Document:

Research Collaboration Termination Agreement, dated as of July 29, 2009

 EXHIBIT 10.323 
 CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. 
 RESEARCH COLLABORATION TERMINATION AGREEMENT 
 This Research Collaboration Termination Agreement (this “Termination Agreement”), effective as of June 22, 2009 (the
“Effective Date”), is made by and between N. V. Organon, a company organized under the laws of The Netherlands, having a principal place of business at Kloosterstraat 6, 5342 AB Oss, The Netherlands (hereinafter referred to as
“Organon”); and Ligand Pharmaceuticals Incorporated, a Delaware corporation, having a principal place of business at 10275 Science Center Drive, San Diego, California 92121 (hereinafter referred to as “Ligand”). 
 RECITALS: 
 WHEREAS, Pharmacopeia Drug Discovery, Inc., now Pharmacopeia LLC, a wholly owned subsidiary of Ligand, and Organon entered into a Collaboration and License Agreement effective February 25, 2002, as modified on December 22,
2003; December 1, 2004; February 8, 2007 and December 13, 2007 (hereinafter the “Collaboration and License Agreement”); 
 WHEREAS, Organon and Ligand desire to terminate the Research Collaboration under the Collaboration and License Agreement and to wind down the research activities thereunder under the terms and conditions
set forth herein. 
 NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants contained herein,
Organon and Ligand hereby agree as follows: 
 1. Unless otherwise defined herein, each of the capitalized terms used in this
Termination Agreement shall have the meaning given to them in the Collaboration and License Agreement. 
 2. Organon and Ligand
agree that the Second Research Term of the Collaboration and License Agreement and, therefore, the Research Collaboration thereunder, shall terminate effective December 31, 2009 (the “Mutual Termination Date”). 
 3. During the period of time between the Effective Date and the Mutual Termination Date (the “Wind Down Period”), (i) the
Parties shall continue their Research Collaboration activities on those Targets currently under investigation under the Collaboration and License Agreement, as may be modified by the JRC, and (ii) Organon shall continue its funding of such
activities under the terms of the Collaboration and License Agreement. 
 4. During the Wind Down Period, Ligand will endeavor
to identify Pharmacopeia Compounds as per Section 2.4 of the Collaboration and License Agreement. Any Lead Compounds delivered for any program shall be handled as set forth in the Collaboration and License Agreement. Programs that have not
produced a Lead Compound at the end of the Wind Down Period shall be handled as follows (for the avoidance of doubt, the terms and conditions of

  

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this Paragraph 4 shall not apply to the [***] program, which is handled separately in Paragraph 5 herein): 
 (a) For the Targets [***], [***] and [***], Organon shall have the option to acquire one or more of these programs as a Transferred Program by paying Ligand a one-time transfer fee of
[***] Dollars ($[***]) for each such Target. The rights to any compounds identified by Ligand as having the level of potency and/or selectivity against such Target, as set forth in Section 2.4 of the Collaboration and License
Agreement, shall be deemed part of the Transferred Program and for the avoidance of doubt, the provisions of Section 2.2(d) of the Collaboration and License Agreement shall apply to such compounds. 
 (b) For the Targets [***], [***], [***], [***], [***] and [***], Organon shall have the option to
acquire one or more of these programs as a Transferred Program by paying Ligand a one-time transfer fee of [***] Dollars ($[***]) per Target or acquiring all such programs as Transferred Programs by paying a one-time transfer fee of
[***] Dollars ($[***]). The rights to any compounds identified by Ligand as being confirmed hits against the Target or any compounds identified during hit-to-lead efforts, but with activity against such Target, shall be included as
part of the Transferred Program and for the avoidance of doubt the provisions of Section 2.2(d) of the Collaboration and License Agreement as amended herein shall apply to such compounds. 
 (c) For each program under consideration as a Transferred Program (the “Candidate Transferred Programs”) in Paragraphs 4(a) or
4(b) above, Ligand shall provide copies of reasonably available data and results for such programs, including chemical structures, necessary to enable Organon to conduct a review of the programs prior to Organon making its decision on whether to
exercise any of its options to acquire such programs. Ligand shall disclose such information to two individuals (the “Reviewers”) if each of the Reviewers first executes a confidentiality agreement with Ligand in the form of the agreement
attached hereto as Exhibit 1 with the names of the two individuals to be filled-in prior to execution of each confidentiality agreement. Organon shall not provide such information relating to the Targets [***], [***] and [***]
to more than two individuals in total and Organon shall not provide such information relating to the Targets [***], [***], [***], [***], [***] and [***] to more than two individuals in total. 
 (i) Ligand shall provide to the Reviewers by January 15, 2010 the relevant data and results related to Candidate
Transferred Programs for the [***], [***], [***], [***], [***] and [***] Targets for the Reviewers’ review, provided that for any such Target one or more Lead Compounds have not already been delivered
and provided that Organon has executed a confidentiality agreement with Ligand in the form of the agreement attached hereto as Exhibit 1. Organon shall have until February 19, 2010 to determine which of these programs it will acquire as one or
more Transferred Programs. Should Organon decide that the two Reviewers for the set of targets under this provision 4(c)(i) will be the same as the Reviewers under 4(c)(ii), the Parties agree that the first confidentiality agreement executed will
apply to both sets of targets. 
 *** Certain information on this page has been omitted and filed separately with the Securities and Exchange
Commission. Confidential treatment has been requested with respect to the omitted portions. 
  

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 (ii) For the Targets [***], [***] and [***], Ligand shall provide the
relevant data and results to the Reviewers by November 2, 2009, provided that for any such Target one or more Lead Compounds have not already been delivered and provided that Organon has executed a confidentiality agreement with Ligand in the
form of the agreement attached hereto as Exhibit 1. Organon shall have until November 15, 2009 to determine which of these programs it will acquire as one or more Transferred Programs. 
 (iii) Organon shall make payment on the Transferred Programs that it selects within forty-five (45) days after receipt
of: (i) all materials required thereunder as set forth in Section 2.2(d)(iv) of the Collaboration and License Agreement, (ii) updated non-disputed Exhibits B and F as per Section 2.2(d)(v) and 2.2(d)(vi), and (iii) an
invoice from Ligand for such payment. Provided that Organon has received from Ligand all of the items specified in this subsection by November 15, 2009, Organon shall make payment before the end of the 2009 calendar year for any Transferred
Programs selected on or before November 15, 2009. 
 5. The [***] program is a Lead Optimization Program under the
Collaboration and License Agreement. During the Wind Down Period, if that program produces a compound that meets the Development Candidate criteria, then such compound will be treated as an Optionable Development Candidate under the Collaboration
and License Agreement. However, if such program does not produce a compound that meets the Development Candidate criteria during the Wind Down Period, Organon shall have the right to continue to pursue the research activities for such program on its
own and the program will be treated as a Lead Compound program under the Collaboration and License Agreement, with the following changes to the milestone payments: 
 (a) Organon will pay Ligand [***] Dollars ($[***]) for the milestone payment for the designation of a Lead Compound. 
 (b) The remaining milestone and royalty payments for Second Research Term Lead Compounds set forth in the Collaboration and License
Agreement will be applicable to such program, except that the milestone payment under Section 7.1.1 (a) for the initiation of GLP Toxicity Studies will be increased to [***] Dollars ($[***]). 
 (c) For the avoidance of doubt, if the [***] program does not produce a compound that meets the Development Candidate criteria during
the Wind Down Period, it shall not be considered an Optionable Development Candidate and the Pharmacopeia Co-Development/Co-Promotion Option under Section 2.9 of the Collaboration and License Agreement shall not apply to such program.

 *** Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions. 
  

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 6. Delete Section 2.2(d) of the Collaboration and License Agreement in its entirety and
replace it with the following new section: 
 “(d) Transferred Programs. Effective as of the Amendment
Date for programs considered Transferred Programs prior to the Effective Date and effective as of the Effective Date for programs considered Transferred Programs after the Effective Date, Pharmacopeia hereby waives its right to receive further
compensation with respect to Transferred Programs or any compounds derived therefrom made by Organon based on a Transferred Program, subject to the following terms:
 (i) Pharmacopeia shall have no further obligation to make any further expenditures with respect to the Transferred Programs.

 (ii) Pharmacopeia agrees that it shall have no further rights to use the Transferred Programs or to file any
patent applications with respect thereto. 
 (iii) All such programs are hereby transferred to Organon and
Organon shall be relieved of any obligation to Pharmacopeia, other than as set forth in paragraph 4(b) of this Termination Agreement, with respect to Transferred Programs under this or any other previous agreement. 
 (iv) Pharmacopeia shall provide Organon with any information, materials or data that are reasonably available to
Pharmacopeia and reasonably necessary for Organon to continue the development or commercialization of the Transferred Programs. 
 (v) Organon’s licenses to the Transferred Programs under the Collaboration and License Agreement and the agreements listed in Exhibit B are hereby replaced by the following: Subject to
Section 2.2(d)(vii), Pharmacopeia hereby grants to Organon a [***]. 
 (vi) Pharmacopeia further
agrees [***]. 
 (vii) The only license granted to Organon with respect to the Transferred Programs is
that set forth in Section 2.2(d)(v), above. The only [***] is that set forth in Section 2.2(d)(vi), above. Nothing in this Section 2.2(d) shall be construed to grant [***]. 
 7. Delete Section 12.1.10 of the Collaboration and License Agreement in its entirety and replace it with the following new section:

 “12.1.10 Patent Rights Applicable to Transferred Programs. To the best of Pharmacopeia’s knowledge, as of
February 25, 2007 for any Transferred Program acquired by Organon before the Effective Date and as of December 31, 2009 for any Transferred Program acquired by Organon after the Effective Date, the Patent Rights identified in Exhibit
F constitute all the Patent Rights Controlled by Pharmacopeia relating to the Transferred Programs.” 
 *** Certain information on this
page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. 
  

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 8. Organon and Ligand agree that (a) notwithstanding the terms of the Collaboration and
License Agreement, the terms of this Termination Agreement shall govern the disposition of the research programs for the Targets during the Wind Down Period, (b) this Termination Agreement shall supersede the Collaboration and License Agreement
with respect to the amendments set forth herein and the remaining terms and conditions of the Collaboration and License Agreement shall remain in full force and effect, and (c) this Termination Agreement represents and contains the full,
complete, final and exclusive understanding and agreement of Organon and Ligand with respect to the subject matter hereof. 
 IN
WITNESS WHEREOF, Organon and Ligand have caused this Termination Agreement to be executed by their duly authorized representatives as of the Effective Date. 
  

											
	 N. V. ORGANON
	 		 	 LIGAND PHARMACEUTICALS INCORPORATED

						
	By:	 	/s/ A. Rijnders	 		 	By:	 	/s/ Charles Berkman	 	
	Name:	 	A. Rijnders	 		 	Name:	 	Charles Berkman	 	
	Title:	 	V.P. Discovery	 		 	Title:	 	V.P., General Counsel and Secretary	 	
		 	28 July 2009	 		 		 	July 29, 2009	 	

  

			
	By:	 	/s/ K.S. Schouten
	Name:	 	K.S. Schouten
	Title:	 	Managing Director

  

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 Exhibit 1 
 [Form of Confidentiality Agreement to be inserted here] 
  

 6Amendment No. 2 to Product Development and Commercialization Agreement

 EXHIBIT 10.331 
 CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. 
 AMENDMENT NO. 2 TO 
 PRODUCT DEVELOPMENT AND COMMERCIALIZATION AGREEMENT 
 THIS AMENDMENT NO. 2 TO PRODUCT DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (this
“Amendment”) amends the Product Development and Commercialization Agreement dated as of March 24, 2006, as the same may have been amended from time to time (the “Agreement”), by and among SmithKline Beecham
Corporation, doing business as GlaxoSmithKline, a Pennsylvania corporation (“SB Corp”), Glaxo Group Limited, a company existing under the laws of England and Wales (“GGL”, and collectively with SB Corp referred to
hereinafter as “GSK”) and Pharmacopeia, LLC, as successor to Pharmacopeia Drug Discovery, Inc., a Delaware limited liability company (“Pharmacopeia”), effective as of the date set forth on the signature page below.

 RECITALS 
 WHEREAS, the Parties have agreed to amend the Agreement to clarify certain matters related to certain of the Programs contemplated under the Agreement. 
 NOW THEREFORE, in consideration of the foregoing premises and the mutual covenants
contained herein, the Parties, intending to be legally bound, agree as follows: 
 1. Capitalized Terms. The capitalized terms used
herein and not otherwise defined shall have the same definitions as provided in the Agreement. 
 2. Amendments. 
 (a) Termination of Exclusivity Obligations for Certain Programs. Notwithstanding Section 3.3 of the Agreement and such other
applicable provisions of the Agreement (except for Section 3.4 and any provisions related thereto, which shall continue to apply in full force, except as stated below for GSK) which restrict the activities of the Parties as to Targets being
pursued in a Program, the Parties acknowledge and agree that, from and after the date of this Amendment, there shall be no limitations or restrictions on the activities of either Party, acting either alone or with a Third Party, with respect to
either of the [***] or the [***] or their respective associated Targets. The Parties acknowledge and agree that, from and after the date of this Amendment, Section 3.3 shall no longer apply to, and the last sentence of
Section 3.4 of the Agreement shall no longer limit or restrict the activities of GSK with respect to either of the [***] or the [***] or their respective associated Targets. The restrictions set forth in Article 9 of the Agreement
shall remain in full force and effect with respect to both Parties. For clarity, GSK shall remain responsible as set forth in the Agreement and this Amendment for all payments 
 *** Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

  

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due with respect to the progression of the [***] or the [***] resulting from this Agreement through development and commercialization by or on behalf of GSK. 
 (b) [***] and Program Payment. GSK shall make the accelerated payment set forth in Paragraph 3 below with respect to the
[***].  
 (c) Discontinued Programs/Reversion Program. The Parties acknowledge and agree that, from and
after the date of this Amendment, three (3) Programs shall be terminated (the “Discontinued Programs”). The Parties shall mutually agree in writing which three (3) Programs shall be Discontinued Programs within sixty
(60) days of the date of this Amendment and the Discontinued Programs and all activities relating thereto shall for all purposes under the Agreement be deemed to be mutually terminated by the Parties as of the date of such agreement, and all
rights granted to GSK to the Targets being pursued in such Discontinued Programs shall thereafter, immediately and without any further action required, revert to Pharmacopeia. The Parties further acknowledge and agree that in the event that GSK
decides not to exercise its option by making a milestone payment set forth in Sections 6.2.1(b) or 6.2 (solely with respect to the [***] or [***]), which non-payment is not cured within forty five (45) days after written notice
thereof is provided to GSK by Pharmacopeia, effective upon the lapse of such forty five (45)-day period without cure, all rights granted to GSK to the respective Target and Program shall thereafter, immediately and without any further action
required, revert to Pharmacopeia (“Reversion Program”). 
 (d) Rights Upon Discontinuation/Reversion.
Notwithstanding Sections 3.3, 3.4, 12.4 and such other applicable provisions of the Agreement which restrict the activities of Pharmacopeia as to the Targets being pursued in such Discontinued Programs or as to the Target being pursued in the
Reversion Program upon the reversion of rights with respect to such Target and Program, the following shall apply with respect to a Discontinued Program or Reversion Program, as the case may be: (i) Pharmacopeia shall be able to directly or
indirectly pursue any research, development and/or commercialization of such Reversion Program and such Discontinued Programs and associated Targets without restriction; (ii) the GSK Options and such other rights and obligations as provided in
Section 4 of the Agreement shall terminate immediately; (iii) any licenses granted to Pharmacopeia by GSK pursuant to Section 5.1.1(b) of the Agreement shall remain in full force and effect as to the GSK Development Compounds and any
corresponding Back-Up Compounds developed pursuant to such Reversion Program or such Discontinued Programs; (iv) any licenses granted by Pharmacopeia to GSK pursuant to Section 5.1.2 of the Agreement shall terminate immediately;
(v) Pharmacopeia shall have no obligation to make the applicable milestone and royalty payments to GSK provided for in Section 6.5 of the Agreement; and (vi) notwithstanding Section 12.5(b) of the Agreement, the following shall
no longer apply to the Discontinued Programs or the Reversion Program: Articles 2, 4, 6, 10 and 12. In addition, with respect to any Discontinued Program, Sections 3.3, 3.4 and 3.5 and any remaining obligations of exclusivity thereunder shall apply
with respect to GSK only until the date which is two (2) years after the date of attainment of the Tractable Hit Criteria for such Target, as such Tractable Hit Criteria attainment dates are listed in Exhibit A, which is attached hereto and is
hereby incorporated by reference. Sections 3.3, 3.4 and 3.5 and the obligations thereunder shall not apply in any manner to GSK for any Discontinued Program beyond the date that is two (2) years after the attainment date listed in Exhibit A for
the relevant Discontinued 
 *** Certain information on this page has been omitted and filed separately with the Securities and Exchange
Commission. Confidential treatment has been requested with respect to the omitted portions. 
  

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Program, regardless of the date that such Program becomes a Discontinued Program. With respect to any Reversion Program, none of the obligations under Sections 3.3, 3.4 or 3.5 shall apply to GSK
from the date of this Amendment, in accordance with the provisions of Paragraph 2(a) above. For clarity, Articles 1, 11 (with respect to Pharmacopeia) and 14 shall remain in full force and effect with respect to the Discontinued Programs and the
Reversion Program, and there shall be no exclusivity obligations of any kind upon GSK under Article 3 or otherwise under the Agreement in relation to any of the Reversion Programs or any of the Discontinued Programs, or any of the Targets associated
therewith, except as expressly stated above in this paragraph (d) for the Discontinued Programs. 
 (e) Information.
GSK shall promptly share with Pharmacopeia any Information, materials and data resulting from the Reversion Program or any Discontinued Program that is reasonably necessary or important for Pharmacopeia to continue the development or
commercialization of the applicable compound, and GSK shall reasonably cooperate with Pharmacopeia to provide a smooth transfer of such Information, materials and data as soon as reasonably practicable and at Pharmacopeia’s sole cost and
expense, provided that GSK has provided a cost estimate in advance and Pharmacopeia has provided prior written approval before such Third Party expenses have been incurred. 
 (f) Designation of Programs as On-Hold/Parked Programs Only. The Parties acknowledge and agree that [***] ([***])
Programs shall serve as On-Hold/Parked Programs to the four (4) Programs currently being progressed. The Parties shall mutually agree in writing within sixty (60) days of the date of this Amendment which [***] ([***])
Programs shall be designated On-Hold/Parked. The JSC may by mutual agreement subsequently determine that On-Hold/Parked Programs should be progressed or that the Programs currently being progressed should be put On-Hold and/or Parked. For example,
and not by way of limitation, when an active Program is terminated, the JSC shall have the authority, on mutual agreement, to replace such Program with an On-Hold or Parked Program. 
 3. Payment. GSK has agreed to accelerate the timing of the payment required under Section 6.2.1(a)(i) of the Agreement solely with respect to the [***] such that GSK shall pay to
Pharmacopeia within two (2) business days of the date of this Amendment Five Hundred Thousand Dollars ($500,000) in full satisfaction of the payment otherwise due under Section 6.2.1(a)(i) of the Agreement with respect to the [***].
For clarity, upon the achievement of the Lead Declaration Criteria by each of up to two (2) additional compounds designated by the JSC for advancement into a Lead Optimization Program as Back-up Compounds by Pharmacopeia with respect to the
[***], an additional Five Hundred Thousand Dollars ($500,000) shall be payable by GSK pursuant to Section 6.2.1(a)(ii). 
 4. No other
Amendment. Except as provided herein, the Agreement shall continue in full force and effect. 
 5. Governing Law. This Amendment and
any dispute arising from the performance or breach hereof shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, U.S.A., without reference to conflicts of laws principles. 
 6. Counterparts. This Amendment may be signed in counterparts, each and every one of which shall be deemed an original, notwithstanding variations in
format or file designation which may result from electronic transmission, storage and printing of copies of this Amendment from 
 *** Certain
information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

  

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 separate computers or printers. Facsimile signatures shall be treated as original signatures.

 [Remainder of Page Intentionally Left Blank] 
  

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 IN WITNESS WHEREOF, the Parties have executed this Amendment No. 2 to Product
Development and Commercialization Agreement through their duly authorized representatives to be effective as of                     , 2009.

  

									
	PHARMACOPEIA, LLC	 		 	 SMITHKLINE BEECHAM CORPORATION,
 d/b/a GLAXOSMITHKLINE

					
	By:	 	/s/ Syed Kazmi	 		 	By:	 	/s/ Michelle Dipp, M.D., Ph.D.        
	Title:	 	V.P., Business Development	 		 	Title:	 	V.P. and Head of U.S. C.E.E.D.D.
	Date:	 	September 23, 2009	 		 	Date	 	September 25, 2009
			
		 		 	GLAXO GROUP LIMITED
				
		 		 	By:	 	/s/ Paul Williamson
		 		 		 	Title:	 	Corporate Director
		 		 		 	Date	 	September 25, 2009

  

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 Exhibit A 
  

			
	 Program Name
	  	 Date JSC Declared Attainment of
 Tractable Hit Criteria

	[***]	  	[***]
	[***]	  	[***]
	[***]	  	[***]
	[***]	  	[***]
	[***]	  	[***]
	[***]	  	[***]

 *** Certain information on this page has been omitted and filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

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