises and employee share purchase plan issuances.

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***Risk Management***

The adequacy of our cash resources depends on the outcome of certain business conditions including our ongoing LUMRYZ commercialization activities, our cost structure, and other factors set forth in "Risk Factors" within Part I, Item 1A of our Annual Report on Form 10-K filed with the SEC on March 3, 2025 and within Part II, Item 1A in this Quarterly Report on Form 10-Q. We will need to commit substantial resources to support the commercialization of LUMRYZ which could result in future losses or otherwise limit our opportunities or affect our ability to operate our business. Our assumptions concerning the outcome of certain business conditions may prove to be wrong or other factors may adversely affect our business, and as a result we could exhaust or significantly decrease our available cash, cash equivalents and marketable securities balances which could, among other things, force us to raise additional funds and/or force us to reduce our expenses, either of which could have a material adverse effect on our business. Additionally, we are unable to estimate the near or long term impacts of inflation, rising interest rates and the impact of potential tariffs, which may have a material adverse impact on our business.

We believe our existing cash, cash equivalents and marketable securities, along with cash anticipated from sales of LUMRYZ, provides sufficient capital to meet our operating, royalty obligation and capital requirements for the next twelve months following the date of this Quarterly Report.

**<u>Other Matters</u>** 

***Litigation***

We are subject to potential liabilities generally incidental to our business arising out of present and future lawsuits and claims related to product liability, personal injury, contract, commercial, intellectual property, tax, employment, compliance and other matters that arise in the ordinary course of business. We accrue for potential liabilities when it is probable that future costs (including legal fees and expenses) will be incurred and such costs can be reasonably estimated. At September 30, 2025 and December 31, 2024, there were no contingent liabilities with respect to any litigation, arbitration or administrative or other proceeding that are reasonably likely to have a material adverse effect on our consolidated financial position, results of operations, cash flows or liquidity. For information regarding legal proceedings we are involved in, see *Note 13: Commitments and Contingencies - Litigation* and *Note 15: Subsequent Events - Settlement Agreement* to our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

**ITEM 3.&nbsp;&nbsp;&nbsp;&nbsp;QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.** 

**<u>Interest Rate Risk</u>**

We are subject to interest rate risk as a result of our portfolio of marketable securities. The primary objectives of our investment policy are as follows: safety and preservation of principal and diversification of risk; liquidity of investments sufficient to meet cash flow requirements; and competitive yield. Although our investments are subject to market risk, our investment policy specifies credit quality standards for our investments and limits the amount of credit exposure from any single issue, issuer or certain types of investment. Our investment policy allows us to maintain a portfolio of cash equivalents and marketable securities in a variety of instruments, including U.S. federal government and federal agency securities, European Government bonds, corporate bonds or commercial paper issued by U.S. or European corporations, money market instruments, certain qualifying money market mutual funds, certain repurchase agreements, tax-exempt obligations of states, agencies, and municipalities in the U.S. and Europe, and equities. A hypothetical 50 basis point change in interest rates would not result in a material decrease or increase in the fair value of our securities due to the general short-term nature of our investment portfolio.

**<u>Foreign Exchange Risk</u>**

We are exposed to foreign currency exchange risk as the functional currency financial statements of a non-U.S. subsidiary is translated to U.S. dollars. The assets and liabilities of this non-U.S. subsidiary having a functional currency other than the U.S. dollar is translated into U.S. dollars at the exchange rate prevailing at the balance sheet date, and at the average exchange rate for the reporting period for revenue and expense accounts. The cumulative foreign currency translation adjustment is recorded as a component of accumulated other comprehensive loss in shareholders' equity. The reported results of this non-U.S. subsidiary will be influenced by their translation into U.S. dollars by currency movements against the U.S. dollar. Our primary currency translation exposure is related to one subsidiary that has functional currencies denominated in euro. A 10% strengthening/weakening in the rates used to translate the results of our non-U.S. subsidiaries that have functional currencies denominated in euro as of September 30, 2025 would have had an immaterial impact on net income (loss) for the three and nine months ended September 30, 2025.

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Transactional exposure arises where transactions occur in currencies other than the functional currency. Transactions in foreign currencies are recorded at the exchange rate prevailing at the date of the transaction. The resulting monetary assets and liabilities are translated into the appropriate functional currency at exchange rates prevailing at the balance sheet date and the resulting gains and losses are reported in investment and other income, net in the unaudited condensed consolidated statements of income (loss). As of September 30, 2025, our primary exposure is to transaction risk related to euro net monetary assets and liabilities held by subsidiaries with a U.S. dollar functional currency. Realized and unrealized foreign exchange gains resulting from transactional exposure were immaterial for the three and nine months ended September 30, 2025.

**<u>Inflation Risk</u>**

Inflation generally affects us by increasing our costs of labor and supplies and the costs of our third parties we rely on for the development, manufacture and supply of our products. We do not believe that inflation had a material effect on our business, financial condition or results of operations during the three and nine months ended September 30, 2025. Although we do not believe that inflation has had a material impact on our financial position or results of operations to date, we may experience some effect in the near future (especially if inflation rates rise) due to an impact on the costs to conduct clinical trials, the costs to commercialize LUMRYZ, labor costs we incur to attract and retain qualified personnel, and other operational costs. Inflationary costs could adversely affect our business, financial condition and results of operations.

**ITEM 4.&nbsp;&nbsp;&nbsp;&nbsp;CONTROLS AND PROCEDURES.** 

**<u>Evaluation of Disclosure Controls and Procedures</u>**

Management of the Company, with the participation of its Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company's disclosure controls and procedures as of September 30, 2025, the end of the period covered by this Quarterly Report on Form 10-Q. The term "disclosure controls and procedures," as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended ("Exchange Act"), means controls and other procedures of a company that are designed to provide reasonable assurance that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures are also designed to provide reasonable assurance that such information is accumulated and communicated to the Company's management, including its Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. Based on their evaluation, as of the end of the period covered by this Quarterly Report on Form 10-Q, the Company's Chief Executive Officer and Chief Financial Officer have concluded that the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were effective as of September 30, 2025.

***Other Changes in Internal Controls***

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 or 15d-15 that occurred during the three months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

**PART II – OTHER INFORMATION** 

**ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;LEGAL PROCEEDINGS.** 

The information contained in *Note 13: Commitments and Contingencies - Litigation* and *Note 15: Subsequent Events - Settlement Agreement* to the Company's unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated by reference herein.

**ITEM 1A.&nbsp;&nbsp;&nbsp;&nbsp;RISK FACTORS.** 

Except as set forth below, there have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2024 filed with the SEC on March 3, 2025.

**Risks Relating to Our Pending Transaction with Alkermes**

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***Failure to complete, or delays in completing, the pending transaction with Alkermes announced on October 22, 2025 could materially and adversely affect our results of operations and our share price.***

On October 22, 2025, we announced that we entered into a transaction agreement (the "Transaction Agreement") with Alkermes plc ("Alkermes"). Subject to the terms of the Transaction Agreement, Alkermes will acquire us (the "Transaction"), pursuant to a court-sanctioned scheme of arrangement under Chapter 1 of Part 9 of the Companies Act 2014 of Ireland (the "Scheme"), or under certain circumstances, subject to the terms of the Transaction Agreement, a takeover offer (as such term is defined in the Irish Takeover Panel Act, 1997, Takeover Rules, 2022 (the "Irish Takeover Rules")) rather than the Scheme. As a result of the Scheme, we will become a wholly owned subsidiary of Alkermes. Consummation of the Transaction is subject to certain closing conditions, some of which are not within our control, and may prevent, delay, or otherwise materially adversely affect the completion of the Transaction. We cannot predict with certainty whether and when any of the required closing conditions, including receiving shareholder approval or required regulatory clearances, will be satisfied or if additional uncertainties may arise and cannot guarantee that we will be able to successfully consummate the pending Transaction as currently contemplated under the Transaction Agreement or at all. Under certain limited circumstances in which the Transaction is not consummated, we may be required to reimburse Alkermes for certain documented, specific and quantifiable third-party costs and expenses, subject to a cap equal to one percent (1%) of the aggregate value of the total cash consideration payable in connection with the Transaction. Risks related to the failure of the pending Transaction to be consummated include, but are not limited to, the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the current market price for our ordinary shares reflects a market assumption that the Transaction will be completed but the trading price of our ordinary shares may decline;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• potential adverse effects on our relationships with current collaboration partners, suppliers, healthcare providers and other business partners, or those with which we are seeking to establish business relationships, due to uncertainties about the Transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we will remain liable for significant transaction costs, including legal, financial advisory, accounting, and other costs relating to the Transaction regardless of whether the Transaction is consummated;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the attention of our management will have been diverted to the Transaction; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• we could be subject to litigation related to any failure to complete the Transaction.

Further, under the Transaction Agreement, we are generally required to conduct our business in the ordinary course, consistent with past practice and are restricted from taking certain specified actions absent Alkermes' prior written consent, which restrictions could adversely affect our ability to conduct our business.

The occurrence of any of these events individually or in combination could materially and adversely affect our business, results of operations, financial condition, and our share price.

***The Transaction Agreement limits our ability to pursue alternative transactions which could deter a third party from proposing an alternative transaction.***

The Transaction Agreement contains provisions that, subject to certain exceptions, limit our ability to solicit or knowingly encourage discussions or negotiations with any third party regarding alternative acquisition proposals. It is possible that these or other provisions in the Transaction Agreement might discourage a potential competing acquirer that might have an interest in acquiring all or a significant part of our outstanding ordinary shares from considering or proposing an acquisition or that the price at which Alkermes has proposed to acquire us might result in a potential competing acquirer proposing to pay a lower per share price to acquire our ordinary shares than it might otherwise have proposed to pay.

***The announcement and pendency of the Transaction could adversely affect our business, financial results and/or operations.***

Our efforts to complete the Transaction could cause substantial disruptions in, and create uncertainty surrounding, our business, which may materially adversely affect our results of operation and our business. Uncertainty as to whether the Transaction will be completed may affect our ability to recruit prospective employees or to retain and motivate existing employees. Employee retention may be particularly challenging while the Transaction is pending because employees may experience uncertainty about their roles following the Transaction. A substantial amount of our management's and employees' attention is being directed toward the completion of the Transaction and thus is being diverted from our day-to-day operations. Uncertainty as to our future could adversely affect our business and our relationship with clients and potential clients. For example, clients and other counterparties may defer decisions concerning working with us, or seek to change existing business relationships with us. Changes to or termination of existing business relationships could adversely affect our revenue, earnings and financial condition, as well as the market price of our ordinary shares. The adverse effects of the pendency of the Transaction could be exacerbated by any delays in completion of the acquisition or termination of the Transaction Agreement.

***We have incurred, and will continue to incur, direct and indirect costs as a result of the Transaction.***

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We have incurred, and will continue to incur, significant costs and expenses, including fees for professional services and other transaction costs, in connection with the Transaction. We must pay substantially all of these costs and expenses whether or not the Transaction is completed. There are a number of factors beyond our control that could affect the total amount or the timing of these costs and expenses.

**Risks Related to the Commercialization of Our Lead Product**

***If our competitors develop and market technologies or products that are safer, more effective or less costly than ours, or obtain regulatory approval and market such products before we do, our commercial opportunity may be diminished or eliminated.***

Competition in the pharmaceutical and biotechnology industry is intense and is expected to increase. We compete with other pharmaceutical and biotechnology companies.

The introduction of new products in the U.S. marketplace that compete with, or otherwise disrupt the marketplace for, LUMRYZ or any future product candidates we may develop, if approved, could adversely affect sales of our products. For example, we expect LUMRYZ to face competition from manufacturers of generic twice-nightly sodium oxybate formulations who have reached settlement agreements with the current brand product marketer. In January 2023, Hikma Pharmaceuticals plc, announced the launch of an authorized generic version of Jazz's Xyrem (sodium oxybate). In July 2023, Amneal Pharmaceuticals, Inc. announced that it launched an authorized generic version of Jazz's Xyrem (sodium oxybate). Further, in September 2025, Amneal Pharmaceuticals, Inc. announced that it received FDA approval of its sodium oxybate oral solution 500 mg/mL Abbreviated New Drug Application which references Jazz's Xyrem (sodium oxybate). There are other potential future competitive products that could impact the marketplace. For example, there are some potential competitors who have reached settlement agreements with the current branded, twice-nightly product marketer, which allows for entry of other generic products in 2026, or earlier, under certain circumstances. Beyond generics, there are other potential future products that could impact the larger hypersomnia treatment landscape. For example, there are several companies developing orexin 2 receptor agonists for the treatment of narcolepsy and other sleep disorders.

If the FDA approves a competitor's application for a product candidate before our application for a similar product candidate, and grants such competitor a period of exclusivity, the FDA may take the position that it cannot approve our 505(b)(2) application for a similar product candidate until the exclusivity period expires. Additionally, even if our 505(b)(2) application for a product candidate is approved first, and we receive a period of statutory marketing exclusivity, we may still be subject to competition from other companies with approved products or approved 505(b)(2) NDAs for different conditions of use that would not be restricted by a grant of exclusivity to us.

Many of our competitors have substantially greater financial, technological, manufacturing, marketing, managerial and research and development resources and experience than we do. Furthermore, acquisitions of competing companies by large pharmaceutical companies could enhance our competitors' resources. Accordingly, our competitors may be able to develop, obtain regulatory approval and gain market share for their products more rapidly than us.

**Risks Related to Our Intellectual Property**

***Third parties may claim that our current or future product infringes their rights, and we may incur significant costs resolving these claims. Additionally, legal proceedings related to such claims could materially delay or otherwise adversely affect commercialization plans related to such product.***

Third parties may claim infringement of their patents and other intellectual property rights by the manufacture, use, import, offer for sale or sale of a commercial product. Further, in connection with us seeking regulatory approval for a product candidate, a third party may allege that our product candidate infringes its patents or other intellectual property rights and file suit to delay/prevent regulatory approval and/or commercialization of such product. In response to any claim of infringement, we may choose or be forced to seek licenses, defend infringement actions or challenge the validity or enforceability of those patent rights in court or administrative proceedings. If we cannot obtain required licenses on commercially reasonably terms, or at all, are found liable for infringement or are not able to have such patent rights declared invalid or unenforceable, our business could be materially harmed. We may be subject to claims (and even held liable) for significant monetary damages (including enhanced damages and/or attorneys' fees), encounter significant delays in bringing products to market or be precluded from the manufacture, use, import, offer for sale or sale of products or methods of drug delivery covered by the patents of others. Even if a license is available, it may not be available on commercially reasonable terms or may be non-exclusive, which could result in

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our competitors gaining access to the same intellectual property. We may not have identified, or be able to identify in the future, U.S. or non-U.S. patents that pose a risk of potential infringement claims.

We have in the past been, and may in the future become, subject to claims of infringement, which could delay us in obtaining marketing approvals for additional indications for LUMRYZ or otherwise be delayed in marketing LUMRYZ for such other indications as a result of such claims of infringement. We may in the future invest a significant amount of time and expense in preparing to seek approval for LUMRYZ in IH or other candidate indications only to be subject to significant delay or even additional patent litigation before such candidate indications may be approved or commercialized, if at all.

In addition to the possibility of intellectual property infringement claims, a third party could submit a citizen's petition to the FDA requesting relief that, if granted, could materially adversely affect the NDA and/or underlying product candidate. For example, such a third-party petition could, if granted, materially adversely affect the likelihood and/or timing of NDA approval, content of final product labeling, and/or resulting regulatory exclusivity (if any) for such product.

Parties making claims against us may be able to sustain the costs of patent litigation more effectively than we can because they have substantially greater resources. In addition, any claims, with or without merit, that our product, future products or future product candidates infringe proprietary rights of third parties could be time-consuming, result in costly litigation or divert the efforts of our technical and management personnel, any of which could disrupt our relationships with our partners and could significantly harm our financial positions and operating results.

**Risks Related to Our Business and Industry**

***Significant political, trade, regulatory developments, and other circumstances beyond our control, could have a material adverse effect on our financial condition or results of operations.***

We operate globally and, if approved, we may sell our products in countries throughout the world. Significant political, trade, or regulatory developments in the jurisdictions in which we may sell our products, such as those stemming from the change in U.S. federal administration, are difficult to predict and may have a material adverse effect on us. Similarly, changes in U.S. federal policy that affect the geopolitical landscape could give rise to circumstances outside our control that could have negative impacts on our business operations. For example, in 2025, the United States imposed tariffs on imports on its trading partners, including Canada, Mexico, the EU and China. Historically, tariffs have led to increased political and trade tensions. In response to tariffs, other countries have implemented retaliatory tariffs on U.S. goods. Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effect on global economic conditions and the stability of global financial markets. Any changes in political, trade, regulatory, and economic conditions, including U.S. trade policies, could have a material adverse effect on our financial condition or results of operations.

**General Risk Factors**

***Irish law differs from the laws in effect in the U.S. and might afford less protection to the holders of our ordinary shares and any actual or potential takeover offer for the Company will be subject to Irish Takeover Rules.***

Holders of our ordinary shares could have more difficulty protecting their interests than would the shareholders of a corporation incorporated in a jurisdiction of the U.S. As an Irish-incorporated company, we are governed by Irish law, including the Irish Companies Act 2014 and the Irish Takeover Rules, which differs in some significant, and possibly material, respects from provisions set forth in various U.S. state laws applicable to U.S. corporations and their shareholders, including provisions relating to interested directors, mergers and acquisitions, takeovers, shareholder lawsuits and indemnification of directors. The duties of directors and officers of an Irish company are generally owed to the company only. Therefore, under Irish law shareholders of Irish companies do not generally have a right to commence a legal action against directors or officers and may only do so in limited circumstances. Directors of an Irish company must act with due care and skill, honestly and in good faith with a view to the best interests of the company. Directors must not put themselves in a position in which their duties to the company and their personal interests conflict and must disclose any personal interest in any contract or arrangement with the company or any of our subsidiaries. A director or officer can be held personally liable to the company in respect of a breach of duty to the company.

It may not be possible to enforce court judgments obtained in the U.S. against us in Ireland based on the civil liability provisions of U.S. federal or state securities laws. In addition, there is some uncertainty as to whether the courts of Ireland would recognize or enforce judgments of U.S. courts obtained against us or our directors or officers based on the civil liabilities provisions of U.S. federal or state securities laws or hear actions against us or those persons based on those laws. We have been advised that the U.S. currently does not have a treaty with Ireland providing for the reciprocal recognition and enforcement of

------

judgments in civil and commercial matters. Therefore, a final judgment for the payment of money rendered by any U.S. federal or state court based on civil liability, whether or not based solely on U.S. federal or state securities laws, would not automatically be enforceable in Ireland.

In addition, any actual or potential takeover offer for our company will be subject to the Irish Takeover Rules. Under the Irish Takeover Rules, during the course of an offer or at any earlier time during which our Board has reason to believe that an offer for our company may be imminent, the Board will not be permitted to take any action, other than seeking alternative offers, which might frustrate the making of an offer for our ordinary shares unless we obtain approval from our shareholders or from the Irish Takeover Panel for such action. As a result, our board of directors will not be permitted to take any action which might frustrate Alkermes' offer for our ordinary shares or another third party offer for our ordinary shares. Potentially frustrating actions that are prohibited during the course of an offer, or at any earlier time during which our Board has reason to believe an offer is or may be imminent, include (i) the issuance of shares, options or convertible securities or the redemption or purchase of own shares, (ii) material acquisitions or disposals, (iii) entering into contracts other than in the ordinary course of business or (iv) any action, other than seeking alternative offers, which may result in frustration of an offer. Accordingly, if these restrictions become applicable to us, we may be unable to take, or may be delayed in taking, certain actions, in connection with a financing, commercial or strategic transaction or otherwise, that we believe are in the best interest of the Company.

***Changes in tax law could adversely affect our business and financial condition.***

We are subject to income and other taxes in the U.S. and foreign jurisdictions. Changes to applicable U.S. or foreign tax laws and regulations, or their interpretation and application (which changes may have retroactive application), including with respect to net operating losses and research and development tax credits, could adversely affect us or holders of our ordinary shares. In recent years, many such changes have been made and changes are likely to continue to occur in the future.

For example, the One Big Beautiful Bill Act was signed into law on July 4, 2025 and made significant changes to U.S. federal tax law. In addition, the Organization for Economic Co-operation and Development published the Pillar Two Model Rules on December 20, 2021, defining global minimum taxation of large multinational corporations with greater than 750 million euro in revenue in two of the four previous years, among other criteria. We continue to evaluate the impacts of these legislative changes as additional guidance becomes available.

Future changes in tax laws could have a material adverse effect on our business, cash flow, financial condition or results of operations. We urge investors to consult with their legal and tax advisors regarding the implications of potential changes in tax laws on an investment in our ordinary shares.

**ITEM 2.&nbsp;&nbsp;&nbsp;&nbsp;UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.** 

None.

**ITEM 3.&nbsp;&nbsp;&nbsp;&nbsp;DEFAULTS UPON SENIOR SECURITIES.** 

None.

**ITEM 4.&nbsp;&nbsp;&nbsp;&nbsp;MINE SAFETY DISCLOSURES.** 

Not applicable.

**ITEM 5.&nbsp;&nbsp;&nbsp;&nbsp;OTHER INFORMATION.** 

During the three months ended September 30, 2025, none of the Company's directors or officers (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934) adopted, terminated or modified a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K).

------

**ITEM 6.&nbsp;&nbsp;&nbsp;&nbsp;EXHIBITS.** 

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 2.1+ | <u>[Transaction Agreement, dated as of October 22, 2025, by and between Alkermes plc and the Avadel Pharmaceuticals plc. (incorporated by reference to Exhibit 2.1 to the registrant's Current Report on Form 8-K, filed on October 22, 2025)](https://www.sec.gov/Archives/edgar/data/1012477/000110465925101430/tm2529228d2_ex2-1.htm)</u> |
| 2.2 | <u>[Appendix III to the Rule 2.7 Announcement, dated as of October 22, 2025 (Conditions Appendix) (incorporated by reference to Exhibit 2.2 to the registrant's Current Report on Form 8-K, filed on October 22, 2025)](https://www.sec.gov/Archives/edgar/data/1012477/000110465925101430/tm2529228d2_ex2-2.htm)</u> |
| 10.1**‡** | <u>[Employment Agreement dated as of August 6, 2025 between Avadel Management Corporation and Jerad G. Seurer (incorporated by reference to Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q, for the quarter ended June 30, 2025, filed on August 7, 2025)](https://www.sec.gov/Archives/edgar/data/1012477/000101247725000024/exhibit102q22025.htm)</u> |
| 10.2\*+^ | <u>[Amended and Restated License Agreement by and between Flamel Ireland Ltd and XWPharma Ltd., dated as of August 30, 2025 (filed herewith)](exhibit102q32025.htm)</u> |
| 10.3\* | <u>[Settlement and License Agreement by and between Jazz Pharmaceuticals, Inc. and Jazz Pharmaceuticals Ireland Limited and Avadel CNS Pharmaceuticals LLC and Flamel Ireland Limited (filed herewith)](exhibit103q32025.htm)</u> |
| 31.1\* | <u>[Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) promulgated under the Exchange Act](exhibit311q32025.htm)</u> |
| 31.2\* | <u>[Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) promulgated under the Exchange Act](exhibit312q32025.htm)</u> |
| 32.1\*\* | <u>[Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](exhibit321q32025.htm)</u> |
| 32.2\*\* | <u>[Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](exhibit322q32025.htm)</u> |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104\* | Cover Page Interactive Data File (formatted as inline XBRL with applicable taxonomy extension information contained in Exhibits 101.\*) |

---

\*&nbsp;&nbsp;&nbsp;&nbsp;Filed herewith.

\*\*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Furnished herewith.

**‡ &nbsp;&nbsp;&nbsp;&nbsp;**Management contract or compensatory plan or arrangement filed pursuant to Item 15(b) of Form 10-K.

+ Certain exhibits and schedules to these agreements have been omitted pursuant to Item 601 of Regulation S-K. The registrant will furnish copies of any of the exhibits and schedules to the Securities and Exchange Commission upon request.

^ Certain portions of this exhibit have been omitted because they are not material, and the registrant customarily and actually treats that information as private or confidential.

------

**SIGNATURES** 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **AVADEL PHARMACEUTICALS PLC** | **AVADEL PHARMACEUTICALS PLC** |
| | (Registrant) | (Registrant) |
| Date: November 4, 2025 | By: | */s/ Gregory J. Divis* |
|  |  | Gregory J. Divis |
|  |  | *Chief Executive Officer* |
|  |  | *(Duly Authorized Officer* and *Principal Executive Officer)* |

---

---

| | | |
|:---|:---|:---|
| Date: November 4, 2025 | By: | */s/ Thomas S. McHugh* |
|  |  | Thomas S. McHugh |
|  |  | *Senior Vice President and Chief Financial Officer* |
|  |  | *(Duly Authorized Officer* and *Principal Financial and Accounting Officer)* |

---

## Exhibit 10.2

**CERTAIN INFORMATION CONTAINED IN THIS EXHIBIT, MARKED BY [\*\*\*], HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE THE REGISTRANT HAS DETERMINED THAT IT IS BOTH NOT MATERIAL AND IS THE TYPE THAT THE REGISTRANT TREATS AS PRIVATE OR CONFIDENTIAL.**

**Exhibit 10.2**

**AMENDED AND RESTATED LICENSE AGREEMENT**

This Amended and Restated License Agreement (the "<u>Agreement</u>") is made and entered as of August 30, 2025 (the "<u>Amended and Restated Agreement Effective Date</u>"), by and between XWPharma Ltd, a Cayman Islands corporation with an operating address at 303 Twin Dolphin Dr., Suite 600, Redwood City, CA 94065 USA, ("Licensor"), and Flamel Ireland Ltd (dba "Avadel Ireland"), a company organized under the laws of Ireland ("<u>Licensee</u>"). Licensor and Licensee are each sometimes referred to herein as a "<u>Party</u>" or collectively as the "<u>Parties</u>."

**<u>RECITALS</u>**

WHEREAS, Licensor Controls Licensed IP related to Licensed Compounds and has the exclusive right to grant an exclusive license under said Licensed IP; and

WHEREAS, Licensee desires to obtain, and Licensor desires to grant, an exclusive license under the Licensed IP to research, Develop and Exploit Licensed Compounds and Licensed Products on the terms and conditions set forth herein;

WHEREAS, Licensee and Licensor entered into that certain License Agreement dated [\*\*\*] (the "<u>Effective Date</u>"), as amended by [\*\*\*] (as amended, the "<u>Original Agreement</u>"); and

WHEREAS, Licensee and Licensor desire to amend and restate the Original Agreement in its entirety with this Agreement as of the Amended and Restated Agreement Effective Date.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and for other good and valuable consideration, the amount and sufficiency of which are hereby acknowledged, Licensor and Licensee hereby agree as follows:

**Article 1<br>DEFINITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1"<u>Affiliate</u>" means, with respect to a Person, any other Person that directly or indirectly controls, or is controlled by, or is under common control with such Person. The term "control" as used herein means (a) in the case of corporate entities, direct or indirect ownership of at least fifty percent (50%) of the stock or shares entitled to vote for the election of directors; or (b) in the case of an entity that is not a corporate entity, the possession, directly or indirectly, of the power to direct the management and policies of such entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2"<u>Agreement</u>" has the meaning set forth in the preamble.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3"<u>Amended and Restated Agreement Effective Date</u>" has the meaning set forth in the preamble.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4"<u>Amendments</u>" has the meaning set forth in the recitals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5"[\*\*\*]" has the meaning set forth in Section 2.5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6"<u>Breaching Party</u>" has the meaning set forth in Section 10.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7"[\*\*\*]" means [\*\*\*].

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8"<u>Combination Product</u>" has the meaning set forth in Section 1.39.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9"<u>Commercially Reasonable Efforts</u>" means those efforts that would normally be undertaken, when using prudent scientific and business judgment, by a similarly situated company in the same industry to achieve an objective, including, for a product candidate, or a product (as applicable), in each case, of similar commercial potential at a similar stage in its development or product life cycle to those of a Licensed Product, taking into account all scientific, safety and other factors, that such company would normally take into account, including the present and future market potential and competitive market position of the Licensed Product as compared to other products in such company's product portfolio, issues of safety and efficacy, expected and actual cost and time to Develop, expected and actual profitability (including royalties and other payments required hereunder), expected and actual competitiveness of alternative products (including generic or biosimilar products in the marketplace), the nature and extent of expected and actual market exclusivity, the expected likelihood and timing of Regulatory Approvals, the expected and actual pricing and reimbursement, and the expected and actual amounts of marketing and promotional expenditures required (as applicable).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10"<u>Confidential Information</u>" has the meaning set forth in Section 9.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11"<u>Confidentiality Agreement</u>" means that certain Confidential Disclosure Agreement between the Parties dated [\*\*\*], which was extended by way of amendment on [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12[Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13[Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14"<u>Control</u>" or "<u>Controlled</u>" means, with respect to any Information, Patent Right or other intellectual property right, the possession (whether by ownership or, other than pursuant to this Agreement, license or sublicense or other grant of rights) by a Party or its Affiliate of the ability to use or practice such Information, Patent Right or other intellectual property right to grant to the other Party a license, sublicense or access as provided herein to such item as of the time such Party or its Affiliate would first be required hereunder to grant the other Party such access, license or sublicense, without violating the terms of any agreement or other arrangement with any Third Party or being obligated to pay any royalties or other consideration therefor. [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15"<u>Develop</u>" or "<u>Development</u>" means, with respect to a particular Licensed Product, the performance of all pre-clinical and clinical development (including toxicology, pharmacology, test method development and stability testing, process development, formulation development, quality control development, statistical analysis), clinical trials, manufacturing and regulatory activities that are required to obtain Regulatory Approval of such Licensed Product in the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16"<u>Disclosing Party</u>" has the meaning set forth in Section 9.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17"<u>Distributor</u>" means a Third Party to whom Licensee or its Affiliates or Sublicensees grant a right to sell or distribute a Licensed Product, that purchases its requirements for such Licensed Product from Licensee or its Affiliates or Sublicensees and does not otherwise make any royalty or other payments to Licensee or its Affiliates or Sublicensees with respect to Licensee's, its Affiliates' or its Sublicensees' intellectual property rights or Licensed Products, including any payments that are calculated on the basis of a percentage of, or profit share on, such Third Party's sale of Licensed Products.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18"<u>Effective Date</u>" has the meaning set forth in the recitals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19"<u>Exploit</u>" or "<u>Exploitation</u>" means, with respect to a particular Licensed Product, to use, have used, manufacture, have manufactured, sell, have sold, offer for sale, have offered for sale, import,

&nbsp;&nbsp;&nbsp;&nbsp;2

------

have imported, export and have exported, including to research, develop, commercialize or otherwise exploit such Licensed Product.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20"<u>Field</u>" means all prophylactic, palliative, therapeutic and diagnostic uses in humans for the diagnosis and/or treatment of any and all disorders/indications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.21"<u>First Commercial Sale</u>" means, with respect to Licensed Product, the date of the first sale by Licensee or any of Licensee's sublicensees of any Licensed Product to a Third Party after the grant of Regulatory Approval in the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.22"<u>GAAP</u>" means generally accepted accounting principles in the United States in effect from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.23"<u>Information</u>" means any data, results, and information of any type whatsoever, in any tangible or intangible form, including know-how, trade secrets, practices, techniques, methods, processes, discoveries and claims, including synthesis, preparation, recovery and purification processes and techniques, control methods and assays, inventions, developments, specifications, formulations, formulae, materials (including biological or chemical) or compositions of matter of any type or kind (patentable or otherwise), software, algorithms, marketing reports, clinical and non-clinical study reports, regulatory submission documents and summaries, expertise, stability, technology, test data including pharmacological, biological, chemical, biochemical, toxicological, and clinical test data, analytical and quality control data, stability data, studies and procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.24"<u>Licensed Compound</u>" means [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.25"<u>Licensed Know-How</u>" means all Information Controlled as of the Effective Date or thereafter during the Term by Licensor or any of its Affiliates that is necessary or useful for the research, Development or Exploitation of any Licensed Compounds or Licensed Products in the Field in the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.26"<u>Licensed IP</u>" means all Licensed Know-How and Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.27"<u>Licensed Patent Rights</u>" means all Patent Rights Controlled as of the Effective Date or thereafter during the Term by Licensor or any of its Affiliates that is necessary or useful for the research, Development or Exploitation of any Licensed Compounds or Licensed Products in the Field in the Territory. Licensed Patent Rights existing as of the Effective Date include those set forth in <u>Exhibit B</u>, which Exhibit shall be updated by Licensor at the request of Licensee from time to time during the Term, and for clarity, Patent Rights shall include all Patent Rights that claim direct or indirect priority (in whole or in part) to any of the Patent Rights on such Exhibit. Licensed Patent Rights shall exclude [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.28"<u>Licensed Product</u>" means any current and future pharmaceutical product containing a Licensed Compound, including [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.29"<u>Licensee</u>" has the meaning set forth in the preamble.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.30"<u>Licensee Indemnitees</u>" has the meaning set forth in Section 7.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.31"<u>Licensor</u>" has the meaning set forth in the preamble.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.32"<u>Licensor Indemnitees</u>" has the meaning set forth in Section 7.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.33"<u>Losses</u>" has the meaning set forth in Section 7.1.

&nbsp;&nbsp;&nbsp;&nbsp;3

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.34"<u>Manufacturing Technology Transfer</u>" has the meaning set forth in Section 2.3(c).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.35"<u>Manufacturing Technology Transfer Plan</u>" has the meaning set forth in Section 2.3(c).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.36"<u>Material Breach</u>" has the meaning set forth in Section 10.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.37"[\*\*\*]" means [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.38"<u>Mono Product</u>" has the meaning set forth in Section 1.39.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.39"<u>Net Sales</u>" means the gross invoiced price for Licensed Products sold by Licensee or its Affiliates (the "<u>Selling Party</u>") (including sales generated from named patient programs and excluding sales deferred for GAAP accounting purposes until such sales are recognized) in the Field to Third Parties (including Distributors), excluding all Sublicense Net Revenue, less the following deductions from such gross amounts:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)[\*\*\*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)[\*\*\*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)[\*\*\*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)[\*\*\*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)[\*\*\*];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)[\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)[\*\*\*].

<u>1.40</u>[\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.41"<u>Non-Breaching Party</u>" has the meaning set forth in Section 10.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.42"<u>Original Agreement</u>" has the meaning set forth in the recitals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.43"<u>Other Product</u>" has the meaning set forth in Section 1.39.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.44"<u>Party</u>" or "<u>Parties</u>" has the meaning set forth in the preamble.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.45"<u>Patent Rights</u>" means any and all patents and patent application anywhere in the world (which for purposes of this Agreement shall include certificates of invention and applications for such certificates), including any provisionals, nonprovisionals, divisionals, continuations, continuations-in-part, substitutions, reissues, re-examinations, revalidations, extensions (including pediatric exclusivity patent extensions), registrations, supplementary protection certificates and renewals of any such patents or patent applications, and all inventions disclosed in each such patent or patent application, and all rights and priorities in any of the foregoing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.46"<u>Person</u>" means an individual, sole proprietorship, partnership, limited partnership, limited liability partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture or other similar entity or organization, including a government or political subdivision, department or agency of a government.

&nbsp;&nbsp;&nbsp;&nbsp;4

------

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.47"<u>Pivotal Bioequivalence Study</u>" means, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.48"<u>Pilot Pharmacokinetics Study</u>" means, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.49"<u>Receiving Party</u>" has the meaning set forth in Section 9.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.50"<u>Regulatory Approval</u>" means any approval, clearance, authorization, registration, certification, license, or permit granted by any Regulatory Authority and necessary to commercially

manufacture, import, export, market, and sell a Licensed Product in the applicable jurisdiction in accordance with applicable laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.51"<u>Regulatory Authority</u>" means, with respect to a country in the Territory, any national (e.g., the FDA), supra-national (e.g., the European Commission, the Council of the European Union, or the EMA), regional, state or local regulatory agency, department, bureau, commission, council or other governmental authority involved in the granting of Regulatory Approvals for pharmaceutical products in such country or countries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.52"<u>Reversion Date</u>" has the meaning set forth in Section 10.5(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.53"<u>Reversion Notice</u>" has the meaning set forth in Section 10.5(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.54"<u>Royalty Term</u>" has the meaning set forth in Section 4.1(c)(ii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.55[Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.56"<u>Sublicense</u>" means an agreement pursuant to which Licensee grants a sublicense to any of the Licensed IP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.57"<u>Sublicense Net Revenue</u>" means, with respect to any sales or other Exploitation of Licensed Products by a Sublicensee in the Field in the Territory outside of the United States, all income and amounts (cash and non-cash) received by Licensee or its Affiliates from a Sublicensee in consideration of the grant of a Sublicense. Sublicense Net Revenue specifically excludes [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.58"<u>Sublicensee</u>" means any non-Affiliate sublicensee of the rights granted by Licensee pursuant to Section 2.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.59"<u>Technology Transfer</u>" has the meaning set forth in Section 2.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.60"<u>Term</u>" has the meaning set forth in Section 10.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.61"<u>Territory</u>" means worldwide except mainland China, Hong Kong and Macao.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.62"<u>Third Party</u>" means any Person other than a Party or their respective Affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.63"<u>Third Party Claims</u>" has the meaning set forth in Section 7.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.64"<u>Third Party IP Claim</u>" has the meaning set forth in Section 6.3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.65"<u>Valid Claim</u>" means (a) a claim of an issued and unexpired patent which has not been revoked or held unenforceable or invalid by a decision of a court or other governmental agency of competent jurisdiction, unappealable or unappealed within the time allowed for appeal, and which has not

&nbsp;&nbsp;&nbsp;&nbsp;5

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been admitted to be invalid or unenforceable through reissue or disclaimer or otherwise, or (b) a claim of a pending patent application that was filed and has been prosecuted in good faith and has not been (i) cancelled, withdrawn, abandoned or finally disallowed without the possibility of appeal or refiling of such application, or (ii) pending for more than [\*\*\*] years since such claim was first presented or is the result of amending another claim pending for more than [\*\*\*] years (either in the same application or in another application in the same jurisdiction) so as to add or delete an obvious limitation, so as to make a trivial or nonsubstantive change, or so as to change a matter of form.

**Article 2<br>GRANT OF RIGHTS; EXCLUSIVITY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1<u>License Grant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Licensor hereby grants as of the Effective Date to Licensee and its Affiliates for the Term a royalty-bearing, exclusive (even as to Licensor and its Affiliates) license, with the right to sublicense through multiple tiers, under the Licensed IP, to research, Develop and Exploit the Licensed Compounds and Licensed Products in the Field in the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Licensor acknowledges and agrees that, during the Term, it shall not, nor allow any Affiliate to, directly or indirectly, (i) grant any licenses or other rights inconsistent with this Section 2.1 or (ii) practice any of the Licensed IP to the extent licensed to Licensee hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2<u>Sublicenses</u>. Licensee shall have the right to grant sublicenses of the rights and licenses granted to Licensee hereunder through multiple tiers. Licensee shall incorporate terms and conditions into its sublicense agreements sufficient to enable Licensee to comply with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3<u>Technology Transfer</u>. In furtherance of the license to Licensed Know-How that is granted to Licensee pursuant Section 2.1, Licensor and Licensee shall cooperate to arrange for and complete an orderly transfer from Licensor to Licensee, or to make such other mutually acceptable arrangements as are reasonably necessary, to provide Licensee with access to the Licensed Know-How within [\*\*\*] after the Amended and Restated Agreement Effective Date (the "<u>Technology Transfer</u>"). Without limiting the generality of the foregoing, the Parties have agreed to the following specific procedures to the Technology Transfer:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Data Transfer</u>. Within [\*\*\*] after the Amended and Restated Agreement Effective Date, Licensor will promptly deliver or otherwise provide Licensee with copies of relevant documentation, data and information which constitutes Licensed Know-How (preferably in digital or other electronic format where possible, but which may also include hard-copy documentation), which are set forth in <u>Exhibit C</u> (attached hereto).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Transfer of Licensed Compound</u>. Within [\*\*\*] after the Amended and Restated Agreement Effective Date, Licensor will deliver to Licensee the quantities of Licensed Compounds, which are set forth in <u>Exhibit D</u> (attached hereto). Licensee shall reimburse Licensor for any shipping costs incurred for the transfer of such materials to Licensee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Manufacturing Technology Transfer</u>. The technology transfer described in this Section 2.3(c) shall be referred to as the "<u>Manufacturing Technology Transfer</u>" and shall be conducted in accordance with the manufacturing technology transfer plan attached hereto as <u>Exhibit E</u> (attached hereto) (the "<u>Manufacturing Technology Transfer Plan</u>"). The Manufacturing Technology Transfer Plan: (i) specifies goals and estimated timelines for the achievement of the Manufacturing Technology Transfer; (ii) identifies certain of the technology to be delivered; (iii) specifies the activities related to implementation of such technology in Licensee's or its designee's facilities; and (iv) sets forth those obligations assigned to each Party with respect to such technology transfer. Without limitation of the Manufacturing Technology Transfer Plan, as soon as reasonably practicable after the Amended and Restated Agreement Effective Date, but, except as set forth below, in no event later than [\*\*\*] after the

&nbsp;&nbsp;&nbsp;&nbsp;6

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Amended and Restated Agreement Effective Date, Licensor will deliver to Licensee a copy of all Licensed Know-How, including such Licensed Know-How as is specifically identified in the Manufacturing Technology Transfer Plan or that relates to the manufacture of the Licensed Compound and Licensed Product, related documentation and all such Licensed Know-How as is reasonably anticipated to become a part of the Chemistry, Manufacturing and Controls section of a regulatory submission document included in a New Drug Application, as set forth in 21 CFR § 314.50 or otherwise related to the formulation, manufacturing, packaging and control of the Licensed Compound and Licensed Product. Without limiting the generality of the foregoing, upon Licensee's request, Licensor will (A) provide all cooperation, information and assistance as may be necessary to enable Licensee to purchase the Licensed Compound from Licensor's current contract manufacturer(s) and (B) assign to Licensee, those agreements related to the manufacture, supply or distribution of supplies of the Licensed Compound and Licensed Product, if any, set forth on <u>Exhibit E</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4[Reserved]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5<u>[\*\*\*]</u>.

**Article 3<br>DEVELOPMENT, REGULATORY, AND COMMERCIALIZATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1<u>General</u>. Licensee shall have the exclusive right, and sole responsibility and decision-making authority, to research, Develop and Exploit the Licensed Compounds and Licensed Products and to conduct (either itself or through its Affiliates, Sublicensees or other Third Parties selected by Licensee) all non-clinical studies and clinical trials that Licensee believes appropriate to obtain Regulatory Approval for Licensed Products in the Field and Territory. Licensee shall be solely responsible for developing, preparing any and all regulatory filings for, obtaining Regulatory Approval of, and commercializing Licensed Products in the Field and in the Territory, in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2<u>Responsibility for Costs</u>. Following the Amended and Restated Agreement Effective Date and at all times during the Term Licensee shall bear all costs associated with the research, development and commercialization of the Licensed Products in the Territory, including regulatory, manufacturing, distribution, marketing and sales activities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3<u>Support in Development, Commercialization and Manufacturing</u>. For a period of [\*\*\*] following the Amended and Restated Agreement Effective Date, upon Licensee's request, Licensor will, at its sole cost and expense, use commercially reasonable efforts to make representatives who are knowledgeable regarding the Licensed IP and Licensed Compounds, including the properties and functions thereof, and who are then currently employed or otherwise engaged by Licensor (or its Affiliates), available for up to a total of [\*\*\*] to provide scientific and technical explanations and advice to the Licensee related to the development, commercialization and manufacturing of the Licensed Compounds and Licensed Products. Such access shall be at Licensee's reasonable request and mutually convenient times, (but shall not limit Licensor's ability to hire or terminate employees in its discretion) and may include (without limitation) teleconferences, electronic communications or face-to-face meetings. If during such [\*\*\*] period Licensee requests additional assistance beyond such [\*\*\*], Licensor shall provide such additional assistance and Licensee shall reimburse Licensor for such additional assistance at an hourly rate of $[\*\*\*] per person. Notwithstanding the foregoing, any Licensee communications or requests under this Section 3.3 shall be directed to [\*\*\*] of Licensor, who shall coordinate on behalf of any other officers, directors, employees, consultants, agents and other representatives, at the following address:

Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;7

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Phone: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.4<u>Regulatory Assistance</u>. Licensor shall provide Licensee with reasonable assistance in connection with the regulatory activities for the Licensed Products in the Field in the Territory. Licensor shall assign to Licensee, and will provide full copies of, all regulatory materials and Regulatory Approvals that are Controlled by Licensor and its Affiliates that solely relate to Licensed Compounds, including any Investigational New Drug application or equivalent application filed with the applicable Regulatory Authority. With respect to any regulatory materials and Regulatory Approvals that are Controlled by Licensor and its Affiliates that are necessary or reasonably useful to Exploit the Licensed Compound but do not solely relate to a Licensed Compound, Licensor hereby grants to Licensee a "Right of Reference," as that term is defined in 21 C.F.R. § 314.3(b) (or any successor rule or analogous law recognized outside of the United States) to such regulatory materials and Regulatory Approvals to Exploit the Licensed Compound. Licensor shall provide Licensee access to all material preclinical and clinical data, results, communications and other information, Controlled by Licensor and its Affiliates and relating to or resulting from clinical trials or regulatory filings relating to the Licensed Compounds in the Field, for use by Licensee in obtaining Regulatory Approval for the Licensed Products in the Field in the Territory. Licensee shall have a right of access, a right of reference and a right to use and incorporate all such data, results, communications and other information for purposes of obtaining Regulatory Approval of the Licensed Products in the Field in the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5<u>Diligence</u>. Licensee shall [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.6<u>Trademarks</u>. As between Licensor and Licensee, Licensee shall have the sole authority to select trademarks for the Licensed Compounds and/or Licensed Products and shall own all such trademarks.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.7<u>Reports</u>. Licensee will keep Licensor reasonably informed about Licensee commercialization activities for the Licensed Product by providing Licensor at least once every [\*\*\*] with a written report summarizing significant events in the commercialization of the Licensed Product.

**Article 4<br>ROYALTIES AND PAYMENT TERMS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1<u>Consideration for Grant of Rights.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Upfront Payment</u>. In consideration of the licenses and rights granted to Licensee hereunder, Licensee shall pay to Licensor a nonrefundable license issue fee in the amount of twenty million dollars ($20,000,000) as follows: (i) fifteen million dollars ($15,000,000) paid by Licensee to Licensor pursuant to the Amendments prior to the Amended and Restated Agreement Effective Date (the receipt of which Licensor hereby acknowledges) are hereby credited towards the payment due under this Section 4.1(a); and (ii) the balance of five million dollars ($5,000,000) which shall be payable no later than [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Milestone Payments</u>. As further consideration for Licensor's grant of the rights and licenses hereunder, Licensee shall pay or cause to be paid to Licensor the following nonrefundable amount(s) after achievement of the corresponding development or sales milestone event. For each development milestone event, Licensee shall notify Licensor in writing within [\*\*\*] after achievement of each such development milestone event and Licensor shall issue Licensee an invoice for the amount of the corresponding development milestone payment, which Licensee shall pay within [\*\*\*] following its receipt thereof. Upon the achievement of each sales milestone event, Licensee shall notify Licensor of such achievement no more than [\*\*\*] after Licensee files with the U.S. Securities and Exchange Commission its Form 10-Q or Form 10-K for the calendar quarter during which such achievement

&nbsp;&nbsp;&nbsp;&nbsp;8

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occurred. Upon receipt of such notice, Licensor shall issue Licensee an invoice for the amount of the corresponding sales milestone payment, which Licensee shall pay within [\*\*\*] following its receipt thereof.

---

| | |
|:---|:---|
| **Development Milestones**  | **Milestone Payment** |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| **Sales Milestones in the United States** | **Milestone Payment** |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |

---

For avoidance of doubt, the foregoing milestone payment shall be payable only once, upon the first achievement of the milestone event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Running Royalties</u>. As further consideration for Licensor's grant of the rights and licenses hereunder, Licensee shall pay to Licensor tiered, marginal royalties as a percentage of Net Sales of Licensed Products sold by Licensee and its Affiliates where such sale then would infringe any Valid Claims contained in the Licensed Patent Rights absent the license grant in this Agreement, as follows. By way of illustration, assume in a year that the annual Net Sales of a Licensed Product is $[\*\*\*], the total royalty payments shall be calculated as the sum of [\*\*\*].

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---

| | |
|:---|:---|
| **Annual Net Sales** | **Royalty Rates** |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |
| [\*\*\*] | [\*\*\*] |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)<u>No Multiple Royalties</u>. If the manufacture, use or sale of any Licensed Product is claimed or covered by more than one of the Licensed Patent Rights, multiple royalties shall not be due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)<u>Duration of Royalty Obligations</u>. The royalty obligations set forth in Section 4.1(c) shall continue on a country-by-country basis as to each Licensed Product until the last of [\*\*\*] years [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)<u>Royalty Adjustment</u>. [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)<u>Royalty Reports</u>. [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Sublicense Net Revenue Sharing</u>. As further consideration for Licensor's grant of the rights and licenses hereunder, Licensee shall pay to Licensor [\*\*\*] of any such Sublicense Net Revenue received by Licensee from each Sublicensee in connection with the development and/or commercialization of a Licensed Product, including with respect to upfront payments, milestone payments and running royalties, within [\*\*\*] after the receipt of such funds by Licensee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Method of Payment</u>. All payments under this Agreement should be made payable to "[\*\*\*]" and sent to the address identified in Section 12.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Payments in U.S. Dollars</u>. All payments due under this Agreement shall be payable in United States dollars. Conversion of foreign currency to U.S. dollars shall be made at the conversion rate existing in the United States (as reported in the Wall Street Journal) on the last business day of the calendar quarter of the applicable calendar quarter. Such payments shall be without deduction of exchange, collection, or other charges, and, specifically, without deduction of withholding or similar taxes or other government-imposed fees or taxes, except as permitted in the definition of Net Sales.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2<u>Records</u>. Licensee shall maintain, and shall cause its Affiliates and Sublicensees to maintain, complete and accurate records relating to amounts payable to Licensor in relation to this Agreement. The relevant entity shall retain such records for at least [\*\*\*] years following the end of the calendar year to which they pertain, during which time a certified, independent public accountant selected by Licensor and reasonably acceptable to Licensee shall have the right, at Licensor's expense, to inspect such records during normal business hours to verify any reports and payments made or compliance in other respects under this Agreement. In the event that any audit performed under this Section 4.2 reveals an underpayment in excess of [\*\*\*], Licensee shall bear the full out-of-pocket cost of such audit. If such an audit reveals an underpayment or overpayment, the Party responsible for making payment shall remit any amounts due to the other Party the amount of the underpayment or overpayment discovered unpaid under this Section 4.2 within [\*\*\*] of receiving notice thereof from the other Party.

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**Article 5<br>INTELLECTUAL PROPERTY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1<u>New Inventions</u>. As between the Parties, [\*\*\*] and in connection with the research, Development and/or Exploitation of Licensed Products, whether or not patented or patentable, and any and all Patent Rights and other intellectual property rights with respect thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2<u>Responsibility for Licensed Patent Rights</u>. Licensor hereby appoints Licensee as its agent to prepare, file, prosecute, maintain and defend in all agency proceedings (e.g., reissues, reexaminations, *inter partes* review, oppositions, interferences and other post-grant proceedings originating in a patent office) all of the Licensed Patent Rights during the Term. Promptly after the Amended and Restated Agreement Effective Date, Licensor shall provide complete copies of the prosecution histories of the Licensed Patent Rights to Licensee. Licensee shall copy Licensor on all patent prosecution documents and give Licensor reasonable opportunities to advise Licensee on such filing, prosecution and maintenance. In the event Licensee desires to abandon any patent or patent application within such Licensed Patent Rights, Licensee shall provide Licensor with reasonable prior written notice of such intended abandonment or decline of responsibility. If Licensor elects to continue such patent or patent application, the Parties shall consult and Licensee may elect to retain responsibility therefor. Otherwise, the right to prepare, file, prosecute, maintain and defend the relevant Licensed Patent Rights, at Licensor's expense, shall revert to Licensor, provided that any such Licensed Patent Rights shall continue to be subject to the license and other rights granted to Licensee hereunder. For clarity, Licensor shall retain the sole right to prepare, file, prosecute, maintain and defend all [\*\*\*] at Licensor's sole expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3<u>Patent Extensions and Orange Book Listings</u>. If elections with respect to obtaining patent term extensions (including any available pediatric extensions) or supplemental protection certificates or their equivalents in any country with respect to the Licensed Patent Rights are available, Licensee shall have the sole and exclusive right to make any such elections. With respect to data exclusivity periods (such as those periods listed in the FDA's Orange Book (including any available pediatric extensions) or periods under national implementations of Article 10.1(a)(iii) of Directive 2001/EC/83 or orphan exclusivity periods, and all equivalents in any country), Licensee shall have the sole and exclusive right to seek and maintain all such data exclusivity periods available for the Licensed Products. With respect to all of the rights and activities identified in this Section 5.3, Licensor hereby appoints Licensee as its agent for such purposes with the authority to act on Licensor's behalf with respect to such Licensed Patent Rights in a manner consistent with this Agreement.

**Article 6<br>INFRINGEMENT**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1<u>Notification of Infringement</u>. Each Party agrees to provide written notice to the other Party promptly after becoming aware of any infringement, misappropriation or other violation of the Licensed Patent Rights by a Third Party and of any available evidence thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2<u>Right to Prosecute Infringements</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Licensee Right to Prosecute</u>. Licensee shall have the first and exclusive right, but not the obligation, under its own control and at its own expense, to prosecute any Third Party infringement, misappropriation or other violation of the Licensed Patent Rights, subject to Sections 6.5 and 6.6. The total cost of any such infringement action commenced or defended solely by Licensee shall be borne by Licensee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Licensor Right to Prosecute</u>. If (a) after having been notified of any alleged infringement that is material and competitive in the marketplace Licensee does not act promptly and diligently either (i) to persuade the alleged infringer to desist or (ii) to bring and prosecute an

&nbsp;&nbsp;&nbsp;&nbsp;11

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infringement action, or (b) within [\*\*\*] years after having been notified of any alleged infringement that is material and competitive in the marketplace Licensee is unsuccessful in persuading the alleged infringer to desist and shall not have brought and shall not be diligently prosecuting an infringement action, then Licensor shall have the right, but shall not be obligated, under its own control and at its own expense, to prosecute any infringement of the Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3<u>Defense of Third Party Actions</u>. If a Third Party asserts a claim (including a declaratory judgment action) naming Licensor or Licensee or any of its Affiliates or Sublicensees as a defendant and alleging either (i) invalidity, unenforceability or non-infringement of any Licensed Patent Rights, or (ii) infringement of a third party patent based on actions taken under the licenses granted in this Agreement (each a "<u>Third Party IP Claim</u>"), then, Licensee or Licensor, as the case may be, shall promptly notify the other Party in writing and Licensee may elect, upon written notice to Licensor within [\*\*\*] after receiving or giving notice of the commencement of such action, to take over the sole control of such action at its own expense. If Licensee does not defend any such action, then Licensor shall have the right, but shall not be obligated, to defend such action at Licensor's expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4<u>Offset</u>. Licensee may offset a total of [\*\*\*] of any expenses incurred in connection with: (i) actions under Section 6.2(a) and (ii) Third Party IP Claims, against any payments due to Licensor under Article 4 up to a maximum offset amount of [\*\*\*], *provided that* with respect to clause (ii), any such Third Party IP Claims are attributable to the Licensed Compound claimed or covered by the Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5<u>Recovery</u>. In the event that either Party exercises the rights conferred in this Article 6 and recovers any damages or other sums in such action, such damages or other sums recovered shall first be applied to all out-of-pocket costs and expenses incurred by the Parties in connection therewith (including attorneys' fees and, in the case of Licensor, including any offsets made pursuant to Section 6.4). If such recovery is insufficient to cover all such costs and expenses of both Parties, the controlling Party's costs shall be paid in full first before any of the other Party's costs. If after such reimbursement any funds shall remain from such damages or other sums recovered, such funds shall be retained by the Party that controlled the action or proceeding under this Article 6; provided, however, that (a) if Licensee is the Party that controlled such action or proceeding, Licensor shall receive out of any such remaining recovery received by Licensee an amount equal to royalties payable hereunder by treating such remaining recovery as "Net Sales" hereunder and (b) if Licensor is the Party that controlled such action or proceeding, the remaining recovery received by Licensor shall be retained in full by Licensor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6<u>Cooperation</u>. Each Party agrees to cooperate in any action under this Article 6 which is controlled by the other Party, including joining such action as a party plaintiff if necessary or desirable for initiation or continuation of such action; provided that the controlling Party reimburses the cooperating Party promptly for any reasonable costs and expenses incurred by the cooperating Party in connection with providing such assistance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7<u>Patent Certifications</u>. Licensor shall notify and provide Licensee with copies of any allegations of alleged patent invalidity, unenforceability or non-infringement of a Patent Right pursuant to a Paragraph IV Patent Certification by a Third Party filing an Abbreviated New Drug Application, an application under §505(b)(2) or any other similar patent certification by a Third Party, and any foreign equivalent thereof. Such notification and copies shall be provided to Licensee within [\*\*\*] after Licensor receives such certification.

**Article 7<br>INDEMNIFICATION AND INSURANCE**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1<u>Indemnification By Licensee</u>. Licensee shall indemnify Licensor, its Affiliates, and their respective directors, officers, employees and agents (collectively, the "<u>Licensor Indemnitees</u>"), and defend and save each of them harmless, from and against any and all losses, damages, liabilities, costs

&nbsp;&nbsp;&nbsp;&nbsp;12

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and expenses (including reasonable attorneys' fees and expenses) (collectively, "<u>Losses</u>") in connection with any and all liability suits, investigations, claims or demands by Third Parties (collectively, "<u>Third Party Claims</u>") arising out of [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2<u>Indemnification by Licensor</u>. Licensor shall indemnify Licensee, its Affiliates and Sublicensees, and their respective directors, officers, employees and agents (collectively, the "<u>Licensee Indemnitees</u>"), and defend and hold each of them harmless, from and against any and all Losses in connection with any and all Third Party Claims to the extent arising from or occurring as a result of or in connection with [\*\*\*], except to the extent that such Losses arise out of or result from (i) the gross negligence or willful misconduct of a Licensee Indemnitee, or (ii) Licensee's breach of any obligation, representation, warranty or covenant in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3<u>Indemnification Procedure</u>. To be eligible to be indemnified as described in this Article 7, each of the indemnitees seeking to be indemnified shall provide the indemnifying Party with prompt notice of any claim (with a description of the claim and the nature and amount of any such loss) giving rise to the indemnification obligation pursuant to Section 7.1 or 7.2, as the case may be, and the exclusive ability to defend such claim (with the reasonable cooperation of the indemnitee(s)). Each indemnitee shall have the right to retain its own counsel, at its own expense, if representation by the counsel of the indemnifying Party would be inappropriate due to actual or potential differing interests between such indemnitee(s) and the indemnifying Party. Neither the indemnitee(s) nor the indemnifying Party shall settle or consent to the entry of any judgment with respect to any claim for losses for which indemnification is sought without the prior written consent of the other (not to be unreasonably withheld or delayed); provided however, that the indemnifying Party shall have the right to settle or compromise any claim for losses without such prior written consent if the settlement or compromise provides for a full and unconditional release of the indemnitee(s) and is not materially prejudicial to any indemnitee's rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4<u>Insurance</u>. Each Party shall have and maintain such types and amounts of liability insurance as is normal and customary in the industry generally for parties similarly situated and shall upon request provide the other Party with a copy of its policies of insurance in that regard, along with any amendments and revisions thereto.

**Article 8<br>REPRESENTATIONS, WARRANTIES AND COVENANTS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1<u>Representations and Warranties of the Parties</u>. Each of Licensee and Licensor hereby represents and warrants that, as of the Amended and Restated Agreement Effective Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Corporate Existence and Power</u>. It is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, and has full corporate power and authority and the legal right to own and operate its property and assets and to carry on its business as it is now being conducted and as contemplated by this Agreement, including the right to grant the rights granted hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Authority and Binding Agreement</u>. (i) It has the corporate power and authority and the legal right to enter into this Agreement and perform its obligations hereunder; (ii) it has taken all necessary corporate action required to authorize the execution and delivery of the Agreement and the performance of its obligations hereunder; and (iii) this Agreement has been duly executed and delivered on behalf of such Party, and constitutes a legal, valid and binding obligation of such Party that is enforceable against it in accordance with its terms.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Debarment</u>. It has not used prior to the Amended and Restated Agreement Effective Date and will not use, during the Term, any officer, director, employee, agent or independent contractor who has been debarred by any Regulatory Authority, or, to such Party's knowledge, is the subject of debarment proceedings by a Regulatory Authority. Upon request by a Party and subject to

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applicable laws, the other Party agrees to provide a list of persons, including such Party's officers, directors, employees, agents and independent contractors used to perform the services or work provided under any activities conducted for or on behalf of such Party or any of its Affiliates pursuant to this Agreement who, within the [\*\*\*] years preceding the Amended and Restated Agreement Effective Date, or subsequent to the Amended and Restated Agreement Effective Date, were or are convicted of one of the criminal offenses enumerated in section 306 of the United States Federal Food, Drug, and Cosmetic Act, 21 U.S.C. 301 et seq., or subject to similar sanction of any other Regulatory Authority.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2<u>Further Representations by Licensor</u>. Licensor hereby further represents, warrants and covenants (as applicable) as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Exhibit B</u>. <u>Exhibit B</u> accurately identifies all patents and patent applications Controlled by Licensor as of the Amended and Restated Agreement Effective Date that relate to the Licensed Compound, Licensed Know-How and/or are necessary or useful for the research, development, manufacture, use or sale of any Licensed Product.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Licensed IP</u>. As of the Amended and Restated Agreement Effective Date, (i) Licensor is the sole and exclusive owner of the entire rights, title and interest in and to all Licensed Patent Rights and Licensed Know-How within the Licensed IP free of any encumbrance, lien or claim of ownership by any Third Party, (ii) Licensor or its Affiliates have timely paid all filing and renewal fees payable with respect to the Licensed Patent Rights, and (iii) Licensor has complied with all applicable laws, including any duties of candor to applicable patent offices, in connection with the filing, prosecution and maintenance of the Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Sufficient Rights</u>. Licensor represents that it has the full and legal rights and authority to license the Licensed IP to Licensee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>No Conflict</u>. Licensor has not entered, and shall not enter, into any agreement with any Third Party that is in conflict with the rights granted to Licensee under this Agreement, and has not taken and shall not take any action that would in any way prevent it from granting the rights granted to Licensee under this Agreement, or that would otherwise materially conflict with or adversely affect the rights granted to Licensee under this Agreement. Its performance and execution of this Agreement does not and shall not result in a breach of any other contract to which it is a party. It is aware of no action, suit, inquiry or investigation instituted by any Third Party that threatens the validity of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>No Other Agreements</u>. There are no agreements (including any licenses), written or oral, granting any licenses or other rights to (or from) Licensor (or any of its Affiliates) relating to the Licensed IP, Licensed Compounds or Licensed Products, except for licenses granted to contract research organizations or contract manufacturing organizations operating on behalf of Licensor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>No Claims</u>. No Third Party has any license, option or other rights or interest in or to the Licensed IP. Licensee has not received, nor is aware, of any claims or allegations (including threatened interference actions or oppositions) that a Third Party has any right or interest in or to the Licensed IP or that any of the Licensed Patent Rights are invalid or unenforceable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)<u>Assignments</u>. As of the Amended and Restated Agreement Effective Date, Licensor has secured from all employees, consultants, contractors and other persons who have contributed to the creation or invention of any of the Licensed IP a written agreement assigning to Licensor all rights to such creations, inventions or Licensed IP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)<u>Validity and Enforceability</u>. Licensor is not aware of the existence of any facts that could form the basis for the invalidation or unenforceability of the Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)<u>Third-Party Activities</u>. As of the Amended and Restated Agreement Effective Date and to Licensor's knowledge, there are no activities by Third Parties that would constitute infringement or misappropriation of the Licensed IP (in the case of pending claims, evaluating them as if issued).

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j)<u>Third Party Intellectual Property</u>. To Licensor's knowledge as of the Amended and Restated Agreement Effective Date, no intellectual property rights of any Third Party were infringed or misappropriated during the creation of the Licensed IP or would be infringed or misappropriated by the practice of the Licensed IP.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k)<u>Inventors</u>. Licensor has obtained from all inventors of Licensed Patent Rights owned by Licensor valid and enforceable agreements assigning to Licensor each such inventor's entire right, title and interest in and to all such Licensed Patent Rights.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l)[\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m)<u>Further Assurances</u>. Licensor shall perform all acts reasonably requested by Licensee to assure that the Licensed IP shall be licensed to Licensee to the extent provided for herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3<u>Disclaimer of Warranties</u>. EXCEPT AS OTHERWISE BE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY OTHER WARRANTIES CONCERNING LICENSED IP OR ANY OTHER MATTER WHATSOEVER, INCLUDING ANY EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD-PARTY RIGHTS OR ARISING OUT OF COURSE OF CONDUCT OR TRADE CUSTOM OR USAGE, AND EACH PARTY DISCLAIMS ALL SUCH EXPRESS OR IMPLIED WARRANTIES.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4<u>Limitation of Liability</u>. EXCEPT WITH RESPECT TO A CLAIM FOR INDEMNIFICATION PURSUANT TO ARTICLE 7 OR A CLAIM FOR FRAUD OR WILLFUL MISCONDUCT, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY INDIRECT, SPECIAL, PUNITIVE, INCIDENTAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES (INCLUDING DAMAGES FOR LOSS OF PROFITS OR EXPECTED SAVINGS OR OTHER ECONOMIC LOSSES) ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ITS SUBJECT MATTER.

**Article 9<br>CONFIDENTIALITY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1<u>Definition</u>. During the Term and subject to the terms and conditions of this Agreement, a Party (a "<u>Disclosing Party</u>") may communicate to another Party (a "<u>Receiving Party</u>") information in connection with this Agreement or the performance of its obligations hereunder, whether in oral, written, graphic, or electronic form, which information may include scientific and manufacturing information and plans, marketing and business plans, and financial and personnel matters relating to a Party or its present or future products, sales, suppliers, customers, employees, investors or business (collectively, "<u>Confidential Information</u>"). For clarity, disclosures made under the Confidentiality Agreement prior to the Amended and Restated Agreement Effective Date are hereby deemed to have been made during the Term and are in all respects subject to this Article 9.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2<u>Exclusions</u>. Notwithstanding the foregoing, information of a Disclosing Party shall not be deemed Confidential Information with respect to a Receiving Party for purposes of this Agreement if such information:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)was already known to the Receiving Party or any of its Affiliates, other than under an obligation of confidentiality or non-use, at the time of disclosure by the Disclosing Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)was generally available or known to parties reasonably skilled in the field to which such information or know-how pertains, or was otherwise part of the public domain, at the time of its disclosure to the Receiving Party;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)became generally available or known to parties reasonably skilled in the field to which such information or know-how pertains, or otherwise became part of the public domain, after its disclosure to the Receiving Party through no fault of or breach of its obligations under this Article 9 by the Receiving Party;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)was disclosed to the Receiving Party other than under an obligation of confidentiality or non-use, by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)was independently discovered or developed by the Receiving Party or any of its Affiliates, as evidenced by their written records, without the use of, and by personnel who had no access to, Confidential Information of the Disclosing Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3<u>Disclosure and Use Restriction</u>. Except as expressly provided herein, the Parties agree that, during the Term and for [\*\*\*] years thereafter, the Receiving Party shall keep completely confidential and shall not publish or otherwise disclose to any Third Party and shall not use for any purpose except for the purposes contemplated by this Agreement any Confidential Information of the Disclosing Party. Further, neither Licensor nor its Affiliates will disclose to Third Parties any Confidential Information solely related to any Licensed Compound or Licensed Product, including a method of making or using the same, to any Third Party without the prior written consent of Licensee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.4<u>Authorized Disclosure.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Each Party may disclose Confidential Information of the other Party to the extent such disclosure is:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)reasonably necessary to prosecute or defend litigation with respect to this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)reasonably necessary to comply with applicable laws, governmental regulations or court orders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)reasonably necessary for the prosecution or enforcement of Patent Rights relating to Licensed Products or for regulatory filings for Licensed Products;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)in the case of Licensee as the disclosing Party, pursuant to Licensee's exercise of its license pursuant to Section 2.1;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)to such Party's officers, directors, employees, consultants, contractors, Affiliates, licensees, or Sublicensees who are bound by obligations of confidentiality and non-use at least equivalent in scope to those set forth in this Article 9; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)to existing or potential acquirers or merger candidates, investment bankers, existing or potential investors, venture capital firms or other financial institutions or investors for purposes of obtaining financing, each of whom prior to disclosure is bound by obligations of confidentiality and non-use at least equivalent in scope to those set forth in this Article 9 (but may be of shorter duration).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)In the event a Party is required to make a disclosure of the other Party's Confidential Information pursuant to Section 9.4(a) it shall, except where impracticable, give reasonable advance notice to the other Party of such disclosure and use commercially reasonable efforts to secure confidential treatment of such information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.5<u>Terms of Agreement</u>. The Parties agree that the terms of this Agreement are the Confidential Information of Licensee, subject to the special authorized disclosure provisions set forth in Section 9.4 and this Section 9.5. Notwithstanding the foregoing, a Party may make any filings of this Agreement or otherwise disclose the terms of this Agreement as required by law or regulation in any country so long as it uses its reasonable efforts to obtain confidential treatment for portions of this

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Agreement as available, consults with the other Party, and permits the other Party to participate, to the extent practicable, in seeking a protective order or other confidential treatment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.6<u>Return of Confidential Information</u>. Upon termination or expiration of this Agreement, or earlier if so agreed in writing by the Parties, the Receiving Party shall either return all copies of the Confidential Information it may have received or be deemed to have received from the other Party, or destroy in a secure manner all such copies of the Confidential Information if so instructed by the other Party except (a) to the extent of a continuing license in favor of the Licensee as the Receiving Party; and (b) for one (1) copy which may be retained for the purpose of establishing that Party's compliance with its obligations under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.7<u>Use of Name</u>. Neither Party may make public use of the other Party's name except (a) in connection with announcements and other permitted disclosures relating to this Agreement and the activities contemplated hereby, (b) as required by applicable laws, and (c) otherwise as agreed in writing by such other Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.8<u>Public Disclosures</u>. Licensor may not make any press release or public announcements regarding the Development or Exploitation of Licensed Products under this Agreement, without the prior written consent of Licensee. Neither Party shall have the right to make press releases or public announcements regarding this Agreement or the terms of this Agreement without the prior written consent of the other Party. Subject to the foregoing sentence, Licensee shall have the right to make press releases or public announcements regarding the Development and/or Exploitation of Licensed Products, and in connection with which acknowledge (subject to Section 9.7) that the Licensed Compounds and/or Licensed Products were licensed in from an unaffiliated entity, without the prior written consent of Licensor. In addition, Licensor acknowledges that Licensee intends to issue a press release including the terms of transaction following the Amended and Restated Agreement Effective Date and Licensor hereby consents to the issuance of such press release, including the use of Licensor's name in the press release.

**Article 10<br>TERMINATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1<u>Term</u>. The term of this Agreement shall commence on the Effective Date and, unless earlier terminated in accordance with this Article 10, shall remain in effect on a country-by-country and Licensed Product-by-Licensed Product basis until the expiration of the Royalty Term for such Licensed Product (the "<u>Term</u>"). The Term can be extended by Parties' mutual agreement. Upon expiration of this Agreement, [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2<u>Voluntary Termination by Licensee</u>. Licensee shall have the right to terminate this Agreement, for any reason, upon at least [\*\*\*] prior written notice to Licensor if such termination is to be effective [\*\*\*], such notice to state the date in the future upon which termination is to be effective, which date shall be after the minimum notice period as provided in this Section 10.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3<u>Termination for Material Breach.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Any material failure by a Party (the "<u>Breaching Party</u>") to comply with any of its material obligations contained in this Agreement (such failure, a "<u>Material Breach</u>") shall entitle the other Party (the "<u>Non-Breaching Party</u>") to give to the Breaching Party written notice specifying the nature of the Material Breach, requiring the Breaching Party to cure such Material Breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)If such Material Breach is not cured within [\*\*\*] after the receipt of notice pursuant to Section 10.3(a) above, the Non-Breaching Party shall be entitled to terminate this Agreement on written notice to the Breaching Party and without prejudice to any of its other rights conferred on it by this Agreement; provided that if a Material Breach (other than for non-payment) cannot reasonably be cured within such [\*\*\*] period and the Breaching Party promptly delivers a plan to cure such Material

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Breach (reasonably acceptable to the Non-Breaching Party) and uses commercially reasonable efforts to implement such plan, then the cure period shall be extended for so long as the Breaching Party is using commercially reasonable efforts to cure such Material Breach (up to a maximum cure period of one hundred [\*\*\*] from the date of initial notice); further provided, however, if a Material Breach by Licensee arises as a result of a breach by a Sublicensee of the terms of a sublicense, Licensee shall have [\*\*\*] to cure such Material Breach, which cure will be deemed achieved by the termination of such sublicense; provided, moreover, that if the Breaching Party disputes the existence of a Material Breach, the matter shall be submitted for resolution in accordance with Article 11, and the Breaching Party shall not have the right to terminate this Agreement unless and until a final decision of Material Breach is rendered under Article 11 and the Breaching Party fails to cure such Material Breach within [\*\*\*] thereafter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4<u>Effect of Expiration or Termination.</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Survival</u>. The following provisions shall survive the expiration or termination of this Agreement: Article 1, Article 7, Article 8, Article 9, Article 11 and Article 12, and Section 2.1(a) (subject to Section 10.1 (the last sentence)), Section 5.1, Section 10.4, Section 10.5 and Section 10.6.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Survival of Certain Sublicenses</u>. Upon termination of this Agreement by Licensor pursuant to Section 10.3, upon Licensee's request, any sublicense granted by Licensee shall survive and shall automatically be assigned by Licensee to Licensor such that such sublicense becomes a direct license between Licensor and the applicable Sublicensee on the same terms and conditions as those set forth in this Agreement, to the extent applicable to the rights granted by Licensee to such Sublicensee, provided that such sublicense was granted in accordance with the terms of Section 2.2 and that such Sublicensee is in compliance with the terms of the sublicense agreement and agrees to comply with all applicable terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Inventory</u>. Upon the early termination of this Agreement, Licensee and its Affiliates and Sublicensees may complete and sell any work-in-progress and inventory of Licensed Products that exist as of the effective date of termination, provided that (i) Licensee pays Licensor the applicable running royalty or other amounts due on such sales of Licensed Products in accordance with the terms and conditions of this Agreement, and (ii) Licensee and its Affiliates and Sublicensees shall complete and sell all work-in-progress and inventory of Licensed Products within [\*\*\*] after the effective date of termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Option to Continue In-Lieu of Termination for Licensor Material Breach</u>. If Licensee has the right to terminate this Agreement under Section 10.3 as a result of any uncured Material Breach, it may elect (at its sole discretion) not to exercise such termination right, in which case this Agreement shall continue in full force and effect, except as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)Each milestone payment, royalty payment or Sublicensee net revenue sharing payment under Sections 4.1(b), 4.1(c) and 4.1(d) respectively that become due thereafter shall be reduced by [\*\*\*] after applying all applicable deductions and reductions to such payments permitted under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)The Parties acknowledge and agree that the remedies set forth in this Section 10.4(d) are reasonable remedies, in lieu of Licensee's exercise of its termination right, for the occurrence of any of the circumstances for which Licensee has the right to terminate this Agreement under Section 10.3. If Licensee elects to accept the remedies set forth in this Section 10.4(d) in lieu of its exercise of its termination right, such remedies shall be Licensee's sole remedy for Licensor's Material Breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)Expiration or termination of this Agreement for any reason shall not relieve either Party of any liability or obligation which accrued hereunder prior to the effective date of such termination or expiration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5<u>Reversion</u>.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Notice</u>. Within [\*\*\*] following the effective date of termination of this Agreement by Licensee pursuant to Section 10.2 or Section 10.3 Licensor may provide written notice to Licensee that Licensor desires to have all or any portion of this Section 10.5 apply (the "<u>Reversion Notice</u>"). Effective upon receipt of such Reversion Notice (such date, the "<u>Reversion Date</u>") then the corresponding provisions of this Section 10.5 apply with respect to all Licensed Product.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Reversion Rights</u>. Licensee hereby (i) grants to Licensor a worldwide, exclusive, transferable, royalty-bearing license (with rights to sublicense through multiple tiers), under all Patent Rights arising under Section 5.1 Controlled by Licensee or its Affiliates as of the effective date of termination that are directed specifically to the Licensed Product, (ii) grants to Licensor a non-exclusive, worldwide, royalty-bearing license (with rights to sublicense through multiple tiers) under all know-how arising under Section 5.1 Controlled by Licensee or its Affiliates as of the effective date of termination that is necessary or reasonably useful to Exploit the Licensed Product, and (iii) effective as of the Reversion Date, [\*\*\*] (collectively, the "<u>Reversion IP</u>"), subject to a commercially reasonable reversion royalty in the Field in the Territory, in each case (i) and (ii), to Exploit the Licensed Product; provided that, as a condition to the grant of any license to Licensor under any Reversion IP that is Controlled but not owned by Licensee or its Affiliates, Licensor shall agree in writing to (A) comply with any Third Party agreement that provides Licensee or its Affiliates the right to grant such license and (B) make any payments due to any Third Party under such Third Party agreement that arise from Licensor's practice of such Reversion IP in connection with the Licensed Product. If requested by Licensor, the Parties will discuss in good faith the possibility of including in such Reversion IP rights to a Combination Product. Sections 4.1(c), 4.1(d), 4.1(e), 4.1(f) and 4.2 shall apply mutatis mutandis to such reversion royalty in the reversion license. The Parties shall promptly negotiate towards a reversion license agreement containing such a license grant to the foregoing Reversion IP, the reversion royalty rate and royalty terms described in the immediately prior sentence, and access to or an assignment of other rights, data, and materials as are reasonably necessary to permit Licensor to exploit the Licensed Product in the Field in the Territory. [\*\*\*].

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6<u>Rights in Bankruptcy</u>. All rights and licenses granted under or pursuant to this Agreement by Licensor are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of right to "intellectual property" as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that Licensee shall retain and may fully exercise all of its rights and elections under the U.S. Bankruptcy Code. The Parties further agree that, in the event of the commencement of any proceeding relating to bankruptcy, insolvency, receivership, arrangement, liquidation or dissolution with respect to Licensor and/or the debts of the Licensor under any existing or future law of any jurisdiction, including but not limited to the U.S. Bankruptcy Code and/or Cayman Islands law, Licensee shall be entitled to a complete duplicate of (or complete access to, as appropriate) any intellectual property licensed to Licensee and all embodiments of such intellectual property, which, if not already in Licensee's possession, shall be promptly delivered to it (a) upon any such commencement of a bankruptcy proceeding upon Licensee's written request therefor, unless Licensor elects to continue to perform all of its obligations under this Agreement or (b) if not delivered under clause (a), following the rejection of this Agreement by Licensor upon written request therefor by Licensee.

**Article 11<br>DISPUTE RESOLUTION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1<u>Mandatory Procedures</u>. The Parties agree that any dispute arising out of or relating to this Agreement shall be resolved solely by means of the procedures set forth in this Article 11, and that such procedures constitute legally binding obligations that are an essential provision of this Agreement. If either Party fails to observe the procedures of this Article 11, as may be modified by their written agreement, the other Party may bring an action for specific performance of these procedures in any court of competent jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;19

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2<u>Equitable Remedies</u>. Although the procedures specified in this Article 11 are the sole and exclusive procedures for the resolution of disputes arising out of or relating to this Agreement, either Party may seek a preliminary injunction or other provisional equitable relief if, in its reasonable judgment, such action is necessary to avoid irreparable harm to itself or to preserve its rights under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3<u>Dispute Resolution Procedures</u>. Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be settled by binding confidential arbitration in accordance with the International Chamber of Commerce ("<u>ICC</u>") Arbitration Rules, and the procedures set forth below. In the event of any inconsistency between the ICC Arbitration Rules and the procedures set forth below, the procedures set forth below shall control. Judgment upon the award rendered by the arbitrators may be enforced in any court having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)The location of the arbitration shall be in New York City, New York. Licensor and Licensee hereby irrevocably submit to the exclusive jurisdiction and venue of the ICC International Court of Arbitration panel selected by the Parties and located in New York City, New York, for any dispute regarding this Agreement, and to the exclusive jurisdiction and venue of the federal and state courts located in the State of New York for any action or proceeding to enforce an arbitration award or as otherwise provided in Section 11.3(e), and waive any right to contest or otherwise object to such jurisdiction or venue.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)The arbitration shall be conducted by a panel of three (3) neutral arbitrators who are independent and disinterested with respect to the Parties, this Agreement, and the outcome of the arbitration. Each Party shall appoint one (1) neutral arbitrator, and these two arbitrators so selected by the Parties shall then select the third (3<sup>rd</sup>) arbitrator, and all arbitrators must have at least [\*\*\*] years' experience in mediating or arbitrating cases regarding the same or substantially similar subject matter as the dispute between Licensor and Licensee. If one Party has given written notice to the other Party as to the identity of the arbitrator appointed by the Party, and the Party thereafter makes a written demand on the other Party to appoint its designated arbitrator within the next [\*\*\*], and the other Party fails to appoint its designated arbitrator within [\*\*\*] after receiving said written demand, then the arbitrator who has already been designated shall appoint the other two (2) arbitrators.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)The arbitrators shall decide any disputes and shall control the process concerning these pre-hearing discovery matters. Pursuant to the Rules of ICC, the Parties may subpoena witnesses and documents for presentation at the hearing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Prompt resolution of any dispute is important to both Parties; and the Parties agree that the arbitration of any dispute shall be conducted expeditiously. The arbitrators are instructed and directed to assume case management initiative and control over the arbitration process (including scheduling of events, pre-hearing discovery and activities, and the conduct of the hearing), in order to complete the arbitration as expeditiously as is reasonably practical for obtaining a just resolution of the dispute.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)The arbitrators may grant any legal or equitable remedy or relief that the arbitrators deem just and equitable, to the same extent that remedies or relief could be granted by a state or federal court, provided however, that no punitive damages may be awarded. No court action shall be maintained seeking punitive damages. The decision of any two (2) of the three (3) arbitrators appointed shall be binding upon the Parties. Notwithstanding anything to the contrary in this Agreement, prior to or while an arbitration proceeding is pending, either Party has the right to seek and obtain injunctive and other equitable relief from a court of competent jurisdiction to enforce that Party's rights hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)The expenses of the arbitration, including the arbitrators' fees, expert witness fees, and attorney's fees, may be awarded to the prevailing Party, in the discretion of the arbitrators, or may be apportioned between the Parties in any manner deemed appropriate by the arbitrators. Unless and until the arbitrators decide that one Party is to pay for all (or a share) of such expenses, both Parties shall share equally in the payment of the arbitrators' fees as and when billed by the arbitrators.

&nbsp;&nbsp;&nbsp;&nbsp;20

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)Notwithstanding the foregoing, any disputes arising hereunder with respect to the inventorship, validity, enforceability or other aspect of intellectual property rights shall be resolved by a court of competent jurisdiction and not by arbitration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)Except as set forth below and as necessary to obtain or enforce a judgment upon any arbitration award, the Parties shall keep confidential the fact of the arbitration, the dispute being arbitrated, and the decision of the arbitrators. Notwithstanding the foregoing, the Parties may disclose information about the arbitration to persons who have a need to know, such as directors, trustees, management employees, witnesses, experts, investors, attorneys, lenders, insurers, actual or potential collaborators or corporate partners of Licensee, actual or potential acquirors of Licensee, and others who may be directly affected provided that such persons are bound to keep such information confidential. Additionally, if a Party has stock which is publicly traded, the Party may make such disclosures as are required by applicable securities laws, but shall use commercially reasonably efforts to seek confidential treatment for such disclosure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4<u>Performance to Continue</u>. Each Party shall continue to perform its undisputed obligations under this Agreement pending final resolution of any dispute arising out of or relating to this Agreement; provided, however, that a Party may suspend performance of its undisputed obligations during any period in which the other Party fails or refuses to perform its undisputed obligations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.5<u>Statute of Limitations</u>. The Parties agree that all applicable statutes of limitation and time-based defenses (such as estoppel and laches) shall be tolled while the procedures set forth in Section 11.3 are pending. The Parties shall cooperate in taking any actions necessary to achieve this result.

**Article 12<br>MISCELLANEOUS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1<u>Notice</u>. Any notices required or permitted under this Agreement shall be in writing, shall specifically refer to this Agreement, and shall be sent by hand, recognized national overnight courier, confirmed facsimile transmission, confirmed electronic mail, or registered or certified mail, postage prepaid, return receipt requested, to the following addresses or facsimile numbers of the Parties:

&nbsp;&nbsp;&nbsp;&nbsp;If to Licensor:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;XWPharma Limited

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

[\*\*\*]

Attention: [\*\*\*]

Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;

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

Cooley LLP

55 Hudson Yards

New York, NY 10001-2157

Attention: [\*\*\*]<br>Email: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;21

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&nbsp;&nbsp;&nbsp;&nbsp;If to Licensee:

Flamel Ireland Limited

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10 Earlsfort Terrace

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dublin 2

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D02 T380 Ireland

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Attention: [\*\*\*]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fax: <u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>

<u>With email copy to</u>: [\*\*\*]

All notices under this Agreement shall be deemed effective upon receipt. A Party may change its contact information immediately upon written notice to the other Party in the manner provided in this Section 12.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2<u>Governing Law</u>. This Agreement and all disputes arising out of or related to this Agreement, or the performance, enforcement, breach or termination hereof, and any remedies relating thereto, shall be construed, governed, interpreted and applied in accordance with the laws of the State of New York, without regard to conflict of laws principles, except that questions affecting the construction and effect of any patent shall be determined by the law of the country in which the patent shall have been granted. The United Nations Convention on Contracts for the International Sale of Goods shall not apply to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.3<u>Assignment</u>. Without the prior written consent of the other Party hereto (which may be granted at the other Party's discretion), neither Party shall sell, transfer, assign, delegate, pledge or otherwise dispose of, whether voluntarily, involuntarily, by operation of law or otherwise, this Agreement or any of its rights or duties hereunder; provided, however, that each Party may assign or transfer this Agreement or any of its rights or obligations hereunder without the consent of the other Party (a) to any Affiliate of the assigning Party; or (b) to any Third Party in connection with a change of control, merger, consolidation, stock sale or sale or transfer of all or substantially all of the Party's assets to which this Agreement relates, or other similar transaction or series of transactions. Any purported assignment or transfer in violation of this Section 12.3 shall be void *ab initio* and of no force or effect. Any permitted assignee shall assume all assigned obligations of its assignor under this Agreement. The terms and conditions of this Agreement shall be binding upon, and shall inure to the benefit of, the Parties and their respected successors and permitted assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.4<u>Performance by Affiliates</u>. Each Party may discharge any obligations and exercise any right hereunder through any of its Affiliates. Each Party hereby guarantees the performance by its Affiliates of such Party's obligations under this Agreement, and shall cause its Affiliates to comply with the provisions of this Agreement in connection with such performance. Any breach by a Party's Affiliate of any of such Party's obligations under this Agreement shall be deemed a breach by such Party, and the other Party may proceed directly against such Party without any obligation to first proceed against such Party's Affiliate. Further, upon written request by Licensee, a separate agreement shall be created and signed between the Parties and such Affiliate to address any tax or other corporate needs of Licensee; provided that, any such agreement is substantially consistent with the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.5<u>Force Majeure</u>. Neither Party shall be responsible for delays resulting from causes beyond the reasonable control of such Party, including fire, explosion, flood, war, strike, or riot, provided that the nonperforming Party uses commercially reasonable efforts to avoid or remove such causes of nonperformance and continues performance under this Agreement with reasonable dispatch whenever such causes are removed.

&nbsp;&nbsp;&nbsp;&nbsp;22

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.6<u>Amendment and Waiver</u>. This Agreement may be amended, supplemented, or otherwise modified only by means of a written instrument signed by both Parties. Any waiver of any rights or failure to act in a specific instance shall relate only to such instance and shall not be construed as an agreement to waive any rights or fail to act in any other instance, whether or not similar.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.7<u>Severability</u>. In the event that any provision of this Agreement shall be held invalid or unenforceable for any reason, such invalidity or unenforceability shall not affect any other provision of this Agreement, and the Parties shall negotiate in good faith to modify the Agreement to preserve (to the extent possible) their original intent. If the Parties fail to reach a modified agreement within [\*\*\*] after the relevant provision is held invalid or unenforceable, then the dispute shall be resolved in accordance with the procedures set forth in Article 11. While the dispute is pending resolution, this Agreement shall be construed as if such provision were deleted by agreement of the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.8<u>Relationship of Parties</u>. Nothing in this Agreement is intended or shall be deemed to constitute a partnership, agency, employer-employee or joint venture relationship between the Parties. No Party shall incur any debts or make any commitments for the other, except to the extent, if at all, specifically provided herein. Except under Sections 7.1 and 7.2, there are no express or implied third party beneficiaries hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.9<u>Binding Effect</u>. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective legal representatives, successors and assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.10<u>Counterparts; Facsimiles</u>. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and all of which together shall be deemed to be one and the same instrument. Facsimile or PDF execution and delivery of this Agreement by either Party shall constitute a legal, valid and binding execution and delivery of this Agreement by such Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.11<u>Headings</u>. All headings are for convenience only and shall not affect the meaning of any provision of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.12<u>Interpretation</u>. The captions and headings to this Agreement are for convenience only and are to be of no force or effect in construing or interpreting any of the provisions of this Agreement. Unless specified to the contrary, references to Articles, Sections or Exhibits mean the particular Articles, Sections or Exhibits to this Agreement and references to this Agreement include all Exhibits hereto. Unless context otherwise clearly requires, whenever used in this Agreement: (a) the words "include" or "including" shall be construed as incorporating, also, "but not limited to" or "without limitation;" (b) the word "day" or "year" means a calendar day or year unless otherwise specified; (c) the word "notice" means notice in writing (whether or not specifically stated) and shall include notices, consents, approvals and other written communications contemplated under this Agreement; (d) the words "hereof," "herein," "hereby" and derivative or similar words refer to this Agreement (including any Exhibits); (e) the word "or" shall be construed as the inclusive meaning identified with the phrase "and/or;" (f) provisions that require that a Party or the Parties hereunder "agree," "consent" or "approve" or the like shall require that such agreement, consent or approval be specific and in writing, whether by written agreement, letter or otherwise; (g) words of any gender include the other gender; (h) words using the singular or plural number also include the plural or singular number, respectively; and (i) the word "law" (or "laws") when used herein means any applicable, legally binding statute, ordinance, resolution, regulation, code, guideline, rule, order, decree, judgment, injunction, mandate or other legally binding requirement of a government entity, together with any then-current modification, amendment and re-enactment thereof, and any legislative provision substituted therefor.

&nbsp;&nbsp;&nbsp;&nbsp;23

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.13<u>Entire Agreement</u>. This Agreement constitutes the entire agreement between the Parties with respect to its subject matter and, as of the Amended and Restated Agreement Effective Date, supersedes all prior agreements or understandings between the Parties relating to its subject matter, whether oral or written, regarding such subject matter, including the Confidentiality Agreement and the Original Agreement. For clarity, this Agreement has been executed by the Parties as of the Amended and Restated Agreement Effective Date, with the Parties' mutual intent that on the Amended and Restated Agreement Effective Date, the Original Agreement shall be amended and restated in its entirety by this Agreement. For further clarity, the terms and conditions of the Original Agreement apply to the period between the Effective Date and the Amended and Restated Agreement Effective Date. Except as specified herein, no waiver, modification or amendment of any provision of this Agreement shall be valid or effective unless made in a writing referencing this Agreement and signed by a duly authorized officer of each Party.

[*remainder of this page intentionally left blank*]

&nbsp;&nbsp;&nbsp;&nbsp;24

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives.

XWPharma Limited&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Flamel Ireland Limited

By:<u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ James Huang&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>&nbsp;&nbsp;&nbsp;&nbsp;By:<u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Rosemarie Tully&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>

Name: <u>James Huang&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>&nbsp;&nbsp;&nbsp;&nbsp;Name: <u>&nbsp;&nbsp;&nbsp;&nbsp;Rosemarie Tully&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>

Title: <u>Executive Chairman&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>&nbsp;&nbsp;&nbsp;&nbsp;Title: <u>President&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>

------

EXHIBIT A

LICENSED COMPOUND

[\*\*\*]

------

EXHIBIT B

PATENT RIGHTS

[\*\*\*]

------

EXHIBIT C

LICENSED KNOW-HOW

[\*\*\*]

------

EXHIBIT D

QUANTITIES OF LICENSED COMPOUNDS TO BE TRANSFERRED

[\*\*\*]

------

EXHIBIT E

MANUFACTURING TECHNOLOGY TRANSFER

[\*\*\*]

## Exhibit 10.3

**Exhibit 10.3**

**<u>SETTLEMENT AND LICENSE AGREEMENT</u>**

This SETTLEMENT AND LICENSE AGREEMENT (this "**Agreement**"), dated as of this 21<sup>st</sup> day of October, 2025 (the "**Effective Date**"), is hereby entered into by and between Jazz Pharmaceuticals, Inc. and Jazz Pharmaceuticals Ireland Limited (collectively, "**Jazz**"), on the one hand, and Avadel CNS Pharmaceuticals LLC and Flamel Ireland Limited (collectively, "**Avadel**"), on the other hand. Jazz and Avadel are each referred to herein individually as a "**Party**" and collectively as the "**Parties**."

**WHEREAS**, Jazz and Avadel are engaged in the Lawsuits (as defined herein);

**WHEREAS**, Jazz and Avadel wish to fully settle the Lawsuits upon and subject to the terms and conditions set forth herein;

**WHEREAS**, settlement of the Lawsuits will help Jazz and Avadel avoid the uncertainty and risk of prolonged litigation, permit Jazz and Avadel to save litigation costs, and permit the management of Jazz and Avadel to focus on managing and operating their respective companies, rather than devoting substantial time and resources to the Lawsuits.

**NOW, THEREFORE**, in consideration of the mutual promises, agreements, and covenants hereinafter set forth, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

**Section 1– DEFINITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1"**Affiliate**" means, as to an entity, another entity that, directly or indirectly, Controls, is Controlled by or is under common Control with such entity, where "**Control,**" for purposes of this definition of Affiliate, means ownership of more than fifty percent (50%) of the outstanding shares or securities representing the right to vote for the election of directors or other managing authority of such entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2"**Attributable**" means, with respect to a dispensed prescription of Avadel Licensed Products, the "Indication for Use" marked on the prescription form for Avadel Licensed Products, or, should the prescription form be modified in the future to no longer specify such information, such other data source relied upon by Avadel in the ordinary course of business to identify the indication for use.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3"**Avadel Licensed Patents**" means (i) the patents asserted against Jazz in the Lawsuits, (ii) any past, present, or future patents or patent applications owned or otherwise controlled by Avadel or its Affiliates that have been or could be asserted against Jazz Licensed Products, and (iii) any Family Members of any of the patents and patent applications covered by (i) or (ii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4"**Avadel Licensed Products**" means (i) LUMRYZ, including all present and future indications, strengths, conditions of use, dosages, doses, dosage forms, and presentations

**1**

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(i.e., packaging) of LUMRYZ, (ii) the products that are the subject of NDA No. 214755, including all amendments and supplements thereto, and (iii) foreign counterparts or equivalents to the products covered by (i) and (ii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5"**Business Day**" means any calendar day other than Saturday, Sunday, or a United States federal holiday.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6"**Calendar Quarter**" means the three (3)-month period ending on the last day of March, June, September, or December of each Calendar Year; provided, however, that the final Calendar Quarter shall end on (and include) February 18, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7"**Calendar Year**" means each period of twelve (12) months commencing on January 1 and ending on December 31; provided, however, that the final Calendar Year shall end on (and include) February 18, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8"**Family Members**" means, in respect of a patent or patent application, all patents and patent applications having any common claim of priority with such patent or patent application and all patents and patent applications that claim priority to such patent or patent application (including existing and future reissue, re-examination, continuation, continuation-in part, and divisional patents and patent applications) and all patents issuing from any of the foregoing, including any foreign counterparts, whether filed before, on, or after the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9"**FDA**" means the U.S. Food and Drug Administration, or any successor agency thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10"**FD&C Act**" means the U.S. Federal Food, Drug, and Cosmetic Act (21 U.S.C. §301, et seq.), including any amendments or supplements thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11"**First Non-Narcolepsy Royalty Term**" means the period commencing on October 1, 2025, and continuing through and including February 29, 2028.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12"**GAAP**" means generally accepted accounting principles in the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13"**Jazz Licensed Patents**" means (i) the patents asserted against Avadel in the Lawsuits, (ii) any past, present, or future patents or patent applications owned or otherwise controlled by Jazz or its Affiliates that have been or could be asserted against Avadel Licensed Products, and (iii) any Family Members of any of the patents and patent applications covered by (i) or (ii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14"**Jazz Licensed Products**" means (i) XYWAV and XYREM, including all present and future indications, strengths, conditions of use, dosages, doses, dosage forms, and presentations (i.e., packaging) of XYWAV and XYREM, (ii) the products that are the subject of NDA Nos. 021196 or 212690, including all amendments and supplements thereto, and (iii) foreign counterparts or equivalents to the products covered by (i) and (ii).

**2**

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15"**Lawsuits**" means the following cases: *Jazz Pharmaceuticals, Inc. v. Avadel CNS Pharmaceuticals, LLC*, C.A. No. 21-691; *Jazz Pharmaceuticals, Inc. et al v. Avadel CNS Pharmaceuticals, LLC*, C.A. No. 21-1138; *Jazz Pharmaceuticals, Inc. et al v. Avadel CNS Pharmaceuticals, LLC*, C.A. No. 21-1594; *Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al*, C.A. No. 22-487; *Avadel CNS Pharmaceuticals, LLC v. Jazz Pharmaceuticals, Inc.*, C.A. No. 22-941; *Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc., et al*, C.A. No. 25-09; *Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al*, C.A. No. 25-57; *Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc., et al*, C.A. No. 25-221; and *Avadel CNS Pharmaceuticals, LLC et al v. Jazz Pharmaceuticals, Inc. et al*, C.A. No. 25-435, each brought in the United States District Court for the District of Delaware (the "**Court**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16"**Narcolepsy Indications**" means those indications for which Avadel Licensed Products are approved by the FDA as of the Effective Date, including specifically "for the treatment of cataplexy or excessive daytime sleepiness (EDS) in patients 7 years of age and older with narcolepsy."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17"**Narcolepsy Royalty Term**" means the period commencing on October 1, 2025, and continuing through and including February 18, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18"**NDA**" means a "New Drug Application" submitted to the FDA under FD&C Act Section 505(b) and applicable regulations promulgated thereunder by the FDA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19"**Net Sales**" means the gross amount invoiced on all sales of Avadel Licensed Products by Avadel and, as applicable, its Affiliates to Third Parties less deductions taken in the ordinary course of business as permitted in calculating net sales or net revenue (as applicable) under GAAP (existing at the time Net Sales is calculated) consistently applied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.20"**Non-Narcolepsy Indications**" means any indication or use, other than Narcolepsy Indications, for which the Avadel Licensed Products are prescribed or dispensed, including any indications related to idiopathic hypersomnia, regardless of whether the Avadel Licensed Products are approved for any such indications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.21"**Orphan Drug Exclusivity**" means the seven (7)-year period during which, as provided for by FD&C Act Section 527, the FDA is prohibited from approving another product that is the "same drug," as that term is defined in 21 CFR 316.3(b)(14), as a previously approved drug for a rare disease or condition.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.22"**Person**" means any individual, partnership, association, corporation, limited liability company, trust, or other legal person or entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.23"**Second Non-Narcolepsy Royalty Term**" means the period commencing on March 1, 2028, and continuing through and including February 18, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.24"**Territory**" means worldwide.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.25"**Third Party**" means any Person other than a Party or its Affiliates.

**Section 2– STIPULATIONS; SETTLEMENT; RELEASES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1<u>Settlement Payment</u>. Within three (3) Business Days of (i) the Effective Date, or (ii) Jazz's receipt from Avadel of wire-transfer instructions and other documentation reasonably required by Jazz, whichever is later, Jazz Pharmaceuticals Ireland Limited shall transfer to the account designated by Avadel the total sum of ninety million U.S. dollars ($90,000,000.00) (the "**Settlement Payment**") as directed in the wire-transfer instructions. The Settlement Payment is non-refundable and non-creditable, and along with the rights granted herein by Avadel and Jazz, represents consideration hereunder for the compromise and release of all Avadel Released Claims which Avadel or any of the other Avadel Releasors may have against any of the Jazz Released Parties, including claims for alleged lost revenue associated with delayed approval by the FDA, alleged misappropriation of trade secrets, and alleged patent infringement, in each case in the manner set forth, and as those terms are defined, herein. Upon the transfer of the Settlement Payment into the designated account, Avadel shall be deemed to have received such funds and Avadel acknowledges that upon such receipt Jazz shall have made a good faith, full, and valid discharge of its payment obligations pursuant to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2<u>Dismissal of Lawsuits</u>. Within five (5) Business Days after receipt of the Settlement Payment pursuant to Section 2.1, Jazz and Avadel will work together to coordinate their respective, simultaneous filing of the necessary papers and documentation with the Court, and take such other actions as needed, to have the Lawsuits, including all counterclaims and defenses, dismissed with prejudice, and with each Party bearing its own attorneys' fees, costs, and expenses. Specifically, the Parties shall submit and file the stipulated dismissals attached hereto as Exhibit A. The date upon which the Court signs the last of all such dismissals shall be the "**Dismissal Effective Date**." If for any reason the Court rejects or otherwise resists any dismissal with prejudice proposed by the Parties, the Parties agree to confer promptly in good faith in an effort to modify such pleadings and do whatever else is necessary and appropriate to overcome any objections by the Court which shall approximate as closely as possible the purpose of this Agreement. Jazz represents that it will not petition for certiorari in *Jazz Pharms., Inc. v. Kennedy*, No. 25A304 (S. Ct.).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3<u>Releases</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Avadel Release</u>. Effective upon Jazz's transfer of the Settlement Payment pursuant to Section 2.1, Avadel, acting on behalf of itself, its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, Affiliates, and assigns, and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them ("**Avadel Releasors**"), hereby absolutely, fully, and forever release, relieve, acquit, waive, relinquish, and discharge Jazz, and each of its current and former parents, subsidiaries, Affiliates, insurers, and each of their respective present and past officers, directors, equity holders, managers, members, agents,

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servants, employees, representatives, predecessors, successors, assigns, and attorneys ("**Jazz Released Parties**"), of and from any and all claims, counterclaims, demands, obligations, actions, causes of action, damages, costs, attorneys' fees, losses, suits, judgments, and liabilities of any kind or nature whatsoever, whether based on a tort, contract, or other theory of recovery, whether known or unknown, liquidated or unliquidated, contingent or determined, direct or indirect, in law or in equity, accrued or unaccrued, based on activities on or before the Effective Date, to the extent that they relate to: (i) the Lawsuits, including but not limited to any claims, counterclaims, or defenses asserted, or that could have been asserted, in the Lawsuits; (ii) the manufacture, use, distribution, development, offer for sale, sale, or import of the Jazz Licensed Products by or on behalf of Jazz or any of its Affiliates, including but not limited to any claims for infringement of any of the Avadel Licensed Patents; and (iii) all past, present, and future claims arising from or relating to any alleged misappropriation, possession, acquisition, or use, of any alleged trade secret of Avadel that was asserted or could have been asserted in the Lawsuits ("**Avadel Released Claims**"). For the avoidance of doubt, the foregoing waiver and release does not apply to any claim for breach or enforcement of this Agreement.

Avadel hereby covenants and agrees that, to the full extent permitted by law, neither it nor any Avadel Releasor shall sue or otherwise seek to establish or to impose liability based, in whole or in part, on any Avadel Released Claim against any Jazz Released Party. Avadel also covenants and represents that no Avadel Releasor shall sue or otherwise seek to establish or to impose liability relating to any Avadel Released Claim against any of the Jazz Released Parties. Avadel also covenants and represents that, to the full extent permitted by law, no Avadel Releasor will assist or cooperate with any person or entity in seeking to establish or to impose liability based, in whole or in part, on any Avadel Released Claim against any of the Jazz Released Parties. Avadel agrees that its covenant not to sue Jazz in this paragraph encompasses any past, present, or future claim with respect to the alleged misappropriation, possession, acquisition, or use of any trade secret falling within the scope of any Avadel Released Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Jazz Release</u>. Effective upon the Dismissal Effective Date, Jazz, acting on behalf of itself, its predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, Affiliates, and assigns, and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them ("**Jazz Releasors**"), hereby absolutely, fully, and forever release, relieve, acquit, waive, relinquish, and discharge Avadel, and each of its current and former parents, subsidiaries, Affiliates, insurers, and each of their respective present and past officers, directors, equity holders, managers, members, agents, servants, employees, representatives, predecessors, successors, assigns, and attorneys ("**Avadel Released Parties**"), of and from any and all claims, counterclaims, demands, obligations, actions, causes of action, damages, costs, attorneys' fees, losses, suits, judgments, and liabilities of any kind or nature whatsoever, whether based on a tort, contract, or other theory of recovery, whether known or unknown, liquidated or unliquidated, contingent or determined, direct or indirect, in law or in equity, accrued or unaccrued, based on activities on or before the Effective Date, to the extent that they relate to: (i) the Lawsuits, including but not limited to any claims, counterclaims, or defenses asserted, or that could have

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been asserted, in the Lawsuits; (ii) the manufacture, use, distribution, development, offer for sale, sale, or import of the Avadel Licensed Products by or on behalf of Avadel or any of its Affiliates, including but not limited to any claims for infringement of any of the Jazz Licensed Patents; and (iii) all past, present and future claims arising from or relating to any alleged misappropriation, possession, acquisition or use, of any alleged trade secret of Jazz that could have been asserted in the Lawsuits ("**Jazz Released Claims**"). Without limiting the foregoing, Jazz hereby waives, forgives, and/or discharges any and all royalty obligations of Avadel for sales of the Avadel Licensed Products from launch through September 30, 2025. For the avoidance of doubt, the foregoing waiver and release does not apply to any claim for breach or enforcement of this Agreement.

Jazz hereby covenants and agrees that, to the full extent permitted by law, neither it nor any Jazz Releasor shall sue or otherwise seek to establish or to impose liability based, in whole or in part, on any Jazz Released Claim against any Avadel Released Party. Jazz also covenants and represents that no Jazz Releasor shall sue or otherwise seek to establish or to impose liability relating to any Jazz Released Claim against any of the Avadel Released Parties. Jazz also covenants and represents that, to the full extent permitted by law, no Jazz Releasor will assist or cooperate with any person or entity in seeking to establish or to impose liability based, in whole or in part, on any Jazz Released Claim against any of the Avadel Released Parties. Jazz agrees that its covenant not to sue Avadel in this paragraph encompasses any past, present, or future claim with respect to the alleged misappropriation, possession, acquisition, or use of any trade secret falling within the scope of any Jazz Released Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4<u>Waiver of Right to Assert Unknown Claims</u>: The releases in Section 2.3 include an express, informed, knowing, and voluntary waiver and relinquishment to the fullest extent permitted by law. The Parties acknowledge they may have sustained damages, losses, costs, or expenses presently unknown and unsuspected and that such damages, losses, costs, or expenses may give rise to additional damages, losses, costs, or expenses in the future. The Parties further acknowledge they negotiated this Agreement taking into account presently unsuspected and unknown claims, counterclaims, causes of action, damages, losses, costs, and expenses, and the Parties voluntarily and with full knowledge of its significance expressly waive and relinquish any rights they may have under any state or federal statute, rule, or common law principle in law or equity relating to limitations on releases, general or otherwise. In particular, but without limitation, each Party hereby expressly waives any and all provisions, rights, and benefits conferred by § 1542 of the California Civil Code, which reads:

A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party;

or by any law of any state or territory of the United States, or principle of common law, which is similar, comparable, or equivalent to § 1542 of the California Civil Code, with respect to the matters released in Section 2.3.

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5<u>Settlement of Disputed Claims</u>. The Parties acknowledge that this Agreement is a compromise and final settlement of the Lawsuits, and is not, nor may it be construed as, an admission of liability by either Party or an admission that either Party engaged in any wrongful, tortious, or unlawful activity, nor are the Parties acknowledging the infringement, validity, or invalidity of any patents or the merits of the contentions, claims, defenses, counterclaims, grounds, or responses of the other Party.

**Section 3– LICENSE GRANTS AND ROYALTY PAYMENTS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1<u>License Grants</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)As of the Effective Date, Avadel, acting on behalf of itself and its Affiliates, hereby grants Jazz and its Affiliates a non-exclusive, perpetual, irrevocable, non-terminable, non-transferrable (except as expressly provided in this Agreement), royalty-free, fully paid-up covenant not to sue, without the right to sublicense (except as expressly provided in this Agreement), under the Avadel Licensed Patents to make, have made, use, sell, offer for sale, import, and otherwise exploit Jazz Licensed Products in the Territory.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)As of the Effective Date, Jazz, acting on behalf of itself and its Affiliates, hereby grants Avadel and its Affiliates a non-exclusive, perpetual, irrevocable, non-terminable, non-transferrable (except as expressly provided in this Agreement), royalty-bearing license, without the right to sublicense (except as expressly provided in this Agreement), under the Jazz Licensed Patents to make, have made, use, sell, offer for sale, import, and otherwise exploit Avadel Licensed Products for the Narcolepsy Indications in the Territory. Avadel's royalty obligations under the foregoing license shall cease on February 19, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Effective as of March 1, 2028, Jazz, acting on behalf of itself and its Affiliates, grants Avadel and its Affiliates a non-exclusive, perpetual, irrevocable, non-terminable, non-transferrable (except as specifically provided in this Agreement), royalty-bearing license, without the right to sublicense (except as expressly provided in this Agreement), under the Jazz Licensed Patents to make, have made, use, sell, offer for sale, import, and otherwise exploit the Avadel Licensed Products for the Non-Narcolepsy Indications in the Territory. Avadel's royalty obligations under the foregoing license shall cease on February 19, 2036.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2<u>Limited Right to Sublicense</u>: The Parties may sublicense their rights in Section 3.1 to make and to use solely to contract manufacturers in order to manufacture, and to commercialization partners in order to sell and offer for sale, Jazz Licensed Products or Avadel Licensed Products, as applicable, solely on behalf of such Party. Each sublicense must be granted under a written agreement that is consistent with the terms and conditions of this Agreement and that (a) requires each sublicensee to comply with the terms and conditions of this Agreement that are applicable to such sublicense and (b) precludes the granting of any further sublicenses by such sublicensee. The sublicensing Party shall remain directly responsible for all of its obligations under this Agreement without regard to whether they have been delegated or sublicensed to any sublicensees. Any sublicensee conduct, act, or omission that would have constituted a breach of this Agreement shall be imputed to the sublicensing Party and deemed a breach of this Agreement as if such conduct, act, or omission had been committed by the

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sublicensing Party. Any such sublicense shall terminate upon termination or expiration of this Agreement. Each Party must provide to the other Party the identity of each sub-licensee and duration of the sublicense, within thirty (30) days of executing any sub-license.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3<u>Royalties</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)<u>Royalty Rates</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)On a Calendar Quarter basis, during the Narcolepsy Royalty Term, Avadel shall pay to Jazz a non-refundable, non-creditable royalty equal to 3.85% of Net Sales of the Avadel Licensed Products Attributable to Narcolepsy Indications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)On a Calendar Quarter basis, during the First Non-Narcolepsy Royalty Term, Avadel shall pay to Jazz a non-refundable, non-creditable royalty equal to 80% of Net Sales of the Avadel Licensed Products that are Attributable to Non-Narcolepsy Indications; provided, however, that no royalty is payable under this Section 3.3(a)(ii) for a given Calendar Quarter unless the Net Sales of Non-Narcolepsy Indications exceed $2,250,000.00 (two million, two hundred and fifty thousand U.S. dollars) during that Calendar Quarter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)On a Calendar Quarter basis, during the Second Non-Narcolepsy Royalty Term, Avadel shall pay to Jazz a non-refundable, non-creditable royalty equal to 10% of Net Sales of the Avadel Licensed Products that are Attributable to Non-Narcolepsy Indications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)<u>Potential Stepdown in Royalty Rates</u>. In the event that claim 24 of U.S. Patent No. 11,147,782 (i) is canceled in Reexamination No. 90/015,486, and after all appeals are exhausted, or (ii) otherwise determined by the U.S. Patent and Trademark Office or a United States federal court to be invalid or unenforceable, and after all appeals are exhausted, then, effective upon the date of such exhaustion, the royalty rate in Section 3.3(a)(i) will be changed to 3.75%, and the royalty rate in Section 3.3(a)(iii) will be changed to 9.5%.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)<u>Reporting and Payment</u>. Avadel shall calculate all amounts payable to Jazz pursuant to Section 3.3 in U.S. dollars at the end of each Calendar Quarter. Within sixty (60) calendar days after the end of such Calendar Quarter, Avadel shall provide Jazz with a report that separately sets forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)a calculation of Net Sales, including the amount of gross sales and aggregate deductions from gross sales taken in accordance with GAAP as consistently applied by Avadel, of the Avadel Licensed Products Attributable to Narcolepsy Indications during the applicable Calendar Quarter;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)a calculation of Net Sales, including the amount of gross sales and aggregate deductions from gross sales taken in accordance with GAAP as consistently applied by Avadel, of the Avadel Licensed Products Attributable to Non-Narcolepsy Indications during the applicable Calendar Quarter; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)a calculation of the amount of royalty payment due to Jazz on each such category of Net Sales for such Calendar Quarter.

Concurrently with the delivery of the quarterly report, Avadel shall pay Jazz the royalty amounts due with respect to such Calendar Quarter. The quarterly report shall be provided to no more than three Jazz employees, who will be disclosed to Avadel upon request, and shall not be distributed by Jazz beyond those three people, the Jazz legal department, and outside counsel for Jazz. The quarterly report shall only be used by Jazz for purposes of evaluating compliance with this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)<u>Manner of Payment</u>. All payments under Section 3.3 shall be payable in U.S. dollars via electronic funds transfer in the requisite amount to such bank account as Jazz may from time to time designate by notice in writing to Avadel.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)<u>Records and Audits</u>. During the period when any payment is due from Avadel to Jazz hereunder and for a period of three (3) years thereafter, Avadel and its Affiliates shall keep a copy of each prescription form and complete and accurate records in accordance with GAAP pertaining to the sale, transfer, or other disposition of the Avadel Licensed Products hereunder for the preceding three (3) years, but no period earlier than October 1, 2025, including such details regarding deductions from gross sales as used by Avadel to calculate Net Sales under Section 3.3(c). Each Calendar Year, beginning 2026, Jazz shall have the right to cause an independent, certified public accountant associated with an independent accounting firm reasonably acceptable to Avadel to audit such records to confirm the Attributions made among the royalty provisions of Section 3.3(a) and otherwise confirm Net Sales (in this case including an audit of each of the itemized deductions taken in calculating Net Sales), royalties, and other payments for a period covering no earlier than October 1, 2025, and not more than the preceding three (3) year period; provided, however, that such audit right shall not be exercised more than once in any Calendar Year and, once audited, a given period may not be re-audited. Such audits may be exercised during normal business hours upon reasonable prior written notice to Avadel. The accounting firm shall enter into appropriate obligations of confidence with Avadel to treat all information it receives during its inspection in confidence and shall only provide Jazz with information at the same level of detail as the quarterly reports. Prompt adjustments shall be made by the Parties to reflect the results of such audit. Jazz and Avadel shall each bear fifty percent (50%) of the cost of such audit. If any audit reveals an underpayment or overpayment by Avadel, the Parties shall promptly reconcile any such underpayment or overpayment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)<u>Interest</u>. If Avadel fails to make any payment due to Jazz on the due date for payment, without prejudice to any other right or remedy available to Jazz, such late payments shall accrue interest at the rate of 10% per annum, compounded monthly.

**Section 4– REPRESENTATIONS; WARRANTIES; COVENANTS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1<u>Representations and Warranties</u>: Each Party represents and warrants to the other Party, as of the Effective Date, that:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)such Party is duly organized, validly existing, and in good standing under the laws of the jurisdiction of its incorporation and has full corporate power and authority to enter into this Agreement and to carry out the provisions hereof;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)such Party has taken all corporate action(s) necessary to authorize the execution and delivery of this Agreement and the performance of its obligations under this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)this Agreement has been duly executed by such Party and constitutes a valid and legally binding obligation of such Party, enforceable in accordance with its terms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)the execution, delivery, and performance of this Agreement by such Party does not conflict with any agreement, instrument, or understanding, oral or written, to which it is a party or by which it may be bound, nor violate any material law or regulation of any court, governmental body, or administrative or other agency having jurisdiction over it;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)such Party has the right to grant the licenses, releases, and covenants granted hereunder, and has the right to settle the Lawsuits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)such Party has been advised by its counsel of its rights and obligations under this Agreement and enters into this Agreement freely, voluntarily, and without duress;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)such Party is not relying on any promises, inducements, or representations other than those provided herein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h)there is no lawsuit or any other civil or administrative proceeding, or any claim or counterclaim of any kind, in any court, tribunal, government entity or agency, or dispute resolution proceeding (including, without limitation, arbitration and mediation) pending on the Effective Date that was commenced by such Party or any of its Affiliates against any other Party or any of its Affiliates involving the Avadel Licensed Patents, the Jazz Licensed Patents, the Avadel Licensed Products, or the Jazz Licensed Products, other than the Lawsuits; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)such Party has not transferred, assigned, subrogated, or pledged to any Third Party or to an Affiliate, the right to bring, pursue, or settle any of the claims, counterclaims, or demands released pursuant to Section 2.3 of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2<u>Avadel Covenants</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)Without limiting anything in Section 3.1(a), effective upon Jazz's transfer of the Settlement Payment pursuant to Section 2.1, Avadel, for itself and its Affiliates, covenants to Jazz that it will not sue, assert any claim or counterclaim against, or otherwise participate in any action or other judicial or legal proceeding against, Jazz or any of its Affiliates or any of Jazz or any of its Affiliates' representatives, shareholders, members, licensees, sublicensees, trustees, officers, directors, managers, employees, agents, attorneys, partners, divisions, distributors, marketers, promoters, co-promoters, customers, suppliers, importers, manufacturers, or insurers, or any patients, physicians, pharmacists, REMS administrators, REMS vendors, or other health

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care providers or entities (in each case, in their capacity as such), or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause, assist, or authorize any person or entity to do any of the foregoing, in each case claiming or otherwise asserting that the Jazz Licensed Products, or Jazz's manufacture, use, sale, distribution, marketing, offer for sale, or importation of the Jazz Licensed Products in the Territory, infringes the Avadel Licensed Patents (the "**Avadel Covenant Not to Sue**"). Avadel shall impose the Avadel Covenant Not to Sue on any Third Party to which Avadel or any of its Affiliates may after the Effective Date of this Agreement assign, license, or otherwise transfer or grant any rights under any Avadel Licensed Patents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Effective upon the date on which Jazz transfers the Settlement Payment pursuant to Section 2.1, Avadel covenants not to contest, assist, or participate in any way in the contest in any forum, including Federal Courts, whether under 28 U.S.C. §§ 2201-2202 or otherwise, U.S. Patent and Trademark Office, and the U.S. International Trade Commission, or foreign equivalents (any of the foregoing, a "Forum"), that any Jazz Licensed Patent is valid and enforceable, or make public pronouncements regarding the validity thereof; provided, however, that if Jazz or its Affiliates asserts a Jazz Licensed Patent against Avadel or its Affiliates (or against any Avadel Released Party with respect to an Avadel Licensed Product) in an infringement action in any Forum, then Avadel or its Affiliates may assert invalidity, unpatentability, and unenforceability defenses (but not counterclaims) in that case; and provided further that it will not be considered a violation of the foregoing to cooperate with a subpoena or other similar legal process or applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Effective upon the date on which Jazz transfers the Settlement Payment pursuant to Section 2.1, Avadel, for itself and its Affiliates, covenants to Jazz that it will not sue, assert any claim or counterclaim against, or otherwise participate in any action or in any judicial or other legal proceeding against, Jazz or any of its Affiliates or any of their respective representatives, shareholders, members, licensees, sublicensees, trustees, officers, directors, managers, employees, agents, attorneys, partners, divisions, distributors, customers, suppliers, importers, manufacturers, distributors, or insurers, or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause, assist, or authorize any person or entity to do any of the foregoing, in each case claiming or otherwise asserting that any or all of the Avadel Licensed Products, and/or Avadel's manufacture, use, sale, distribution, marketing, offer for sale, or importation of the Avadel Licensed Products in the Territory, does not or would not infringe claims of any or all of the Jazz Licensed Patents. For clarity, nothing herein prevents Avadel or its Affiliates from asserting the non-infringement of a product other than an Avadel Licensed Product with respect to the Jazz Licensed Patents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Avadel, for itself and its Affiliates, covenants not to market, offer for sale, take orders for, distribute, promote, or provide patient support services with respect to Avadel Licensed Products for Non-Narcolepsy Indications before March 1, 2028, and neither Avadel nor its Affiliates shall authorize a Third Party to do the same. Any sales of the same prior to such date will be subject to Section 3.3(a)(ii).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3<u>Jazz Covenants</u>:

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)As of the Dismissal Effective Date, Jazz covenants not to challenge the approval or approvability of any Avadel Licensed Product for FDA approval for any and all present and future indications in any forum or court of law or with any regulatory authority. For the avoidance of doubt, Jazz is not providing, and does not provide, consent (pursuant to 21 C.F.R. § 316.31(a)(3) or any similar law or regulation) for the FDA to approve a marketing application related to the use of the Avadel Licensed Products to treat idiopathic hypersomnia earlier than August 13, 2028, which is the day after the expiration of Jazz's Orphan Drug Exclusivity related to the treatment of idiopathic hypersomnia (ODE-369).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)Without limiting anything in Section 3.1, effective upon the Dismissal Effective Date, Jazz, acting on behalf of itself and its Affiliates, will not sue or bring any other action, claim, or proceeding, against Avadel or its Affiliates for infringement of the Jazz Licensed Patents solely with respect to making, using, selling, offering for sale, importing, and exporting Avadel Licensed Products (i) for the Narcolepsy Indications or, (ii) subject to Section 3.3(a)(ii), as of March 1, 2028, for the Non-Narcolepsy Indications.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)Effective upon the Dismissal Effective Date, Jazz covenants not to contest, assist, or participate in any way in the contest in any Forum, that any Avadel Licensed Patent is valid and enforceable, or make public pronouncements regarding the validity thereof; provided, however, that if Avadel or its Affiliates asserts an Avadel Licensed Patent against Jazz or its Affiliates (or against any Jazz Released Party with respect to a Jazz Licensed Product) in an infringement action in any Forum, then Jazz or its Affiliates may assert invalidity, unpatentability, and unenforceability defenses (but not counterclaims) in that case; and provided further that it will not be considered a violation of the foregoing to cooperate with a subpoena or other similar legal process or applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)Effective upon the Dismissal Effective Date, Jazz, for itself and its Affiliates, covenants to Avadel that it will not sue, assert any claim or counterclaim against, or otherwise participate in any action or in any judicial or other legal proceeding against, Avadel or any of its Affiliates or any of Avadel or any of its Affiliates' respective representatives, shareholders, members, licensees, sublicensees, trustees, officers, directors, managers, employees, agents, attorneys, partners, divisions, marketers, promoters, co-promoters, customers, suppliers, importers, manufacturers, distributors, or insurers, or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause, assist, or authorize any person or entity to do any of the foregoing, in each case claiming or otherwise asserting that any or all of the Jazz Licensed Products, and/or Jazz's manufacture, use, sale, distribution, marketing, offer for sale, or importation of the Jazz Licensed Products in the Territory does not or would not infringe claims of any or all of the Avadel Licensed Patents. For clarity, nothing herein prevents Jazz or its Affiliates from asserting the non-infringement of a product other than a Jazz Licensed Product with respect to the Avadel Licensed Patents.

**Section 5– TERM**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1<u>Term</u>. Unless earlier terminated in accordance with the terms hereof, the term of this Agreement shall extend from the Effective Date until the expiration of the last to expire of the Avadel Licensed Patents or the Jazz Licensed Patents.

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**Section 6– CONFIDENTIALITY**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1The terms of this Agreement shall be maintained in strict confidence by the Parties (including their Affiliates and their respective employees, officers, directors, and other representatives, including without limitation accountants, attorneys, and auditors), and shall not disclose the terms of this Agreement to any Third Party, except:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a)the terms of this Agreement may be disclosed, without notice to the other Parties, to any Party's legal counselors, auditors, accounting, financial advisors, or other similar professionals representing a Party, so long as any such Persons agree to be bound by the confidentiality requirements of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)the terms of this Agreement may be disclosed if a Party is required to do so, in the opinion of legal counsel for such Party, by the Securities and Exchange Act of 1934, as amended, the Securities Act of 1933, as amended, or other applicable law; provided, however, that such disclosure shall be limited to the minimum required, as determined by the disclosing Party in consultation with its legal counsel, and the disclosing Party shall give the other Party at least one business day's (minimum twelve (12) hours') advance notice of the specific content in the disclosure before the disclosure is made so that the parties can confer in good faith and resolve any dispute over the necessity for such disclosure;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)either Party or any of its Affiliates may communicate with the FDA on a confidential basis concerning this Agreement and the licenses provided for herein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)either Party or its Affiliates may communicate with that Party's potential and actual acquirers, investors, underwriters, and lenders, subject to obligations of confidentiality at least as stringent as those contained herein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e)either Party or any of its Affiliates may disclose such terms to Third Parties to the extent necessary for the performance of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f)if a Party is required or requested to provide the terms of this Agreement to a Third Party pursuant to a subpoena, discovery demand, discovery order, or other legal processes or requirements, it shall inform the other Party in sufficient time prior to any such disclosure to allow the other Party to seek a protective order or confidential treatment prior to any such disclosure;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g)the terms of this Agreement may be disclosed as otherwise agreed to by the Parties in writing.

The Parties acknowledge and agree that after the dismissals are filed pursuant to Section 2.2, the fact that the Parties have settled the Lawsuits will be a matter of public record and shall not be subject to any confidentiality restrictions, but the terms of such settlement shall be maintained in confidence as provided by this Section 6.

**Section 7– GENERAL PROVISIONS**

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1<u>Choice of Law and Venue</u>. This Agreement shall be governed, interpreted, and construed in accordance with the laws of the State of Delaware, without giving effect to choice of law principles. The Parties agree that that the United States District Court for the District of Delaware shall have exclusive jurisdiction to deal with any disputes arising out of or in connection with this Agreement and that, accordingly, any such proceedings arising out of or in connection with this Agreement shall be brought in the United States District Court for the District of Delaware. If there is any dispute for which the United States District Court for the District of Delaware does not have subject matter jurisdiction, the state courts in Delaware shall have exclusive jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2<u>Remedies in the Event of Breach</u>. The Parties acknowledge and agree that money damages may not be a sufficient remedy for any breach of any provision of this Agreement by the other Party, and that the non-breaching Party may be entitled to equitable relief, including a temporary restraint, a preliminary injunction, a permanent injunction, and specific performance for any such breach. Such remedies are not to be the exclusive remedies for a breach of the Agreement, but will be in addition to all other remedies available at law or equity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3<u>No Other License</u>. Except as expressly provided in this Agreement, nothing in this Agreement shall be construed as granting to a Party or any of its Affiliates any license or other rights under any other intellectual property rights of any other Party, whether by implication or estoppel. Nothing in this Agreement shall grant any Party or any of its Affiliates in marketing or promoting the sale of products or services, the right to directly or indirectly use or refer to the trademarks or trade names of the other Party or any of its Affiliates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4<u>No Assignment</u>. Either Party may assign its rights under this Agreement, in whole or in part, without prior written consent of the other Party as part of a sale, transfer, or spin-off of its product line relevant to this Agreement, or all or substantially all of its equity to, or a change in Control (as defined in the definition of Affiliate) transaction with, a Third-Party acquirer. All releases and covenants of the Parties herein shall run with the rights being sold, assigned, or transferred and shall be binding on any successors-in-interest, transferees, or assigns thereof. Notwithstanding the foregoing, no Party shall assign or otherwise transfer any right hereunder or any right in or to any patent that is the subject of this Agreement to any Third Party unless: (i) such transfer, sale or assignment is subject to all of the terms and conditions of this Agreement; and (ii) such Third Party executes an agreement agreeing to be bound by all the terms and conditions of this Agreement with respect to the rights being transferred or assigned. Any attempted transfer, license, assignment, or grant in contravention of this section shall be null and void. This Agreement shall bind, inure to the benefit of, and be enforceable by the Parties and their permitted successors and assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5<u>Costs</u>. Each Party shall each bear its own costs and legal fees associated with the Lawsuits and with the negotiation and preparation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6<u>Taxes</u>. Jazz shall be responsible for all taxes (other than taxes based on Avadel's net income), fees, duties and other governmental charges (collectively, "**<u>Taxes</u>**"), and any related penalties and interest, arising from the payment of the Settlement Payment under this Agreement, and will pay Avadel the entire amounts due for the Settlement Payment without any deductions

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of any kind. Avadel shall be responsible for all Taxes (other than Taxes based on Jazz's net income) arising from the payment of the royalties under this Agreement, and will pay Jazz the entire amounts due for royalties without <u>tax</u> deductions of any kind.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7<u>Severability</u>. If any provision of this Agreement is declared illegal, invalid, or unenforceable by a court having competent jurisdiction, it is mutually agreed that this Agreement shall endure except for the part declared invalid or unenforceable by order of such court; provided, however, that in the event that the terms and conditions of this Agreement are materially altered, the Parties will, in good faith, renegotiate the terms and conditions of this Agreement to reasonably replace such invalid or unenforceable provisions in light of the intent of this Agreement; provided further that if the Parties do not succeed in reaching mutually acceptable modifications to this Agreement within thirty (30) calendar days of such material alteration, then the Parties agree to a binding mediation before Judge Layn Phillips, or if he is unavailable, another mediator mutually selected by the Parties, in order to reach agreement on an appropriate modification of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8<u>Entire Agreement</u>. This Agreement constitutes the complete, final, and exclusive agreement between the Parties with respect to the subject matter hereof and supersedes and terminates any prior or contemporaneous agreements and/or understandings between the Parties, whether oral or in writing, relating to such subject matter. There are no covenants, promises, agreements, warranties, representations, conditions, or understandings, either oral or written, between the Parties other than as are set forth in this Agreement. No subsequent alteration, amendment, change, waiver, or addition to this Agreement shall be binding upon the Parties unless reduced to writing and signed by an authorized officer of each Party. Each Party in deciding to execute this Agreement has retained counsel and has not relied on any understanding, agreement, representation, or promise by the other Party that is not explicitly set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9<u>Headings</u>. The captions and descriptive headings of this Agreement are for convenience only, and shall be of no force or effect in construing or interpreting any of the provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10<u>Waiver of Rule of Construction</u>. The Parties expressly agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be applied in the construction or interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11<u>No Third-Party Beneficiaries</u>. Except as expressly provided herein, nothing in this Agreement, either express or implied, is intended to or shall confer upon any Third Party any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12<u>Notices</u>. All notices, requests, claims, demands, and other communications under this Agreement shall be in writing and shall be given by delivery by hand, by registered or certified mail (postage prepaid, return receipt requested), or by email to the respective Parties at the following addresses (or at such other address for a Party as shall be specified by like notice).

If to Jazz, to:&nbsp;&nbsp;&nbsp;&nbsp;

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Jazz Pharmaceuticals, Inc.

Attn: General Counsel

3000 El Camino Real

2 Palo Alto Square, Suite 600

Palo Alto, CA 94306

[\*\*\*]

With a copy to:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Frank Calvosa, Esq.

Quinn Emanuel Urquhart & Sullivan, LLP

295 Fifth Avenue

New York, NY 10016

[\*\*\*]

If to Avadel, to:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

Avadel CNS Pharmaceuticals, LLC

16640 Chesterfield Grove Road, Suite 200

Chesterfield, MO 63005

[\*\*\*]

With a copy to:

Kenneth Schuler

Latham and Watkins

330 N Wabash Ave #2800

Chicago, IL 60611

[\*\*\*]

Any such notice shall be deemed to have been received on the date actually received. Either Party may change its address by giving the other Party written notice, delivered in accordance with this Section 7.11.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.13<u>Counterparts</u>. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic image scan transmission shall be effective as delivery of a manually executed counterpart of this Agreement.

[THE REST OF THIS PAGE LEFT INTENTIONALLY BLANK]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date.

**JAZZ PHARMACEUTICALS, INC.**

By: <u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Alan Campion&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name:&nbsp;&nbsp;&nbsp;&nbsp;Alan Campion<br>&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VP, Finance

**JAZZ PHARMACEUTICALS IRELAND LIMITED**

By: <u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Hugh Kiely&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name:&nbsp;&nbsp;&nbsp;&nbsp;Hugh Kiely<br>&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VP, Taxation & Treasury

**AVADEL CNS PHARMACEUTICALS LLC**

By: <u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Gregory J. Davis&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name:&nbsp;&nbsp;&nbsp;&nbsp;Gregory J. Davis<br>&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;President

**FLAMEL IRELAND LIMITED**

By: <u>&nbsp;&nbsp;&nbsp;&nbsp;/s/ Jerad G. Seurer&nbsp;&nbsp;&nbsp;&nbsp;</u><br>&nbsp;&nbsp;&nbsp;&nbsp;Name:&nbsp;&nbsp;&nbsp;&nbsp;Jerad G. Seurer<br>&nbsp;&nbsp;&nbsp;&nbsp;Title:&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Director & Assistant Secretary

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<u>Exhibit A</u>

**IN THE UNITED STATES DISTRICT COURT<br>FOR THE DISTRICT OF DELAWARE**

---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>JAZZ PHARMACEUTICALS, INC.,<br>Plaintiff,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<br>AVADEL CNS PHARMACEUTICALS LLC,<br>Defendant. | &nbsp;&nbsp;&nbsp;<br>C.A. No. 21-691 (GBW) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>JAZZ PHARMACEUTICALS, INC. and <br>JAZZ PHARMACEUTICALS IRELAND LIMITED,<br>Plaintiffs,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<br>AVADEL CNS PHARMACEUTICALS LLC,<br>Defendant. | &nbsp;&nbsp;&nbsp;<br>C.A. No. 21-1138 (GBW) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<br>JAZZ PHARMACEUTICALS, INC. and <br>JAZZ PHARMACEUTICALS IRELAND LIMITED,<br>Plaintiffs,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<br>AVADEL CNS PHARMACEUTICALS LLC,<br>Defendant. | &nbsp;&nbsp;&nbsp;<br>C.A. No. 21-1594 (GBW) |

---

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---

| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AVADEL CNS PHARMACEUTICALS LLC, <br>AND AVADEL PHARMACEUTICALS PLC,<br>Plaintiffs,<br>v.<br>JAZZ PHARMACEUTICALS, INC., AND <br>JAZZ PHARMACEUTICALS IRELAND <br>LIMITED,<br>Defendants. | &nbsp;&nbsp;&nbsp;&nbsp;<br>C.A. No. 22-487 (GBW) |
| AVADEL CNS PHARMACEUTICALS LLC,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Plaintiff,<br>&nbsp;&nbsp;&nbsp;&nbsp;v.<br>JAZZ PHARMACEUTICALS, INC,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Defendant.. | &nbsp;&nbsp;<br>C.A. No. 22-941-GBW |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AVADEL CNS PHARMACEUTICALS, LLC AND FLAMEL IRELAND LIMITED,<br>Plaintiffs,<br>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v.<br>JAZZ PHARMACEUTICALS, INC., AND JAZZ PHARMACEUTICALS IRELAND LIMITED,<br>Defendants. | <br>C.A. No. 25-09-GBW **(CONSOLIDATED)**<br>C.A. No. 25-057-GBW (Member Case)<br>C.A. No. 25-221-GBW (Member Case)<br>C.A. No. 25-435-GBW (Member Case) |

---

**STIPULATION AND [PROPOSED]** 

**<u>ORDER OF DISMISSAL WITH PREJUDICE</u>**

IT IS HEREBY STIPULATED AND AGREED, by and among Jazz Pharmaceuticals, Inc., Jazz Pharmaceuticals Ireland Limited (collectively, "Jazz"), Avadel CNS Pharmaceuticals LLC, Avadel Pharmaceuticals plc, and Flamel Ireland Limited (collectively, "Avadel"), pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii) and/or 41(a)(2), that all claims, counterclaims,

**19**

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and affirmative defenses asserted in these actions by and between Jazz and Avadel are dismissed WITH PREJUDICE, with each party responsible for its own attorneys' fees and costs.

Dated: October 21, 2025

---

| | |
|:---|:---|
| Morris, Nichols, Arsht & Tunnell LLP<br>/s/ <br><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>Jeremy A. Tigan (#5239)<br>Cameron P. Clark (#6647)<br>1201 North Market Street<br>P.O. Box 1347<br>Wilmington, DE 19899<br>(302) 658-9200<br>jtigan@morrisnichols.com<br>cclark@morrisnichols.com<br>Attorneys for Jazz  | McCarter & English, LLP<br>/s/ <br><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u><br>Daniel M. Silver (#4758)<br>Alexandra M. Joyce (#6423)<br>Renaissance Centre<br>405 North King Street, 8th Floor<br>Wilmington, DE 19801<br>(302) 984-6300<br>dsilver@mccarter.com<br>ajoyce@mccarter.com<br>Attorneys for Avadel |

---

SO ORDERED this ___ day of _________________, 2025. <br> UNITED STATES DISTRICT JUDGE

**20**

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Gregory J. Divis, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Quarterly Report on Form 10-Q of Avadel Pharmaceuticals plc;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: November 4, 2025 | /s/ Gregory J. Divis |
| | Gregory J. Divis |
| | Chief Executive Officer |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Thomas S. McHugh, certify that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. I have reviewed this Quarterly Report on Form 10-Q of Avadel Pharmaceuticals plc:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: November 4, 2025 | /s/ Thomas S. McHugh |
| | Thomas S. McHugh |
| | Senior Vice President and Chief Financial Officer |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906**

**OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report on Form 10-Q of Avadel Pharmaceuticals plc (the "Company") for the period ended September 30, 2025 (the "Report"), the undersigned hereby certifies in his capacity as Chief Executive Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78*o*(d)), as amended; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | |
|:---|:---|
| Date: November 4, 2025 | /s/ Gregory J. Divis |
| | Gregory J. Divis |
| | Chief Executive Officer |

---

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906**

**OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report on Form 10-Q of Avadel Pharmaceuticals plc (the "Company") for the period ended September 30, 2025 (the "Report"), the undersigned hereby certifies in his capacity as Chief Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of his knowledge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78*o*(d)), as amended; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | |
|:---|:---|
| Date: November 4, 2025 | /s/ Thomas S. McHugh |
| | Thomas S. McHugh |
| | Senior Vice President and Chief Financial Officer |

---

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