Document:

exv10w34

 

Exhibit 10.34

***Text Omitted and Filed Separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4) and 240.24b-2

COLLABORATION AND LICENSE AGREEMENT

     This Collaboration and License Agreement (the “Agreement”) is made and entered into
effective as of December 3, 2004 (the “Effective Date”) by and between Micromet AG, having
its principal place of business at Staffelseestrasse 2, 81477, Munich, Germany (“Micromet”), and
Ares Trading S.A., having its principal place of business at Zone Industrielle de
l’Ouriettaz, CH-1170 Aubonne, Switzerland (“Serono”). Micromet and Serono each may be
referred to herein individually as a “Party,” or collectively as the “Parties.”

Recitals

     A. Micromet is developing a pharmaceutical product comprising a human antibody of IgG-1
subtype binding to EpCAM.

     B. Serono is a pharmaceutical company with experience in the development and
commercialization of pharmaceutical products.

     C. Micromet and Serono desire to collaborate on the development of the Product (as defined
below), to obtain marketing approval of the Product, and thereafter to have one or both Parties
commercialize the Product.

     In consideration of the foregoing premises and the mutual promises and covenants
contained herein and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Parties hereby agree as follows:

Agreement

1. Definitions

     When used in this Agreement, capitalized terms will have the meanings as defined below and
throughout the Agreement.

     1.1 “Additional Indication” means any of the following Indications: [***].

     1.2 “Affiliate” means a legal entity that controls, is controlled by, or is under common
control with a Party. For purposes of this definition only, “control” and, with correlative
meanings, the terms “controlled by” and “under common control with” means (a) the possession,
directly or indirectly, of the power to direct the management or policies of a legal entity,
whether through the ownership of voting securities or by contract relating to voting rights or
corporate governance, or (b) the ownership, directly or indirectly, of more than fifty percent
(50%) of the voting securities or other ownership interest of a legal entity; provided,
however, that if local law restricts foreign ownership, control will be established by direct or
indirect

 

			
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ownership of the maximum ownership percentage that may, under such local law, be owned by
foreign interests.

     1.3 “Applicable Law” means the laws, rules, and regulations, including any statutes, rules,
regulations, guidelines, or other requirements, that may be in effect from time to time and apply
to the development, manufacture, registration, and marketing of the Product in the countries of the
Territory, including any such statutes, rules, regulations, guidelines, or other requirements of
the FDA or the EMEA.

     1.4 “Assignment Agreement” means the Assignment Agreement (“Übertragungs Vertrag”) between
Micromet GmbH and [***] and [***] entered into on [***].

     1.5 “BI” means Boehringer Ingelheim Pharma GmbH & Co. KG.

     1.6 “BI Process Development Agreement” means the Process Development Agreement between
Micromet and BI dated as of December 15, 2003.

     1.7 “BI Process License Agreement” means the Process License Agreement between Micromet and BI
entered into on December 15, 2003.

     1.8 “BLA” means a Biologics License Application filed with the FDA in conformance with
Applicable Law.

     1.9 “CAT Agreement” means the Non-Exclusive Product License Agreement between Micromet and
Cambridge Antibody Technology Limited entered into on September 3, 2003.

     1.10 “Clinical Trial Materials” means the Product formulated in accordance with applicable
specifications, and placebo of such formulations, for administration to healthy volunteers or
patients in clinical trials.

     1.11 “Collaboration Technology” means Joint Collaboration Technology, Micromet Collaboration
Technology, and Serono Collaboration Technology.

     1.12 “Combination Study” has the meaning as defined in Section 3.1.5.

     1.13 “Commercialization” means the marketing, promotion, advertising, selling or distribution
of the Product in a country after all Marketing Approvals have been obtained in such country. The
term “Commercialize” has a correlative meaning.

     1.14 “Commercially Reasonable Efforts” means those diligent efforts consistent with the
exercise of prudent scientific and business judgment, as applied by a Party to the
development and commercialization of its own pharmaceutical products at a similar stage of
development and with similar market potential.

 

			
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     1.15 “Confidential Information” has the meaning as defined in Section 9.1.

     1.16 “Control” and, with correlative meaning, the term “Controlled”, means, with respect to a
Party and any Patent, Know-How, or other intellectual property right, the ability to grant the
other Party access, a license or a sublicense (as applicable) or right to use such Patent,
Know-How, or intellectual property right as provided in this Agreement without violating the terms
of any agreement or other arrangement with any Third Party existing at the time such Party would be
required under this Agreement to grant the other Party such access, license, sublicense or right of
use.

     1.17 “Co-Promotion Option” has the meaning as defined in Section 5.1.

     1.18 “Co-Promotion Option Period” has the meaning as defined in Section 5.1.

     1.19 “Co-Promotion Period” has the meaning as defined in Section 5.2.

     1.20 “Co-Promotion Territory” means the territory of the United States or Europe or both, with
respect to which Micromet has exercised the Co-Promotion Option.

     1.21 “Development Activities” means any activities to be performed pursuant to a Development
Plan in connection with the development of the Product, including any in vitro or in vivo
preclinical studies, clinical studies in humans, the preparation and filing of the BLA or MAA, the
development of a commercial scale manufacturing process for the Product, and the manufacture of
Clinical Trial Materials for use in clinical trials performed prior to the first Marketing Approval
or as a condition of receiving such Marketing Approval.

     1.22 “Development Expenses” means, with respect to a Party, all direct and indirect costs and
expenses incurred by such Party in carrying out Development Activities, calculated in accordance
with generally accepted accounting principles consistently applied and such Party’s cost accounting
systems, including (a) the cost of such individuals performing Development Activities by or on
behalf of such Party calculated at the FTE Rate; (b) reasonable out-of-pocket expenses not included
in the FTE Rate, as set forth in a Development Plan (such as expenses for dedicated equipment,
reagents, etc.); (c) the Fully Burdened CTM Manufacturing Cost of, or purchase price paid for,
Clinical Trial Materials manufactured or purchased for the performance of the Development
Activities; and (d) manufacturing process development and other services provided by Third Parties
in connection with the performance of the Development Activities. Development Expenses will not
include [***].

     1.23 “Development Plan” means either or both of the Micromet Program Plan or the Serono
Program Plan.

     1.24 “Development Program” means either or both of the Micromet Program or the Serono Program.

     1.25 “Dyax Agreement” means the License Agreement between Micromet and Dyax Corporation
entered into on October 30, 2000.

 

			
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     1.26 “EMEA” means the European Medicines Evaluation Agency, or any successor agency thereof.

     1.27 “EpCam” means the whole or part of the human epithelial cell adhesion molecule EpCAM
identified by the SWISS-PROT entry name TTD1_HUMAN and accession number P16422.

     1.28 “Europe” means (a) those countries that, as the Effective Date, are member states of the
European Union, and (b) any country not included within the foregoing that, as of the date of first
commercial sale of the Product following the receipt of the first Marketing Approval in a member
state of the European Union, is a member state of the European Union, and in each case any
successor states comprising the territory of such member states.

     1.29 “FDA” means the United States Food and Drug Administration, or any successor agency
thereof.

     1.30 “Field” means the treatment of human diseases, disorders and conditions.

     1.31 “Final Study Report” has the meaning as defined in Section 3.1.

     1.32 “FTE” means [***] hours of scientific or technical work per year on or directly related
to the execution or implementation of a Development Program carried out by a qualified individual
by or on behalf of a Party. Scientific or technical work can include, but is not limited to,
research, experimental laboratory work, developing manufacturing processes for the Product,
conducting pre-clinical and clinical development of the Product, recording and writing up results,
reviewing literature and references, holding scientific discussions, preparing and filing a BLA or
MAA for the Product, and managing and directing scientific or technical staff.

     1.33 “FTE Rate” means (a) €[***] per FTE per annum for FTEs performed outside of the United
States, and (b) US$[***] per FTE per annum for FTEs performed in the United States, which amounts
described in each of the foregoing subsections include laboratory supplies and equipment (excluding
items provided for separately under the applicable Development Program), equipment maintenance
costs, utilities, waste removal, and a pro rata allocation of general and administrative expenses
plus facilities expenses.

     1.34 “Fully Burdened CTM Manufacturing Cost” means the consolidated fully burdened cost
incurred by Serono or on its behalf in the manufacture of Clinical Trial Materials, including (a)
direct labor and material costs; (b) product quality assurance/control costs, to the extent
allocable to the Clinical Trial Materials; (c) facility and equipment depreciation costs; (d)
facility and equipment validation and control costs; (e) costs of transport, customs, clearance and
storage of the Clinical Trial Materials (if necessary), duty, and insurance; and (f) applicable
overhead reasonably allocable to the Clinical Trial Materials, in each case as determined in
accordance with International Accounting Standards as applied by Serono consistently across
its products. Fully-Burdened CTM Manufacturing Cost will exclude
[***] and any [***]

 

			
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     1.35 “GCP” means the standards, practices and procedures set forth in the International
Conference on Harmonization (ICH) guidelines entitled “Guidance for Industry E6 Good Clinical
Practice: Consolidated Guidance,” including related regulatory requirements imposed by the FDA, and
equivalent foreign regulations or standards, as applicable.

     1.36 “GLP” means good laboratory practices regulations promulgated by the FDA, published at 21
C.F.R. § 58, as such regulations may be amended from time to time, and equivalent foreign
regulations or standards, as applicable.

     1.37 “IND” means an Investigational New Drug Application filed with the FDA, and the
equivalent application in jurisdictions outside the United States.

     1.38 “Indication” means a cancer of [***] or any [***] thereof, including [***], [***], [***],
[***], [***], [***], [***], [***], [***], [***], [***], [***], [***], [***], [***], [***], and
[***]. Any [***] that are clinically or pathologically distinct will be considered [***] (e.g.
[***] and [***] are [***] and for the purpose of this definition [***], or [***] are cancers [***] and for the purpose of this definition [***]).

     1.39 “Interim Study Report” has the meaning as defined in Section 3.1.

     1.40 “JCC” has the meaning set forth in Section 5.4.2.

     1.41 “Joint Collaboration Technology” means any Patents and Know-How made, conceived or
developed jointly by employees, agents or independent contractors of both Parties or their
Affiliates during the course of, in furtherance of, and as a direct result of such employees,
agents or independent contractors performing an activity pursuant to this Agreement.

     1.42 “Know-How” means (a) any scientific or technical information, results and data of any
type whatsoever, in any tangible or intangible form whatsoever, that is not in the public domain or
otherwise publicly known, including databases, practices, methods, techniques, specifications,
formulations, formulae, knowledge, know-how, skill, experience, test data including
pharmacological, medicinal chemistry, biological, chemical, biochemical, toxicological and clinical
test data, analytical and quality control data, stability data, studies and procedures, and
manufacturing process and development information, results and data, and (b) any biological,
chemical, or physical materials that are not in the public domain or otherwise available to the
public; all to the extent not claimed or disclosed in a Patent.

     1.43 “Licensed Know-How” means any Know-How Controlled by Micromet as of the Effective Date or
during the Term that is made, conceived or developed by employees, agents or
independent contractors of Micromet or its Affiliates and that is necessary or useful for the
manufacture, use, or sale of the Product; but excluding any Know-How within the Micromet
Collaboration Technology or Joint Collaboration Technology.

 

			
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     1.44 “Licensed Patents” means the Micromet Patents and the Third Party Patents.

     1.45 “Licensed Technology” means the Licensed Know-How, the Licensed Patents, the Micromet
Collaboration Technology, and Micromet’s rights and interest in the Joint Collaboration Technology.

     1.46 “MAA” means a marketing approval application filed with the EMEA, and any corresponding
applications in countries or territories other than the European Union or the United States.

     1.47 “Major Market” means the [***], the [***], [***], [***], [***], [***] and [***].

     1.48 “Marketing Approval” means the approval of a BLA or MAA, or any supplement thereof, and
any pricing and reimbursement approvals to the extent required by Applicable Law prior to the sale
of pharmaceutical products in a country or territory.

     1.49 “Marketing Costs” has the meaning as defined in Exhibit F.

     1.50 “Micromet Collaboration Technology” means any Patents and Know-How made, conceived or
developed solely by employees, agents or independent contractors of Micromet or its Affiliates
during the course of, in furtherance of, and as a direct result of such employees, agents or
independent contractors performing an activity pursuant to this Agreement.

     1.51 “Micromet Contribution” has the meaning as defined in Section 5.3.1.

     1.52 “Micromet Patents” means the Patents listed on Exhibit A and any other Patents
Controlled by Micromet as of the Effective Date or during the Term that are made, conceived or
developed by employees, agents or independent contractors of Micromet or its Affiliates and are
necessary or useful for the manufacture, use, or sale of the Product; but excluding any Patents
within the Micromet Collaboration Technology or Joint Collaboration Technology,

     1.53 “Micromet Program” has the meaning as defined in Section 3.1.

     1.54 “Micromet Program Plan” has the meaning as defined in Section 3.1.

     1.55 “MT201” means a human antibody of IgG-1 subtype binding to EpCAM with the sequence set
forth in Exhibit B.

     1.56 “Net Profits” has the meaning as defined in Exhibit F.

     1.57 “Net Sales” means the gross amount invoiced by Serono, its Affiliates or Sublicensees for
sales of the Product to any Third Party (other than any Sublicensee), less
deductions with respect to: (a) normal trade, cash and quantity discounts allowed by Serono,
its Affiliates or Sublicensees, including charge backs; (b) credits, allowances or adjustments

 

			
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allowed by Serono, its Affiliates or Sublicensees, including amounts allowed for returned or
defective products; (c) insurance and transportation charges paid by Serono, its Affiliates or
Sublicensees; (d) custom duties, value added taxes (VAT), sales taxes or other governmental charges
paid by Serono, its Affiliates or Sublicensees in connection with such sales (but excluding what is
commonly known as income taxes); (e) amounts debited by Serono, its Affiliates or Sublicensees on
account of bad debts with respect to Net Sales previously invoiced; and (f) rebates or
reimbursements actually granted by Serono, its Affiliates or Sublicensees to managed health care
organizations, federal, state, or local governments (or their agencies), including Medicaid
rebates. In the event any amounts debited on account of bad debts are subsequently recovered by
Serono, its Affiliates or Sublicensees, such amounts will be added to Net Sales for the calendar
quarter in which such recovery occurred.

If a Combination Product (as defined below) is sold, then for the purpose of calculating royalties
owed under this Agreement on sales of the Combination Product, Net Sales will be calculated as
follows: first, Serono will determine the actual Net Sales of such Combination Product (calculated
using the above described deductions) and then such amount will be multiplied by the fraction
A/(A+B), where A is the weighted (by sales volume) average invoice price of the actual Product
component of such Combination Product, and B is the weighted (by sales volume) average invoice
price of the other active ingredient(s) or functional device of such Combination Product. If the
invoice price of either the Product or the other active ingredient(s) or functional device of such
Combination Product cannot be determined, Net Sales of such Combination Product will be equitably
determined by the Steering Committee with unanimous agreement of all members and without
application of the dispute resolution procedures set forth in Section 2.1.5. “Combination Product”
means (a) a Product consisting of MT201 and one or more other active ingredients, or (b) a Product
where MT201 (alone or with one or more other active ingredients) is contained in or otherwise
administered to a patient by a functional device proprietary to Serono, an Affiliate of Serono or a
Third Party; but in all cases excluding any inert ingredients or packaging materials.

Notwithstanding the foregoing, any amounts received on account of transfers of Product between
Serono, its Affiliates or Sublicensees will be excluded from the calculation of Net Sales, and Net
Sales will be calculated based on the final sale of such transferred product by Serono, its
Affiliates or Sublicensees to any Third Party (who is not a Sublicensee). Further, transfers or
dispositions of the Product for charitable or promotional purposes or for preclinical, clinical,
manufacturing, regulatory or governmental purposes will not be deemed to be “sales.”

     1.58 “Ongoing Trial” has the meaning as defined in Section 3.1.

     1.59 “Opt-Out Option” has the meaning as defined in Section 5.5.

     1.60 “Patents” means (a) all patents and patent applications in any country or supranational
jurisdiction, and (b) any provisionals, substitutions, divisions, continuations, continuations in
part, reissues, renewals, registrations, confirmations, patents of addition, reexaminations,
extensions, supplementary protection certificates and the like, of any such patents or patent
applications.

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     1.61 “Pivotal Trial” means a clinical trial that is of appropriate size and design to
establish that a pharmaceutical product is safe and effective for its intended use, to define
warnings, precautions and adverse reactions that are associated with the pharmaceutical product in
the dosage range to be prescribed, and is required to support Marketing Approval of such
pharmaceutical product or label expansion of such pharmaceutical product.

     1.62 “Product” means a product consisting of or comprising MT201.

     1.63 “Project Team” has the meaning as defined in Section 2.2.

     1.64 “Project Team Leader” has the meaning as defined in Section 2.2.

     1.65 “Rejected Indication” has the meaning set forth in Section 3.3.5.

     1.66 “Serono Collaboration Technology” means any Patents and Know-How that are necessary or
used for the manufacture, use, or sale of the Product and that are made, conceived or developed
solely by employees, agents or independent contractors of Serono or its Affiliates during the
course of, in furtherance of, and as a direct result of such employees, agents or independent
contractors performing an activity pursuant to this Agreement.

     1.67 “Serono Program” has the meaning as defined in Section 3.3.

     1.68 “Serono Program Plan” has the meaning as defined in Section 3.3.

     1.69 “Steering Committee” has the meaning as defined in Section 2.1.1.

     1.70 “Sublicensee” means a Third Party that is developing or Commercializing the Product
pursuant to a license agreement with Serono or any of its Affiliates.

     1.71 “Technology Acquisition Agreement” means any agreement entered into before or after the
Effective Date between a Party and a Third Party under which such Party is granted a license to or
is assigned any of such Third Party’s Patents or Know-How that claim or cover the Product or the
development, manufacture or Commercialization thereof.

     1.72 “Technology Acquisition Payments” means any license fees, milestone payments, royalties,
or other cash payments made or payable by a Party to a Third Party under any Technology Acquisition
Agreement in connection with the execution of such agreement or the development, manufacture or
Commercialization of the Product.

     1.73 “Term” has the meaning as defined in Section 11.1.

     1.74 “Territory” means all countries and territories of the world.

     1.75 “Third Party” means any entity other than Micromet, Serono or their respective
Affiliates.

     1.76 “Third Party Patents” means the Patents licensed to Micromet pursuant to the Dyax
Agreement and the CAT Agreement, and any other Patents of a Third Party Controlled by

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Micromet as of the Effective Date that are necessary or useful for the manufacture, use, or
sale of the Product.

     1.77 “United States” means the United States of America, its territories and possessions,
including the Commonwealth of Puerto Rico.

     1.78
“Valid Claim” means: [***].

2. Collaboration Governance

     2.1 Steering Committee.

          2.1.1 Establishment. Within thirty (30) days following the Effective Date, the Parties will
establish a steering committee (the “Steering Committee”) to oversee the development of the Product
under this Agreement. Each Party will appoint three (3) employees to serve as their
representatives on the Steering Committee. From time to time, Micromet and Serono each may replace
any of its representatives on the Steering Committee upon written notice to the other Party. One
member of the Steering Committee will be designated as the “Chairperson.” Micromet will designate
the Chairperson for the period prior to the commencement of the Serono Program, and Serono will
designate the Chairperson for the period following the commencement of the Serono Program. Subject
to the provisions of this Section 2, the Steering Committee will establish its own procedural rules
for its operation.

          2.1.2 Tasks of the Steering Committee. The Steering Committee will: (a) determine Indications
to be pursued in the development of the Product; (b) review and approve, in its discretion, any
updates or amendments to the Micromet Program Plan and accompanying budget for Development Expenses
proposed by the Project Team; (c) develop the strategy for the Serono Program; (d) review and
approve, in its discretion, the Serono Program Plan (including the allocation of Development
Activities therein) and any updates or amendments thereto proposed by the Project Team; (e) monitor
the progress of the activities undertaken by the Parties pursuant to the Development Program; (f)
review the product lifecycle plans of the Parties for the Product, including indication and label
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or delivery systems; (g) agree upon a communication strategy for the Product; (h) attempt to
resolve disputes among the members of the Project Team and (i) take such other actions as are
expressly delegated to the Steering Committee in this Agreement. The Steering Committee will not
have any power to amend this Agreement and will have only such powers as are specifically delegated
to it under this Agreement.

          2.1.3 Steering Committee Meetings. The Steering Committee will meet not less than once every
calendar quarter until completion of the Ongoing Trials; thereafter, the Steering Committee will
meet not less than semi-annually. Meetings may be held in person or by means of telecommunication
(telephone, video, or web conferences); provided that at least one meeting per year will be held in
person. At least four (4) members of the Steering Committee will constitute a quorum for any
meeting, provided that at least two (2) representatives from each Party are present. The Steering
Committee may meet more frequently by agreement of the Parties or upon the request of either Party.
The Chairperson will be responsible for organizing the meetings of the Steering Committee and for
distributing the agenda of the meetings, which will include any report received from the Project
Team Leaders, but will have no additional powers or rights beyond those held by the other
representatives to the Steering Committee. The Chairperson will include on the agenda any item
within the scope of the responsibility of the Steering Committee that is requested to be included
by a Party, and will distribute the agenda to the Parties no less than seven (7) days before any
meeting of the Steering Committee. Each Party may, in its discretion, invite non-voting employees,
consultants or advisors (which consultants and advisors will be under an obligation of
confidentiality no less stringent than the terms set forth in Section 9) to attend any meeting of
the Steering Committee. Each Party will bear its own costs associated with holding and attending
Steering Committee meetings.

          2.1.4 Meeting Minutes. Minutes will be kept of all Steering Committee meetings by the hosting
Party and sent to all members of the Steering Committee for review and approval within fourteen
(14) days after each meeting. If the meeting is held by means of telecommunication, Micromet will
be deemed to be the hosting Party during the Micromet Program, and Serono will be deemed to be the
hosting Party during the Serono Program. Minutes will be deemed approved unless any member of the
Steering Committee objects to the accuracy of such minutes by providing written notice to the other
members of the Steering Committee within fourteen (14) days of receipt of the minutes. In the
event of any such objection that is not resolved by mutual agreement of the Parties, such minutes
will be amended to reflect such unresolved dispute.

          2.1.5 Decision Making.

               (a) Unless expressly otherwise set forth in this Agreement, the Steering Committee will take
action by unanimous consent of the Parties, with each Party having a single vote, irrespective of
the number of representatives actually in attendance at a meeting, or by a written resolution
signed by the designated representatives of each of the Parties.

               (b) If the Steering Committee is unable to reach unanimous consent on a particular matter
within thirty (30) days of a formal vote requested by either Party on such matter, then either
Party may provide written notice of such dispute to the Chief Executive

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Officer of the other Party; provided, however, that no such referral to the Chief Executive
Officers will occur, and [***] will have the casting vote, with respect to matters relating to the
[***].

               (c) The Chief Executive Officers (or their respective designees, who will not be members of
the Steering Committee or Project Team) of each of the Parties will meet at least once in person to
discuss the dispute and use their good faith efforts to resolve the dispute within [***] after
submission of such dispute to such officers.

               (d) If any such dispute is not resolved by the Chief Executive Officers or their designees
within [***] after submission of such dispute to such officers, then the Chief Executive Officer of
[***] will have the authority to finally resolve such dispute (reasonably taking into consideration
the position of [***]); provided, however, [***].

     2.2 Project Team.

          2.2.1 Establishment of the Project Team. At its first meeting, the Steering Committee will
establish a joint project team consisting of an adequate number of employees of both Parties that
will be responsible for managing the execution of Development Activities (the “Project Team”). The
Project Team may change its number of representatives from time to time by mutual consent of its
members. Each Party will designate one of its Project Team members as the co-leader of the Project
Team (each, a “Project Team Leader”). The Project Team Leaders may, in their discretion, create
sub-teams of the Project Team for the purpose of carrying out specific tasks provided for in this
Agreement. From time to time, Micromet and Serono each may replace any of its representatives on
the Project Team upon written notice to the other Party. The Project Team Leaders will alternate
serving as the Chairperson of the Project Team, with each Project Team Leader acting as Chairperson
for a period of one year. Micromet will designate the first Chairperson. The Chairperson will be
responsible for administering Project Team meetings and circulating the agenda prior to each
meeting, but will have no additional powers or rights beyond those held by the other
representatives to the Project Team. Subject to the provisions of this Section 2, the Project Team
will establish its own procedural rules for its operation.

          2.2.2 Tasks of the Project Team. The Project Team will: (a) propose any appropriate updates
or amendments to the Micromet Program Plan or the accompanying budget for Development Expenses; (b)
propose the Serono Program Plan (including the allocation of Development Activities therein) and
the accompanying budget for Development Expenses as well as any appropriate updates or amendments
thereto; (c) coordinate the activities undertaken by the Parties pursuant to the Development
Program; and (d) take such other actions as are expressly delegated to Project Team by the Steering
Committee. The Parties acknowledge and agree that certain portions of the Micromet Program Plan in
the form attached to this Agreement as Exhibit G contain references to potential changes to
the Micromet Program Plan or the studies to be performed pursuant to such plan, and that any such
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the Micromet Program Plan only upon unanimous consent of the Parties pursuant to the decision
making processes set forth in Section 2.2.5 and 2.1.5.

          2.2.3 Meeting. The Project Team will meet not less than once every calendar quarter.
Meetings may be held in person or by means of telecommunication (telephone, video, or web
conferences); provided that at least one meeting per year will be held in person. At least four
(4) members of the Project Team will constitute a quorum for any meeting, provided that at least
two (2) representatives from each Party are present. The Project Team may meet more frequently by
agreement of the Parties or upon the request of either Party. Each Party will bear its own costs
associated with holding and attending Project Team meetings.

          2.2.4 Minutes. Minutes will be kept of all Project Team meetings by the hosting Party and
sent to all members of the Project Team for review and approval within fourteen (14) days after
each meeting. If the meeting is held by means of telecommunication, Micromet will be deemed to be
the hosting Party during the Micromet Program, and Serono will be deemed to be the hosting Party
during the Serono Program. Minutes will be deemed approved unless either Project Team Leader
objects to the accuracy of such minutes by providing written notice to the other Project Team
Leader within fourteen (14) days of receipt of the minutes. In the event of any such objection
that is not resolved by mutual agreement of the Parties, such minutes will be amended to reflect
such unresolved dispute.

          2.2.5 Decision Making. The Project Team will take action by unanimous consent of the Parties,
with each Party having a single vote, irrespective of the number of representatives actually in
attendance at a meeting or by a written resolution signed by both Project Team Leaders. If the
Project Team is unable to reach unanimous consent on a particular matter within thirty (30) days of
a formal vote requested by either Party on such matter, either Project Team Leader may refer such
matter to the Steering Committee for resolution.

          2.2.6 Reporting. Within thirty (30) days after the end of each calendar quarter and at least
one week prior to any Steering Committee meeting, the Project Team Leaders will provide to the
Steering Committee a written progress report, which will describe the progress made in the
performance of Development Activities since the last such report. In addition to the progress
reports provided hereunder, it is contemplated that the Parties will maintain informal
communications through the Project Team Leaders on their day-to-day activities under this
Agreement.

          2.2.7 Dissolution. If Micromet does not exercise the Co-Promotion Option described in Section
5.1, then the Project Team will be disbanded upon the expiration of the Co-Promotion Option Period.

3. Development Program

     3.1 Micromet Program. Subject to the terms and conditions of this Agreement, Micromet will
perform the following activities (collectively, the “Micromet Program”) following the Effective
Date, all as described in further detail in the plan attached to this Agreement as Exhibit
G, which plan will include the development timelines and a budget of

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Development Expenses to be incurred pursuant to the Micromet Program (the “Micromet Program
Plan”):

          3.1.1 Ongoing Trial. Completion of the following Phase II clinical trials of the Product
being conducted by Micromet as of the Effective Date: MT201-201 (prostate cancer) and MT201-202
(metastatic breast cancer) (each, an “Ongoing Trial”);

          3.1.2 Interim Study Report. Compilation of initial statistical analysis of each Ongoing Trial
(each, an “Interim Study Report”), to be performed [***] weeks after registration of the last
patient in the applicable Ongoing Trial;

          3.1.3 Final Study Report. Preparation of a final study report for each Ongoing Trial
(each, a “Final Study Report”), to be performed following database lock ([***] weeks after
registration of the last patient) and completion of the applicable Ongoing Trial;

          3.1.4 BI Process Development Agreement. Management of Micromet’s collaboration relating to
the development and scale-up of a manufacturing process for the Product pursuant to the BI Process
Development Agreement;

          3.1.5 Combination Study. Performance of a Phase I clinical trial designed to demonstrate the
safety of a combination of the Product with docetaxel (the “Combination Study”); and

          3.1.6 Ongoing Preclinical Work. Performance of certain additional preclinical activities
relating to Product.

     3.2 Conduct of the Micromet Program.

          3.2.1 Efforts and Standards. Micromet will use Commercially Reasonable Efforts to conduct the
Micromet Program, either itself or with or through Affiliates or Third Party contractors. Micromet
will use or retain personnel with sufficient skills and experience as are required to accomplish
efficiently and expeditiously the activities of the Micromet Program as set forth in the Micromet
Program Plan in a good scientific manner and in compliance in all material respects with all
Applicable Laws including GLP and GCP. Micromet will commit such amount of FTEs to conduct the
Micromet Program as are necessary to accomplish the Micromet Program in a timely manner, and in any
event no smaller amount of FTEs than are specified by the Micromet Program Plan. Serono will not
be obligated to reimburse Micromet for any Development Expenses incurred by or on behalf of
Micromet for the Micromet Program in excess of the total Development Expenses budgeted in the
Micromet Program Plan, unless otherwise agreed in writing by Serono.

          3.2.2 Records. All preclinical work conducted by or on behalf of Micromet in the Micromet
Program will be completely and accurately recorded, in sufficient detail and in good scientific
manner, in separate laboratory notebooks distinct from other work being conducted by Micromet.
Micromet will also retain all clinical trial records required by

 

			
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Applicable Law to be maintained. On reasonable notice, and at reasonable intervals but not
more than [***], Serono will have the right to audit Micromet’s compliance with this Section 3.2.2.

     3.3 Serono Program.

          3.3.1 Scope. Promptly after receipt by Serono of the Interim Study Reports for both Ongoing
Trials, the Steering Committee will develop a strategy for the development of the Product and the
further Development Activities through Marketing Approval of the Product, other than the
Development Activities included in the Micromet Program (the “Serono Program”).

          3.3.2 Serono Program Plan.

               (a) During and promptly following the formulation of the Serono Program, the Project Team will
prepare a plan describing the Development Activities to be performed during the Serono Program to
enable the filing of BLAs and MAAs and the receipt of Marketing Approval for the Product in the
Territory (the “Serono Program Plan”), including a budget of Development Expenses to be incurred
pursuant to the Serono Program Plan and the procedures for the timely transfer to Serono of any
preclinical and clinical analytical assays and clinical data, regulatory filings, and any other
Licensed Know-How, materials, or data relating to the Product.

               (b) Within [***] days after receipt by Serono of the Final Study Reports for both Ongoing
Trials, the Project Team will review and update the draft Serono Program Plan, if necessary, and
present the Serono Program Plan to the Steering Committee for review and approval. Within [***]
days of its receipt, the Steering Committee will approve the Serono Program Plan, after, if
necessary, making any revisions thereto to render such Plan approvable.

          3.3.3 Commencement. The Serono Program will commence upon approval by the Steering Committee
of the initial Serono Program Plan pursuant to Section 3.3.2 above.

          3.3.4 Responsibilities.

               (a) If Micromet has exercised the Co-Promotion Option with respect to both the United States
and Europe, then the Parties, [***], will [***]. Subject to the foregoing, the Steering Committee
will define the development strategy for each such Indication and approve the allocation of the
Development Activities of the Serono Program Plan between the Parties in its discretion and the
Project Team will coordinate the Development Activities undertaken by each Party for each such
Indication.

 

			
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               (b) If Micromet has not exercised the Co-Promotion Option, or has exercised it with respect to
the United States or Europe only, then the Steering Committee will approve the allocation of the
Development Activities of the Serono Program Plan between the Parties in its discretion; provided,
however, that notwithstanding anything in this Agreement to the contrary, any Development
Activities allocated to Micromet will be subject to Micromet’s written consent.

               (c) Each Party will be responsible for the performance of such Development Activities as may
be allocated to it under the Serono Program Plan pursuant to subsections (a) and (b) above. In any
event, the Serono Program Plan will provide that Serono is responsible for performing all
activities relating to Chemistry, Manufacturing and Controls (CMC) pursuant to the BI Process
Development Agreement.

          3.3.5 Additional Indications.

               (a) At any time during the Co-Promotion Period, Micromet may submit to the Steering Committee
a written proposal to add to the Serono Program any Indication from the list of Additional
Indications that is not then included in the Serono Program. If the Steering Committee approves
the inclusion of such Indication in the Serono Program, then the Serono Program Plan will be
updated to include the Development Activities to be performed by the Parties in connection with
such Indication. If the Steering Committee does not approve the inclusion of any such Indication
in the Serono Program (each such Indication, a “Rejected Indication”), then, notwithstanding
anything in this Agreement to the contrary, Micromet will have the right, at its own option and
expense, to plan and conduct the development of the Product for each such Rejected Indication;
provided, however, that Micromet may not conduct development of the Product for more than [***]
Rejected Indications simultaneously; and provided further, however, that Micromet may not conduct
development of the Product for any Rejected Indication if such Indication has not been approved
pursuant to Section 2.1.5 for inclusion in the Serono Program based on a determination made in good
faith, on the basis of substantiated medical or scientific rationale, that conducting the
development of the Product for such Indication could present safety issues that could compromise
the Serono Program. Micromet agrees and acknowledges that if and for so long as the Product is
being developed as part of the Serono Program for the [***].

               (b) As Serono is responsible following the completion of the Micromet Program for conducting
meetings and discussions related to the Product with regulatory authorities, including the FDA,
Micromet will not, in the course of developing the Product for a Rejected Indication, conduct any
such meetings or discussions without Serono’s participation or its prior written consent, which
consent will not be unreasonably withheld. In addition, Micromet will not send any written
materials to the FDA or any other regulatory authority regarding the Product unless such written
materials have been reviewed and approved by Serono, which approval will not be unreasonably
withheld. If Micromet receives any written or oral communications from the FDA or any other
regulatory authority relating to the Product, Micromet will promptly notify Serono and provide a
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communication, or notes of any oral communication. The Parties will confer regarding any
response to such written or oral communication prior to its transmission by Serono to the FDA or
other regulatory authority. Micromet will provide to Serono any safety data resulting from any
clinical trials conducted of the Product in the Rejected Indication in accordance with Applicable
Law and the safety reporting and data exchange agreement executed by the Parties pursuant to
Section 3.8. Serono will be responsible pursuant to such safety reporting and data exchange
agreement for reporting safety data to the FDA or other regulatory authorities.

               (c) At any time during which Micromet is developing the Product for a Rejected Indication,
Micromet will provide to Serono a copy of any INDs, any interim analyses and final reports of
clinical trials performed of the Product for such Rejected Indication, and will otherwise provide
updates at the meetings of the Project Team and Steering Committee regarding the development of the
Product for the Rejected Indication, including a detailed description of the development costs
incurred by Micromet to date with respect to such development. Serono will have the right, not
more than [***], to review source data of the clinical trials of the Product for the Rejected
Indication that are available to Micromet. Micromet will conduct any clinical studies of the
Product in the Rejected Indication in compliance in all material respects with all Applicable Laws
including GCP. Serono may at any time during the period Micromet is developing the Product for a
Rejected Indication elect to include such Rejected Indication as part of the Serono Program. Upon
such election, (i) the Serono Program Plan will be updated to include the Development Activities to
be performed by the Parties in connection with such Indication; (ii) Micromet will transfer to
Serono any clinical data, regulatory filings including INDs, and any other Know-How, materials, or
data that have been made, conceived or developed during the development of the Product for the
Rejected Indication in an orderly fashion and in a manner such that the value of the delivered
information and materials is preserved in all material respects; (iii) Micromet will assign or
sublicense to Serono any Technology Acquisition Agreement entered into by Micromet pursuant to
Section 6.3.1 with respect to the development of the Product for such Rejected Indication; (iv)
Serono will [***]; (v) such Indication will cease to be a Rejected
Indication; and (vi) Serono will [***].

               (d) If Micromet has completed all Pivotal Trials of the Product in a Rejected Indication that,
as reasonably determined in good faith in accordance with the decision making processes set forth
in Section 2.1.5, are required to support Marketing Approval for the Product in such Rejected
Indication, then such Indication will cease to be a Rejected Indication and will be deemed included
in the Serono Program, and Micromet will transfer to Serono any clinical data and any other
Know-How, materials, or data that have been made, conceived or developed during the development of
the Product for the Rejected Indication in an orderly fashion and in a manner such that the value
of the delivered information and materials is preserved in all material respects. Micromet will
also assign or sublicense to Serono any Technology Acquisition Agreement entered into by Micromet
pursuant to Section 6.3.1 with

 

			
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respect to the development of the Product for such Rejected Indication. Serono will
thereafter prepare and file a BLA or MAA for the Product in such Rejected Indication. Within [***]
days of acceptance of such BLA or MAA by the relevant regulatory authority, Serono will [***], and [***]. The Parties will
update the marketing plan developed pursuant to Section 5 to include such Rejected Indication and
will Commercialize the Product for such Rejected Indication under the terms of this Agreement.

               (e) If the BI Process Development Agreement and the BI Process License Agreement have been
assigned to Serono or Serono is then manufacturing Clinical Trial Materials, Serono will supply to
Micromet Clinical Trial Materials required by Micromet for the development of any Rejected
Indication [***]. Serono will use commercially reasonable efforts to ensure that
capacity is available at a Serono manufacturing facility or a BI manufacturing facility to meet the
foregoing obligation, provided that in the event of any capacity limitations, the supply of
Clinical Trial Materials for the performance of the Serono Program or Product for the
Commercialization of the Product will take precedence over the supply of Clinical Trial Materials
required by Micromet for the development of such Rejected Indications.

          3.3.6 Records. All preclinical work conducted by or on behalf of the Parties in the Serono
Program will be completely and accurately recorded, in sufficient detail and in good scientific
manner, in separate laboratory notebooks distinct from other work being conducted by the applicable
Party. Each Party will also retain all clinical trial records required by Applicable Law to be
maintained in connection with the Serono Program or the development of any Rejected Indication.
During any period when either both Parties are performing Development Activities under the Serono
Program or Micromet is developing a Rejected Indication, on reasonable notice, and at reasonable
intervals but not more than [***] [***], each Party will have the right to audit the other Party’s
compliance with this Section 3.3.6.

     3.4 Diligence in Development.

          3.4.1 By Serono. Serono, itself or through one or more Affiliates, Sublicensees or other
Third Parties, will use Commercially Reasonable Efforts to develop and obtain Marketing Approval
for the Product in all Major Markets. Serono will perform the Serono Program in a good scientific
manner and in compliance in all material respects with all Applicable Laws including GLP and GCP.
All efforts of Serono’s Affiliates, Sublicensees and Third Party contractors will be considered
efforts of Serono for the purpose of determining Serono’s compliance with its obligations under
this Section 3.4.1. Serono’s fulfillment of its obligations to use Commercially Reasonable Efforts
under this Section 3.4.1 will be conclusively established at any given time if, during the
preceding [***] period, any one of the following situations applies: (a) with respect to any [***]
period falling within the first [***] from the

 

			
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commencement of the Serono Program pursuant to Section 3.3.3, Serono, its Affiliates or
Sublicensees [***]; (b) with respect to any subsequent [***]
period, Serono, its Affiliates or Sublicensees [***]; (c)
Serono, its Affiliates or Sublicensees [***]; (d) Serono, its
Affiliates or Sublicensees [***]; or (e)
the Parties collectively [***] with respect to [***] (i) at least [***] during such [***] period, or (ii) at least
[***], in the aggregate, during such [***] period [***].

          3.4.2 By Micromet. Micromet will use Commercially Reasonable Efforts to perform its
Development Activities under the Serono Program in a good scientific manner and in compliance in
all material respects with all Applicable Laws including GLP and GCP. All efforts of Micromet’s
Affiliates will be considered efforts of Micromet for the purpose of determining Micromet’s
compliance with its obligations under this Section 3.4.2.

     3.5 Development Expenses.

          3.5.1 Obligation. Serono will bear all Development Expenses incurred by the Parties;
provided, however, that (a) Serono will not have any obligation to make any payments in excess of
[***] Euros (€[***]) with respect to the Micromet Program as described in the plan attached to this
Agreement as Exhibit G; (b) Serono will not have any obligation to make any payments with
respect to Micromet’s FTEs for the management of the Ongoing Trials, and (c) during the
Co-Promotion Period, the allocation of Development Expenses incurred by the Parties for the Serono
Program will be as set forth in Section 5.3.

          3.5.2 Reports and Payment. Serono will pay to Micromet on or before the first day of each
calendar quarter the amount of Development Expenses budgeted to be incurred by Micromet in such
calendar quarter as set forth in the applicable Development Plan. Within thirty (30) days of the
end of each calendar quarter, Micromet will provide Serono with quarterly reports containing a
detailed account of Development Activities performed by Micromet and Micromet’s Development
Expenses incurred during the preceding calendar quarter, including the number of individuals that
performed Development Activities, the number of FTE hours worked by each such individual and the
out-of-pocket expenses incurred by Micromet. All reported charges will be in accordance with the
budget for Development Expenses for the applicable Development Plan. Any such report will be
considered Confidential Information of Micromet, subject to the terms and conditions of Section 9.
The Development Expenses set forth in such reports will be reconciled with Serono’s payments for
such quarter. If such payments are in excess of Micromet’s accumulated Development Expenses, then
the amount of such excess will be credited against the next payment of Development Expenses due by
Serono hereunder (or, if no such payment is due, refunded by Micromet to Serono within [***] days
of such determination). If Micromet’s accumulated Development Expenses exceed the amount paid by
Serono, then Serono will pay the excess amount to Micromet within [***] days of the determination.

 

			
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     3.6 Development Plan Updates. In the course of the performance of the Development
Program, the Project Team will update the applicable Development Plan as it deems necessary and
appropriate. In addition, the Project Team will update the budget for Development Expenses set
forth in the applicable Development Plan in order to reflect the changes to the Development Plan.
Any changes to a Development Plan, including changes to the budget for Development Expenses, are
subject to approval by the Steering Committee.

     3.7 Technology Transfer; Assignment of BI Process Development Agreement and BI
Process License Agreement.

          3.7.1 Technology Transfers. Upon commencement of the Serono Program pursuant to
Section 3.3.3, the Parties will transfer the Licensed Know-How to Serono in accordance with the
Serono Program Plan. In addition, from time to time in connection with the performance by the
Parties of the Serono Program Plan, the Parties will share any analytical assays and clinical data,
regulatory filings, and any other Know-How, materials, or data relating to the Product that have
not already been shared between the Parties. The costs incurred by the transferring Party in
connection with any transfers made pursuant to this Section 3.7.1 will be [***].

          3.7.2 Assignment of BI Process Development Agreement and BI Process License
Agreement. Promptly following the Effective Date, Micromet will use diligent efforts to obtain
BI’s consent to the assignment of the BI Process Development Agreement and the BI Process License
Agreement to Serono, and if Micromet has received such consent, Micromet will assign the BI Process
Development Agreement and the BI Process License Agreement to Serono [***] of the Serono Program
pursuant to Section 3.3.3. If such consent is not received by Micromet prior to the end of such
[***], the Parties will in good faith negotiate an alternate arrangement under which Micromet will
supply Clinical Trial Materials and Product to Serono for Serono’s performance of this Agreement or
take any actions pursuant to the BI Process Development Agreement and the BI Process License
Agreement that would permit Serono or its designee to manufacture Clinical Trials Materials and the
Product. If Micromet is supplying Clinical Trial Materials or Product to Serono and Micromet is
also developing the Product for a Rejected Indication, then in the event of any capacity
limitations with respect to the manufacture of Clinical Trial Materials or Product, the supply of
Clinical Trial Materials for the performance of the Serono Program or Product for the
Commercialization of the Product will take precedence over the supply of Clinical Trial Materials
required by Micromet for the development of such Rejected Indication.

     3.8 Regulatory Obligations during the Development Program. During the Micromet Program,
Micromet will maintain a safety database with respect to any animal studies or clinical trials
conducted with the Product by or on behalf of Micromet and will be responsible for maintaining INDs
and conducting any other regulatory activities required for the conduct of the Micromet Program,
including communicating and preparing and filing all reports (including adverse drug experience
reports) with the FDA or other applicable regulatory authorities. If Micromet receives any written
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authority relating to the Product, Micromet will promptly notify Serono and provide a copy to
Serono of any written communication, or notes of any oral communication. The Parties will confer
regarding any response to such written or oral communication prior to its transmission to the FDA
or other regulatory authority. Upon Micromet’s exercise of its Co-Promotion Option, the Parties
will execute a safety reporting and data exchange agreement specifying safety reporting
requirements and methods for exchange of important safety information regarding the Product. Upon
the commencement of the Serono Program pursuant to Section 3.3.3, the Parties will maintain a
common safety database for animal studies and clinical trials of the Product, which database will
be managed by Serono. Serono will thereafter be responsible for maintaining INDs and conducting
any other regulatory activities required for the conduct of the Serono Program, including
communicating and preparing and filing all reports (including adverse drug experience reports) with
the FDA or other applicable regulatory authorities.

     3.9 Clinical Trial Materials. Micromet will be responsible for purchasing any additional
Clinical Trial Materials from BI pursuant to the BI Process Development Agreement that are required
to conduct the Ongoing Clinical Trials and the Combination Study. Serono will be responsible for
manufacturing or purchasing all Clinical Trial Materials required to conduct the Serono Program.
The costs of manufacturing or purchasing Clinical Trial Materials for the conduct of the Serono
Program will be Development Expenses.

     3.10 Progress Reports. The Parties will inform each other of their Development Activities
through their interactions in the Project Team and through progress reports submitted to the
Steering Committee. To the extent not otherwise provided for herein, upon request of a Party, the
other Party will provide the requesting Party copies of clinical trial protocols, preliminary
reports and final reports of any clinical studies performed by it, and any other information or
data reasonably requested by the other Party.

4. Unilateral Commercialization by Serono

     4.1 Principles of Commercialization. Serono will be solely responsible for Commercializing
the Product in the Territory during the Term; provided, however, that, during the Co-Promotion
Period, Section 5 will apply to the Parties’ co-promotion of the Product in the Co-Promotion
Territory.

     4.2 Regulatory Obligations during Commercialization. Serono will own and maintain all
regulatory filings and Marketing Approvals for the Product developed pursuant to this Agreement,
including all INDs, BLAs and MAAs (other than those INDs held by Micromet pursuant to the Micromet
Program prior to their transfer to Serono pursuant to Section 3.7 and those INDs held by Micromet
pursuant to Section 3.3.5). As between the Parties, Serono will be solely responsible for all
activities in connection with maintaining Marketing Approvals and other regulatory approvals
required for the Commercialization and manufacture of the Product in the Territory, including
communicating and preparing and filing all reports (including adverse drug experience reports) with
the applicable regulatory authorities.

     4.3 Regulatory Meetings. Serono will promptly notify Micromet in writing and in advance of
any meeting with or inspection by any regulatory authority related to the Product and provide
copies of any written correspondence and documentation relating thereto. At

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Micromet’s option, and subject to Serono’s approval, which will not unreasonably be withheld,
Micromet may have an employee or Third Party consultant participate in such meeting or inspection
as an observer.

     4.4 Diligence in Commercialization. Serono will use Commercially Reasonable Efforts to launch
the Product in a country after receiving all Marketing Approvals in such country, and thereafter
will use Commercially Reasonable Efforts to Commercialize the Product in such country. Serono may
sell the Product as part of a bundle with other Serono products or offer package deals to customers
that include the Product, provided that for the calculation of Net Sales, the gross amount invoiced
for the Product so treated will be deemed to be the weighted (by sales volume) average invoice
price in the preceding calendar quarter for Product sold separately and the rebate or discount with
respect to the Product may not exceed the weighted average rebate or discount on all other products
sold as part of the bundle or package. Upon request of Micromet, Serono will provide to the
Steering Committee a copy of the launch and annual marketing plans prepared by Serono with respect
to the Commercialization of the Product, and any amendments or updates thereto.

     4.5 Product Supply. Serono will be responsible for manufacturing or purchasing all commercial
supplies of the Product in the Territory.

     4.6 Branding, Trademarks, Trade Dress, and Logos. Serono will be the owner of all trademarks,
trade dress, logos, slogans, designs and copyrights developed for or used on or in connection with
the Commercialization of the Product in the Territory. Serono will select the trademark or
trademarks used to identify the Product that will be Commercialized in the Territory pursuant to
this Agreement. Serono will oversee the filing, prosecution and maintenance of all trademark
registrations for the Product in the Territory. Serono will be responsible for the payment of any
and all costs relating to filing, prosecution, and maintenance of the trademark or trademarks for
the Product in the Territory.

5. Joint Development and Commercialization

     5.1 Option. Micromet will have the right to elect to develop and Commercialize the Product in
the United States and in Europe jointly with Serono (the “Co-Promotion Option”) pursuant to the
provisions of this Section 5.1. Within [***] days of commencement of the Serono Program pursuant
to Section 3.3.3 (the “Co-Promotion Option Period”), Micromet may exercise the Co-Promotion Option
with respect to one or both of the United States and Europe by providing written notice of such
exercise to Serono designating the territory or territories with respect to which Micromet desires
to exercise the option (such territory or territories, the “Co-Promotion Territory”). Such
exercise will be effective immediately upon receipt of such notice by Serono. If Micromet does not
exercise the Co-Promotion Option during the Co-Promotion Option Period, and Serono’s actual
expenditures for Development Expenses during the initial [***] following expiration of the
Co-Promotion Option Period do not equal at least [***] percent of the amounts for Development
Expenses for such period set forth in the Serono Program Plan, then Serono will promptly so notify
Micromet. For [***] day period following such notice,

 

			
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Micromet may exercise its Co-Promotion Option (treating such period as the Co-Promotion Option
Period), upon written notice to Serono and the payment of Micromet’s share (as described in Section
5.3.1) of Development Expenses incurred by Serono to the date of option exercise.

     5.2 Co-Promotion Period. The “Co-Promotion Period” will commence upon Micromet’s exercise of
the Co-Promotion Option and will expire upon the earlier of: (a) if Micromet has exercised the
Opt-Out Option pursuant to Section 5.5 with respect to the entire Co-Promotion Territory, the end
of the period described in Section 5.5.2 or (b) termination of the Parties’ development and
Commercialization of the Product in the Co-Promotion Territory.

     5.3 Development Expenses during Co-Promotion Period.

          5.3.1 Split of Expenses. During the Co-Promotion Period, the development of the Product will
continue pursuant to the terms of Sections 2, 3, and 4, subject to the terms and conditions of this
Section 5. Micromet will be responsible for and pay a certain percentage, as set forth in
Exhibit E, of the Development Expenses incurred by the Parties in connection with the
development of the Product in the Co-Promotion Territory during the Co-Promotion Period in
accordance with the Serono Program Plan (such amount, the “Micromet Contribution”).

          5.3.2 Report of Development Expenses Incurred. Within [***] days of the end of each calendar
quarter during the Co-Promotion Period during which Development Expenses have been incurred by
either Party in connection with the development of the Product in the Co-Promotion Territory, each
Party incurring such Development Expenses will deliver a report to the other Party. Each such
report will contain a detailed account of Development Activities performed and Development Expenses
incurred during the preceding calendar quarter, including the number of individuals that performed
Development Activities, the number of FTE hours worked by each such individual and the
[***] incurred. Any such report will be considered Confidential Information of
the Party submitting it, subject to the terms and conditions of Section 9. All reported charges
will be in accordance with the budget for Development Expenses for the Serono Program.

          5.3.3 Reconciliation. Following receipt of such reports, there will be a reconciliation of
the Development Expenses incurred during such calendar quarter by each Party, with a subsequent
payment by one Party to the other to the extent necessary so that each Party bears its appropriate
percentage share of such Development Expenses. Such balancing payments by one Party to the other
to reimburse the other Party for the purposes of cost sharing under this Agreement will be approved
by the Project Team within [***] ([***]) days of the end of each calendar quarter with respect to
which reports have been delivered hereunder and will be made within [***] ([***]) days thereafter.

          5.3.4 Grace Period. Notwithstanding the foregoing provisions of Section 5.3, in the event
that the budget for the current calendar year in the Serono Program Plan most recently approved by
the Steering Committee [***] compared to the budget for such calendar year in the last Serono
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Micromet will have the right to delay the payment of its share of the Development Expenses
[***] of such prior approved budgeted amount for [***]months following the end of the current
calendar year; provided, however, that any payments which are not made on the date such payments
would otherwise be due will bear interest until paid at the lower of (a) [***] above the overnight
LIBOR rate in effect on the due date, or (b) the maximum rate permitted by applicable law,
calculated on the number of days such payment is delayed.

     5.4 Co-Promotion Terms.

          5.4.1 Co-Promotion Agreement. Within [***] days after completion of the final study report
for the first Pivotal Trial for the Product anywhere in the Co-Promotion Territory, if such
completion occurs during the Co-Promotion Period, the Parties will negotiate in good faith a
co-promotion agreement governing the co-promotion of Product by the Parties in the Co-Promotion
Territory that will include the provisions of this Section 5.4 and such other terms that are
customary and appropriate for a co-promotion arrangement (the “Co-Promotion Agreement”). Until
such Co-Promotion Agreement is negotiated, the Parties will Commercialize the Product in the
Co-Promotion Territory in accordance with the provisions of this Section 5.4 and Section 4.

          5.4.2 Joint Commercialization Committee. The co-promotion of the Product in the Co-Promotion
Territory will be governed by a Joint Commercialization Committee (the “JCC”) to be established by
the Parties. Each Party will have equal representation on the JCC, which will meet at least once
per calendar quarter, at mutually agreeable times and locations, to discuss and coordinate the
launch of the Product in the Co-Promotion Territory, the marketing and promotion of the Product and
the strategies and programs that should be developed to maximize Net Profits generated with the
Product. In addition, if there is more than one territory within the Co-Promotion Territory, the
Parties will establish a regional commercialization committee for each such territory, with each
such committee having the responsibilities allocated to such committee by the JCC. The JCC will be
responsible for issues relating to branding, labeling, positioning, life cycle management and
post-approval clinical trials of the Product in the territories within the Co-Promotion Territory.
Any regional commercialization committee established for a territory within the Co-Promotion
Territory will be responsible for any region-specific operational issues as the JCC may delegate,
will report to the JCC on a regular basis and will refer any dispute to the JCC.

          5.4.3 Dispute Resolution. The JCC will take action by unanimous consent of the Parties, with
each Party having a single vote. If the JCC is unable to reach unanimous consent on a particular
matter within thirty (30) days of a formal vote requested by either Party on such matter, either
Party may refer such matter to the Steering Committee for resolution pursuant to Section 2.1.5.

          5.4.4 Marketing Plan. The JCC will develop an annual marketing plan and budget for the
promotion and detailing of the Product in the Co-Promotion Territory (the “Marketing Plan”). The
Marketing Plan will include a comprehensive marketing, promotion

 

			
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and sales strategy for the Product, including a budget of Marketing Costs relating to the
Product. The Marketing Plan will provide for activities of each Party (whether itself or with or
through Affiliates) in the marketing and promotion of the Product in the Co-Promotion Territory
that will be commensurate with the Parties’ respective marketing and sales force capabilities and
will be designed to maximize Net Profits. The JCC will propose, and the Steering Committee will
approve, the Marketing Plan. For each calendar year following the first commercial sale of the
Product, the JCC will submit to the Steering Committee an annual Marketing Plan for the Product on
or before November 15 of the calendar year preceding the calendar year to which such Marketing Plan
relates.

          5.4.5 Costs and Profit Sharing.

               (a) Serono will set the sales price for, distribute and book all sales revenue for the Product
in the Co-Promotion Territory.

               (b) As further described in subsection (c) below, [***] the [***], [***], [***], [***] and
[***] incurred by either Party in connection with the Commercialization of the Product in the
Co-Promotion Territory, and in lieu of paying royalties on Net Sales of the Product to Micromet
under Section 7.3, Serono will pay to Micromet an amount corresponding to [***] of the Net Profits
of the Product sold by Serono, its Affiliates or Sublicensees in the Co-Promotion Territory.

               (c) The payment of Micromet’s share of Net Profits due pursuant to this Section 5.4.5 is due
and payable within [***] days of the end of each calendar quarter during the Co-Promotion Period
during which there were sales of the Product in the Co-Promotion Territory. Serono will accompany
each payment of Net Profits under this Agreement with a report setting forth, on a
country-by-country basis, the amount of gross sales of the Product in such country, a calculation
of Net Sales and Net Profits (with itemized deductions), the currency conversion rate used and
EURO-equivalent of such Net Profits, and a calculation of the amount of Micromet’s share of Net
Profits. Such report will be considered Confidential Information of Serono subject to the
obligations of Section 9 of this Agreement.

5.5 Opt-Out Option.

          5.5.1 Description of Option. Micromet will have the right to opt out of the co-development
and co-promotion of Product (the “Opt-Out Option”) with respect to (a) the entire Co-Promotion
Territory, or (b) if both the United States and Europe compose the Co-Promotion Territory, either
the United States or Europe individually. The territory or territories with respect to which
Micromet exercises the Opt-Out Option will be referred to collectively as the “Opt-Out Territory.”
Micromet may exercise the Opt-Out Option at any time by providing written notice to Serono, which
exercise will become effective immediately upon receipt of such notice by Serono (such effective
date, the “Opt-Out Date”).

          5.5.2 Expiration of the Co-Promotion Period for the Opt-Out Territory. If Micromet exercises
the Opt-Out Option, then the Co-Promotion Period with respect to the Opt-

 

			
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Out Territory will expire upon the later of: (a) the date [***] following the Opt-Out Date,
and (b) [***] of the then-current calendar year. Upon such expiration, (a) if the Opt-Out
Territory included the entire Co-Promotion Territory, Micromet will have no further right to
co-develop or co-promote the Product, or (b) if the Opt-Out Territory only included a portion of
the Co-Promotion Territory, the definition of “Co-Promotion Territory” will be deemed amended to
exclude the Opt-Out Territory and Micromet’s share of Development Expenses under Section 5.3 will
be recalculated, on a going forward basis, based on the new Co-Promotion Territory.

          5.5.3 Restrictions on Funding Obligations. Notwithstanding anything to the contrary in this
Agreement, Micromet’s obligation under Section 5.3 to co-fund Development Expenses in the Opt-Out
Territory after the Opt-Out Date will extend only to Development Activities that are ongoing as of
the Opt-Out Date and will expire at the end of the Co-Promotion Period.

          5.5.4 Milestone Payments. After the Opt-Out Date, Serono will pay, or cause to be paid, to
Micromet, in addition to any other milestones and royalties due hereunder, the following milestone
payments within [***] days following achievement of each of the following milestone events:

               (a) upon receipt of the first Marketing Approval for the Product anywhere in the Opt-Out
Territory for any Indication, a payment equal to [***] of the amount of the Micromet Contribution
that is allocable to the Opt-Out Territory, with such allocation determined by reference to the
ratio of the percentages set forth in Exhibit E (such amount, the “Allocable Micromet
Contribution”);

               (b) upon the later of (i) the [***] of the Product anywhere in the Opt-Out Territory or (ii)
the date when the total amount of aggregate worldwide Net Sales of the Product equal [***], a
payment equal to [***] of the Allocable Micromet Contribution; and

               (c) upon the later of (i) the [***] the first commercial sale of the Product anywhere in the
Opt-Out Territory or (ii) the date when the total amount of aggregate worldwide Net Sales of the
Product equal [***], a payment equal to [***] of the Allocable Micromet Contribution.

     By way of example: If Micromet exercised the Co-Promotion Option for the United States and
Europe, the total amount of the Development Expenses incurred by the Parties in connection with the
development of the Product in the Co-Promotion Territory during the Co-Promotion Period was
US$[***] and Micromet exercised the Opt-Out Option with respect to the United States, then the
Micromet Contribution would be US$[***]. Of the total Micromet Contribution, US$[***] would be
allocable to the United States, and US$[***] would be allocable to Europe. Thus, Micromet would
potentially be entitled to receive the following milestone payments under this Section 5.5.4:
US$[***] under subsection (a), US$[***] under subsection (b), and US$ [***] under subsection (c).

 

			
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6. Intellectual Property; Grant of Rights and Licenses

     6.1 License Grants.

          6.1.1 By Micromet.

               (a) Subject to the terms and conditions set forth in this Agreement, Micromet hereby grants to
Serono a worldwide, exclusive, royalty-bearing right and license (or sublicense, as applicable),
with the right to grant sublicenses, under the Licensed Technology to make, have made, use, offer
for sale, sell, and import the Product in the Field in the Territory.

               (b) The sublicense granted under Section 6.1.1(a) under Micromet’s license to the Third Party
Patents is subject to the terms and conditions set forth in the Dyax Agreement and the CAT
Agreement, respectively, and full copies of such agreements have been made available to Serono.

               (c) Serono hereby covenants and agrees not to use any Licensed Technology, nor grant any Third
Party any license or right under any Licensed Technology, other than as expressly permitted in this
Agreement, the Dyax Agreement or the CAT Agreement, as applicable.

          6.1.2 By Serono. Subject to the terms and conditions set forth in this Agreement, Serono
hereby grants to Micromet a nonexclusive, royalty-free right and license under the Serono
Collaboration Technology to perform Development Activities pursuant to the Micromet Program Plan
and the Serono Program Plan.

          6.1.3 Reservation of Rights. Except for the rights specifically granted in this Agreement,
Micromet reserves all rights to the Licensed Technology. Further, Micromet retains any rights
under the Licensed Technology as may be required to perform its obligations under this Agreement.
No implied licenses are granted under this Agreement.

     6.2 Ownership of Collaboration Technology.

          6.2.1 Micromet Collaboration Technology. Micromet will own all right, title, and interest in
and to the Micromet Collaboration Technology, subject only to the licenses granted to Serono in
this Agreement. Micromet will promptly disclose to Serono in writing, and will cause its
Affiliates, agents and independent contractors to so disclose to Micromet, the development, making,
conception or reduction to practice of any Micromet Collaboration Technology.

          6.2.2 Serono Collaboration Technology. Serono will own all right, title, and interest in and
to any Serono Collaboration Technology, subject only to the licenses granted to Micromet in this
Agreement. Serono will promptly disclose to Micromet in writing, and will cause its Affiliates,
agents and independent contractors to disclose to Serono, the development, making, conception or
reduction to practice of any Serono Collaboration Technology.

          6.2.3 Joint Collaboration Technology. Micromet and Serono will each own an undivided one-half
interest in any Joint Collaboration Technology, without obligation to account to the other for the
exploitation thereof or to seek consent of the other for the grant of any licenses thereunder,
subject to the licenses and rights granted by the Parties in this

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Agreement. Each Party will promptly disclose to the other Party in writing, and will cause
its Affiliates, agents and independent contractors to so disclose to it, the development, making,
conception or reduction to practice of any Joint Collaboration Technology.

          6.2.4 Employees, Agents and Independent Contractors. Each of Serono and Micromet will require
all of its and its Affiliates’ employees to assign all inventions that are the subject of patent
applications claiming Collaboration Technology and that are developed, made or conceived by such
employees to Serono or Micromet according to the ownership principles described in this Section
6.2. Each Party will require any agents or independent contractors performing an activity pursuant
to this Agreement to assign or grant a sublicensable license to all inventions that are the subject
of patent applications claiming Collaboration Technology and that are developed, made or conceived
by such agents or independent contractors to Serono and/or Micromet according to the ownership
principles described in this Section 6.2.

     6.3 Third Party Technology.

          6.3.1 Technology Acquisition Agreement. Each Party hereby agrees not to enter into any
Technology Acquisition Agreement without notifying the other Party in writing and receiving such
Party’s written consent to such Technology Acquisition Agreement; provided, however, that notice to
and consent of Micromet will not be required (a) if Serono seeks to enter into a Technology
Acquisition Agreement with respect to any part of the Territory other than the Co-Promotion
Territory or (b) following the expiration of the Co-Promotion Option Period if Micromet has not
exercised the Co-Promotion Option; and provided further, that either Party will use commercially
reasonable efforts to make any Technology Acquisition Agreements assignable or sublicensable to the
other Party.

          6.3.2 Technology Acquisition Payments.

               (a) Subject
to subsection (b) below, [***] will be responsible for and will make any
Technology Acquisition Payments arising in connection with the development, manufacture or
Commercialization of the Product in the Territory under its own Technology Acquisition Agreements
and under any Technology Acquisition Agreements [***] or
[***] provided, however, that [***] will not be
responsible for or pay any Technology Acquisition Payments arising in connection with the
development of the Product by [***]. [***] will make any Technology Acquisition Payments payable by it
pursuant to this Section 6.3.2(a) in accordance with the terms of the applicable Technology
Acquisition Agreement.

               (b) Notwithstanding
subsection (a) above, [***] will only be responsible for and pay [***]
([***]%) of any Technology Acquisition Payments that become due after the Effective Date under
Sections 3.2, 3.3, 3.4, and 3.5 of the [***], Section 3.1 of the [***], Sections 5.2.1 and 5.3.1 of
the [***], and Section 4.1 of the [***]
[***] [***] will be
responsible for and pay the other [***] ([***]%) of such Technology Assignment Payments. The
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[***] ([***]%) shares of such Technology Acquisition Payments as is appropriate and necessary
to ensure compliance with the applicable Technology Acquisition Agreements. Other than the
payments described in this subsection (b), [***] will not be responsible for any other payments
due under any Technology Acquisition Agreements [***] based on
license fees or the achievement of milestone events.

               (c) [***]
may deduct a portion of the Technology Acquisition Payments paid
[***] under this Agreement, [***].

          6.3.3 Compensation of Micromet Employees. The Parties acknowledge and agree that employees of
Micromet and Micromet are each subject to the German Act on Employees’ Inventions
(Arbeitnehmererfindergesetz, “ArbEG”) under which Micromet may have an obligation to compensate its
employees if they are inventors of Collaboration Technology or intellectual property invented in
connection with the development by Micromet of the Product for a Rejected Indication. Micromet
will pay any such compensation to its employees who are inventors of Collaboration Technology or
such other intellectual property at its own cost and expense.

     6.4 Prosecution and Maintenance of Patents.

          6.4.1 By Micromet. As between the Parties, Micromet will file, prosecute and maintain Patents
in the Micromet Patents and the Micromet Collaboration Technology. [***] will bear all costs
incurred in connection with the filing and prosecution of patent applications and patents included
in the Micromet Patents, the Micromet Collaboration Technology. Micromet will provide Serono with
copies of all material documents and correspondence relating to the prosecution of such Patents (a)
promptly after receipt thereof from applicable patent authorities, and (b) a reasonable time in
advance of filing for documents to be filed by Micromet with applicable patent authorities, in
order to allow Serono time to review such materials and comment thereon. Serono’s comments will be
taken into reasonable consideration by Micromet and its legal counsel in connection with the
prosecution of such Patents. Serono will provide Micromet all reasonable assistance in prosecuting
such Patents at [***] expense.

          6.4.2 By Serono. As between the Parties, Serono will file, prosecute and maintain Patents in
the Joint Collaboration Technology and the Serono Collaboration Technology. [***] will bear all
costs incurred in connection with the filing and prosecution of patent applications and patents
included in the Joint Collaboration Technology and the Serono Collaboration Technology. Serono
will provide Micromet with copies of all material documents and correspondence relating to the
prosecution of Patents in the Joint Collaboration Technology (a) promptly after receipt thereof
from applicable patent authorities, and (b) a reasonable time in advance of filing for documents to
be filed by Serono with applicable patent authorities, in order to allow Micromet time to review
such materials and comment thereon. Micromet’s comments will be taken into reasonable
consideration by Serono and its legal counsel in connection with the prosecution of such Patents.
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independent contractors to provide, Serono all reasonable assistance in prosecuting such
Patents at [***] expense.

     6.5 Enforcement and Defense of Patents.

          6.5.1 Notice. If either Party learns that a Third Party is infringing or allegedly infringing
any Patent within the Licensed Patents, the Micromet Collaboration Technology and Joint
Collaboration Technology or if any Third Party claims that any such Patent is invalid or
unenforceable, it will promptly notify the other Party thereof including available evidence of
infringement or the claim of invalidity or unenforceability. The Parties will cooperate and use
reasonable efforts to stop such alleged infringement or to address such claim without litigation.

          6.5.2 Enforcement and Defense of Licensed Patents, the Micromet Collaboration Technology and
Joint Collaboration Technology.

               (a) Serono will have the first right (but not the obligation) to take the appropriate steps to
remove any infringement or alleged infringement of, or to defend, any Patent within the Micromet
Patents, the Micromet Collaboration Technology and the Joint Collaboration Technology, to the
extent such infringement, alleged infringement or defense arises in respect of the development,
manufacture or commercialization of a product that competes with the Product. Serono may take
steps including the initiation, prosecution and control at its own expense of any suit, proceeding
or other legal action by counsel of its own choice. Micromet will have the right, at its own
expense, to be represented in any such action by counsel of its own choice. If such Patent is
defended or enforced in the Co-Promotion Territory, then each of Micromet and Serono will bear such
costs [***]. If the Patent is defended or enforced outside of the Co-Promotion Territory, then
Micromet will bear [***] ([***]%) of such costs and Serono will bear [***] ([***]%) of such costs.

               (b) If, pursuant to Section 6.5.2(a) hereof, Serono fails to bring a suit, action or
proceeding to remove such infringement or to defend against such claim within [***] days of the
date one Party has provided notice to the other Party pursuant to Section 6.5.1 of such
infringement or claim, then Micromet will have the right (but not the obligation), at its own
expense, to bring any such suit, action or proceeding by counsel of its own choice, and Serono will
have the right, at its own expense, to be represented in any such action by counsel of its own
choice.

               (c) Other than as set forth in Section 6.5.2(a), Micromet will have the sole right (but not
the obligation) to take the appropriate steps to remove any infringement or alleged infringement
of, or to defend, any Patent within the Micromet Patents, the Micromet Collaboration Technology and
the Joint Collaboration Technology. Micromet may take steps including the initiation, prosecution
and control, at its own expense, of any suit, proceeding or other legal action by counsel of its
own choice. Serono will have the right, at its own expense, to be represented in any such action
by counsel of its own choice. Notwithstanding Section 6.5.4, any settlements, damages or other
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respect to the Micromet Patents or the Micromet Collaboration Technology will retained by
Micromet.

          6.5.3 Actions with respect to Serono Collaboration Technology. Serono will have the sole
right (but not the obligation) to take the appropriate steps to remove the infringement or alleged
infringement, or to defend any claims of invalidity or unenforceability, with respect to any Patent
within the Serono Collaboration Technology, including the initiation, prosecution and control at
its own expense of any suit, proceeding or other legal action by counsel of its own choice.
Micromet will have the right, at its own expense, to be represented in any such action by counsel
of its own choice. Notwithstanding Section 6.5.4, any settlements, damages or other monetary
awards recovered pursuant to any such action will retained by Serono.

          6.5.4 Cooperation; Damages.

               (a) If one Party brings any suit, action or proceeding under this Section 6.5, the other Party
agrees to be joined as party plaintiff if necessary to prosecute the suit, action or proceeding and
to give the first Party reasonable authority to file and prosecute the suit, action or proceeding;
provided, however, that neither Party will be required to transfer any right, title or interest in
or to any property to the other Party or any other party to confer standing on a Party hereunder.

               (b) The Party not pursuing the suit, action or proceeding hereunder will provide reasonable
assistance to the other Party, including by providing access to relevant documents and other
evidence and making its employees available, subject to the other Party’s reimbursement of any
out-of-pocket expenses incurred by the non-enforcing or defending Party in providing such
assistance.

               (c) Neither Party will settle or otherwise compromise any such suit, action or proceeding in a
way that adversely affects the other Party’s intellectual property rights or its rights or
interests with respect to the Product without such Party’s prior written consent.

               (d) Any settlements, damages or other monetary awards (the “Recovery”) recovered pursuant to a
suit, action or proceeding brought pursuant to Sections 6.5.2(a), (b) or (c) will be allocated
first to the costs and expenses of the Party taking such action, and second, to the costs and
expenses (if any) of the other Party, with any remaining amounts (if any) to be allocated as
follows:

                    (i) If Serono pursued the suit, action or proceeding:

                         (1) Serono will pay Micromet, within [***] ([***]) days of receipt of the Recovery, [***]
([***]%) thereof with respect to a country that is not within the Co-Promotion Territory, and

 

			
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                         (2) the Recovery with respect to a country that is within the Co-Promotion Territory will be
deemed to be Net Profits, and Serono will pay to Micromet [***] ([***]%) of such Recovery within
[***] ([***]) days of receipt of such Recovery.

                    (ii) If Micromet pursued the suit, action or proceeding, the Recovery will be split between
the Parties [***] in connection with such suit, action or proceeding, and Micromet will pay to
Serono its share of the Recovery within [***] ([***]) days of receipt of such Recovery.

     6.6 Consequences of Patent Challenge.

          6.6.1 Termination on Patent Challenge. Micromet will be permitted to terminate this Agreement
by written notice effective upon receipt if Serono or its Affiliates directly, or indirectly
through assistance granted to a Third Party, commence any interference or opposition proceeding,
challenge the validity or enforceability of, or oppose any extension of or the grant of a
supplementary protection certificate with respect to, any Licensed Patents or Patent within the
Micromet Collaboration Technology (each such action a “Patent Challenge”).

          6.6.2 Sublicensees. Serono will include provisions in all agreements granting sublicenses of
Serono’s rights hereunder providing that if the Sublicensee or its Affiliates undertake a Patent
Challenge with respect to any Licensed Patents under which the Sublicensee is sublicensed, Serono
will be permitted to terminate such sublicense agreement. If a Sublicensee of Serono (or an
Affiliate of such Sublicensee) undertakes a Patent Challenge of any such Licensed Patent under
which such Sublicensee is sublicensed, then Serono upon receipt of notice from Micromet of such
Patent Challenge will terminate the applicable sublicense agreement. If Serono fails to so
terminate such sublicense agreement, Micromet may terminate this Agreement.

7. Fees and Payments

     7.1 Initial License Fee. In consideration of Micromet’s performance of the Micromet Program
and its grant of the rights and licenses to Serono hereunder, within [***] ([***]) days of the
Effective Date, Serono will pay, or cause to be paid, to Micromet a non-creditable initial license
fee in the amount of Ten Million US Dollars (US$10,000,000).

     7.2 Development Milestones. As further consideration for Micromet’s performance of the
Micromet Program and its grant of the rights and licenses to Serono hereunder, Serono will pay, or
cause to be paid, to Micromet non-creditable payments in the amounts set forth on Exhibit D
attached hereto within [***] ([***]) days of the achievement of the corresponding events described
on such exhibit by Serono, its Affiliates or Sublicensees. Each milestone payment is payable only
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     7.3 Royalties.

          7.3.1 Royalty Rates. As further consideration for Micromet’s grant of the rights and licenses
to Serono hereunder, subject to the adjustments provided for in Section 7.3.3, Serono will pay, or
cause to be paid, to Micromet a royalty equal to:

               (a) [***] percent ([***]%) of worldwide Net Sales of the Product for that portion of the total
amount of aggregate worldwide Net Sales of the Product in any calendar year that is less than or
equal to [***]

               (b) [***] percent ([***]%) of worldwide Net Sales of the Product for that portion of the total
amount of aggregate worldwide Net Sales of the Product in any calendar year that is greater than
[***] but less than or equal to [***]

               (c) [***] percent ([***]%) of worldwide Net Sales of the Product for that portion of the total
amount of aggregate worldwide Net Sales of the Product in any calendar year that is greater than
[***] but less than or equal to [***]; and

               (d) [***] percent ([***]%) of worldwide Net Sales of the Product for that portion of the total
amount of aggregate worldwide Net Sales of the Product in any calendar year that is greater than
[***].

     For the avoidance of doubt, the calculation of Net Sales for purposes of the above thresholds
will include [***] without regard to whether
(a) [***] or (b) [***]

          7.3.2 Aggregation of Net Sales; Royalty Term.

               (a) The Parties agree and acknowledge that the determination of aggregate worldwide Net Sales
for the tiers described in Section 7.3.1 will be based upon the Net Sales of the Product then
accrued during each applicable calendar year (or portion thereof) and the determination of a
particular royalty rate then-applicable to a particular sale of the Product will be made as of the
date such sale was invoiced.

               (b) Royalties due under the preceding Section 7.3.1 will commence upon the first commercial
sale of the Product in a particular country in the Territory and will expire on a
country-by-country basis upon the later of: (i) the expiration of the last-to-expire Micromet
Patent or [***] or [***] containing a Valid Claim that would be infringed by the sale of the Product in such country by an
unlicensed Third Party if such unlicensed Third Party were to sell the Product in such country for
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been granted in such country (such Valid Claim a “Qualified Valid Claim”), or (ii) [***] years from the first commercial sale of the Product in such country.

          7.3.3 Royalty Adjustments.

               (a) The royalty rates of Section 7.3.1 will be reduced by [***] ([***]%) (i.e., to [***]%,
[***]%, [***]%, and [***]%, respectively) in any country where the Product is sold where there is
no Micromet Patent or Patent within the Micromet Collaboration Technology or the Joint
Collaboration Technology containing a Qualified Valid Claim. The Parties agree and acknowledge
that the royalty rate applicable to any such particular sale of the Product will be determined in
accordance with the royalty rate then in effect at the time such sale of the Product was invoiced.

               (b) If all Technology Acquisition Payments payable by Serono, taken together in the aggregate,
exceed [***] percent ([***]%) of worldwide Net Sales of the Product in a given calendar quarter,
then Serono may credit against the amount of any royalties due and payable by Serono pursuant to
Section 7.3.1 an amount equal to [***] ([***]%) of the portion of such aggregate Technology
Acquisition Payments that exceeds [***] ([***]%) of worldwide Net Sales of the Product during such
calendar quarter.

               (c) Under no circumstances will the royalties payable by Serono to Micromet under this Section
7.3 be reduced below [***]([***]%) of Net Sales in any country during any calendar quarter,
notwithstanding operation of the foregoing Sections 7.3.3(a) and 7.3.3(b). Any amount that has not
been so offset may be offset against royalties due in subsequent calendar quarters, subject to the
limitation set forth in the previous sentence.

          7.3.4 Royalties Payable Only Once. For clarity, Serono’s obligation to pay royalties to
Micromet under this Section 7.3 is imposed only once with respect to the same unit of the Product
regardless of the number of Micromet Patents or Patents within the Micromet Collaboration
Technology or the Joint Collaboration Technology pertaining thereto.

8. Payment Terms

     8.1 Payment Method. All amounts due to Micromet hereunder will be paid in EURO by wire
transfer in immediately available funds to an account designated by Micromet. Any payments or
portions thereof due hereunder which are not paid on the date such payments are due under this
Agreement will bear interest at the lower of (a) [***] above the overnight LIBOR rate in effect on
the due date, or (b) the maximum rate permitted by applicable law, calculated on the number of days
such payment is delinquent.

     8.2 Payment Schedules; Reports. The payments due pursuant to Section 7.2 are due and payable
on the dates described therein. Royalty payments due pursuant to Section 7.3 are due and payable
within [***] ([***]) days of the end of each calendar quarter during the Term during which there
were Net Sales of the Product in the Territory. Serono will accompany each payment of royalties
under this Agreement with a report setting forth, on a country-by-country

 

			
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basis, the amount of gross sales of the Product in such country, a calculation of Net Sales,
the currency conversion rate used and EURO-equivalent of such Net Sales, and a calculation of the
amount of royalty payment due on such Net Sales. Such report will be considered Confidential
Information of Serono subject to the obligations of Section 9 of this Agreement.

     8.3 Currency Conversion. For any currency conversion required in determining the amount of
royalties or Net Profits due hereunder, such conversion will be made at the exchange rate used by
Serono, consistent with its general internal corporate policies, for its own consolidation purposes
for the translation of such currency into EURO on the day that is the last business day of the
applicable quarterly period for any royalty or Net Profit payments due pursuant to this Agreement.
Such policies will be made available to Micromet upon request and will be consistent with customary
industry practices.

     8.4 Legal Restrictions. If at any time legal restrictions prevent the remittance by Serono of
all or any part of royalties on Net Sales or Net Profits in any country, Serono will have the right
and option to make such payment by depositing the amount thereof in local currency to an account in
the name of Micromet in a bank or other depository in such country. Serono will consult with
Micromet regarding, and promptly notify Micromet of, any and all such arrangements.

     8.5 Taxes.

          8.5.1 Withholding Taxes. Micromet will be responsible for any and all income or other taxes
owed by Micromet and required by applicable law to be withheld or deducted from any of the royalty
and other payments made by or on behalf of Serono to Micromet hereunder (“Withholding Taxes”), and
Serono may deduct from any amounts that Serono is required to pay hereunder an amount equal to such
Withholding Taxes. Micromet will provide Serono any information available to Micromet that is
necessary to determine the Withholding Taxes. Such Withholding Taxes will be paid to the proper
taxing authority for Micromet’s account and evidence of such payment will be secured and sent to
Micromet within one (1) month of such payment. The Parties will do all such lawful acts and things
and sign all such lawful deeds and documents as either Party may reasonably request from the other
Party to enable Micromet and Serono or its Affiliates or Sublicensees to take advantage of any
applicable legal provision or any double taxation treaties with the object of paying the sums due
to Micromet hereunder without withholding or deducting any Withholding Taxes.

          8.5.2 Additional Withholding Taxes. If, as a result of any change in the corporate status or
location of Serono, or the permitted assignment of this Agreement by Serono, additional Withholding
Taxes become due on payments from Serono or its permitted assignee to Micromet that would not have
been due absent such change in corporate status or location or permitted assignment, and Micromet
is not able to claim a credit or reimbursement for such tax, in whole or in part, then Serono will
deduct Withholding Taxes in accordance with this Section 8.5, but will, in addition to the sums
otherwise payable under this Agreement, pay to Micromet such further sum as will ensure that, after
deduction of Withholding Taxes on all such sums, the net amount received by Micromet equals the
amount that Micromet would have received had the non-creditable or non-reimbursable amount of such
additional Withholding Taxes not been deducted. To the extent that any such amount paid by Serono
to Micromet in accordance with

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this Section 8.5 is in fact subsequently able to be claimed by Micromet as a credit or
reimbursement for such tax otherwise deducted, then Micromet will pay such amount to Serono.

     8.6 Records Retention; Audit.

          8.6.1 Record Retention. Each Party will maintain complete and accurate books, records and
accounts used for the determination of expenses incurred in connection with the performance of
Development Activities or relevant for the calculation of Net Sales and Net Profits, in sufficient
detail to confirm the accuracy of any payments required under this Agreement, which books, records
and accounts will be retained by such Party until [***] years after the end of the period to
which such books, records and accounts pertain.

          8.6.2 Audit. Each Party will have the right to have an independent certified public
accounting firm of internationally recognized standing, reasonably acceptable to the other Party,
to have access during normal business hours, and upon reasonable prior written notice, to such of
the records of the other Party as may be reasonably necessary to verify the accuracy of any
Development Expenses shared or paid by the other Party under this Agreement or the calculation of
Net Sales or Net Profits for any calendar quarter ending not more than three (3) years prior to the
date of such request; provided, however, that no Party will not have the right to conduct more than
[***]. The accounting firm will disclose to the Parties only whether the Development Expenses, Net
Sales or Net Profits reported by the audited Party are correct or incorrect and the specific
details concerning any discrepancies. The auditing Party will bear all costs of such audit, unless
the audit reveals a discrepancy in the audited Party’s favor of more than [***], in which case the
audited Party will bear the cost of the audit.

          8.6.3 Payment of Additional Amounts. If, based on the results of any audit, additional
payments are owed to either Party under this Agreement, then the other Party will make such
additional payments promptly after the accounting firm’s written report is delivered to both
Parties.

          8.6.4 Confidentiality. Each Party will treat all information subject to review under this
Section 8.6 in accordance with the provisions of Section 9 and will cause its accounting firm to
enter into a reasonably acceptable confidentiality agreement with the audited Party obligating such
firm to maintain all such financial information in confidence pursuant to such confidentiality
agreement.

9. Confidentiality

     9.1 Definition. During the Term and subject to the terms and conditions of this Agreement, a
Party (the “Disclosing Party”) may communicate to the other Party (the “Receiving Party”)
information in connection with this Agreement or the performance of its obligations under this
Agreement, including any information regarding reports provided pursuant to this Agreement,
scientific and manufacturing information and plans, marketing and business plans, and financial and
personnel matters relating to a Party or its Affiliates or its or their

 

			
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present or future products, sales, suppliers, customers, employees, investors or business
(collectively, “Confidential Information”).

     9.2 Exclusions. Notwithstanding the foregoing, any information of a Party will not be deemed
Confidential Information with respect to the Receiving Party for purposes of this Agreement if such
information:

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

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

               (c) became generally available or known to parties reasonably skilled in the field to which
such information 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 Section 9 by the
Receiving Party;

               (d) was disclosed to the Receiving Party or its Affiliates, 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

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

     9.3 Disclosure and Use Restriction. Except as expressly provided herein, the Parties agree
that, during the Term and for [***] years thereafter, each Party and its Affiliates and
sublicensees will keep completely confidential and will not publish or otherwise disclose any
Confidential Information of the other Party, its Affiliates or sublicensees. Neither Party will
use any Confidential Information of the other Party without such other Party’s consent, except in
connection with performance of this Agreement.

     9.4 Authorized Disclosure. Each Party may use and disclose Confidential Information of the
other Party to the extent that such use and disclosure is:

          9.4.1 made in response to a valid order of a court of competent jurisdiction or other
governmental or regulatory body of competent jurisdiction; provided, however, that such Party will
first have given notice to such other Party and given such other Party a reasonable opportunity to
quash such order and to obtain a protective order requiring that the Confidential Information that
is the subject of such order be held in confidence by such court or governmental or regulatory body
or, if disclosed, be used only for the purposes for which the order was issued; and provided,
further, however, that if a disclosure order is not quashed or a protective order is

 

			
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not obtained, the Confidential Information disclosed in response to such court or governmental
order will be limited to that information which is legally required to be disclosed in response to
such court or governmental order;

          9.4.2 otherwise required by applicable law; provided, however, that the disclosing Party will
provide such other Party with notice of such disclosure in advance thereof to the extent
practicable;

          9.4.3 made by such Party to the regulatory authorities as required in connection with any
filing of INDs, BLAs, MAAs, or similar applications or requests for regulatory approvals; provided,
however, that reasonable measures will be taken to assure confidential treatment of such
information;

          9.4.4 made by such Party in connection with the prosecution or defense of litigation,
including a disclosure made by Micromet to meet Micromet’s discovery obligations in Micromet AG v.
Cell Therapeutics, Inc., No. CV04-0290 RSM, pending in the United States District Court for the
Western District of Washington; provided, however, that all information so disclosed by Micromet
will be marked with the legend “Highly Confidential” pursuant to the terms of the Court’s November
12, 2004 Protective Order;

          9.4.5 made by such Party, in connection with the performance of this Agreement, to Affiliates,
permitted sublicensees, employees, consultants, independent contractors or agents, each of whom
prior to disclosure must be bound by obligations of confidentiality and non-use at least equivalent
in scope to those set forth in this Section 9;

          9.4.6 made by such Party 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 must be bound by
obligations of confidentiality and non-use at least equivalent in scope to those set forth in this
Section 9; or

          9.4.7 made in a patent application filed pursuant to this Agreement.

     9.5 Terms of Agreement to be Maintained in Confidence. Subject to the provisions of this
Section 9, the Parties agree that the terms of this Agreement are deemed Confidential Information
of both Parties and will be subject to the restrictions on use and disclosure set forth herein.

10. Public Communications

     10.1 General Provisions. The Parties will cooperate with respect to the timing and content of
communications with the public regarding the development and Commercialization of the Product,
subject to the provisions of this Section 10.

     10.2 Use of Name. Neither Party will 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 law or the rules

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or regulations applicable to the listing or quoting of the securities of either Party or its
Affiliates on any stock or securities exchange, and (c) otherwise as agreed in writing by such
other Party.

   10.3 Press Releases.

          10.3.1 Permitted Announcements. The Parties hereby approve the joint press release set forth
in Exhibit H and will cooperate in the release thereof as soon as practicable after the
signature of this Agreement by the Parties. The Parties agree that Micromet may disclose by press
release or other public announcement the receipt of any milestone payment hereunder (except the
amount of such payment may not be disclosed unless such disclosure is approved by Serono in
writing). Further, if in the reasonable opinion of a Party’s legal counsel a press release or
public announcement is legally required by applicable law or the rules or regulations applicable to
the listing or quoting of the securities of such Party or its Affiliates on a stock or securities
exchange, such Party may issue such press release or make such other public announcement. Any
press release or other public announcement will be made pursuant to the procedures set forth in
Section 10.3.3.

          10.3.2 No Other Disclosures. Except to the extent already disclosed in a press release or
other public announcement pursuant to Section 10.3.1, neither Party will make any public
announcements concerning this Agreement or the subject matter hereof except with the prior approval
of the other Party, and then only pursuant to the procedures set forth in Section 10.3.3.

          10.3.3 Procedures. Each Party will use reasonable efforts to submit to the other Party a
draft of any public announcement (“Proposed Disclosure”) for review and comment at least [***]
prior to the date on which such Party plans to make such announcement, and in any event will submit
such draft to the other Party at least [***] prior to the release of such Proposed
Disclosure, and will review and consider in good faith any comments provided in response by the
other Party. If a Party is unable to comply with the foregoing [***] notice requirement because of
a legal obligation or stock or securities exchange requirement to make more rapid disclosure, such
Party will not be in breach of this Agreement but will in that case give telephone notice to a
senior executive of the other Party and provide a draft of the Proposed Disclosure with as much
notice as possible prior to the release of such announcement.

     10.4 Publications. At least [***] prior to submission of any material for publication or
presentation related to the Development Activities or the development by Micromet of the Product
for a Rejected Indication, the submitting Party will provide to the other Party a draft of such
material for its review and comment. The receiving Party will provide any comments to the
submitting Party within [***] of receipt of such materials. No publication or presentation with
respect to the Development Activities or the development by Micromet of the Product for a Rejected
Indication will be made unless and until the other Party’s comments on the proposed publication or
presentation have been addressed and changes have been agreed upon and any information has been
removed that is determined by the other Party to be its Confidential Information or that the other
Party desires to maintain in secrecy to maximize the commercial

 

			
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value of this Agreement; provided, however, that the Parties agree that appropriate disclosure
will be made of clinical data for the Product following receipt of any Marketing Approval for the
Product. If requested in writing by the other Party, the submitting Party will withhold material
from submission for publication or presentation for an additional [***] to allow for the filing of
a patent application or the taking of such measures as may be appropriate to establish and preserve
proprietary rights in the information in the material being submitted for publication or
presentation.

11. Term and Termination

     11.1 Term. The term of this Agreement (the “Term”) will commence on the Effective Date and
end upon the later of (a) the date of expiration of all royalty payment obligations for the Product
as provided in Section 7.3 or (b) the date of the expiration or invalidation of the last Third
Party Patent sublicensed to Serono hereunder, unless earlier terminated as provided in this
Agreement.

     11.2 Termination for Material Breach.

          11.2.1 Material Breach. Any material failure by a Party (the “Breaching Party”) to comply
with any of its material obligations provided for in this Agreement will entitle the other Party
(the “Non-Breaching Party”) to give to the Breaching Party written notice specifying the nature of
the material breach, requiring the Breaching Party to make good or otherwise cure such material
breach.

          11.2.2 Cure of Material Breach. If such breach is not cured within [***] days after the
receipt of notice pursuant to Section 11.2.1 above (or, if such breach cannot be cured within such
[***] period, if the Party in material breach does not commence actions to cure such breach within
such period and thereafter diligently continue such actions and cure such breach within [***] days
after the receipt of such notice, except in the case of a breach of a payment obligation, as to
which the Breaching Party will have only a [***] cure period), the Non-Breaching Party will have
the right, on written notice to the Breaching Party, to terminate this Agreement without prejudice
to any of the other rights and remedies conferred on it by this Agreement or by applicable law.

     11.3 Termination at Will. Serono may terminate this Agreement it its entirety, for any reason
or no reason: (a) [***] upon written notice to Micromet following receipt by Serono of the
Final Study Report for either Ongoing Trial, and (b) upon [***] prior written notice to Micromet at
any time thereafter.

 

			
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12. Effects of Termination

   12.1 Post-Termination Activities.

          12.1.1 Assignments. Upon termination of this Agreement in its entirety for any reason, Serono
will promptly (and in each case within sixty (60) days of receipt of Micromet’s request) and at no
cost to Micromet:

               (a) reassign to Micromet the BI Process Development Agreement and the BI Process License
Agreement, if such agreements have been assigned to Serono and if BI consents to such reassignment;

               (b) upon Micromet’s request, assign to Micromet all of Serono’s right, title and interest in
and to any agreements between Serono and Third Parties that are freely assignable by Serono and
that relate solely to the development or manufacture of the Product;

               (c) assign to Micromet all of Serono’s right, title and interest in and to any trademarks
(including any goodwill associated therewith) Controlled by Serono and used in connection with
Commercialization of the Product in the Territory, including any registrations for the foregoing;

               (d) transfer to Micromet copies of all data and materials Controlled by Serono and made or
developed in the Serono Program that are necessary for the development or Commercialization of the
Product;

               (e) assign to Micromet, to the extent freely assignable by Serono, the management and
continued performance of any clinical trials for the Product ongoing as of the effective date of
such termination;

               (f) transfer to Micromet all of Serono’s right, title and interest in and to any and all
regulatory filings and Marketing Approvals Controlled by Serono for the Product, including any
INDs, BLAs, and MAAs; and

               (g) to the extent that any agreement described in this Section 12.1.1 is not assignable by
Serono, then such agreement will not be assigned, and upon the request of Micromet, Serono will
cooperate in good faith and use commercially reasonable efforts to allow Micromet to obtain and to
enjoy the benefits of such agreement in the form of a license or other right to the extent Serono
has the right and ability to do so.

          12.1.2 Manufacturing Activities. Upon termination of this Agreement in its entirety during
the Serono Program for any reason, Serono will:

               (a) upon Micromet’s request, if Serono is then manufacturing the Product, supply Micromet with
clinical and commercial quantities of the Product for the shorter of (i) the period until Micromet
or its designee has established and validated a manufacturing process for the Product and is
approved to manufacture clinical trial and commercial supplies of

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the Product or (ii) [***] from the effective date of such termination; provided, however, that
Micromet will reimburse Serono for [***] of the reasonable and documented costs incurred by Serono
in such manufacturing activities; and

               (b) if Serono is then manufacturing the Product, transfer the completed manufacturing process
for the Product to Micromet or its designee upon Micromet’s request and at its cost and expense.

          12.1.3 License Grant. Upon termination of this Agreement in its entirety for any reason,
Serono will grant to Micromet a worldwide, exclusive, royalty-bearing right and license, with the
right to sublicense and authorize the grant of further sublicenses, under the Serono Collaboration
Technology and Serono’s rights and interest in the Joint Collaboration Technology to make, have
made, use, sell, offer for sale, and import the Product in the Territory in the Field; provided,
however, that Micromet will be responsible for any payments associated with the grant of any
license pursuant to the preceding sentence. Micromet will pay Serono a royalty of [***] of Net
Sales of the Product in any country where the Product is sold where there is a Patent within Serono
Collaboration Technology or the Joint Collaboration Technology containing a Valid Claim that would
be infringed by the sale of the Product in such country by an unlicensed Third Party if such
unlicensed Third Party were to sell the Product in such country for an Indication for which
Marketing Approval for the Product has been granted in such country, with the following adjustments
to the applicable defined terms: (i) Micromet being substituted for Serono in the definitions of
“Net Sales” and “Sublicensee,” and (ii) for Net Sales, the determination of the Parties being
substituted for the determination of the Steering Committee with respect to Combination Products.
Such royalties will be paid by Micromet to Serono in accordance with the provisions of Sections 8.1
through 8.6 hereof, applying mutatis mutandis the obligations of Serono therein to Micromet.

     12.2 Sublicensees. In the event this Agreement terminates for any reason, each of Serono’s
Sublicensees at such time will continue to have the rights and license set forth in their
sublicense agreements, subject to the continued performance of the obligations thereunder;
provided, however, that such Sublicensee agrees in writing that Micromet is entitled to enforce all
relevant terms and conditions of such sublicense agreement directly against such Sublicensee, and
provided further, however, that such Sublicensee is not then in breach of its sublicense agreement.

     12.3 Sale of Inventory. Upon any termination of this Agreement, Serono and its Affiliates and
Sublicensees will be entitled, during the next [***], to sell any inventory of the Product which
remains on hand as of the effective date of the termination, so long as Serono pays to Micromet the
royalties applicable to said subsequent sales in accordance with the terms and conditions set forth
in this Agreement.

     12.4 Rights upon Expiration. Upon expiration of this Agreement pursuant to Section 11.1,
Serono will have a worldwide, non-exclusive, royalty-free, irrevocable right and license, with the
right to sublicense and authorize the grant of further sublicenses, under the Licensed

 

			
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Know-How to make, have made, use, sell, offer for sale, and import the Product in the
Territory in the Field.

     12.5 Accrued Rights. Termination of this Agreement for any reason will be without prejudice
to any rights that will have accrued to the benefit of a Party prior to the effective date of such
termination. Such termination will not relieve a Party from obligations that are expressly
indicated to survive the termination of this Agreement.

     12.6 Survival. The following Sections, together with any definitions used or exhibits
referenced therein, will survive any termination or expiration of this Agreement: 6.2; 6.4.2; 6.5
(only with respect to pending actions); 5.4.5; 7 and 8 (only as to accrued and unpaid amounts);
8.6; 9; 12; 13; 15; and 16.

13. Indemnification and Insurance

     13.1 Indemnification of Micromet. Serono will indemnify Micromet, its Affiliates, and their
respective directors, employees and agents (each, a “Micromet Indemnitee”), and defend and save
each of them harmless from and against any and all losses, damages, liabilities, costs and expenses
(including reasonable attorneys’ fees and expenses) (collectively, “Losses”) arising in connection
with any and all claims, demands, lawsuits, or investigations by a Third Party (each a “Third Party
Claim”) against a Micromet Indemnitee, to the extent caused by or arising out of: (a) any breach
by Serono of this Agreement, (b) the gross negligence or willful misconduct on the part of Serono
or its Affiliates or Sublicensees in performing any activity contemplated by this Agreement, or (c)
the development or Commercialization of the Product in the Territory by or on behalf of Serono
(other than by or on behalf of Micromet or its Affiliates); in each case, excluding any Losses for
which Micromet has an obligation to indemnify Serono pursuant to Section 13.2.

     13.2 Indemnification of Serono. Micromet will indemnify Serono, its Affiliates, and their
respective directors, employees and agents (each, a “Serono Indemnitee”), and defend and save each
of them harmless from and against any and all Losses arising in connection with any and all Third
Party Claims against a Serono Indemnitee, to the extent caused by or arising out of: (a) any
breach by Micromet of this Agreement, (b) the gross negligence or willful misconduct on the part of
Micromet or its Affiliates in performing any activity contemplated by this Agreement, (c) the
development or Commercialization of the Product in the Territory by or on behalf of Micromet (other
than by or on behalf of Serono or its Affiliates or Sublicensees), or (d) the lawsuit Micromet AG
v. Cell Therapeutics, Inc., No. CV04-0290 RSM, pending in the United States District Court for the
Western District of Washington, and any further lawsuits or other proceedings arising therefrom or
related thereto; in each case, excluding any Losses for which Serono has an obligation to indemnify
Micromet and its Affiliates pursuant to Section 13.1.

     13.3 Notice of Claim. All indemnification claims in respect of any Serono Indemnitee or
Micromet Indemnitee seeking indemnity under Sections 13.1 or 13.2 (collectively, the “Indemnitees”
and each an “Indemnitee”) will be made solely by the corresponding Party (the “Indemnified Party”).
The Indemnified Party will give the indemnifying Party (the “Indemnifying Party”) prompt written
notice (an “Indemnification Claim Notice”) of any Losses or the discovery of any fact upon which
such Indemnified Party intends to base a request

42

 

for indemnification under Section 13.1 or Section 13.2, but in no event will the Indemnifying
Party be liable for any Losses that result from any delay in providing such notice. Each
Indemnification Claim Notice must contain a description of the claim and the nature and amount of
such Loss (to the extent that the nature and amount of such Loss are known at such time). Together
with the Indemnification Claim Notice, the Indemnified Party will furnish promptly to the
Indemnifying Party copies of all notices and documents (including court papers) received by any
Indemnitee in connection with the Third Party Claim.

     13.4 Control of Defense. At its option, the Indemnifying Party may assume the defense of any
Third Party Claim subject to indemnification as provided for in Sections 13.1 and 13.2 by giving
written notice to the Indemnified Party within thirty (30) days after the Indemnifying Party’s
receipt of an Indemnification Claim Notice. Upon assuming the defense of a Third Party Claim, the
Indemnifying Party may appoint as lead counsel in the defense of the Third Party Claim any legal
counsel it selects. Should the Indemnifying Party assume the defense of a Third Party Claim, the
Indemnifying Party will not be liable to the Indemnified Party or any other Indemnitee for any
legal expenses subsequently incurred by such Indemnified Party or other Indemnitee in connection
with the analysis, defense or settlement of the Third Party Claim.

     13.5 Right to Participate in Defense. Without limiting Section 13.4, any Indemnitee will be
entitled to participate in, but not control, the defense of a Third Party Claim for which it has
sought indemnification hereunder and to employ counsel of its choice for such purpose; provided,
however, that such employment will be at the Indemnitee’s own expense unless (a) the employment
thereof has been specifically authorized by the Indemnifying Party in writing, or (b) the
Indemnifying Party has failed to assume the defense and employ counsel in accordance with Section
13.4 (in which case the Indemnified Party will control the defense).

     13.6 Settlement. With respect to any Losses relating solely to the payment of money damages
in connection with a Third Party Claim and that will not result in the Indemnitee’s becoming
subject to injunctive or other relief or otherwise adversely affect the business of the Indemnitee
in any manner, and as to which the Indemnifying Party will have acknowledged in writing the
obligation to indemnify the Indemnitee hereunder, the Indemnifying Party will have the sole right
to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such
Loss, on such terms as the Indemnifying Party, in its sole discretion, will deem appropriate, and
will transfer to the Indemnified Party all amounts which said Indemnified Party will be liable to
pay prior to the time of the entry of judgment. With respect to all other Losses in connection
with Third Party Claims, where the Indemnifying Party has assumed the defense of the Third Party
Claim in accordance with Section 13.4, the Indemnifying Party will have authority to consent to the
entry of any judgment, enter into any settlement or otherwise dispose of such Loss provided it
obtains the prior written consent of the Indemnified Party (which consent will be at the
Indemnified Party’s sole and absolute discretion). The Indemnifying Party that has assumed the
defense of the Third Party Claim in accordance with Section 13.4 will not be liable for any
settlement or other disposition of a Loss by an Indemnitee that is reached without the written
consent of such Indemnifying Party. Regardless of whether the Indemnifying Party chooses to defend
or prosecute any Third Party Claim, no Indemnitee will admit any liability with respect to, or
settle, compromise or discharge, any Third Party Claim without first

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offering to the Indemnifying Party the opportunity to assume the defense of the Third Party
Claim in accordance with Section 13.4.

     13.7 Cooperation. If the Indemnifying Party chooses to defend or prosecute any Third Party
Claim, the Indemnified Party will, and will cause each other Indemnitee to, cooperate in the
defense or prosecution thereof and will furnish such records, information and testimony, provide
such witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as
may be reasonably requested in connection with such Third Party Claim. Such cooperation will
include access during normal business hours afforded to the Indemnifying Party to, and reasonable
retention by the Indemnified Party of, records and information that are reasonably relevant to such
Third Party Claim, and making Indemnitees and other employees and agents available on a mutually
convenient basis to provide additional information and explanation of any material provided
hereunder, and the Indemnifying Party will reimburse the Indemnified Party for all its reasonable
out-of-pocket expenses incurred in connection with such cooperation.

     13.8 Expenses of the Indemnified Party. Except as provided above, the reasonable and
verifiable costs and expenses, including fees and disbursements of counsel, incurred by the
Indemnified Party in connection with any Third Party Claim will be reimbursed on a calendar quarter
basis by the Indemnifying Party, without prejudice to the Indemnifying Party’s right to contest the
Indemnified Party’s right to indemnification and subject to refund in the event the Indemnifying
Party is ultimately held not to be obligated to indemnify the Indemnified Party.

     13.9 Insurance. Each Party will obtain and keep in force, through self insurance or
otherwise, in a form reasonably acceptable to the other Party hereto, insurance in scope and amount
as required by law applicable to a Party’s activities hereunder and such additional amounts as may
be reasonably necessary to cover such Party’s indemnity obligations under this Agreement with scope
and coverage as is normal and customary in the biotechnology/pharmaceutical industry generally for
parties similarly situated. It is understood that such insurance will not be construed to limit a
Party’s liability with respect to its indemnification obligations under this Section 13. Each
Party will, except to the extent self insured, provide to the other Party upon request a
certificate evidencing the insurance such Party is required to obtain and keep in force under this
Section 13. Such certificate will provide that such insurance will not expire or be cancelled or
modified without at least thirty (30) days’ prior notice to the other Party.

14. Representations and Warranties

     14.1 Mutual Representations and Warranties. Each Party hereby represents and warrants to the
other Party that, as of the Effective Date:

          14.1.1 Such Party (a) has the corporate power and authority to enter into this Agreement and
perform its obligations hereunder, and (b) has taken all necessary corporate action on its part
required to authorize the execution and delivery of this Agreement and the performance of its
obligations hereunder;

44

 

          14.1.2 This Agreement has been duly executed and delivered on behalf of such Party and
constitutes a legal, valid and binding obligation of such Party and is enforceable against it in
accordance with its terms subject to the effects of bankruptcy, insolvency or other laws of general
application affecting the enforcement of creditor rights and judicial principles affecting the
availability of specific performance and general principles of equity, whether enforceability is
considered a proceeding at law or equity; and

          14.1.3 The execution and delivery of this Agreement and the performance of such Party’s
obligations hereunder (a) do not conflict with or violate any requirement of any provision of the
articles of incorporation, bylaws or any similar instrument of such Party in any material way, and
(b) do not conflict with, breach, constitute a default or require any consent under any contractual
obligation by which such Party is bound and do not violate any law or regulation of any court,
governmental body or administrative or other agency having authority over such Party.

     14.2 Additional Representations and Warranties of Micromet. Micromet hereby represents and
warrants to Serono that, as of the Effective Date:

          14.2.1 Micromet is a corporation duly organized, validly existing and in good standing under
the laws of Germany, and has full corporate power and authority and the legal right to own and
operate its properties and assets and to carry on its business as it is now being conducted and as
it is contemplated to be conducted by this Agreement;

          14.2.2 Exhibit A sets forth a complete list of all Micromet Patents as of the
Effective Date that would be infringed by the manufacture, use, sale, offer for sale, or import of
the Product anywhere in the world;

          14.2.3 Exhibit C sets forth a complete list of all Technology Acquisition Agreements
entered into by Micromet as of the Effective Date;

          14.2.4 Micromet has the right, power and authority to grant Serono the licenses and
sublicenses set forth in Section 6.1, subject to the terms, conditions and limitations set forth in
the Dyax Agreement and the CAT Agreement; and the Micromet Patents and Licensed Know-How are free
and clear of any liens, charges, encumbrances or rights of others to possession or use;

          14.2.5 Micromet’s grant of rights and licenses to Serono hereunder is not in conflict with, or
in any way prohibited or limited by, the agreement or arrangements between Micromet and Cell Therapeutics, Inc. or
its predecessors or affiliates underlying the lawsuit Micromet AG v. Cell Therapeutics, Inc., No. CV-04-0290 RSM, pending in the United States District Court for the Western District of Washington;

          14.2.6 Micromet has all right, title and interest in, to and under the Micromet Patents; the
Micromet Patents are subsisting and, to the Knowledge of Micromet, the Micromet Patents are not
invalid or unenforceable, in whole or in part;

45

 

          14.2.7 to the Knowledge of Micromet, the Micromet Patents have been filed, prosecuted and
maintained at the respective patent offices in accordance with all applicable laws and regulations,
in each case where the failure to comply with such law or regulation would render such Micromet
Patent invalid or unenforceable, in whole or in part;

          14.2.8 to the Knowledge of Micromet, no Licensed Patent is the subject of any re-issue,
interference, opposition or appeal proceedings, except as expressly provided in the applicable
Technology Acquisition Agreement listed on Exhibit C;

          14.2.9 to the Knowledge of Micromet, no Third Party has filed, pursued or maintained or
expressly threatened to file, pursue or maintain any claim, lawsuit, charge, complaint or other
action alleging that any Licensed Patent is invalid or unenforceable, except as expressly provided
in the Applicable Technology Acquisition Agreement listed on Exhibit C;

          14.2.10 Micromet has notified Serono in writing of all patents and patent applications, of
which Micromet is aware, that are issued to or filed by a Third Party that may cover the
manufacture, use, sale, offer for sale, or importation of the Product in the Territory;

          14.2.11 each of the Technology Acquisition Agreements set forth on Exhibit C is in
full force and effect in accordance with its terms; Micromet is not in breach of any of such
Technology Acquisition Agreements; to Micromet’s Knowledge, no other party to any of such
Technology Acquisition Agreements is in breach thereof; and Micromet has provided Serono with a
true, correct and complete copy of each of such Technology Acquisition Agreements;

          14.2.12 to the Knowledge of Micromet, all information and data, whether written or oral,
relating to the Product provided by or on behalf of Micromet to Serono on or before the Effective
Date in contemplation of this Agreement was free from material inaccuracies; and

          14.2.13 Micromet has not willfully failed to disclose information or data relating to the
Product with the intention of causing the information and data covered by the preceding Section
14.2.12 to be misleading in any material respects.

          14.2.14
As used herein, “Knowledge of Micromet” means
the [***], as of [***], of [***] of Micromet [***].

     14.3 Additional Covenants of Micromet. Micromet hereby covenants to Serono that:

          14.3.1 Micromet will not amend or waive, or take any other action or commit any omission that
would alter, any of its rights under any of the Technology Acquisition Agreements set forth on
Exhibit C in any manner that would materially and adversely affect Serono’s rights and
benefits under this Agreement; and

          14.3.2 Micromet will not license, sell or otherwise transfer any right, title or interest in,
to or under any Licensed Technology to the extent such right, title or interest is licensed
hereunder to Serono; provided, however, that Micromet will have the right to assign or
transfer such right, title and interest, subject to the rights and licenses granted to Serono

 

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

46

 

hereunder, to a permitted assignee of Micromet’s rights and obligations hereunder pursuant to
Section 16.2 hereof.

     14.4 Additional Representations and Warranties of Serono. Serono hereby represents and
warrants to Micromet that, as of the Effective Date:

          14.4.1 Serono is a corporation duly organized, validly existing and in good standing under the
laws of Switzerland; and

          14.4.2 Serono has full corporate power and authority and the legal right to own and operate
its properties and assets and to carry on its business as it is now being conducted and as it is
contemplated to be conducted by this Agreement.

     14.5 Limitation on Representations or Warranties. Notwithstanding anything to the contrary
herein, a Party will not be in breach of any representation or warranty made pursuant to Section 14
to the extent such breach arises [***] (a) [***], or
(b) [***].

15. Disclaimer; Limitation of Liability

     15.1 Disclaimer of Warranty. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN SECTION 14,
SERONO AND MICROMET MAKE NO REPRESENTATIONS AND GRANT NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN
FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND SERONO AND MICROMET EACH SPECIFICALLY
DISCLAIMS ANY OTHER REPRESENTATIONS AND WARRANTIES, WHETHER WRITTEN OR ORAL, EXPRESS, STATUTORY OR
IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR
PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENTS OR THE NON-INFRINGEMENT OF ANY
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

     15.2 Limitation of Liability. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR LOST PROFITS OR FOR
ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, HOWEVER CAUSED, ON ANY THEORY
OF LIABILITY AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES,
ARISING UNDER ANY CAUSE OF ACTION AND ARISING IN ANY WAY OUT OF THIS AGREEMENT. THE FOREGOING
LIMITATIONS WILL NOT APPLY TO AN AWARD OF ENHANCED DAMAGES AVAILABLE UNDER THE PATENT LAWS FOR
WILLFUL PATENT INFRINGEMENT AND WILL NOT LIMIT EITHER PARTY’S OBLIGATIONS TO THE OTHER PARTY UNDER
SECTIONS 9 AND 13.

16. Miscellaneous

     16.1 Force Majeure. Neither Party will be held liable or responsible to the other Party or be
deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling
or performing any term of this Agreement when such failure or delay is caused by or results
from

 

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

47

 

events beyond the reasonable control of the non-performing Party, including fires, floods,
embargoes, epidemics, quarantines, terrorism, war, acts of war (whether war be declared or not),
insurrections, riots, civil commotion, strikes, lockouts or other labor disturbances, failure or
delay of transportation, default by suppliers or unavailability of raw materials, acts of God or
acts, omissions or delays in acting by any governmental authority. The non-performing Party will
notify the other Party of such force majeure within ten (10) days after such occurrence by giving
written notice to the other Party stating the nature of the event, its anticipated duration, and
any action being taken to avoid or minimize its effect. The suspension of performance will be of
no greater scope and no longer duration than is necessary and the non-performing Party will use
commercially reasonable efforts to remedy its inability to perform. In the event that Micromet
provides notice of force majeure to Serono, Serono will have the right not to make any future
payments otherwise payable pursuant to Section 3.5.2 until such time as Micromet resumes
performance hereunder, and either the schedule for payments hereunder will be revised to apply any
payments already made in advance by Serono for the performance so delayed or suspended by Micromet
to such performance once it is resumed or Micromet will refund any such payments to Serono in the
event that such performance is not for any reason resumed within a reasonable period of time.

     16.2 Assignment. Neither Party will 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 obligations under this Agreement without the prior written consent of the
other Party (which consent may be granted, withheld or conditioned at such other Party’s sole and
absolute discretion); provided, however, that either Party may assign or transfer this Agreement or
any of its rights or obligations under this Agreement without the consent of the other Party (a) to
any Affiliate of such Party, or (b) to any Third Party with which it merges or consolidates, or to
which it transfers all or substantially all of its assets to which this Agreement relates. If any
Affiliate to which a Party has assigned its rights or obligations under this Agreement thereafter
ceases to be an Affiliate of such Party, then such assignment will be deemed to require the consent
of the other Party pursuant to this Section 16.2. The assigning Party (unless it is not the
surviving entity) will remain jointly and severally liable with the relevant Affiliate or Third
Party assignee under this Agreement, and the relevant Affiliate assignee, Third Party assignee or
surviving entity will assume in writing all of the assigning Party’s obligations under this
Agreement. Any purported assignment or transfer in violation of this section will be void ab
initio and of no force or effect.

     16.3 Severability. If any provision of this Agreement is held to be illegal, invalid or
unenforceable under any present or future law, and if the rights or obligations of either Party
under this Agreement will not be materially and adversely affected thereby, (a) such provision will
be fully severable, (b) this Agreement will be construed and enforced as if such illegal, invalid
or unenforceable provision had never composed a part of this Agreement, (c) the remaining
provisions of this Agreement will remain in full force and effect and will not be affected by the
illegal, invalid or unenforceable provision or by its severance from this Agreement, and (d) in
lieu of such illegal, invalid or unenforceable provision, the Parties will negotiate a legal, valid
and enforceable provision as similar in terms to such illegal, invalid or unenforceable provision
as may be possible and reasonably acceptable to the Parties.

48

 

     16.4 Governing Law; Dispute Resolution.

          16.4.1 Governing Law. This Agreement, and any claim, dispute, or controversy of whatever
nature arising out of or relating to this Agreement will be governed by and construed in accordance
with the laws of the State of New York, without giving effect to any principles, statutory
provisions or other rules of choice of law that would require the application of the laws of a
different state or country.

          16.4.2 Resolution by [***]. The Parties will try to settle their differences amicably between
themselves. If any claim, dispute, or controversy (other than a matter subject to resolution by
the Steering Committee or the Chief Executive Officers pursuant to Section 2.1.5) arises out of or
concerns the interpretation of this Agreement, the performance or alleged nonperformance of a
Party’s obligations under this Agreement, or any other alleged breach of this Agreement (each a
“Dispute”), a Party will, before initiating any proceedings pursuant to Section 16.4.3, notify the
other Party in writing of such Dispute. If the Parties are unable to resolve a Dispute within
[***] of receipt by one Party of the written notice from the other Party regarding the Dispute,
such Dispute will be referred to [***] who will meet in person at least once and use their good
faith efforts to resolve the Dispute within [***] after such referral. For the avoidance of doubt,
in no event will the dispute resolution provisions applicable to Steering Committee actions in
Section 2.1.5 limit a Party’s right to resolve, in accordance with the terms of this Section 16.4,
any Dispute arising out of or concerning the interpretation of this Agreement, the performance or
alleged nonperformance of a Party’s obligations under this Agreement, or any other alleged breach
of this Agreement.

          16.4.3 Resolution by the Courts. If a Dispute is not resolved as provided in the preceding
Section 16.4.2, whether before or after termination of this Agreement, the Parties hereby agree to
the exclusive jurisdiction of the courts of competent jurisdiction in New York, New York. Each
Party hereby agrees to such exclusive jurisdiction and waives any objections as to the personal
jurisdiction or venue of such courts.

          16.4.4 Injunctive Relief. Notwithstanding the provisions of this Section 16.4, either Party
will have the right to seek temporary injunctive relief in any court of competent jurisdiction as
may be available to such Party under the laws and rules applicable in such jurisdiction.

     16.5 Notices. All notices or other communications that are required or permitted hereunder
will be in writing and delivered personally, sent by facsimile (and promptly confirmed by personal
delivery or overnight courier as provided in this Agreement), or sent by internationally-recognized
overnight courier addressed as follows:

 

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

49

 

     If to Serono, to:

Ares Trading S.A.

Zone Industrielle de l’Ouriettaz

CH-1170 Aubonne

Switzerland

Attention: General Manager

Facsimile: ++41 22 354 5081

with a copy to:

Serono International S.A.

15bis, chemin des Mines

Case postale 54

1211 Genève 20

Switzerland

Attention: General Counsel

Facsimile: ++41 22 739 3070

50

 

     If to Micromet, to:

Micromet AG

Staffelseestr. 2

81477 Munich

Germany

Attention: Chief Executive Officer

Facsimile: ++49 89 895 277 205

with a copy to:

Cooley Godward, LLP

One Freedom Square

Reston Town Center

11951 Freedom Drive

Reston, Virginia 20190-5656

Attention: Matthias Alder

Facsimile: (703) 456-8100

or to such other address as the Party to whom notice is to be given may have furnished to the other
Party in writing in accordance with this Agreement. Any such communication will be deemed to have
been given (a) when delivered, if personally delivered or sent by facsimile on a business day, and
(b) on the second business day after dispatch, if sent by internationally-recognized overnight
courier. It is understood and agreed that this Section 16.5 is not intended to govern the
day-to-day business communications necessary between the Parties in performing their duties, in due
course, under the terms of this Agreement.

     16.6 Entire Agreement; Modifications. This Agreement sets forth and constitutes the entire
agreement and understanding between the Parties with respect to the subject matter of this
Agreement and all prior agreements, understanding, promises and representations, whether written or
oral, with respect thereto are superseded by this Agreement, including the Confidentiality
Agreement between the Parties dated February 24, 2004, amended and restated on May 5, 2004 (the
“CDA”); provided that any “Confidential Information” as defined in the CDA will be deemed to be
Confidential Information subject to the terms of this Agreement as if disclosed under this
Agreement by the Party that is the “Disclosing Party” under the CDA. Each Party confirms that it
is not relying on any representations or warranties of the other Party except those that are
expressly made in this Agreement. No amendment or modification of this Agreement will be binding
upon the Parties unless made in a writing referencing this Agreement and duly executed by
authorized representatives of both Parties.

     16.7 Relationship of the Parties. It is expressly agreed that the relationship between the
Parties is and will be that of independent contractors, and that the relationship between the
Parties will not constitute a partnership, joint venture or agency relationship. Neither Party
will have the authority to make any statements, representations or commitments of any kind, or to
take any action, which will be binding on the other Party, without the prior written consent of the
other Party to do so. All persons employed by a Party will be employees of such Party and not

51

 

of the other Party and all costs and obligations incurred by reason of any such employment
will be for the account and expense of such Party.

     16.8 Waiver. Any term or condition of this Agreement may be waived at any time by the Party
that is entitled to the benefit of such term or condition, but no such waiver will be effective
unless set forth in a written instrument duly executed by or on behalf of the Party waiving such
term or condition. The waiver by either Party of any right under this Agreement or of claims based
on the failure to perform or a breach by the other Party hereof will not be deemed a waiver of any
other right under this Agreement or of any other breach or failure by said other Party whether of a
similar nature or otherwise.

     16.9 Counterparts. This Agreement may be executed in two (2) or more counterparts, each of
which will be deemed an original, but all of which together will constitute one and the same
instrument.

     16.10 No Benefit to Third Parties. The representations, warranties, covenants and agreements
set forth in this Agreement are for the sole benefit of the Parties hereto and their successors and
permitted assigns, and they will not be construed as conferring any rights on any other parties.

     16.11 Further Assurance. Each Party will duly execute and deliver, or cause to be duly
executed and delivered, such further instruments and do and cause to be done such further acts and
things, including the filing of such assignments, agreements, documents and instruments, as may be
necessary or as the other Party may reasonably request in connection with this Agreement or to
carry out more effectively the provisions and purposes hereof, or to better assure and confirm unto
such other Party its rights and remedies under this Agreement.

     16.12 English Language. This Agreement has been written and executed in the English language.
Any translation of this Agreement into any other language will not be an official version hereof,
and in the event of any conflict in interpretation between the English version of this Agreement
and such translation, the English version will control.

     16.13 No Drafting Party. This Agreement has been submitted to the scrutiny of, and has been
negotiated by, both Parties and their counsel, and will be given a fair and reasonable
interpretation in accordance with its terms, without consideration or weight being given to any
such terms having been drafted by any Party or its counsel.

     16.14 Construction. Except where the context otherwise requires, wherever used, the singular
will include the plural, the plural the singular, the use of any gender will be applicable to all
genders, and the word “or” is used in the inclusive sense (and/or). The captions of this Agreement
are for convenience of reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision contained in this Agreement. The term
“including” as used herein means including, without limiting the generality of any description
preceding such term. References to “Section” or “Exhibit” are references to the numbered sections
of this Agreement and the exhibits attached to this Agreement, unless expressly stated otherwise.

[Remainder of this page is left blank intentionally]

52

 

     IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed by their duly
authorized representatives as of the date first above written.

	 	 	 	 	 	 	 
	Micromet AG	 	Ares Trading S.A.
	 
	 	 	 	 	 	 
	By:	 	/s/ Christian Itin	 	By: /s/ Leon Bernhardt
	 	 	Christian Itin	 	Name: Leon Bernhardt
	 	 	Chief Executive Officer	 	Title: Authorized Representative
	 
	 	 	 	 	 	 
	By:	 	/s/ Gregor K. Mirow	 	By: /s/ F. Naef
	 	 	Gregor K. Mirow	 	Name: F. Naef
	 	 	Chief Financial Officer	 	Title: Authorized Representative

[Signature Page to the Collaboration and License Agreement]

 

 

Exhibit A

Micromet Patents

[ *** ]

	 	 	 	 	 	 	 	 	 	 	 
	 	 	Application	 	 	 	 	 	Patent	 	 
	Country	 	date	 	Application #	 	Date of grant	 	#	 	Status
	 	 	 	 	 	Granted patents	 	 	 	 	 
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	 	 	 	 	 	
[***]	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]
	[***]
	 	[***]	 	[***]	 	[***]	 	[***]	 	[***]

 

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

 

 

[ *** ]

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Priority	 	Priority	 	Publication	 	Publication	 	 	 	Patent	 	 
	Country	 	date	 	#	 	date	 	#	 	Patent date	 	#	 	status
	[***]

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

 

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

 

 

Exhibit 10.34

Exhibit B

MT201 Amino Acid Sequence

I. MT 201: VL Sequence

a. Nucleic Acid / Amino Acid portrayal

[***]

 

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

 

 

b. Amino Acid portrayal

[***]

 

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

 

 

II. MT 201: VH Sequence

a. Nucleic Acid / Amino Acid portrayal

[***]

 

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

 

 

b. Amino Acid portrayal

[***]

 

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

 

 

Exhibit C

Technology Acquisition Agreements

[***]

 

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

 

 

Exhibit D

Milestone Payments

	 	 	 	 	 
	Milestone Event	 	Milestone Payment
	1. Enrollment of the last patient in the
Ongoing Trial MT201-201 (prostate cancer)
	 	US$	1,000,000	 
	 
	 	 	 	 
	2. Enrollment of the last patient in the
Ongoing Trial MT201-202 (metastatic breast
cancer)
	 	US$	1,000,000	 
	 
	 	 	 	 
	3. Sixty (60) days following receipt by Serono
of the Final Study Report for the second
Ongoing Trial to be completed
	 	US$	10,000,000	 
	 
	 	 	 	 
	4. Enrollment of the first patient in the first
Pivotal Trial of the Product for the first
Indication and such trial is not terminated
prior to the payment due date described in
Section 7.2 for this development milestone
	 	US$[***]
	 
	 	 	 	 
	5. Enrollment of the first patient in the first
Pivotal Trial of the Product for the second
Indication and such trial is not terminated
prior to the payment due date described in
Section 7.2 for this development milestone
	 	US$[***]
	 
	 	 	 	 
	6. Enrollment of the first patient in the first
Pivotal Trial of the Product for the third
Indication and such trial is not terminated
prior to the payment due date described in
Section 7.2 for this development milestone
	 	US$[***]
	 
	 	 	 	 
	7. Filing of the first BLA for the Product in
the United States for the first Indication
	 	US$[***]
	 
	 	 	 	 
	8. Filing of the first BLA for the Product in
the United States for the second Indication
	 	US$[***]
	 
	 	 	 	 
	9. Filing of the first BLA for the Product in
the United States for the third Indication
	 	US$[***]

 

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

 

 

	 	 	 	 	 
	Milestone Event	 	Milestone Payment
	10. Filing of the first MAA for the Product in
the European Union (or if the European Union
does not exist at the time of filing, then
filing in any three of the five Major Markets
in Europe) for the first Indication
	 	US$[***]
	 
	 	 	 	 
	11. Filing of the first MAA for the Product in
the European Union (or if the European Union
does not exist at the time of filing, then
filing in any three of the five Major Markets
in Europe) for the second Indication
	 	US$[***]
	 
	 	 	 	 
	12. Filing of the first MAA for the Product in
the European Union (or if the European Union
does not exist at the time of filing, then
filing in any of three of the five Major
Markets in Europe) for the third Indication
	 	US$[***]
	 
	 	 	 	 
	13. Filing of the first application for
Marketing Approval for the Product in Japan for
the first Indication
	 	US$[***]
	 
	 	 	 	 
	14. Filing of the first application for
Marketing Approval for the Product in Japan for
the second Indication
	 	US[***]
	 
	 	 	 	 
	15. Filing of the first application for
Marketing Approval for the Product in Japan for
the third Indication
	 	US$[***]
	 
	 	 	 	 
	16. Receipt of Marketing Approval for the
Product in the United States for the first
Indication
	 	US$[***]
	 
	 	 	 	 
	17. Receipt of Marketing Approval for the
Product in the United States for the second
Indication
	 	US$[***]
	 
	 	 	 	 
	18. Receipt of Marketing Approval for the
Product in the United States for the third
Indication
	 	US$[***]
	 
	 	 	 	 
	19. Receipt of Marketing Approval for the
Product in the European Union (or if the
European Union does not exist at the time of
the receipt of Marketing Approval, then receipt
in any three of the five Major Markets in
Europe) for the first Indication
	 	US$[***]

 

			
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	Milestone Event	 	Milestone Payment
	20. Receipt of Marketing Approval for the
Product in the European Union (or if the
European Union does not exist at the time of
the receipt of Marketing Approval, then receipt
in any three of the five Major Markets in
Europe) for the second Indication
	 	US$[***]
	 
	 	 	 	 
	21. Receipt of Marketing Approval for the
Product in the European Union (or if the
European Union does not exist at the time of
the receipt of Marketing Approval, then receipt
in any three of the five Major Markets in
Europe) for the third Indication
	 	US$[***]
	 
	 	 	 	 
	22. Receipt of Marketing Approval for the
Product in Japan for the first Indication
	 	US$[***]
	 
	 	 	 	 
	23. Receipt of Marketing Approval for the
Product in Japan for the second Indication
	 	US$[***]
	 
	 	 	 	 
	24. Receipt of Marketing Approval for the
Product in Japan for the third Indication
	 	US$[***]
	 
	 	 	 	 

The milestone payments set forth in items 7-12 and 16-21 above will be reduced by [***] percent
([***]%) in the event that the applicable milestone event occurs during the Co-Promotion Period and
during such time as the United States (for items 7-9 and 16-18) or Europe (for items 10-12 and
19-21) are within the Co-Promotion Territory.

 

			
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with respect to the omitted portions.

 

 

Exhibit E

Sharing of Development Expenses during the Co-Promotion Period

     The percentage of Development Expenses in the United States and Europe for the Product that
Micromet will bear during the Co-Promotion Period is set forth in the following table:

	 	 	 
	 	 	Percentage of United States/Europe
	Co-Promotion Territory	 	Development Expenses
	United States only
	 	[***]%
	Europe only
	 	[***]%
	United States and Europe
	 	[***]%

 

			
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with respect to the omitted portions.

 

 

Exhibit F

Net Profits

“Net Profits” means Net Sales of the Product in the Co-Promotion Territory, less: (a) [***], (b)
[***], (c) [***], (d) [***], and (e) [***].

“Cost
of Goods Sold” means, with respect to a particular unit of the Product, (a) the [***], or (b) [***] a
[***], and any [***], [***], [***] and [***] of the Product (if necessary), [***], and [***] borne
by Serono (to the extent not included in such [***]).

“Distribution
Costs” means the costs and expenses specifically identifiable to
the distribution of the Product, consisting of [***],
[***] and other [***], [***], [***], [***], [***] and [***] and other such activities, but in any
case, not including [***].

“Fully-Burdened
Manufacturing Cost” means the consolidated fully burdened cost incurred by Serono or on its behalf in the
manufacture of the Product, including (a) [***] costs; (b) [***] costs, to the extent allocable to
the Product; (c) [***] costs; (d) [***] costs; (e) costs of [***] of the Product (if necessary),
[***]; and (f) [***] reasonably allocable to the Product, in each case as determined in accordance
with International Accounting Standards as applied by Serono consistently across its products.
Fully-Burdened Manufacturing Cost will exclude [***] [***], [***] and any [***] not directly
related and allocable to the Product in accordance with Serono’s methodology for allocating such
costs across its other products.

“Marketing
Costs” means the direct costs and expenses incurred in
connection with the marketing and advertising of the
Product following Marketing Approval, including [***], [***], [***], [***] and [***], [***], [***],
[***] required to maintain or expand [***] of the Product and other similar activities related to
the Product, obtaining [***], and obtaining [***] (to the extent not included in the [***]); all of which
costs will be calculated based on both [***] (e.g.,
[***] for the [***] and [***] and
[***] for [***] allocated to [***] of
the Product in the, etc.)
and [***] and [***] (e.g., [***], [***], [***], etc.) in each case as determined in accordance with
International Accounting Standards as applied by Serono consistently across its products.

“General
and Administrative Costs” means the general and administrative
costs allocated to the [***] and [***], as determined in accordance with
International Accounting Standards as applied by Serono consistently across its products.

 

			
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with respect to the omitted portions.

 

 

Exhibit G

Micromet
Program Plan

[***]

 

			
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filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.

 

 

Exhibit H

Press Release

 

 

Exhibit I

[***]

 

			
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filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.

 

 

First Amendment to Collaboration and License Agreement

This First Amendment to the Collaboration and License Agreement (the “First Amendment”) is entered
into on November 24, 2006 (the “First Amendment Effective Date”) between Micromet AG, with
its principal place of business at Staffelseestrasse 2, 81477, Munich, Germany (“Micromet”), and
Ares Trading S.A., with its principal place of business at Zone Industrielle de
l’Ouriettaz, CH-1170 Aubonne, Switzerland (“Serono”). Micromet and Serono each may be referred to
herein individually as a “Party,” or collectively as the “Parties.”

Recitals

     Whereas, Micromet and Serono have entered into a certain Collaboration and License
Agreement dated December 3, 2004 (the “Agreement”), with respect to the development and
commercialization of Micromet’s proprietary pharmaceutical product comprising a human antibody of
IgG-1 subtype binding to EpCAM;

     Whereas, Micromet and Serono desire to amend the Agreement to reflect a
modification of the Micromet Program agreed by the Parties; 

     Now Therefore, in consideration of the foregoing premises and mutual promises,
covenants and conditions contained in this First Amendment, the Parties agree as follows:

Agreement

1. All capitalized terms not defined herein shall refer to terms defined in Section 1 of the
Agreement.

2. Amendment to Section 1. The Parties agree to amend Section 1 of the Agreement by adding the
following terms as follows:

          1.79 “Additional Phase I Study” has the meaning set forth in Section 3.1.7.

          1.80 “Final Phase I Study Report” has the meaning set forth in Section 3.1.8.

3. Amendment to Section 2.1.3. The Parties agree to amend the first sentence of Section 2.3.1 of
the Agreement as follows:

          2.1.3 Steering Committee Meetings. The Steering Committee will meet not less than once
every calendar quarter until the completion of the Micromet Program and during the
development of the Product during the Co-Promotion Period; thereafter, the Steering
Committee will meet not less than semi-annually. [Remainder of Section 2.1.3 unchanged]

4. Amendment to Section 3.1. The Parties agree to amend Section 3.1 of the Agreement in part as
follows:

1

 

     3.1 Micromet Program. Subject to the terms and conditions of this Agreement, Micromet
will perform the following activities (collectively, the “Micromet Program”) following the
Effective Date, all as described in further detail in the plan attached to this Agreement as
Exhibit G (as may be amended by the Steering Committee from time to time pursuant to
Section 2.1), which plan will include the development timelines and a budget of Development
Expenses to be incurred pursuant to the Micromet Program (the “Micromet Program Plan”):

          [Section 3.1.1 to Section 3.1.6 remain unchanged]

          3.1.7 Additional Phase I Monotherapy Study. Performance of a Phase I clinical trial
(identified as MT201-103) designed to demonstrate the safety of the
Product as a monotherapy in patients with solid tumors (the “Additional Phase I Study”);
and

          3.1.8 Final Phase I Study Reports. Preparation of a final study report for the
Combination Study and the Additional Phase I Study (each, a “Final Phase I Study Report”),
to be performed following database lock and completion of the applicable study.

5. Amendment to Section 3.3.1. The Parties agree to amend and restate Section 3.3.1 of the
Agreement, in its entirety, as follows:

          3.3.1 Scope. Promptly following receipt of the first draft of the first Final Phase I
Study Report, the Steering Committee will begin to develop a strategy for the development of
the Product and further Development Activities through Marketing Approval of the Product,
other than the Development Activities included in the Micromet Program (the “Serono
Program”).

6. Amendment to Section 3.3.2(b). The Parties agree to amend and restate Section 3.3.2(b) of the
Agreement, in its entirety, as follows:

     (b) Within [***] after receipt by Serono of the last Final Phase I Study Report, the
Project Team will review and update the draft Serono Program Plan, if necessary, and present
the Serono Program Plan to the Steering Committee for review and approval. Within [***] of
its receipt, the Steering Committee will approve the Serono Program Plan, after, if
necessary, making any revisions thereto to render such plan approvable.

7. Amendment to Section 3.5.1. The Parties agree to amend and restate Section 3.5.1 of the
Agreement, in its entirety, as follows:

     3.5.1 Obligation. Serono will bear all Development Expenses incurred by the Parties;
provided, however, that (a) any expenses in excess of [***]% of the approved budget of Exhibit G
(as may be amended by the Steering Committee pursuant to Section 2.1) shall be subject to Steering
Committee approval; and (b) during the Co-Promotion Period, the allocation of
Development Expenses incurred by the Parties for the Serono Program will be as set forth in Section
5.3.

8. Amendment to Section 11.3. The Parties agree to amend and restate Section 11.3 of the
Agreement, in its entirety, as follows:

 

			
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2

 

     11.3 Termination at Will. Serono may terminate this Agreement in its entirety, for any
reason or no reason: (a) [***] upon written notice to Micromet following receipt by
Serono of the last Final Phase I Study Report, and (b) upon [***] days’ prior written notice
to Micromet at any time thereafter.

9. Amendment to Exhibit G. The Parties agree to amend and restate Exhibit G. An amended Exhibit
G is attached to this First Amendment and shall replace the original Exhibit G attached to the
Agreement.

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

11. Effectiveness. This First Amendment will become effective upon the execution hereof by both
Parties.

12. Continuing Effect. Other than as set forth in this First Amendment, all of the terms and
conditions of the Agreement will continue in full force and effect.

In Witness Whereof, the Parties have executed this First Amendment in duplicate originals
by their duly authorized officers as of the First Amendment Effective Date.

	 	 	 	 	 	 	 	 	 
	Ares Trading S.A.	 	Micromet AG	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Franck Latrille
	 	By:
	 	/s/ Jens Hennecke	 	 
	Name:

	 	Franck Latrille
	 	Name:
	 	Jens Hennecke	 	 
	Title:

	 	Authorized
Representative
	 	Title:
	 	VP Business Development	 	 
	 
	 	 	 	 	 	 	 	 
	Ares Trading S.A.	 	Micromet AG	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Jacque Theurillat
	 	By:
	 	/s/ Carsten Reinhardt	 	 
	Name:

	 	Jacque Theurillat
	 	Name:
	 	Carsten Reinhardt	 	 
	Title:

	 	Authorized
Representative
	 	Title:
	 	SVP Clinical
Development
	 	 

 
 

			
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3

 

Exhibit G

Micromet Program Plan

[***]

 

			
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Commission. Confidential treatment has been requested with respect to the omitted portions.

4exv10w35

 

Exhibit 10.35

***Text Omitted and Filed Separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4) and 240.24b-2

RESEARCH AND LICENCE AGREEMENT

between

MICROMET AG

and

BIOVATION LIMITED

August 14, 2001

 

 

RESEARCH AND LICENCE AGREEMENT

This Agreement is made this 14th day of August, 2001 (the “EFFECTIVE DATE”)

BETWEEN

MICROMET AG of Am Klopferspitz 19, 82152 Martinsried, Munich, Germany (hereinafter “MICROMET”)

and

BIOVATION LIMITED of Crombie Lodge, Aberdeen Science Park, Balgownie Drive, Aberdeen AB22 8GU,
Scotland, UK (hereinafter “BIOVATION”).

WHEREAS MICROMET is the owner of a cDNA which encodes a SINGLE-CHAIN ANTIBODY which binds to a
specific antigen; and

WHEREAS BIOVATION has certain proprietary technology, materials and know-how in genetic engineering
of biological materials, including single-chain antibodies, relating to removal of potentially
immunogenic sequences, from the variable regions of antibodies (“DeImmunisation”) to produce an
antibody for therapeutic and/or in vivo diagnostic purposes; and

WHEREAS MICROMET wishes BIOVATION to apply its technology and know-how to genetically engineer a
SINGLE-CHAIN ANTIBODY and BIOVATION wishes to perform such services under the terms and conditions
below;

NOW THEREFORE it is hereby agreed as follows:

	1.	 	DEFINITIONS
	 
	 	 	Throughout this Agreement, where the context so requires, the use of the singular shall be
construed to include the plural, and the use of the plural shall be construed to include
the singular, and the use of any gender shall include all genders.
	 
	 	 	In this Agreement, the following terms have the following meanings;

	 	(a)	 	“ASSAY” shall mean the method and experimental protocol providing a means to
measure [***] of the SINGLE-CHAIN ANTIBODY supplied by MICROMET to BIOVATION in the
context of a BiTE

 

			
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1/19

 

 

	 	(b)	 	“BiTE” shall mean a single-chain bispecific antibody format proprietary to
MICROMET consisting of the SINGLE-CHAIN ANTIBODY connected via a peptide linker to a
second single-chain antibody binding to a target cell antigen
	 
	 	(c)	 	“BIOVATION PATENT RIGHTS” shall mean all patent applications and granted
patents relevant to “DEIMMUNISATION TECHNOLOGY” which are or become owned by
BIOVATION, or to which BIOVATION otherwise has, now or in the future, the right to
grant licences, and which generically or specifically claim TECHNICAL INFORMATION,
technology, products or a composition comprising products, a process for manufacturing
or formulating a product, an intermediate used in such process or a use of product or
a technology, as well as all other intellectual property rights arising therefrom,
including, but not limited to, all continuations in part, divisional applications, and
future patents issuing thereon, corresponding foreign patent applications and patents,
all reissues, re-examinations, extensions, including supplementary protection
certificates and including, but not limited to, the PATENT RIGHTS
	 
	 	(d)	 	“BISPECIFIC PRODUCT(S)” shall mean each bispecific antibody developed by
coupling the DEIMMUNISED ANTIBODY (or portion thereof) with another antibody (or
portion thereof)
	 
	 	(e)	 	“CONFIDENTIAL INFORMATION” shall mean all information disclosed by MICROMET
to BIOVATION with reference to the SINGLE-CHAIN ANTIBODY, whether such information is
in tangible or intangible form, including non-technical or technical information,
trade secrets, know-how, inventions, processes and samples. CONFIDENTIAL INFORMATION
shall include any oral disclosure provided such oral disclosure is reduced to writing
and given to BIOVATION in written form within 30 days after oral disclosure.
	 
	 	(f)	 	“DEIMMUNISED ANTIBODY(IES)” shall mean all genetically engineered variant(s)
of the SINGLE-CHAIN ANTIBODY arising from the RESEARCH PROGRAMME
	 
	 	(g)	 	“DEIMMUNISATION TECHNOLOGY” shall mean the technical process applied by
BIOVATION to generate DEIMMUNISED ANTIBODY as outlined in the RESEARCH PROGRAMME.
	 
	 	(h)	 	“DELIVERABLES” shall mean any and all materials and specific know how arising
out of the RESEARCH PROGRAMME as it relates to exploitation of the SINGLE-CHAIN
ANTIBODY(IES) including, without limitation, all specific data reports, specific cell
lines, specific plasmids and antibodies including the DEIMMUNISED ANTIBODY(IES).

 2/20

 

	 	(i)	 	“EFFECTIVE DATE” shall mean the date, first mentioned above.
	 
	 	(j)	 	“FIELD” shall mean the field of human therapy and human in vivo and in vitro
diagnostics limited to the SINGLE-CHAIN ANTIBODY.
	 
	 	(k)	 	“NET SALES” shall mean the total annual gross receipts for sales of PRODUCTS
by or on behalf of MICROMET and its permitted sublicensees or from leasing, renting or
otherwise making PRODUCTS available to third parties on a payment basis, whether
invoiced or not, less (i) quantity and/or cash discounts, allowances, rebates,
customer merchandising and pricing funds (including price declines and managed care
discounts), wholesaler discounts and chargebacks allowed or given from the billed
amount, (ii) freight, postage, shipping, packing and insurance expenses (if separately
identified in the invoice), (iii) credits or refunds allowed for rejected, outdated or
returned product and (iv) sales and other taxes and duties directly related to the
sale (not including income tax) as detailed in the respective invoice. No deductions
shall be made for commissions paid to individuals, whether they be with independent
sales agencies or regularly employed by MICROMET and on its payroll, or for the cost
of collections.
	 
	 	(l)	 	“PATENT RIGHTS” shall mean (i) those patent applications and (ii) patents
based on inventions derived or arising from a SINGLE-CHAIN ANTIBODY, which were first
conceived or reduced to practice during the performance of the RESEARCH PROGRAMME, and
(iii) all patents issuing on (i) or (ii) throughout the world, as well as
substitutions, extensions, reissues, renewals, divisional applications, continuations,
continuations-in-part of or to (i) or (ii) above, to the extent that they are
necessary or useful to manufacture, use, sell, offer for sale, or export a PRODUCT.
	 
	 	(m)	 	“PRODUCT” shall mean any product incorporating or derived through the
application of DEIMMUNISATION TECHNOLOGY to a SINGLE-CHAIN ANTIBODY, which could not
be manufactured, used, sold, offered for sale, or exported without a licence under the
PATENT RIGHTS.
	 
	 	(n)	 	The “RESEARCH PROGRAMME” shall mean the programme outlined in Schedule II
attached hereto and made a part hereof for the SINGLE-CHAIN ANTIBODY.
	 
	 	(o)	 	“SINGLE-CHAIN ANTIBODY” shall mean one single-chain antibody binding to a
certain antigen and the cDNA which produces the SINGLE-CHAIN ANTIBODY as specified in
Schedule I attached hereto and made a part hereof.

 3/20

 

	 	(p)	 	“TECHNICAL INFORMATION” shall mean technical and scientific information and
proprietary technology relevant to DEIMMUNISATION TECHNOLOGY which is owned by,
licensed-in by or otherwise in the possession of BIOVATION at the EFFECTIVE DATE
and/or during the period of the RESEARCH PROGRAMME.

	2.	 	COLLABORATION
	 
	2.1	 	After the EFFECTIVE DATE, MICROMET shall transfer to BIOVATION the cDNA of the SINGLE-CHAIN
ANTIBODY and information pertaining thereto. Such SINGLE-CHAIN ANTIBODY is and shall remain
the property of MICROMET and BIOVATION shall have no rights therein. Upon receipt of the
SINGLE-CHAIN ANTIBODY, BIOVATION agrees to use reasonable efforts to conduct research relating
to the genetic engineering of each of the SINGLE-CHAIN ANTIBODY transferred to the extent
described in the RESEARCH PROGRAMME.
	 
	2.2	 	During the RESEARCH PROGRAMME, BIOVATION’s principal investigator and representative shall be
Dr Frank Carr and MICROMET’s principal representative shall be Dr Patrick Baeuerle or other
such person or persons as the respective parties shall notify the other in writing.
	 
	2.3	 	BIOVATION shall provide MICROMET with a written research report upon completion of the
RESEARCH PROGRAMME for the SINGLE-CHAIN ANTIBODY transferred. BIOVATION will deliver to
MICROMET at the completion of Stage 2 of the RESEARCH PROGRAMME for the SINGLE-CHAIN ANTIBODY,
[***] from the SINGLE-CHAIN ANTIBODY with sufficient information and materials for MICROMET to
reasonably verify satisfactory completion of Stage 2. The representatives or their designees
shall keep in contact during the conduct of the RESEARCH PROGRAMME for the SINGLE-CHAIN
ANTIBODY.
	 
	2.4	 	Upon completion of the RESEARCH PROGRAMME for the SINGLE-CHAIN ANTIBODY, BIOVATION shall
provide to MICROMET all DELIVERABLES together with samples of the relevant materials created
during the RESEARCH PROGRAMME, such as plasmids, cell lines and DEIMMUNISED ANTIBODY(IES),
along with any protocol for using, handling and storing such materials.

 

			
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	3.	 	GRANT OF RIGHTS
	 
	3.1	 	BIOVATION agrees to grant to MICROMET under the PATENT RIGHTS a non-exclusive world-wide
licence to the extent necessary to commercialise the DEIMMUNISED ANTIBODY (as specified in
Schedule II) and/or the DELIVERABLES in the FIELD. For greater certainty, such
commercialisation of the DEIMMUNISED ANTIBODY shall include and be limited to the clinical
development, launch, manufacture, marketing and distribution of the PRODUCT. MICROMET shall
be entitled to grant sub-licences of the rights required to commercialize the PRODUCT provided
that MICROMET informs BIOVATION of any such sublicence granted in writing and provided further
that any such sublicence agreement is in full accordance with the terms and conditions of this
Agreement
	 
	4.	 	FUNDING
	 
	4.1	 	In consideration for the research performed by BIOVATION and the licence granted, MICROMET
shall make the following payments to BIOVATION:

	 	(a)	 	the sum of US$[***] upon the EFFECTIVE DATE;
	 
	 	(b)	 	upon completion of Stage 2 (as described in Schedule II) of the RESEARCH
PROGRAMME, the sum of US$[***] plus the sum of US$[***] subject to delivery of [***];
	 
	 	(c)	 	within [***] months of completion of Stage 2 (as described in Schedule II) of
the RESEARCH PROGRAMME, the sum of US$[***] subject to the [***] having an [***] in
the [***] (as described in SCHEDULE III) which is not more than [***].

	4.2	 	All payments under Section 4.1 (a), (b) and (c) shall be due within thirty days of receipt of
invoice by MICROMET from BIOVATION and are under no circumstances refundable.

	4.3	 	Following the completion of the first clinical trial with the first DEIMMUNISED ANTIBODY,
upon MICROMET’s decision to make public any clinical results, MICROMET shall immediately
provide to BIOVATION a copy of any clinical data which MICROMET elects to make public.
BIOVATION will not disclose or otherwise make public clinical data from MICROMET which
MICROMET has not already put into the public domain without MICROMET’s prior written approval,
which approval shall not be unreasonably withheld.

 

			
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	4.4	 	Provided that MICROMET has paid all balances due under clause 4.1 above, BIOVATION herewith
grants to MICROMET for each specific DEIMMUNISED ANTIBODY a non-exclusive licence under the
PATENT RIGHTS to the extent necessary for worldwide commercialisation of the DEIMMUNISED
ANTIBODY derived from the specific SINGLE-CHAIN ANTIBODY sequence. Under such licence grant
MICROMET shall be entitled to launch, manufacture, market, distribute and to commercialise a
PRODUCT but shall not be entitled to use BIOVATION PATENT RIGHTS or any of BIOVATION’S
proprietary technology to discover DEIMMUNISED ANTIBODIES independently of BIOVATION. It is
expressly understood that MICROMET shall pay to BIOVATION for each PRODUCT containing the
DEIMMUNISED ANTIBODY:

	 	(a)	 	US$[***] upon the commencement of the first phase I clinical trial (i.e.,
dosing of first human subject in such trial) for each of the first two BISPECIFIC
PRODUCTS. US$[***] upon the commencement of the first phase II clinical trial (i.e.,
dosing of first human subject in such trial) for each of the first two BISPECIFIC
PRODUCTS;
	 
	 	(b)	 	US$[***] upon the commencement of the first phase III clinical trial (i.e.,
dosing of first human subject in such trial) per BISPECIFIC PRODUCT;
	 
	 	(c)	 	US$[***] upon submission of first BLA or equivalent per BISPECIFIC PRODUCT;
	 
	 	(d)	 	a payment of US$[***] upon cumulative total sales per BISPECIFIC PRODUCT of
US$[***];
	 
	 	(e)	 	a payment of US$[***] upon cumulative total sales per BISPECIFIC PRODUCT of
US$[***];
	 
	 	(f)	 	a payment of US$[***] upon cumulative total sales per BISPECIFIC PRODUCT of
US$[***];
	 
	 	(g)	 	a royalty of [***]% on NET SALES of first BISPECIFIC PRODUCT and for the
second and each subsequent BISPECIFIC PRODUCT a royalty of [***]% on NET SALES up to
US$[***], a royalty of [***]% on NET SALES from US$[***] to US$[***] and a royalty of
[***]% on NET SALES exceeding US$[***].

All payments under the licence pursuant to (a) — (f) above shall be due within [***] days
of the event triggering payment without the requirement for an

 

			
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 6/20

 

	 	 	advance invoice from BIOVATION. MICROMET will promptly notify BIOVATION of an event
triggering a payment under this section 4.4. After the beginning of commercialisation of
each DEIMMUNISED ANTIBODY or a PRODUCT relating thereto, all payments under (g), above
shall be due within [***] days following the end of each calendar quarter.
	 
	 	 	At the election of MICROMET a payment of US$[***] may be made within [***] to [***] above
to [***] for the [***]. At the election of MICROMET a payment of US$[***] may be made
within [***] to [***]. At the election of MICROMET a payment of US$[***] may be made
within [***] to [***].
	 
	4.5	 	In the event MICROMET does not enter into clinical Phase I trial with at least one
DEIMMUNISED ANTIBODY within 24 months of the payment due according to 4.1(c) and the
DEIMMUNISED ANTIBODY fulfils the specifications described in clause 4.1 (c) MICROMET shall
either:

	 	(a)	 	pay the amount of US$[***] to extend the time point to [***]; and
	 
	 	(b)	 	pay the amount of US$[***] as a final payment for work performed in
connection with the RESEARCH PROGRAMME; or
	 
	 	(c)	 	assign all of its right, title and interest in the PATENT RIGHTS and
DELIVERABLES to BIOVATION and other rights proprietary to MICROMET to allow BIOVATION
to commercialise the DEIMMUNISED ANTIBODY provided that BIOVATION is in full
accordance with the terms and conditions of the relevant agreements MICROMET has with
third parties and provided that assignment of rights made under this clause 4.5(c)
shall be limited to rights specific to the DEIMMUNISED ANTIBODY as to which payment
was made from MICROMET to BIOVATION pursuant to clause 4.1(c).

	4.6	 	Payments shall be made by cheque drawn upon a UK clearing bank or paid by wire transfer into
BIOVATION’s designated bank account. BIOVATION reserves the right to suspend all work on the
RESEARCH PROGRAMME in the event payment is past due.

	4.7	 	Unless agreed in writing by BIOVATION, any payments due hereunder which are not paid within
thirty days of receipt by MICROMET of invoice from BIOVATION shall then be subject to the levy
of interest charges at the rate of [***] calculated from the published rate on the last day of
each preceding month where a balance is due.

 

			
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	4.8	 	Immediately following MICROMET’s decision to seek a partner or licensee for the first
SINGLE-CHAIN ANTIBODY, MICROMET will provide sufficient non-confidential information to
BIOVATION to consider a proposal to MICROMET for BIOVATION or an affiliate of BIOVATION to
enter into negotiations to become a partner or licensee. Confidential information available
for potential partners will be made available to BIOVATION upon signing an appropriate secrecy
agreement.
	 
	4.9	 	MICROMET agrees to keep true and accurate records and books of account containing all data
necessary for the calculation of the royalties payable to BIOVATION under section 4.4. Such
records and books of account shall upon reasonable notice having been given by BIOVATION be
open at all reasonable times during business hours for inspection by a duly authorised, but
neutral and independent accountant, who shall be acceptable to both parties without prejudice
	 
	4.10	 	MICROMET shall prepare a statement in respect of each calendar quarter of this Agreement
which shall show for the calendar quarter in question MICROMET’s NET SALES on sales by it of
the PRODUCTS on a country by country basis, details of the quantities of PRODUCTS sold in each
country and the royalty and VAT due to BIOVATION thereon pursuant to section 4.4 above. Such
statement shall be submitted to BIOVATION within [***] following the end of the calendar
quarter or part thereof to which it relates together with a remittance for the royalties and
VAT due to BIOVATION. If BIOVATION shall give notice to MICROMET within [***]s of the receipt
of any such statement that it does not accept the same such statement shall be certified by an
independent chartered accountant appointed by agreement between the parties or, in default of
agreement within [***], by the President for the time being of the Institute of Chartered
Accountants of England and Wales in London. MICROMET shall make available all books and
records required for the purpose of such certification at reasonable times during normal
business hours and the statement so certified shall be binding between the parties. The costs
of such certification shall be the responsibility of BIOVATION if the certification shows the
original statement to have been understating due payments by more than [***]% and otherwise
shall be the responsibility of MICROMET. Following any such certification the parties shall
make any adjustments necessary in respect of the royalties already paid to BIOVATION in
relation to the year in question.
	 
	4.11	 	MICROMET shall pay royalties to BIOVATION free and clear of and without deduction or
deferment in respect of any demand, set-off, counterclaim or other dispute and so far as is
legally possible such payment shall be made free and clear of any taxes imposed by or under
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	 	 	authority and in particular but without limitation where any sums due to be paid to
BIOVATION hereunder are subject to any withholding or similar tax. MICROMET and, without
prejudice to the foregoing, BIOVATION shall use their best endeavours to do all such lawful
acts and things and to sign all such lawful deeds and documents as will enable MICROMET to
take advantage of any applicable legal profession or any double taxation treaties with the
object of paying the sums due to BIOVATION without imposing or withholding any tax. Sums
are expressed in this agreement as exclusive of value added tax (VAT). BIOVATION agrees to
provide MICROMET with a VAT invoice in respect of every payment affected by VAT.
	 
	5.	 	RIGHTS TO DELIVERABLES AND TECHNOLOGY
	 
	5.1	 	Upon payment of all balances due under clause 4.1, BIOVATION shall forthwith assign to and
deliver documentation to MICROMET evidencing all rights to the DELIVERABLES.
	 
	5.2	 	Pursuant to clause 5.1, MICROMET shall be free to use the DELIVERABLES including any methods,
protocols and procedures it receives from BIOVATION in any manner whatsoever subject to the
provision of clause 8.4 and provided that MICROMET shall not be entitled to use BIOVATION
PATENT RIGHTS or any of BIOVATION’S proprietary technology to discover DEIMMUNISED ANTIBODIES
independently of BIOVATION.
	 
	5.3	 	In cases where employees of both parties have made an invention in the course of the RESEARCH
PROGRAMME and are co-inventors thereof, all relating intellectual property rights will be
jointly owned by BIOVATION and MICROMET. In cases where only one party has made an invention
in the course of the RESEARCH PROGRAMME, this invention will solely belong to the party the
employees of which made the invention. In any event, regardless BIOVATION shall inform
MICROMET of its intent to file patent applications to inventions covering the DEIMMUNISED
ANTIBODIES made in the course of the RESEARCH PROGRAMME. BIOVATION shall obtain MICROMET’s
written consent before filing a patent application featuring inventions to the DEIMMUNISED
ANTIBODIES made during the course of the PROGRAMME. In the jointly owned cases, the filing
strategy for patentable inventions will be developed and negotiated in good faith by the
parties and the costs will be shared in equal parts. Moreover, MICROMET and BIOVATION will be
joint applicants in those cases. Pursuant to this paragraph for all such inventions,
BIOVATION agrees to grant MICROMET, without further consideration, an exclusive worldwide
license in all intellectual property arising in the course of the RESEARCH PROGRAMME to
research, develop, make, use, sell and commercialise the DEIMMUNISED ANTIBODY. In the event
either party fails diligently to file, prosecute, maintain or defend patents and patent
applications for

 9/20

 

	 	 	any patentable inventions will become jointly owned and the other party will be entitled to
undertake such filing, prosecution, maintenance and defense, as its own cost and with the
cooperation of the first party.

	5.4	 	If any warning letter or other notice of infringement of a third party’s patent rights is
received by or brought against either party because of such party’s performance pursuant to
this Agreement or with respect to the SINGLE-CHAIN ANTIBODY, the parties shall promptly and in
good faith coordinate and lend all reasonable assistance to each other in taking legal action,
if appropriate, which is mutually agreed upon.
	 
	5.5	 	If, in relation to the RESEARCH PROGRAMME of SCHEDULE II, the [***] by BIOVATION of [***] and
the design and construction of [***] infringes on any method claims of third party rights
which requires MICROMET to make additional payments of any kind to that third party, MICROMET
and BIOVATION agree to negotiate in good faith a reduction of the milestone and royalty
payments set forth in 4.4 up to a [***]% maximum reduction in such payments.
	 
	6.	 	TERMS AND TERMINATION
	 
	6.1	 	Subject as hereinafter provided this Agreement and the licence granted pursuant thereto shall
continue in full force and effect for a period of fifteen (15) years from the EFFECTIVE DATE,
or until the last of the PATENT RIGHTS expires, whichever is the later.
	 
	6.2	 	Either party shall have the right to immediately terminate this Agreement in the event the
other party (i) shall fail to perform any of its material obligations under this Agreement and
such default is not cured within [***] of written notice of default, or (ii) shall file for
protection under bankruptcy or similar statutes or shall be liquidated.
	 
	6.3	 	Upon expiration of this Agreement pursuant to Section 6.1, BIOVATION shall deliver possession
and title to all DELIVERABLES and shall return any materials received from MICROMET. Articles
5, 7 and 8 shall survive expiration of this Agreement. All payments due prior to termination
will have to be paid by MICROMET, no further payments will be due.
	 
	6.4	 	Upon termination of this Agreement by MICROMET pursuant to Section 6.2, BIOVATION shall
deliver possession and title to all DELIVERABLES and shall return any materials received from
MICROMET. Articles 5, 7 and 8 shall survive

 

			
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	 	 	expiration of this Agreement. All payments due prior to termination will have to be paid
by MICROMET, no further payments will be due.
	 
	6.5	 	BIOVATION may terminate this Agreement and the said licences forthwith by notice to MICROMET
to that effect upon the happening of any of the following events:-

	 	(i)	 	if MICROMET fails to perform or observe any of the obligations on its part to
be performed or observed and if the breach is one capable of remedy has not been
remedied within [***] of the giving of a notice informing MICROMET of such breach.
Articles 7 and 8 shall survive termination of this Agreement;
	 
	 	(ii)	 	if MICROMET files a voluntary petition in bankruptcy or applies to any
Tribunal for a Receiver Trustee or similar officer to be appointed by any Court or
Executive Department to liquidate or conserve MICROMET or any substantial part of its
property or assets due to insolvency or to the threat thereof or if MICROMET suffers
any trusteeship or receivership to continue undischarged for a period of [***] or
suffers any similar procedure for the relief of distressed debtors entered into by
MICROMET voluntarily or involuntarily or if MICROMET is otherwise divested of its
assets for a period of sixty days or makes a general assignment for the benefit of its
creditors. Articles 7 and 8 shall survive termination of this Agreement.

	6.6	 	Before completion of Stage 2 MICROMET may only terminate under 6.2. After completion of
Stage 2 MICROMET may terminate this Agreement and the Licences granted pursuant hereto by
giving to BIOVATION [***] notice to that effect and the terms of clause 4.5 shall then apply.
Such termination shall be without prejudice to the right of BIOVATION to enforce the PATENT
RIGHTS in the event of subsequent sale of PRODUCTS by MICROMET or its sublicencee(s).
Articles 7 and 8 shall survive termination of this Agreement. All payments due prior to
termination will have to be paid by MICROMET, no further payments will be due apart from but
under clause 4.5(b and c) if applicable.
	 
	6.7	 	Termination of this Agreement shall be without prejudice to any rights of either party
against the other which may have accrued up to the date of such termination.

 

			
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	7.	 	CONFIDENTIALITY
	 
	7.1	 	BIOVATION agrees that it will hold the CONFIDENTIAL INFORMATION received from MICROMET in
secrecy, and confidence and will not disclose it to any third person, nor use it for any
purpose other than for the purpose of this Agreement, unless or until such CONFIDENTIAL
INFORMATION:

	 	(a)	 	was known to BIOVATION at the time it was received, and BIOVATION promptly so
notifies MICROMET or is subsequently developed independently by BIOVATION without any
reliance on the information received; or
	 
	 	(b)	 	was publicly known when received from MICROMET or thereafter becomes publicly
known through no fault of BIOVATION; or
	 
	 	(c)	 	is made known to BIOVATION by a third person who did not derive it from
MICROMET and who does not impose any obligation or confidence on BIOVATION; or
	 
	 	(d)	 	is approved for disclosure by prior written consent of MICROMET; or
	 
	 	(e)	 	is required by government authority, and reasonable notice of the impending
disclosure has been given to MICROMET.

	7.2	 	BIOVATION further agrees that it will restrict disclosure of the CONFIDENTIAL INFORMATION to
within its own organisation and affiliates to those persons having a need to know it for the
purpose of this Agreement, and that such persons will be advised of the obligation set forth
in this Agreement and obligated in like fashion.
	 
	7.3	 	The above obligations shall expire [***] years from the date of BIOVATION receiving the
CONFIDENTIAL INFORMATION.
	 
	7.4	 	All CONFIDENTIAL INFORMATION shall remain the sole and exclusive property of MICROMET
	 
	7.5	 	This Agreement shall not be construed as granting any licence rights with respect to the
CONFIDENTIAL INFORMATION.
	 
	7.6	 	MICROMET agrees to be bound by the obligations under Article 7 respectively with regard to
TECHNICAL INFORMATION.

 

			
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	7.7	 	The parties agree that any disclosure of the content of this Agreement (including disclosure
in connection with potential stock exchange listings, if any) shall be subject to the parties’
prior written mutual agreement.
	 
	8.	 	WARRANTIES AND DISCLAIMERS
	 
	8.1	 	BIOVATION represents and warrants that the performance of its own obligations hereunder will
not conflict with any existing or future obligation of BIOVATION to a third party.
	 
	8.2	 	Except as otherwise provided in this agreement, neither party makes any representations or
warranties whatsoever, whether express or implied, with regard to any materials, information
or know-how, including, without limitation, the TECHNICAL INFORMATION, DELIVERABLES,
DEIMMUNISED ANTIBODY(IES) (as below); in particular neither party makes any warranty of
merchantability or fitness for a particular purpose.
	 
	8.3	 	MICROMET indemnifies, defends and holds harmless BIOVATION and its affiliates from any claims
brought against MICROMET by third parties in respect of any damage or injury directly or
indirectly resulting from the use of the DELIVERABLES or the DEIMMUNISED ANTIBODY(IES).
	 
	8.4	 	MICROMET will be responsible for obtaining additional licences to any patents and
technologies required for the commercialisation of the DEIMMUNISED ANTIBODIES and, upon
request, BIOVATION will provide reasonable assistance to MICROMET in obtaining such licences
provided that MICROMET shall reimburse BIOVATION for all out-of-pocket expenses incurred by
BIOVATION in providing such assistance.
	 
	8.5	 	Nothing in this Agreement or in any licences to be granted pursuant thereto shall be
construed as a representation or warranty that the BIOVATION PATENT RIGHTS are valid or that
any manufacture, use, sale or other disposal of the PRODUCTS is not an infringement of any
patents or other rights not vested in BIOVATION.
	 
	8.6	 	MICROMET shall promote the sale of the PRODUCTS of good marketable quality and shall use
reasonable endeavours to meet the market demand therefore.
	 
	9.	 	INFRINGEMENT
	 
	 	 	If MICROMET becomes aware of a suspected infringement of the BIOVATION PATENT RIGHTS it
shall notify BIOVATION giving full particulars thereof. If the alleged infringement
consists of any act which (if done by MICROMET) would be within the scope of the licences
granted under this Agreement BIOVATION and MICROMET shall (within a reasonable time of the
said

 13/20

 

	 	 	notification) consult together with a view to agreeing upon a course of action to be
pursued.

	10.	 	WAIVER
	 
	 	 	The waiver by BIOVATION of any breach, default or omission in the performance or observance
of any of the terms of this Agreement by MICROMET shall not be deemed to be a waiver of any
other such breach, default or omission.
	 
	11.	 	FORCE MAJEURE
	 
	 	 	If the performance of this Agreement or any obligation hereunder (except for the payment of
money) is prevented, restricted or interfered with by reason of fire or other casualty or
accident, strikes or labour disputes, inability to procure raw materials, power or
supplies, war, invasion, civil commotion or other violence, compliance with any order of
any governmental authorities or any other act or conditions whatsoever beyond reasonable
control of either party hereto, the party so affected upon giving a prompt notice to the
other party shall be excused from such performance to the extent of such prevention,
restriction or interference; provided however that the party so affected shall use its best
efforts to avoid or remove such causes of non-performance and shall continue performance
hereunder with the utmost dispatch whenever such causes are removed.
	 
	12.	 	ASSIGNMENT
	 
	 	 	In the event that BIOVATION or MICROMET shall be acquired by another company, or be merged
with another company, this Agreement shall be assigned to and have become the obligation of
the acquiring company. However excluding this exception, this Agreement shall not be
assigned by either party without the prior written consent of the other party
	 
	13.	 	GOVERNING LAWS
	 
	 	 	This Agreement shall be governed and interpreted in accordance with laws of England.
	 
	14.	 	ARBITRATION
	 
	 	 	All disputes, differences or controversies arising out of or in connection with this
Agreement, its interpretation, performance, or termination, which may arise between the two
parties hereto out of or in relation to this Agreement shall be amicably settled between
the parties hereto. In case of failure of amicable settlement between the parties hereto,
it shall be finally settled by binding arbitration under the rules of the International
Chamber of Commerce in Zürich,

 14/20

 

	 	 	Switzerland (as to proceedings initiated by BIOVATION) or in London, England (as to
proceedings initiated by MICROMET) by three arbitrators appointed in accordance with said
rules. The costs of the arbitration, including administrative and arbitrators’ fees, shall
be shared equally by the Parties. Each Party shall bear its own costs and attorneys’ and
witnesses’ fees; provided, however, that the prevailing Party, as determined by the
arbitration panel, shall be entitled to an award against the other Party in the amount of
the prevailing Party’s costs and reasonable attorneys’ fees. The arbitration award shall
be final and each Party shall comply in good faith and submit itself to the jurisdiction of
the appropriate state or federal courts in Munich, Germany or London, England for the sole
purpose of the entry of such arbitrator’s award to render effective such arbitration
decision. Notwithstanding the foregoing, judgment on the award by the arbitrator may be
entered in any court having jurisdiction. If judicial enforcement or review of the
arbitrator’s decision is sought, the prevailing Party shall be entitled to costs and
reasonable attorney’s fees in addition to any amount of recovery ordered by the court.
	 
	15.	 	NOTICES

	 	(a)	 	All notices and statements required to be given to either party shall be
dispatched by recorded delivery or facsimile with confirmation by recorded delivery
addressed to such party at the following address:
	 
	 	 	 	To BIOVATION

	 
	 	 	 	Chief Executive Officer

	 
	 	 	 	Biovation Limited

	 
	 	 	 	Crombie Lodge

	 
	 	 	 	Aberdeen Science Park

	 
	 	 	 	Balgownie Drive

	 
	 	 	 	Aberdeen AB22 8GU

	 
	 	 	 	United Kingdom

	 
	 	Tel: 	 	 44 1224 707337

	 
	 	Fax: 	 	 44 1224 708816

	 
	 	 	 	To MICROMET

	 
	 	 	 	Vice President Business Development

	 
	 	 	 	Micromet AG

	 
	 	 	 	Am Klopferspitz 19

	 
	 		 	82152 Martinsried

	 
	 	 	 	Germany

	 
	 	Tel:  	 	49 89 895 2770

	 
	 	Fax: 	 	 49 89 895 27722
	 
	 	(b)	 	All notices and statements shall be deemed to be given, seven days after
mailing or at the time of delivery of a facsimile to the addresses above.

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	 	(c)	 	Each party hereto may change its address set forth above for the purpose of
this Agreement by giving a written notice to the other party from time to time.

	16.	 	ENTIRE AGREEMENT
	 
	 	 	This Agreement contains the entire understanding of the parties hereto with respect to the
subject matter contained herein. There are no restrictions, promises, covenants or
understandings other than those expressly set forth herein, and no rights or duties on the
part of either party hereto are to be implied or inferred beyond those expressly herein
provided for. The parties hereto may, from time to time during the continuance of this
Agreement, modify, vary or alter any of the provisions of this Agreement but only by an
instrument duly executed by the parties hereto.
	 
	17.	 	MISCELLANEOUS PROVISIONS

	 	(a)	 	Each party acknowledges that it has negotiated and entered into this
Agreement in good faith.
	 
	 	(b)	 	In the event any one of the provisions of this Agreement is held
unenforceable or in conflict with the law of any jurisdiction, the validity of the
remaining provisions shall not be affected by such holding. The Parties agree to
negotiate and amend in good faith such provision in a manner consistent with the
intentions of the Parties as expressed in the Agreement if any invalid or
unenforceable provision affects the consideration of either Party.
	 
	 	(c)	 	A press release to announce the signing of this Agreement shall be released
within 3 months of the EFFECTIVE DATE. Such press release and any further press
releases relating to this agreement shall be subject to agreement by both BIOVATION
and MICROMET.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed in duplicate
originals by their respective officers here unto duly authorised, of which original to be held by
each party.

Biovation Ltd

	 	 	 	 	 
	Signed

	 	/s/ Frank J. Carr
 

	 	 
	Dr Frank J Carr	 	 
	Chief Executive Officer	 	 

 16/20

 

Micromet AG

	 	 	 	 	 
	Signed

	 	/s/ Christian Itin
 

	 	 
	Dr Christian Itin	 	 
	Vice President, Business & Corporate Development	 	 

 17/20

 

SCHEDULE I

SINGLE-CHAIN ANTIBODY

	 	 	 
	Designated Name	 	Antigen
	 
	 	 
	[***]

	 	[***]

 

			
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SCHEDULE II

STAGES OF THE RESEARCH PROGRAMME/TIMESCALE

PROJECT APPLICATION OF DEIMMUNISATION TECHNOLOGY FOR ENGINEERING OF SINGLE-CHAIN ANTIBODIES
(V = variable region; C = constant region; CDR = complementary determining region; H = heavy; L =
light)

	 	 	 
	Stage 1:
	 	 
	 
	[***]

Timescale

	 	[***]
	Deliverables

	 	[***]
	 
	 	 
	Stage 2:
	 	 
	 
	 	 
	[***]
	 	 
	 
	 	 
	Timescale

	 	[***]
	Deliverables

	 	[***]

 

			
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SCHEDULE III

ASSAY

[***]

 

			
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Exhibit 10.35

1st Amendment of the
Research and License Agreement of August 14th 2001

between Micromet Ag And Biovation Limited

Biovation and Micromet agree to the following amendments to the Research and License agreement of
August 14th 2001 between Micromet AG and Biovation Limited.

In Preamble insert:

This amended agreement is made this date of 26th September 2002 (the “AMENDMENT DATE”)

Whereas MICROMET wishes to extend the original agreement of 14 August 2001 (the “AGREEMENT”) to
include the [***]ASSAY analysis of “MICROMET’S DEIMMUNISED [***]”

Whereas BIOVATION wishes to perform such further services to apply its technology and know-how for
the [***]ASSAY analysis of MICROMET’S DEIMMUNISED [***]

Whereas BIOVATION and MICROMET agree that the following amendments will be applied to the
AGREEMENT.

In Definitions insert:

	(a)	 	“AMENDMENT DATE” shall be the date of this amendment
	 
	(b)	 	“MICROMET’S [***]” shall mean the SINGLE CHAIN ANTIBODY as described in the RESEARCH
AGREEMENT between BIOVATION and MICROMET of 14th August 2001
	 
	(c)	 	“MICROMET’S DEIMMUNISED [***]” shall mean the lead DEIMMUNISED SINGLE CHAIN ANTIBODY as in
the RESEARCH AGREEMENT between BIOVATION and MICROMET of 14th August 2001 nominated
by MICROMET
	 
	(d)	 	The “RESEARCH PROGRAMME II” shall mean the programme outlined in Schedule IV attached hereto
and made a part hereof
	 
	(e)	 	“[***] ASSAY” shall mean the method and experimental protocol to measure [***] as detailed in
Schedule IV

In Collaboration insert:

 

			
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	2.2	 	On the AMENDMENT DATE BIOVATION agrees to use reasonable efforts to conduct research relating
to the analysis of peptides derived from MICROMET’S [***] and MICROMENT’S DEIMMUNISED [***] to
the extent described in the RESEARCH PROGRAMME II
	 
	2.4	 	BIOVATION shall provide MICROMET with a written research report upon completion of the
RESEARCH PROGRAMME II for MICROMET’S DEIMMUNISED [***]

In Funding insert:

	(b)	 	The sum of US$[***] upon the AMENDMENT DATE
	 
	(e)	 	Upon completion of the RESEARCH PROGRAMME II, the sum of US$[***] subject to all [***]
derived from MICROMET’S DEIMMUNISED [***] exhibiting [***]

In Funding replace clause 4.5 by:

	4.5	 	In the event MICROMET does not enter into clinical Phase I trial with at least one
DEIMMUNISED ANTIBODY within 24 months of the payment upon completion of the RESEARCH PROGRAMME
II and the DEIMMUNISED ANTIBODY fulfils the specifications described in clause 4.1 (c) and
[***] MICROMET shall either:
	 
	(a)	 	pay the amount of US$[***] to extend the time point to [***] by [***]; and
	 
	(b)	 	pay the amount of US$[***] as a final payment after [***] for work performed in connection
with the RESEARCH PROGRAMME or
	 
	(c)	 	assign all of its right, title and interest in the PATENT RIGHTS and DELIVERABLES to
BIOVATION and other rights proprietary to MICROMET to allow BIOVATION to commercialise the
DEIMMUNISED ANTIBODY provided that BIOVATION is in full accordance with the terms and
conditions of the relevant agreements MICROMET has with third parties and provided that
assignment of rights made under this clause 4.5(c) shall be limited to rights specific to the
DEIMMUNISED ANTIBODY as to which payment was made from MICROMET to BIOVATION pursuant to
clause 4.1(c).

 

			
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In Schedule IV insert:

STAGES OF THE RESEARCH PROGRAMME II/TIMESCALE

	 	 	 	 	 
	PROJECT

	 	[***]
	 	 
	 
	 	 	 	 
	[***]
	 	 	 	 
	 
	 	 	 	 
	Timescale

	 	[***]	 	 
	Deliverables

	 	[***]	 	 

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IN WITNESS WHEREOF, the parties hereto have caused this amendments to the Research and License
agreement of August 14th 2001 between Micromet AG and Biovation Limited to be duly
executed in duplicate originals by their respective officers here unto duly authorised, of which
original to be held by each party.

Biovation Ltd

	 	 	 	 	 
	Signed

	 	/s/ Frank J. Carr
 

	 	 
	Dr Frank J Carr	 	 
	Chief Executive Officer	 	 

Micromet AG

	 	 	 	 	 
	Signed

	 	/s/ Christian Itin
 

	 	 
	Dr Christian Itin	 	 
	Chief Business Officer	 	 

[Signature Page to the 1st Amendment of the Research and License agreement]

 4.

 

Exhibit 10.35

***Text Omitted and Filed Separately

Confidential Treatment Requested

Under 17 C.F.R. §§ 200.80(b)(4) and 240.24b-2

SECOND AMENDMENT TO RESEARCH AND LICENCE AGREEMENT

AND ASSIGNMENT

     This Second Amendment to Research and Licence Agreement and Assignment (the
“Amendment”) is made as of this June 16, 2004 by and between Biovation Limited, a
corporation duly organized under and pursuant to the laws of Scotland, and having its principal
place of business at Crombie Lodge, Aberdeen Science Park, Balgownie Drive, Aberdeen AB22 8GU,
Scotland, UK (“Biovation”) and Micromet AG, a corporation duly organized under and
pursuant to the laws of Germany, and having its principal place of business at Staffelseestrasse 2,
81477 Munich, Germany (“Micromet”).

     WHEREAS, Biovation has made certain inventions described on Appendix 1 attached hereto (the
“Inventions”) pursuant to that certain Research and Licence Agreement (the “Research and Licence
Agreement”) between Biovation and Micromet.

     WHEREAS, Micromet is desirous of acquiring the entire right, title, and interest in: any
bispecific antibodies developed by coupling an Invention (or portion thereof) with another antibody
(or portion thereof) (such bispecific antibodies, the “Bispecific Products”); the right to file
applications for patent in any country on Bispecific Products; any application(s) for patent in any
country claiming priority to these application(s); any provisional or other right to recover
damages, including royalties, for prior infringements of these applications; and any patent(s) in
any country that may be granted therefor or thereon.

     WHEREAS, Micromet and Biovation desire to amend the Research and Licence Agreement to grant
Micromet a license to use certain intellectual property in connection with the development and
commercialization of the Inventions.

     NOW, THEREFORE, for good and sufficient consideration, the receipt of which is hereby
acknowledged, the parties to this Amendment hereby agree as follows:

	1.	 	Assignment of Bispecific Products

     1.1 Assignment. To the extent that Biovation has not done so already via a prior agreement
with Micromet, or if Biovation has already done so via a prior agreement with Micromet then in
confirmation of any obligation to do so in said prior agreement, Biovation has sold, assigned,
transferred, and set over, and by these presents does sell, assign, transfer, and set over, unto
Micromet, its successors, legal representatives, and assigns, Biovation’s entire present and future
right, title, and interest in:

	 	(a)	 	the Bispecific Products;

 1.

 

	 	(b)	 	the right to file applications for patent in any country
claiming the Bispecific Products, including all rights under the Hague
Convention, the Paris Convention for the Protection of Industrial Property,
and under the Patent Cooperation Treaty;
	 
	 	(c)	 	any application(s) for patent in any country claiming the
Bispecific Products;
	 
	 	(d)	 	any application(s) for patent in any country claiming
priority to any application(s) for patent claiming the Bispecific Products,
including any division(s), continuation(s), and continuation(s)-in-part;
	 
	 	(e)	 	any provisional or other right to recover damages, including
royalties, for prior infringements of any application for patent identified in
the proceeding paragraphs (b) – (d); and
	 
	 	(f)	 	any patent(s) in any country that may be granted for or on
any application for patent identified in the preceding paragraphs (b) – (d),
including any reissue(s) and extension(s) of said patent(s).

For the avoidance of doubt, this Section 1.1 shall not modify or amend the rights of Micromet and
Biovation in and to the DEIMMUNISED ANTIBODY (as defined in the Research and Licence Agreement) set
forth in the Research and Licence Agreement.

     1.2 Transfer. The above-granted rights, titles, and interests are to be held and enjoyed by
Micromet, for its own use and behalf and the use and behalf of its successors, legal
representatives, and assigns, as fully and entirely as the same would have been held and enjoyed by
Biovation had this sale and assignment not been made.

     1.3 Representations. Biovation hereby represents to Micromet, its successors, legal
representatives, and assigns, that, at the time of execution and delivery of these presents, or if
applicable, at such time said prior agreement was executed, Biovation is the sole and lawful owner
of the entire (except with respect to any ownership interest of Micromet) right, title, and
interest in and to the Inventions, that the Inventions are unencumbered, except, if applicable, by
obligation to assign in accordance with said prior agreement, and that Biovation has good and full
right and lawful authority to sell and convey the same in the manner set forth herein. Biovation
further hereby represents that its employees have assigned to Biovation all their right, title, and
interest in and to the Inventions.

     1.4 Covenants. Biovation agrees to use its commercially reasonable efforts to take all
necessary and proper acts, and will cause its employees, affiliates, contractors, sublicensees, and
consultants to take such necessary and proper acts, to effectuate the assignment provisions set
forth in this Section 1.

 2.

 

	2.	 	Amendment

     2.1 Research and Licence Agreement Terms. For the avoidance of doubt, except as set forth in
this Amendment, the ownership and rights of Micromet and Biovation to the Inventions will remain
under the terms set forth in clause 5.3 of the Research and Licence Agreement.

     2.2 Amendments to Definitions.

          2.2.1 Pursuant to this Amendment, the definition of “BISPECIFIC PRODUCT(S)” in the Research
and Licence Agreement is hereby amended and restated in its entirety to read as follows:

“BISPECIFIC PRODUCT(S)” shall mean each bispecific antibody made by coupling a DEIMMUNISED
ANTIBODY (or portion thereof), including any INVENTION, to a second antibody (or portion
thereof) (it being understood that nothing in this definition shall entitle MICROMET to
receive a license from BIOVATION under this Agreement in and to intellectual property
rights covering such second antibody).

          2.2.2 Pursuant to this Amendment, the following definition is hereby appended at the end of
Section 1 of the Research and Licence Agreement as new clause (q):

“INVENTIONS” shall mean all technology, know-how, and intellectual property relating to the
[***] pursuant to this Agreement, identified by their amino acid sequences (but excluding
any technology, know-how, or intellectual property relating specifically to DEIMMUNISATION
TECHNOLOGY).

     2.3 Amendment to Clause 3.1. Pursuant to this Amendment, the following sentence is hereby
substituted for the first sentence of clause 3.1 of the Research and Licence Agreement:

BIOVATION agrees to grant and hereby grants to MICROMET a non-exclusive, world-wide
licence, with the right to grant sublicences, under the BIOVATION PATENT RIGHTS to make,
have made, use, research, develop, sell, offer for sale, import, and export the DEIMMUNISED
ANTIBODY (as specified in Schedule II), the DELIVERABLES, and/or the BISPECIFIC PRODUCTS in
the FIELD.

     2.4 Sublicences. Pursuant to this Amendment, the following new clause 3.2 is inserted into
the Research and Licence Agreement:

3.2 MICROMET shall be entitled to grant sublicences of the rights granted to it pursuant to
3.1 above (including the right of a sublicensee to authorize the grant

 

			
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of further sublicenses); provided, that, such sublicense agreement shall
conform to the terms of this Agreement and the terms of sections 4.3 to 4.11 shall continue
to be met by MICROMET even where another party is conducting clinical trials and
commercialisation. MICROMET shall provide (i) a copy of such executed sublicense agreement
to BIOVATION within (30) days of granting of the execution thereof except that the
financial terms of such agreement as well as other details that do not bear on MICROMET’S
performance of its obligations under this Agreement may be redacted and (ii) a written
notification of the identity of the sublicensee and full mailing/contact details for the
sublicensee. MICROMET shall remain liable for the performance of MICROMET’S obligations
hereunder. BIOVATION shall not establish any contact with the sublicensee in relation to
the sublicense without the prior written consent of MICROMET.

     2.5 Amendment to Clause 8.1. Pursuant to this Amendment, clause 8.1 of the Research and
Licence Agreement is hereby amended and restated in its entirety to read as follows:

BIOVATION hereby represents and warrants to MICROMET that (a) the BIOVATION PATENT RIGHTS
include all patents and patent applications owned or controlled by BIOVATION or, to the
best of Biovation’s knowledge, its affiliates, specifically related to DEIMMUNISATION
TECHNOLOGY that would be infringed by the manufacture, use, sale, or importation of
PRODUCTS or BISPECIFIC PRODUCTS by MICROMET incorporating the Inventions; (b) the BIOVATION
PATENT RIGHTS (as defined above) shall include patent application [***]filed by [***]and
published on [***] strictly for the manufacture, use, sale, or importation of BISPECIFIC
PRODUCTS by MICROMET incorporating the Inventions; and (c) the performance of its own
obligations hereunder will not conflict with any existing obligation of BIOVATION to a
third party.

	3.	 	Miscellaneous

     This Amendment may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. This Amendment
shall become effective upon the execution hereof by all parties hereto. Other than as set forth in
this Amendment, all of the terms and conditions of the Licence Agreement shall continue in full
force and effect.

     In Witness Whereof, the parties have executed this Amendment as of the date first
written above.

      

					
	Biovation Limited
	 	Micromet AG
	 	 

 

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

 4.

 

	 	 	 	 	 	 	 	 	 
	By:

	 	/s/ Frank J. Carr
	 	 	 	By:
	 	/s/ Christian Itin
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Name: Frank J. Carr	 	 	 	Name: Christian Itin
	 
	 	 	 	 	 	 	 	 
	Title: CEO	 	 	 	Title: CEO

 5.

 

APPENDIX 1

Description of Inventions

All technology, know-how, and intellectual property relating to the deimmunized [***] antibodies
as listed in the [***] generated by Biovation pursuant to the Licence Agreement, identified by
their amino acid sequences (but excluding any technology, know-how, or intellectual property
relating specifically to DEIMMUNISATION TECHNOLOGY, as that term is defined in the Research and
Licence Agreement).

 

			
	***	 	Certain information on this page has been omitted and filed separately with the Commission.
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 1.

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