Document:

Exhibit 10.2 

STOCK PURCHASE AGREEMENT

STOCK PURCHASE AGREEMENT

This Stock Purchase Agreement (“Agreement”) is entered into as of March 14, 2018 (the “Execution Date”), by and between Ionis Pharmaceuticals, Inc., a Delaware corporation, having its principal place of business at 2855 Gazelle Court, Carlsbad, California (“Ionis”), and Akcea Therapeutics, Inc., a Delaware corporation, having its principal place of business at 55 Cambridge Parkway, Suite 100, Cambridge, Massachusetts (“Akcea”). Akcea and Ionis each may be referred to herein individually as a “Party”, or collectively as the “Parties”.

RECITALS

A.   Concurrently with the execution and delivery hereof, Akcea and Ionis are entering into a development, commercialization, collaboration and license agreement (the “License Agreement”) that will become effective as of the Closing (as defined below). 

B.   In addition, Akcea has agreed to sell, and Ionis has agreed to purchase, shares of Akcea’s common stock, par value $0.001 per share (the “Common Stock”) subject to and in accordance with the terms and provisions hereof.

C.   The capitalized terms used herein and not otherwise defined have the meanings given to them in Appendix 1.

AGREEMENT

For good and valuable consideration, the Parties agree as follows:

Section 1. SALE AND PURCHASE OF STOCK

1.1   Purchase of Stock. Subject to the terms and conditions of this Agreement, at the Closing, Akcea will issue and sell to Ionis, and Ionis will purchase from Akcea, (a) 10,666,666 shares of Common Stock for an aggregate purchase price of US$200 million (the “Purchase Price”) and (b) 8,000,000 shares of Common Stock in consideration for the licenses granted pursuant to the License Agreement (the shares of Common Stock issued pursuant to clause (a) and (b), the “Shares”).

1.2   Payment. At the Closing, Ionis will pay the Purchase Price by wire transfer of immediately available funds in accordance with wire instructions provided by Akcea to Ionis prior to the Closing, and Akcea will deliver the Shares in book-entry form to Ionis.

1.3   Closing. The closing of the transactions contemplated by this Section 1 (the “Closing”) will be held at the offices of Akcea as promptly as practicable following, but in no event later than, the second Business Day following the satisfaction or waiver of each of the conditions set forth in Section 7 hereof (other than those conditions which can be satisfied only at the Closing, but subject to the satisfaction or waiver of such conditions at Closing), or at such other time and place as may be agreed to by the parties hereto. Subject to the provisions of Section 8 of this Agreement, the failure to consummate the Closing on the date and time determined pursuant to this Section 1.3 will not result in the termination of this Agreement and shall not relieve any party to this Agreement of any obligation under this Agreement.

Section 2. REPRESENTATIONS AND WARRANTIES OF AKCEA 

Except as otherwise specifically contemplated by this Agreement, Akcea hereby represents and warrants to Ionis, as of the date hereof and as of the Closing, that:

2.1   Private Placement. Neither Akcea nor any person acting on its behalf, has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under any circumstances that would require registration of the Shares under the Securities Act. Subject to the accuracy of the representations made by Ionis in Section 3, the Shares will be issued and sold to Ionis in compliance with applicable exemptions from the registration and prospectus delivery requirements of the Securities Act and the registration and qualification requirements of all applicable securities laws of the states of the United States. Except for Cowen and Company, LLC, Akcea has not engaged any brokers, finders or agents, or incurred, or will incur, directly or indirectly, any liability for brokerage or finder’s fees or agents’ commissions or any similar charges in connection with this Agreement and the transactions contemplated hereby.

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2.2   Organization and Qualification. Akcea is duly incorporated, validly existing and in good standing under the laws of the State of Delaware, with full corporate power and authority to conduct its business as currently conducted as of the Execution Date. Akcea is duly qualified to do business and is in good standing in every jurisdiction in which the nature of the business conducted by it or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would not reasonably be expected to have a Material Adverse Effect. 

2.3   Authorization; Enforceability. Assuming receipt of the Stockholder Approval, Akcea has the requisite corporate power and authority to enter into and to perform its obligations under this Agreement, to consummate the transactions contemplated hereby and by the other Transaction Documents and to issue the Shares in accordance with the terms hereof. Akcea has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement, the License Agreement and the other documents and instruments to be executed and delivered in connection herewith (collectively, the “Transaction Documents”) and the consummation by Akcea of the transactions contemplated hereby and thereby have been duly authorized by Akcea’s Board of Directors (the “Board”) and no further consent or authorization of Akcea, the Board, or its stockholders is required, other than receipt of the Stockholder Approval. The Transaction Documents have been (or with respect to those which will be executed and delivered at the Closing, will be) duly executed by Akcea and constitute (or, as applicable, will constitute) a legal, valid and binding obligation of Akcea enforceable against Akcea in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws.

2.4   Issuance of Shares. Assuming receipt of the Stockholder Approval, the Shares will be duly authorized and, upon issuance in accordance with the terms of this Agreement, will be validly issued, fully paid and non-assessable and will not be subject to preemptive rights or other similar rights of stockholders of Akcea. 

2.5   SEC Documents, Financial Statements. 

(a)   The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act. Akcea has delivered or made available (by filing on the SEC's electronic data gathering and retrieval system (EDGAR)) to Ionis a complete copy of its most recent Annual Report on Form 10-K filed with the SEC prior to the Execution Date (the “SEC Document”). As of its date, the SEC Document complied in all material respects with the requirements of the Exchange Act, and other federal, state and local laws, rules and regulations applicable to it, and, as of its date, such SEC Document did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. 

(b)   The financial statements, together with the related notes and schedules, of Akcea included in the SEC Document comply as to form in all material respects with all applicable accounting requirements and the published rules and regulations of the SEC and all other applicable rules and regulations with respect thereto. Such financial statements, together with the related notes and schedules, have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be otherwise indicated in such financial statements or the notes thereto), and fairly present in all material respects the financial condition of Akcea and its consolidated subsidiaries as of the dates thereof and the results of operations and cash flows for the periods then ended.

2.6   No Conflicts; Government Consents and Permits.

(a)   Assuming receipt of the Stockholder Approval, the execution, delivery and performance of this Agreement and the other Transaction Documents by Akcea and the consummation by Akcea of the transactions contemplated hereby and thereby will not (i) conflict with or result in a violation of any provision of Akcea’s Certificate of Incorporation or Bylaws, (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default under, any agreement, indenture, or instrument to which Akcea is a party, or (iii) result in a violation of any Applicable Law to Akcea, except in the case of clauses (ii) and (iii) only, for such conflicts, breaches, defaults, and violations as would not reasonably be expected to have a Material Adverse Effect or result in a material liability for Ionis. 

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(b)   Akcea is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self regulatory agency in order for it to execute, deliver or perform any of its obligations under this Agreement and the other Transaction Documents in accordance with the terms hereof and thereof, or to issue and sell the Shares in accordance with the terms hereof other than such as have been made or obtained, and except for (i) any post-closing filings required to be made under federal or state securities laws and (ii) any required filings or notifications regarding the issuance or listing of additional shares with Nasdaq.

2.7   Information in the Proxy Statement. None of the information supplied or to be supplied by Akcea for inclusion or incorporation by reference in the Proxy Statement (as defined in Section 6.5(a)) will, at the time it is first published or mailed to the stockholders of Akcea, at the time of any amendment thereof or supplement thereto and at the time of the Meeting (as defined in Section 2.9), contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading. The Proxy Statement will comply as to form in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder. Notwithstanding the foregoing, Akcea makes no representation or warranty with respect to statements made or incorporated by reference in the Proxy Statement based on information supplied or omitted to be supplied by or on behalf of Ionis or any Affiliates thereof for inclusion or incorporation by reference in the Proxy Statement.

2.8   Approval of Agreement and the License Agreement. The Special Transaction Committee of the Board (in the case of clauses (i) and (ii)), and the Board, has (i) approved the execution, delivery and performance of this Agreement and the License Agreement, (ii) determined that entering into this Agreement and the License Agreement, and the consummation of the transactions contemplated respectively therein, are in the best interests of Akcea and its stockholders and (iii) declared this Agreement and the License Agreement advisable.

2.9   Special Meeting of the Stockholders and Company Recommendation. The Board has directed that Akcea submit the Company Proposals to a vote at a meeting (the “Meeting”) of the stockholders of Akcea in accordance with the terms of this Agreement. As of the date hereof, the Board has resolved to recommend (the “Company Recommendation”) that the stockholders of Akcea vote in favor of the Company Proposals at the Meeting.

Section 3. REPRESENTATIONS AND WARRANTIES OF IONIS

Except as otherwise specifically contemplated by this Agreement, Ionis hereby represents and warrants to Akcea that, as of the date hereof and as of the Closing,:

3.1   Authorization; Enforceability. Ionis has the requisite corporate power and authority to enter into and perform its obligations under this Agreement, and to consummate the transactions contemplated hereby and by the other Transaction Documents. Ionis has taken all necessary corporate action to authorize the execution, delivery and performance of this Agreement and the other Transaction Documents. The Transaction Documents have been (or with respect to those which will be executed and delivered at the Closing, will be) duly executed by Ionis and constitute (or, as applicable, will constitute) a legal, valid and binding obligation of Ionis enforceable against Ionis in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, or moratorium or similar laws affecting creditors’ and contracting parties’ rights generally and except as enforceability may be subject to general principles of equity and except as rights to indemnity and contribution may be limited by state or federal securities laws or public policy underlying such laws.

3.2   No Conflicts; Government Consents and Permits.

(a)   The execution, delivery and performance of this Agreement and the other Transaction Documents by Ionis and the consummation by Ionis of the transactions contemplated hereby and thereby will not (i) conflict with or result in a violation of any provision of Ionis’ Certificate of Incorporation or Bylaws, (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default under, any agreement, indenture, or instrument to which Ionis is a party, or (iii) result in a violation of Applicable Law 

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to Ionis, except in the case of clauses (ii) and (iii) only, for such conflicts, breaches, defaults, and violations as would not reasonably be expected to have a material adverse effect on the ability of Ionis to consummate the transactions contemplated hereby and by the other Transaction Documents on such terms in a timely manner or result in a material liability for Akcea. 

(b)   Ionis is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self regulatory agency in order for it to execute, deliver or perform any of its obligations under this Agreement and the other Transaction Documents in accordance with the terms hereof and thereof, or to purchase the Shares in accordance with the terms hereof.

3.3   Investment Purpose. Ionis is purchasing the Shares for its own account and not with a present view toward the public distribution thereof and has no arrangement or understanding with any other persons regarding the distribution of such Shares except as would not result in a violation of the Securities Act. Ionis will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Shares except in accordance with the Securities Act and to the extent permitted by Section 4.1 and Section 4.2. 

3.4   Reliance on Exemptions. Ionis understands that Akcea intends for the Shares to be offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal and state securities laws and that Akcea is relying upon the truth and accuracy of, and Ionis’ compliance with, the representations, warranties, agreements, acknowledgments and understandings of Ionis set forth herein in order to determine the availability of such exemptions and the eligibility of Ionis to acquire the Shares.

3.5   Accredited Investor; Access to Information. Ionis is an “accredited investor” as defined in Regulation D under the Securities Act and is knowledgeable, sophisticated and experienced in making, and is qualified to make decisions with respect to investments in shares presenting an investment decision like that involved in the purchase of the Shares. Ionis has been furnished with materials relating to the offer and sale of the Shares, that have been requested by Ionis, including, without limitation, Akcea’s SEC Document, and Ionis has had the opportunity to review the SEC Document. Ionis has been afforded the opportunity to ask questions of Akcea. Neither such inquiries nor any other investigation conducted by or on behalf of Ionis or its representatives or counsel will modify, amend or affect Ionis’ right to rely on the truth, accuracy and completeness of the SEC Document and Akcea’s representations and warranties contained in this Agreement. Ionis has, with respect to all matters relating to this Agreement and the offer and sale of the Shares, not relied upon counsel.

3.6   Governmental Review. Ionis understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Shares or an investment therein.

3.7   Beneficial Ownership by Ionis and its Directors and Officers. 

(a)   Ionis (i) is the beneficial or record owner of the shares of capital stock of Akcea indicated on the signature page, free and clear of any and all pledges, liens, security interests, mortgage, claims, charges, restrictions, options, title defects, or encumbrances; (ii) does not beneficially own any securities of Akcea other than the shares of capital stock indicated on the signature page; and (iii) has no rights to purchase shares of capital stock of Akcea, other than pursuant to the Transaction Documents.

(b)   Ionis’ directors and officers are the beneficial or record owners of a total of 2,800 shares of Common Stock.

3.8   Irrevocable Proxy. Ionis has not entered into any voting agreement with any person with respect to any of the Ionis Shares, granted any person any proxy or power of attorney with respect to any of the Ionis Shares, deposited any of the Ionis Shares in a voting trust, or entered into any arrangement or agreement with any person limiting or affecting Ionis’ legal power, authority, or right to vote the Ionis Shares on any matter.

3.9   Information in the Proxy Statement. None of the information supplied or to be supplied by Ionis for inclusion or incorporation by reference in the Proxy Statement will, at the time it is first published or mailed to the stockholders of Akcea, at the time of any amendment thereof or supplement thereto and at the time of the Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated 

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therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading. Notwithstanding the foregoing, Ionis makes no representation or warranty with respect to statements made or incorporated by reference in the Proxy Statement based on information supplied or omitted to be supplied by or on on behalf of Akcea or any Affiliates thereof for inclusion or incorporation by reference in the Proxy Statement.

Section 4. TRANSFER, RESALE, LEGENDS. 

4.1   Transfer or Resale. Ionis understands that:

(a)   the Shares have not been and are not being registered under the Securities Act or any applicable state securities laws and, consequently, Ionis may have to bear the risk of owning the Shares for an indefinite period of time because the Shares may not be transferred unless (i) the resale of the Shares is registered pursuant to an effective registration statement under the Securities Act; (ii) Ionis has delivered to Akcea an opinion of counsel (in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the Shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration; or (iii) the Shares are sold or transferred pursuant to Rule 144;

(b)   any sale of the Shares made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144 and, if Rule 144 is not applicable, any resale of the Shares under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC thereunder; and 

(c)   neither Akcea nor any other person is under any obligation to register the resale of the Shares under the Securities Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder. 

4.2   Agreement to Hold Shares. Ionis agrees that it will hold and will not sell the Shares (or otherwise make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale of the Shares) other than as permitted by Section 2 of the Amended and Restated Investor Rights Agreement, dated the date hereof, by and between Akcea and Ionis (the “Amended and Restated Investor Rights Agreement”). 

4.3   Legends. Ionis understands the certificates representing the Shares will bear a restrictive legend recognizing restrictions on transferability under applicable securities laws. Ionis may request that Akcea remove the legend.

Section 5. Agreement to Vote, Transfer Restrictions and Grant of Proxy

5.1   Transfer and Voting Restrictions. 

(a)   At all times during the period commencing with the execution and delivery of this Agreement and expiring on the Expiration Date (as defined in Section 5.4), Ionis shall not Transfer or suffer a Transfer of any of the Ionis Shares. 

(b)   Except as otherwise permitted by this Agreement or as required by an order of a court of competent jurisdiction, Ionis shall not commit any act that could restrict or affect Ionis’ legal power, authority, and right to vote all of the Ionis Shares then owned of record or beneficially by Ionis or otherwise prevent or disable Ionis from performing any of its obligations under this Agreement. Without limiting the generality of the foregoing, except for this Agreement and as otherwise permitted by this Agreement, Ionis shall not enter into any voting agreement with any person with respect to any of the Ionis Shares, grant any person any proxy (revocable or irrevocable) or power of attorney with respect to any of the Ionis Shares, deposit any of the Ionis Shares in a voting trust, or otherwise enter into any agreement or arrangement with any person limiting or affecting Ionis’ legal power, authority, or right to vote the Ionis Shares in favor of the approval of the Company Proposals. 

5.2   Agreement to Vote the Ionis Shares. 

(a)   Prior to the Expiration Date, at every meeting of the stockholders of Akcea called, and at every adjournment or postponement thereof, and on every action or approval by written consent of the 

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stockholders of Akcea, Ionis (in Ionis’ capacity as such) shall appear at the meeting or otherwise cause the Ionis Shares to be present thereat for purposes of establishing a quorum and, to the extent not voted by the persons appointed as proxies pursuant to this Agreement, vote in favor of the Company Proposals (other than the proposal referenced in clause (a) of such defined term, with respect to which Ionis is ineligible to vote).

(b)   If Ionis is the beneficial owner, but not the record holder, of the Ionis Shares, Ionis shall take all actions necessary to cause the record holder and any nominees to vote all of the Ionis Shares in accordance with Section 5.2(a).

(c)   Ionis shall not vote any of the Ionis Shares on the proposal referenced in clause (a) of the Company Proposals.

(d)   Ionis shall cause its Affiliates, including its directors and officers, not to vote, or cause to be voted, any shares of Common Stock that such Affiliate owns, beneficially or of record, on the proposal referenced in clause (a) of the Company Proposals.

5.3   Grant of Irrevocable Proxy. 

(a)   Ionis hereby irrevocably appoints Akcea and each of its executive officers or other designees (the “Proxyholders”), as Ionis’ proxy and attorney-in-fact (with full power of substitution and resubstitution), and grants to the Proxyholders full authority, for and in the name, place, and stead of Ionis, to vote the Ionis Shares, to instruct nominees or record holders to vote the Ionis Shares, or grant a consent or approval in respect of such Ionis Shares in accordance with Section 5.2 and, in the discretion of the Proxyholders, with respect to any proposed adjournments or postponements of any meeting of the stockholders of Akcea at which any of the matters described in Section 5.2(a) are to be considered.

(b)   Ionis hereby revokes any proxies heretofore given by Ionis in respect of the Ionis Shares.

(c)   Ionis hereby affirms that the irrevocable proxy set forth in this Section 5.3 is given in connection with the execution of the Transaction Documents, and that such irrevocable proxy is given to secure the performance of the duties of Ionis under this Agreement. Ionis hereby further affirms that the irrevocable proxy is coupled with an interest, is intended to be irrevocable in accordance with the provisions of Section 212 of the Delaware General Corporation Law, and may under no circumstances be revoked. The irrevocable proxy granted by Ionis herein is a durable power of attorney and shall survive the dissolution, bankruptcy, or incapacity of Ionis.

(d)   The Proxyholders may not exercise this irrevocable proxy on any matter except as provided above in Section 5.2. Ionis may vote the Ionis Shares on all other matters.

5.4   Termination of Grant of Irrevocable Proxy. The grant of the irrevocable proxy pursuant to Section 5.3 above shall terminate and be of no further force or effect whatsoever as of the earlier of (a) such date and time as this Agreement has been validly terminated pursuant to its terms or (b) the date of the Closing (the “Expiration Date”).

Section 6. PRE-CLOSING COVENANTS 

6.1   Conduct of the Inotersen Program Prior to Closing. From the date of this Agreement until the Expiration Date, Ionis (a) shall, and shall cause its Affiliates to, with respect to the development and commercialization of inotersen and its follow-on drug IONIS-TTR-LRx (the “Inotersen Program”), only take actions in the ordinary course of business in a manner that is consistent with past practice; (b) comply in all material respects with the Applicable Laws applicable to the Inotersen Program; (c) use reasonable best efforts to preserve intact the rights granted to Akcea pursuant to the License Agreement (the “Licensed Rights”); and (d) use reasonable best efforts to preserve intact the material business relationships of the Inotersen Program with employees, suppliers, licensors, licensees and others with whom the Inotersen Program deals in the ordinary course of business consistent with past practice. Further, Ionis shall not, and shall not permit any of its representatives or Affiliates to, do any of the following in connection with the Inotersen Program without the prior written consent of Akcea (i) dispose of, fail to prosecute or maintain or permit to lapse or fail to take reasonable steps to protect the Licensed Rights; (ii) permit or allow any of the Licensed Rights to become subject to any lien, pledge, security interest or other encumbrances; (iii) amend, modify or waive any Material Contract; or (iv) violate, withdraw, materially amend, allow to lapse or otherwise take any action or fail to take 

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any action that would result in Ionis or any of its respective Affiliates being in material default (with or without notice or lapse of time or both) under any licenses, permits, authorizations, registrations, qualifications or approvals necessary to the Inotersen Program, or take any other action or fail to take any other action or cause any other event that would result in the suspension, modification, revocation or nonrenewal thereof, or giving to any other person any right of termination, amendment or cancellation thereof. 

6.2   Access to Information. From the date of this Agreement until the Expiration Date, Ionis and its Affiliates shall (i) permit Akcea and its representatives to have reasonable access to all books, records, contracts and documents to the extent pertaining to the Inotersen Program and (ii) furnish Akcea with all financial, operating and other data and information to the extent pertaining to the Inotersen Program (including copies thereof) as Akcea may reasonably request; provided, however, that such access or furnishing of information shall be conducted during normal business hours, under the supervision of Ionis’ personnel and in such a manner as not to interfere with the normal operations of its business. 

6.3   Reasonable Best Efforts. Subject to the terms and conditions of this Agreement, from the date of this Agreement until the Expiration Date, each Party shall cooperate with the other Party and use (and shall cause their respective Affiliates to use) their respective reasonable best efforts to promptly take, or cause to be taken, all actions, and do, or cause to be done, all things, necessary, proper or advisable to cause the conditions to Closing set forth in Section 7 to be satisfied (but not waived) as promptly as practicable. 

6.4   Publicity and Confidentiality. 

(a)   All press releases or public disclosures related to this Agreement prior to the Closing will be mutually agreed upon by the Parties and issued as a joint press release, provided however, that each Party may make disclosure as permitted by Section 6.4(b) and Section 6.4(c). The contents of any announcement or similar publicity can be re-released by either Party without a requirement for re-approval.

(b)   A Party may disclose Confidential Information belonging to the other Party in the following instances to the extent reasonably necessary to comply with Applicable Law (including the rules and regulations of the Securities and Exchange Commission or any national securities exchange, and compliance with tax laws and regulations) and with judicial process, if (i) in the reasonable advice of the advice of counsel for the Party making such disclosure, such disclosure is necessary for such compliance and (ii) such disclosure is made in accordance with Section 6.4(c).

(c)   A Party may disclose Confidential Information pursuant to interrogatories, requests for information or documents, subpoena, civil investigative demand issued by a court or governmental agency or as otherwise required by Applicable Law; provided however, that, unless legally prohibited from doing so, the Party making such disclosure will notify the other Party promptly upon receipt thereof, giving (where practicable) the other Party sufficient advance notice to permit it to oppose, limit or seek confidential treatment for such disclosure, and to file for patent protection if relevant; and provided, further, that the Party making such disclosure will furnish only that portion of the Confidential Information which it is advised by counsel is legally required whether or not a protective order or other similar order is obtained by the Party making the disclosure.

6.5   Preparation of Proxy Statement.

(a)   As promptly as reasonably practicable after the execution of this Agreement, Akcea shall prepare and cause to be filed with the SEC a proxy statement relating to the Company Proposals (such proxy statement, and any amendments or supplements thereto, the “Proxy Statement”). Ionis shall furnish all information concerning Ionis and its Affiliates to Akcea, as may be reasonably requested by Akcea to be included in the Proxy Statement and shall otherwise assist and cooperate with Akcea in the preparation of the Proxy Statement and the resolution of any comments to the Proxy Statement received from the SEC. Both Ionis and Akcea shall promptly correct any information provided by it for use in the Proxy Statement if and to the extent such information becomes false or misleading in any material respect. Akcea shall notify Ionis upon the receipt of any comments from the SEC and of any request by the SEC for amendments or supplements to the Proxy Statement. Akcea shall use its reasonable best efforts to (i) respond as promptly as reasonably practicable to any comments received from the SEC concerning the Proxy Statement and to resolve such comments with the SEC, and (ii) to cause the Proxy Statement to be disseminated to its stockholders as promptly as reasonably practicable after the resolution of any such comments.

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(b)   Akcea shall take all necessary actions in accordance with Applicable Law, the Certificate of Incorporation and Bylaws of Akcea and the rules of Nasdaq, to duly call, give notice of, convene and hold the Meeting for the purpose of obtaining the Stockholder Approval, as soon as reasonably practicable after the SEC confirms that it has no further comments on the Proxy Statement. Notwithstanding any provision of this Agreement to the contrary, Akcea may adjourn, recess or postpone the Meeting (i) to the extent necessary to ensure that any required supplement or amendment to the Proxy Statement is provided to the stockholders of Akcea within a reasonable amount of time in advance of the Meeting, (ii) if as of the time for which the Meeting is originally scheduled (as set forth in the Proxy Statement) there are insufficient shares of Common Stock represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Meeting or (iii) as may be required by Applicable Law.

(c)   If prior to the Closing any event occurs with respect to Ionis or any of its subsidiaries, or any change occurs with respect to other information supplied by Ionis for inclusion in the Proxy Statement, which is required to be described in an amendment of, or a supplement to, the Proxy Statement, Ionis shall promptly notify Akcea of such event or change, and Ionis and Akcea shall cooperate in the prompt filing with the SEC of any necessary amendment or supplement to the Proxy Statement and, as required by Applicable Law, in disseminating the information contained in such amendment or supplement to Akcea’s stockholders. 

6.6   Notification of Certain Events.

(a)   Each Party shall promptly notify the other Party of (i) any notice from any person alleging that the consent of such person is or may be required in connection with the transactions contemplated by this Agreement or the License Agreement; (ii) any notice from any Governmental Entity in connection with the transactions contemplated by this Agreement or the License Agreement; (iii) any inaccuracy in any material respect of any of its representations or warranties contained in this Agreement; (iv) any failure of such Party or such Party’s Affiliates to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it hereunder; and (v) any written notice of pending or threatened legal proceeding relating to the Inotersen Program, the Licensed Rights or the transactions contemplated by this Agreement; provided, however, that the delivery of any notice pursuant to this Section 6.6(a) shall not limit or otherwise affect the rights or remedies available hereunder to the Party receiving that notice.

(b)   From the date of this Agreement until the Expiration Date, Ionis shall promptly notify, and provide a copy to, Akcea of any written notice from any third party alleging, with respect to the Inotersen Program or Licensed Rights, a violation of, or failure to comply with, any Applicable Law. Ionis shall, subject to Applicable Law, promptly notify Akcea of any result, event, change or effect occurring after the date of this Agreement that would have, if it had occurred prior to the date of this Agreement, constituted a breach of any of the representations and warranties contained in Section 3.

6.7   Listing of the Shares. Akcea agrees to use reasonable best efforts to (i) maintain the listing and trading of the Common Stock on Nasdaq and (ii) effect the listing of the Shares on Nasdaq.

Section 7. CONDITIONS TO CLOSING

7.1   Conditions to Obligations of Akcea. Akcea’s obligation to effect the Closing is subject to the fulfillment or waiver of the following conditions at or prior to the Closing, provided that neither Party may waive the requirement to obtain the Disinterested Stockholder Approval:

(a)   Representations and Warranties. The representations and warranties of Ionis contained in this Agreement or in the License Agreement (i) that are not qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all material respects as of the date hereof and as of Closing and (ii) that are qualified as to “materiality” or “Material Adverse Effect” shall be true and correct as of the date hereof and as of the date of the Closing, in each case, except to the extent such representations and warranties are made as of another date, in which case such representations and warranties shall be true and correct, as the case may be, as of such other date.

(b)   Covenants. The covenants and agreements contained in this Agreement to be complied with by Ionis at or before the Closing shall have been performed or complied with in all material respects.

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(c)   No Governmental Prohibition. No Governmental Entity shall have enacted, issued, promulgated, enforced or entered any Applicable Law (whether temporary, preliminary or permanent) that has the effect of making the transactions contemplated by the Transaction Documents illegal or otherwise restraining or prohibiting the consummation of such transactions.

(d)   Stockholder Approval. The Stockholder Approval shall have been obtained.

(e)   Receipt of Funds. Akcea will have received immediately available funds in the full amount of the Purchase Price for the Shares being purchased hereunder.

7.2   Conditions to Obligations of Ionis. Ionis’ obligation to effect the Closing is subject to the fulfillment or waiver of the following conditions at or before the Closing, provided that neither Party may waive the requirement to obtain the Disinterested Stockholder Approval:

(a)   Representations and Warranties. The representations and warranties of Akcea contained in this Agreement or in the License Agreement (i) that are not qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all material respects as of the date hereof and as of the date of the Closing and (ii) that are qualified as to “materiality” or “Material Adverse Effect” shall be true and correct as of the date hereof and as of the Closing, in each case, except to the extent such representations and warranties are made as of another date, in which case such representations and warranties shall be true and correct, as the case may be, as of such other date.

(b)   Covenants. The covenants and agreements contained in this Agreement to be complied with by Akcea at or before the Closing shall have been performed or complied with in all material respects.

(c)   No Governmental Prohibition. No Governmental Entity shall have enacted, issued, promulgated, enforced or entered any Applicable Law (whether temporary, preliminary or permanent) that has the effect of making the transactions contemplated by the Transaction Documents illegal or otherwise restraining or prohibiting the consummation of such transactions.

(d)   Stockholder Approval. The Stockholder Approval shall have been obtained.

(e)   Transfer Agent Instructions. Akcea will have delivered to its transfer agent irrevocable written instructions to issue the Shares to Ionis.

(f)   Listing of Additional Shares. (i) Akcea will have filed with the Nasdaq Stock Market LLC a Notification Form: Listing of Additional Shares, or other successor form, with respect to the Shares and (ii) the Nasdaq Stock Market LLC will have informed Akcea that it has completed its review of such notification form.

Section 8. TERMINATION.

8.1   Termination. Notwithstanding anything herein or elsewhere to the contrary, this Agreement may be terminated and the transactions contemplated herein be abandoned at any time prior to Closing:

(a)    by mutual written consent of Akcea and Ionis;

(b)   by either Akcea or Ionis

(i)   if the Closing shall not have occurred on or prior to July 31, 2018 (the “End Date”); or

(ii)   if any Governmental Entity having jurisdiction over Akcea or Ionis shall have enacted, issued, promulgated, enforced or entered any Applicable Law or taken any other material action, in each case such that the condition set forth in Section 7.1(c) (No Governmental Prohibition) or Section 7.2(c) (No Governmental Prohibition) would not be satisfied;

(c)   by Akcea, upon a material breach of this Agreement by Ionis, provided however that if such breach is capable of being cured within sixty (60) days from the date Ionis is notified in writing by Akcea of such breach, Akcea may not terminate this Agreement during such sixty (60) day period or following such date if such breach is cured at or prior to such date; or

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(d)   by Ionis, upon a material breach of this Agreement by Akcea, provided however that if such breach is capable of being cured within sixty (60) days from the date Akcea is notified in writing by Ionis of such breach, Ionis may not terminate this Agreement during such sixty (60) day period or following such date if such breach is cured at or prior to such date. 

8.2   Effect of Termination. Upon termination of this Agreement pursuant to this Section 8, all provisions of this Agreement shall terminate and thereafter have no effect, and there shall be no liability on the part of either Party hereto except (a) as set forth in Section 6.4 (Publicity and Confidentiality), Section 8.2 (Effect of Termination), Section 9 (Miscellaneous) and (b) nothing shall relieve any Party from liability for fraud or any breach of this Agreement occurring prior to such termination.

Section 9. MISCELLANEOUS.

9.1   Governing Law and Exclusive Jurisdiction. This Agreement will be governed by and construed and enforced in accordance with the laws of the State of Delaware without reference to any rules of conflicts of laws. In any action or proceeding between any of the parties arising out of or relating to this Agreement or any of the transactions contemplated by this Agreement, each of the parties: (i) irrevocably and unconditionally consents and submits to the exclusive jurisdiction and venue of the Court of Chancery of the State of Delaware or to the extent such court does not have subject matter jurisdiction, the Superior Court of the State of Delaware or the United States District Court for the District of Delaware, (ii) agrees that all claims in respect of such action or proceeding shall be heard and determined exclusively in accordance with clause (i) of this Section 9.1, (iii) waives any objection to laying venue in any such action or proceeding in such courts, (iv) waives any objection that such courts are an inconvenient forum or do not have jurisdiction over any party, and (v) agrees that service of process upon such party in any such action or proceeding shall be effective if notice is given in accordance with Section 9.5 of this Agreement.

9.2   Counterparts. This Agreement may be signed in two counterparts, both of which will be deemed an original, notwithstanding variations in format or file designation which may result from the electronic transmission, storage and printing of copies of this Agreement from separate computers or printers. Facsimile signatures and signatures transmitted via electronic mail in PDF format will be treated as original signatures.

9.3   Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable by a court of competent jurisdiction, such adjudication will not affect or impair, in whole or in part, the validity, enforceability, or legality of any remaining portions of this Agreement. All remaining portions will remain in full force and effect as if the original Agreement had been executed without the invalidated, unenforceable or illegal part. The Parties shall each use good faith, reasonable best efforts to replace the illegal, invalid or unenforceable provision with a legal, valid and enforceable provision that achieves similar economic and non-economic effects as the severed provision, in each case as permitted by and to the extent consistent with Applicable Law.

9.4   Entire Agreement; Modifications. This Agreement (including any schedules and exhibits hereto) and the License Agreement sets forth and constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof, and all prior agreements, understanding, promises and representations, whether written or oral, with respect to the subject matter hereof are superseded hereby. Each Party confirms that it is not relying on any representations or warranties of the other Party except as specifically set forth in this Agreement or in the License Agreement. No amendment, modification, release or discharge will be binding upon the Parties unless in writing and duly executed by authorized representatives of both Parties. Ionis hereby waives, provides any necessary consent under and/or amends, as necessary, any provision of any pre-existing agreement between Ionis and Akcea, and/or any of their respective Affiliates, to the extent any provision or transaction contained in or contemplated by any Transaction Document contradicts, requires a consent under or would otherwise violate or breach or contravene any such agreement.

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9.5   Notices. Any notice or request required or permitted to be given under or in connection with this Agreement will be deemed to have been sufficiently given if in writing and personally delivered or sent by certified mail (return receipt requested), facsimile transmission (receipt verified), or overnight express courier service (receipt verified), prepaid, to the Party for which such notice is intended, at the address set forth for such Party below:

	
If to Akcea, addressed to:

	
Akcea Therapeutics, Inc.

55 Cambridge Parkway, Suite 100

Cambridge, MA 02142

Attention: Chief Executive Officer

Fax: 760-602-1855

	
   

	
 

	
with a copy to:

	
Ropes & Gray LLP

Prudential Tower, 800 Boylston Street

Boston, MA 02199

Attention: David McIntosh & Christopher Comeau

	
   

	
 

	
If to Ionis, addressed to:

	
Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, CA 92010

Attention: Chief Operating Officer

Fax: 760-918-3592

	
   

	
 

	
with a copy to:

	
Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, CA 92010

Attention: General Counsel

Email: legalnotices@ionisph.com

or to such other address for such Party as it will have specified by like notice to the other Party; provided that notices of a change of address will be effective only upon receipt thereof. If delivered personally or by facsimile transmission, the date of delivery will be deemed to be the date on which such notice or request was given. If sent by overnight express courier service, the date of delivery will be deemed to be the next Business Day after such notice or request was deposited with such service. If sent by certified mail, the date of delivery will be deemed to be the third Business Day after such notice or request was deposited with the U.S. Postal Service.

9.6   Successors and Assigns. This Agreement is binding upon and inures to the benefit of the Parties and their successors and assigns. Akcea will not assign this Agreement or any rights or obligations hereunder without the prior written consent of Ionis, and Ionis will not assign this Agreement or any rights or obligations hereunder without the prior written consent of Akcea; provided, however, that Ionis may assign this Agreement together with all of the Ionis Shares (subject to Section 4) (i) to any wholly-owned subsidiary and any such assignee may assign the Agreement together with all of the shares that such Affiliate owns (subject to Section 4) to Ionis or any other subsidiary wholly-owned by Ionis, in any such case, without such consent, provided that Ionis remains primarily liable hereunder for all of its obligations set forth herein, regardless of any such assignment or (ii) to any successor corporation resulting from any merger, consolidation, share exchange or other similar transaction.

9.7   Third Party Beneficiaries. This Agreement is intended for the benefit of the Parties hereto, their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

9.8   Further Actions. Each Party will execute, acknowledge and deliver such further instruments, and do all such other acts, as may be necessary or appropriate in order to carry out the expressly stated purposes and the clear intent of this Agreement.

9.9   Construction of Agreement. The terms and provisions of this Agreement represent the results of negotiations between the Parties and their representatives and neither of which has acted under duress or compulsion, whether legal, economic or otherwise. Accordingly, the terms and provisions of this Agreement will 

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be interpreted and construed in accordance with their usual and customary meanings, and each of the Parties hereto hereby waives the application in connection with the interpretation and construction of this Agreement of any rule of law to the effect that ambiguous or conflicting terms or provisions contained in this Agreement will be interpreted or construed against the Party whose attorney prepared the executed draft or any earlier draft of this Agreement. 

9.10   Injunctive Relief Notwithstanding anything to the contrary in this Agreement, each Party will be entitled to seek from any court of competent jurisdiction, in addition to any other remedy it may have at law or in equity, injunctive or other equitable relief in the event of an actual or threatened breach of this Agreement by the other Party, without the posting of any bond or other security, and such an action may be filed and maintained notwithstanding any ongoing discussions between the Parties or any ongoing arbitration proceeding. The Parties agree that in the event of a threatened or actual material breach of this Agreement injunctive or equitable relief would be an appropriate remedy.

9.11   Waiver. Neither Party may waive or release any of its rights or interests in this Agreement except in writing. The failure of either Party to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement will not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition. No waiver by either Party of any condition or term in any one or more instances will be construed as a continuing waiver or subsequent waiver of such condition or term or of another condition or term.

9.12   Interpretation. Except as otherwise explicitly specified to the contrary, (a) references to a section means a section of this Agreement, unless another agreement is specified, (b) the word “including” (in its various forms) means “including without limitation,” (c) the words “shall” and “will” have the same meaning, (d) references to a particular statute or regulation include all rules and regulations thereunder and any predecessor or successor statute, rules or regulation, in each case as amended or otherwise modified from time to time, (e) words in the singular or plural form include the plural and singular form, respectively, (f) references to a particular person include such person’s successors and assigns to the extent not prohibited by this Agreement, (g) unless otherwise specified, “$” is in reference to United States dollars, and (h) the headings contained in this Agreement, in any exhibit or schedule to this Agreement are for convenience only and will not in any way affect the construction of or be taken into consideration in interpreting this Agreement. 

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IN WITNESS WHEREOF, Akcea and Ionis have each caused this Agreement to be duly executed as of the date first above written.

	
 

	
IONIS PHARMACEUTICALS, INC.

	
   

	
 

	
 

	
By:

	
/s/ Stanley T. Crooke

	
   

	
 

	
 

	
Its:

	
Chief Executive Officer

	
   

	
 

	
 

	
45,447,879 shares of Common Stock

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IN WITNESS WHEREOF, Akcea and Ionis have each caused this Agreement to be duly executed as of the date first above written.

	
 

	
AKCEA THERAPEUTICS, INC.

	
   

	
 

	
 

	
By: 

	
/s/ Paula Soteropoulos

	
   

	
 

	
 

	
Its: 

	
Chief Executive Officer

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Annex B

APPENDIX 1

Defined Terms

“Action” means any claim, action, suit, arbitration, proceeding or investigation by or before any Governmental Entity.

“Affiliate” of an entity means any other entity that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such first entity, but such an entity will be deemed to be an Affiliate only for the duration of such control. For purposes of this definition only, “control” (and, with correlative meanings, the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct the management or policies of an entity, whether through the ownership of voting securities or by contract relating to voting rights or corporate governance. During the time that Ionis retains a majority ownership position of Akcea, Ionis will not be considered an Affiliate of Akcea and Akcea will not be considered an Affiliate of Ionis for the purposes of the Transaction Documents only.

“Amended and Restated Services Agreement”means that certain Amended and Restated Services Agreement, dated the date hereof, by and between Akcea and Ionis.

“Applicable Law(s)” means, with respect to any person, any federal, state or local law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order or other similar requirement enacted, issued, entered, adopted, promulgated or applied by a Governmental Entity that is binding upon or applicable to such person, as the same may be amended from time to time unless expressly specified otherwise in this Agreement.

“Business Day” means any day, other than Saturday, Sunday or any statutory holiday or bank holiday in the United States.

“Company Proposals” means proposals for the (a) approval of this Agreement, the License Agreement, the Amended and Restated Investor Rights Agreement, the Amended and Restated Services Agreement and the transactions contemplated thereunder by the receipt of the affirmative vote of holders of a majority of the issued and outstanding shares of Common Stock other than Ionis and its affiliates (the “Interested Stockholders”), which shall exclude a vote of any of Akcea’s directors and officers, (b) approval of the issuance of the shares of Common Stock to Ionis pursuant to this Agreement and the License Agreement as required by and in accordance with Nasdaq Listing Rule 5635 by a majority of the total votes of the issued and outstanding Common Stock cast on the proposal, which is conditioned upon the approval of clause (a) above, (c) approval of an amendment to the certificate of incorporation of Akcea to increase the authorized number of shares of Common Stock by holders of a majority of the issued and outstanding Common Stock, which is conditioned upon the approval of clause (a) above, and (d) approval of an adjournment of the Meeting, if necessary or appropriate, to permit solicitation of additional proxies in favor of any of the proposals in clauses (a) to (c) by holders of a majority of the Common Stock present in person or represented by proxy at the Meeting.

“Confidential Information” has the meaning set forth in the License Agreement.

“Consent” shall mean any approval, consent, ratification, permission, waiver or authorization.

“Constructive Sale” means with respect to any security, a short sale with respect to such security, entering into or acquiring a derivative contract with respect to such security, entering into or acquiring a futures or forward contract to deliver such security, or entering into any other hedging or other derivative transaction that has the effect of either directly or indirectly materially changing the economic benefits or risks of ownership of such security.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder.

“GAAP” means generally accepted accounting principles in the United States of America as applied by Akcea.

“Governmental Entity” means domestic or foreign governmental or regulatory authority, agency, commission, body, court or other legislative, executive or judicial governmental entity.

B-A-1

“Material Adverse Effect” means a material adverse effect on (a) the business, operations, assets or financial condition of Akcea, or (b) the ability of Akcea to consummate the transactions contemplated hereby and by the Transaction Documents in a timely manner.

“Material Contracts” means any agreement used or held for use by Ionis or any of its affiliates that is necessary or reasonably useful to Develop, Manufacture or Commercialize a Product (such terms having their respective meanings set forth in the License Agreement).

“Nasdaq” means The Nasdaq Global Select Market.

“SEC” means the United States Securities and Exchange Commission or any successor entity.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC thereunder.

“Ionis Shares” means (i) all shares of capital stock of Akcea owned, beneficially or of record, by Ionis as of the date hereof, and (ii) all additional shares of capital stock of Akcea acquired by Ionis, beneficially or of record, during the period commencing with the execution and delivery of this Agreement and expiring on the Expiration Date.

“Stockholder Approval” means the (a) approval of this Agreement, the License Agreement, the Amended and Restated Investor Rights Agreement, the Amended and Restated Services Agreement and the transactions contemplated thereunder by the receipt of the affirmative vote of holders of a majority of the issued and outstanding shares of Common Stock other than the Interested Stockholders, which shall exclude a vote of any of Akcea’s directors and officers (the “Disinterested Stockholder Approval”), (b) approval of the issuance of the shares of Common Stock to Ionis pursuant to this Agreement and the License Agreement as required by and in accordance with Nasdaq Listing Rule 5635 by a majority of the total votes of the issued and outstanding Common Stock cast on the proposal, which is conditioned upon the approval of clause (a) above, and (c) approval of an amendment to the certificate of incorporation of Akcea to increase the authorized number of shares of Common Stock by holders of a majority of the issued and outstanding Common Stock, which is conditioned upon the approval of clause (a) above.

“Transfer” means, with respect to any security, the direct or indirect assignment, sale, transfer, tender, exchange, pledge, hypothecation, or the grant, creation, or suffrage of a lien, security interest, or encumbrance in or upon, or the gift, grant, or placement in trust, or the Constructive Sale or other disposition of such security (including transfers by testamentary or intestate succession, by domestic relations order or other court order, or otherwise by operation of law) or any right, title, or interest therein (including any right or power to vote to which the holder thereof may be entitled, whether such right or power is granted by proxy or otherwise), or the record or beneficial ownership thereof, the offer to make such a sale, transfer, Constructive Sale, or other disposition, and each agreement, arrangement, or understanding, whether or not in writing, to effect any of the foregoing.

B-A-2Exhibit 10.3 

Execution Version

AMENDED AND RESTATED SERVICES AGREEMENT 

AMENDED AND RESTATED SERVICES AGREEMENT

This AMENDED AND RESTATED SERVICES AGREEMENT (this “Services Agreement”) is made as of March 14, 2018 (the “Execution Date”) by and among, IONIS PHARMACEUTICALS, INC., a Delaware corporation, with its principal place of business at 2855 Gazelle Court, Carlsbad, CA 92010 (“Ionis”) and AKCEA THERAPEUTICS, INC., a Delaware corporation, with its principal place of business at 55 Cambridge Parkway, Suite 100, Cambridge, MA 02142 (“Akcea”). As of the Effective Date, this Services Agreement, amends, updates and replaces in its entirety the December 18, 2015 Services Agreement between Ionis and Akcea (the “2015 Services Agreement”). All capitalized terms not defined herein will have the meanings set forth in the Development Commercialization and License Agreement, dated December 18, 2015 (the “2015 License Agreement”), and the Development, Commercialization, Collaboration, and License Agreement, dated as of the Execution Date, by and between Ionis and Akcea (as it may be amended from time to time, the “2018 License Agreement” and together with the 2015 License Agreement, the “License Agreements”). Ionis and Akcea each may be referred to herein individually as a “Party,” or collectively as the “Parties.”

RECITALS

WHEREAS, on December 18, 2015, (i) Ionis Pharmaceuticals, Inc. formed Akcea, a Delaware corporation, as a wholly-owned subsidiary for the initial purpose of serving as the development and commercialization entity for the following lipid-modulating antisense drugs: IONIS-APOCIIIRx (IONIS304801), IONIS-APOCIII-LRx (IONIS678354), IONIS-APO(a)Rx (IONIS494372), IONIS-APO(a)-LRx (IONIS681257), IONIS-ANGPTL3Rx (IONIS563580) and IONIS-ANGPTL3-LRx (IONIS703802) (the “Lipid Drugs”); (ii) entered into the 2015 License Agreement to develop, manufacture and commercialize the Lipid Drugs; and (iii) entered into the 2015 Services Agreement to provide certain general and administrative services in support of Akcea’s business;

WHEREAS, on the Execution Date, Ionis and Akcea entered into the 2018 License Agreement to develop, commercialize, collaborate on and manufacture the following antisense drugs: inotersen and IONIS-TTR-LRx (the “TTR Drugs”);

WHEREAS, Akcea continues to need certain services related to general and administrative services in support of its business; and 

WHEREAS, Ionis wishes to provide such Services;

WHEREAS, through this Services Agreement, the Parties now wish to amend and restate the 2015 Services Agreement to expand the Services to include both the Lipid Drugs and the TTR Drugs (collectively the “Supported Drugs”).

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Ionis and Akcea each agree as follows:

		1.	Services. On an annual basis as part of the Parties’ annual budgeting process the Parties will agree on which of the following services set forth in this Article 1 Ionis will provide to Akcea during the upcoming year; provided that if Ionis desires to cease providing or Akcea desires to cease receiving one or more services previously provided to Akcea by Ionis, then such Party will notify the other Party of such cessation in advance of the applicable annual budgeting process as necessary to allow Akcea to transition in an orderly and rational manner to performing such services internally or obtaining replacement services. 

		1.1	General and Administrative Services. The general and administrative support services provided to Akcea under this Services Agreement of the type described below will be referred to herein as the “G&A Services.”

		1.1.1	Investor Relations Services. Ionis will provide to Akcea investor relations services regarding matters of fair and accurate disclosure and compliance with Ionis’ disclosure policy and applicable Law, including, without limitation, compliance with the Sarbanes-Oxley Act of 2002. Such services will include drafting; processing for review and issuing press releases; conference call scripts and presentations; managing conference and medical meeting attendance; managing media and public relations activities; and facilitating interactions with investors and analysts. 

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		1.1.2	Pre-Commercial and Competitive Intelligence Services. Ionis will provide to Akcea services related to pre-commercial activities and related to competitive intelligence services for all of the Supported Drugs as appropriate.

		1.1.3	Accounting and Payroll Services. Ionis will provide to Akcea bookkeeping and accounting services, including maintaining the books and records of Akcea’s financial operations, preparing financial statements (including quarterly and annual financial statements), billings, accounts payable, stock option accounting services, internal audit support services, financial budgeting and forecasting as needed, review of compliance with financial and accounting procedures and government accounting functions (e.g., preparing budgets and setting rates), in each case, in accordance with GAAP, and government regulations as applicable. In addition, Ionis will administer Akcea’s employee payroll, including withholding and remitting employee and employer payroll taxes.

		1.1.4	Personnel Services. Ionis will provide personnel services to Akcea, including maintaining general employee insurance obligations, establishing and managing of an employee benefits program, advising on employee relations and related issues, and managing of Akcea’s retirement plans, including the Ionis Pharmaceuticals, Inc. 401(k) Retirement Plan. However, the Parties expect Akcea to develop its own stock administration capabilities in the near future. 

		1.1.5	Legal Services. Ionis will provide Akcea with legal services, including legal services from Ionis’ General Counsel and other legal counsel with respect to: labor and personnel matters; management of Akcea’s employee equity incentive plans and programs; compliance with applicable securities laws and regulations; compliance with other applicable laws and regulations; litigation management; contract negotiation and preparation; commercial sales agreements; mergers and acquisitions; tax issues; preventive counseling; and all matters relating to corporate governance of Akcea. Notwithstanding the foregoing, if, with the advice of counsel, Akcea reasonably believes an actual or potential conflict of interest is likely to arise between the interests of Ionis’ stockholders and Akcea’s stockholders, then Akcea may retain its own counsel at its own expense for such matters.

		1.1.6	Risk Management; Insurance. Ionis will provide Akcea centralized insurance purchasing for liability, property, casualty and other normal business insurance and the handling of claims.

		1.1.7	Tax Related Services. Ionis will assist Akcea in the preparation of ex-U.S. and U.S. federal, state and local income tax returns, tax research and planning and assistance on tax audits or other tax-related matters.

		1.1.8	Corporate Record Keeping Services. Ionis will maintain, on behalf of Akcea, corporate records, including minutes of meetings of the board of directors and stockholders of Akcea, supervision of transfer agent and registration functions, maintenance of stock records, including the tracking of stock issuances and stock reservations.

		1.1.9	Financial Services. Ionis will provide to Akcea the following financial services: (i) banking services administration, including bank account administration, loan administration, covenant compliance administration, maintenance of cash collection and disbursement systems and arrangement of letters of credit, foreign currency exchanges or conversion calculations and cash transfers; (ii) financial management and information services, including centralized cash management, leasing, customer financing, financial analysis on foreign currency issues, risk assessment and hedging strategies; (iii) investment banking services, including managing Ionis’ and Akcea’s relationships with debt rating agencies. In connection with such services, Ionis is authorized to invest the funds deposited by Akcea with Ionis in taxable, tax-exempt or tax-preferred instruments of short or longer term duration based upon Ionis’ assessment of Akcea’s tax considerations and Akcea’s cash needs and consistent with Akcea’s investment policy and guidelines. Ionis will advise Akcea on a quarterly basis as to the earnings that Akcea may expect on its cash deposits during the following quarter.

		1.1.10	Credit Services. Ionis will assist Akcea in identifying and obtaining cost-effective sources of financing consistent with the needs of Ionis and its affiliated companies.

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		1.1.11	COO, CFO and CBO Oversight Services. The Parties acknowledge and agree that Ionis’ COO, CFO and CBO do and will supervise the employees performing the Services hereunder, and in consideration for such supervisory services, a portion of the COO’s, CFO’s and CBO’s salary will be allocated to and paid by Akcea using the allocation methodology set forth in APPENDIX A (Allocation Methodologies). 

		1.2	R&D Support Services. The research and development support services provided to Akcea under this Services Agreement of the type described below will be referred to herein as the “R&D Support Services.”

		1.2.1	Information Technology Services. Ionis will provide information technology and telephone services to Akcea, including but not limited to: intercompany network services and database management services between Ionis and Akcea; information technology planning services; centralized procurement of hardware and software; support for initial set up or relocation of Akcea facilities; email services; phone services; and mobile device services. Ionis may provide additional information technology services that are mutually agreed between Ionis and Akcea. In addition, Ionis will allow Akcea to access, display and use software systems and programs owned by or licensed to Ionis, except to the extent that Ionis is precluded by its licenses from providing such access, display or use. 

		1.2.2	Purchasing Services. Ionis will provide services to Akcea related to purchasing, including purchase order management, vendor selection, payment terms, negotiating preferred pricing and negotiating supplier agreements.

		1.2.3	Facilities and Office Services. To the extent necessary, Ionis will provide Akcea office and facility services, primarily the appropriate personnel to support Akcea’s office and facility infrastructure. 

		1.2.4	Intellectual Property Support Services. Ionis will provide intellectual property support services to Akcea, including but not limited to filing, prosecuting, maintaining, enforcing, and defending the Ionis Product-Specific Patents licensed to Akcea, trademarks and copyrights, patent due diligence to support partnership transactions and advice regarding intellectual property strategy (collectively, the “IP Support Services”). In the event that a Third Party challenges one of the Ionis Core Technology Patents licensed to Akcea under a License Agreement, then the Parties will discuss and agree to a percentage of the expense to defend such challenge for which Akcea will reimburse Ionis. 

		1.3	Specialty Services. If, from time to time, Akcea wishes Ionis to perform specific projects that go beyond the services already specified in Section 1.1 or Section 1.2 to perform specific projects, Akcea and Ionis will execute a work order that will be governed by the terms of this Services Agreement and will specify the projects Ionis will perform for Akcea and the payment Akcea will make to Ionis for such project. The Parties will execute a work order prior to initiating such work (collectively, the “Specialty Services”). An email from Akcea’s Chief Executive Officer, President, Chief Operating Officer, or Chief Financial Officer referencing this Services Agreement and authorizing Ionis to perform specific Specialty Services will be considered a work order for purposes of this Section 1.3. Ionis will not be reimbursed for performing work that goes beyond the scope of any Specialty Services without an agreed and executed work order. Examples of a Specialty Service under this Section 1.3 are business development services relating to corporate partnering transactions and other services related to a corporate partnership or financing.

		1.4	Development, Regulatory and Manufacturing Services. Ionis will provide services related to Development (including regulatory affairs) and Manufacturing in support of the Lipid Drugs pursuant to the terms of the 2015 License Agreement. Ionis will provide services related to Development (including regulatory affairs) and Manufacturing in support of the TTR Drugs pursuant to the terms of the 2018 License Agreement. Ionis will be reimbursed by Akcea for such services for each of the Lipid Drugs and TTR Drugs using the same methodology the Parties use under the 2015 License Agreement.

		2.	Performance of Services.

		2.1	Performance. All services described in Article 1 of this Services Agreement are collectively referred to as the “Services.” Ionis will provide all Services (i) on an ongoing basis during the Term, as reasonably 

3

required or requested by Akcea, (ii) promptly, (iii) in accordance with the terms of this Services Agreement, (iv) in accordance with the standards and practices for the performance of similar services by Ionis in the conduct of its own business and (v) in a manner consistent with Law applicable to Ionis and Akcea. 

		2.2	Authority. Consistent with Ionis’ signature policy and established procedures and, to the extent of the scope of the Services such Ionis employee is performing for Akcea, Ionis personnel have the authority to act on Akcea’s behalf. 

		3.	Compensation. 

		3.1	Charge for Services. Akcea will pay Ionis fees for the Services as specified in APPENDIX A (Allocation Methodologies) attached hereto, which provides details regarding how to calculate such fees (except Specialty Service fees). These Allocation Methodologies will generally be determined from a good faith estimate by Ionis of a percentage of each Ionis functional area detailed in Section 1 of this Agreement dedicated to providing the Services hereunder. From time to time, the Parties may mutually agree to update APPENDIX A (Allocation Methodologies) as needed, including in the event of a change of circumstances of one or more of the Parties. At a minimum, on an annual basis as part of Ionis’ annual budgeting process, the Parties will review APPENDIX A (Allocation Methodologies) in good faith to ensure the allocations set forth therein are fair and commercially reasonable. 

		3.2	Specialty Services Fee. Akcea will pay Ionis for Specialty Services rendered based upon a good faith estimate of the time burden required of Ionis personnel to perform the Specialty Services based upon the statement of work provided by Akcea. If there is a material change in the statement of work, in scope or budget, Ionis will prepare a revised estimate for Akcea’s approval.

		3.3	Direct Out-of-Pocket Expenses. Akcea will be responsible for paying and will bear the cost of all out-of-pocket expenses for which Akcea is the primary beneficiary, including but not limited to (i) legal services provided to Akcea by outside counsel; (ii) insurance policies and claims that relate specifically to Akcea; (iii) accounting, auditing and tax related services provided to Akcea by external accountants and tax advisors; (iv) filing fees and other costs (e.g., translation costs) charged by Third Parties in connection with filing, prosecuting and maintaining Akcea’s patents, trademarks and copyrights; and (v) travel costs associated with providing any of the Services contemplated by this Services Agreement (collectively the “Direct Expenses”). Akcea and Ionis will use commercially reasonable efforts to have the applicable Third Parties bill Akcea directly for any Direct Expenses. For any out-of-pocket expenses that benefit both Ionis and Akcea but are not Direct Expenses, such expenses will be allocated to Akcea in the same manner as the fees above and depending on whether such expense is in connection with G&A Services, R&D Support Services, IP Support Services, or Specialty Services.

		3.4	Payment Terms. Ionis will invoice Akcea within fifteen (15) days following the end of each Quarter for all amounts due related to the provision of Services under this Services Agreement. Invoices will contain such detail as Akcea may reasonably require and will be payable in U.S. Dollars. All undisputed amounts will be paid by Akcea within 30 days of its receipt of an invoice. Ionis will provide Akcea with W-9s or other forms as may be reasonably requested by Akcea in order to process such payments.

		4.	Personnel. Ionis will assign employees (“Ionis Personnel”) in sufficient numbers, and with the proper skill, training and experience, to provide the Services. Ionis will be solely responsible for paying its Ionis Personnel and providing any employee benefits that they are owed. Before providing Services, all Ionis Personnel must have agreed in writing to (i) confidentiality obligations consistent with the terms of this Services Agreement and (ii) assign all right, title and interest in any intellectual property created by such Ionis Personnel, in performance of the Services to Ionis. The Parties intend for there to be additional Ionis Personnel who are not 100% dedicated to the provision of Services who will instead provide Services as needed.

		5.	Covenants of Akcea.

		5.1	Cooperation. Akcea will fully cooperate with Ionis to permit Ionis to perform Ionis’ duties and obligations under this Services Agreement in a timely manner. Akcea will direct its officers, directors, employees and agents (“Representatives”) to (i) properly and timely respond to requests by Ionis for information and (ii) if requested by Ionis, meet with or consult with the service provider and its professional advisors 

4

regarding any matter related to the Services. Akcea will also promptly provide Ionis with copies of any agreements, instruments or documents in possession of Akcea as are reasonably requested by Ionis, and promptly provide Ionis with any notices or other communications that Akcea may receive that may have any effect on Ionis’ performance of the Services.

		5.2	Accuracy of Information. Akcea will be responsible for the completeness and accuracy of all information furnished to Ionis by Akcea and Representatives of Akcea in connection with Ionis’ performance of the Services. Ionis may rely upon such information in its performance of Services under this Agreement. 

		5.3	Policies and Procedures. 

		5.3.1	During any period in which Ionis is required to consolidate the results of Akcea for purposes of reporting its results under U.S. GAAP, Akcea and its employees will comply with the policies and procedures of Ionis that Ionis, in Ionis’ good faith reasonable judgment, determines that Akcea should comply with to ensure that Ionis can satisfy its reporting obligations as a public company with a class of securities registered under the Securities Exchange Act. These policies include, but are not limited to (i) Ionis’ Code of Ethics, (ii) Ionis’ Disclosure Policies and Procedures, (iii) Ionis’ Signature Policy, (iv) Ionis’ Publication Clearance Policy, (v) Ionis’ Policies and Procedures Manual and (vi) Ionis’ Internal Control Procedures as set forth in the Amended and Restated Investor Rights Agreement entered into between Ionis and Akcea on the Execution Date (the “2018 Investor Rights Agreement”); provided, on a policy by policy basis, Akcea may replace a policy with a reasonably comparable policy that has been expressly approved by Ionis’ Chief Financial Officer and General Counsel and Akcea’s governance committee of its Board of Directors. 

		5.3.2	During any period in which Ionis is no longer required to consolidate the results of Akcea for purposes of reporting its results under U.S. GAAP but is required to record its share of Akcea’s income or losses pursuant to U.S. GAAP, Akcea will provide Ionis with a reconciliation between Akcea’s accounting policies as applied and Ionis’ accounting policies as applied. Akcea will provide this reconciliation in a timely manner. In order to execute the reconciliation in an accurate fashion, Ionis and Akcea will be required to provide each other with their accounting policies in sufficient detail to facilitate such reconciliation and verify that all differences that been identified. Akcea will perform the reconciliation to a level of detail that ensures that Ionis has the ability to assert its financial statements are materially correct. Neither Party will be required to provide the other with information to a lower level of detail, but either Party may do so upon the other Party’s request. In addition, Akcea will permit Ionis’ auditors to have access to Akcea results as necessary to perform procedures on Akcea’s financial information solely for the purposes of preparing Ionis’ publicly filed financial statements.

		6.	Financial Records; Audit Right. Ionis will maintain accurate financial records relating to its provision of the Services hereunder for a period of three (3) years, or longer as required by applicable Law. The terms set forth in APPENDIX B will govern each Party’s rights and obligations with respect to the auditing of such financial records.

5

		7.	Confidential Information. The terms regarding confidentiality and non-use set forth in the 2018 Investor Rights Agreement and ARTICLE 8 of the 2018 License Agreement will govern each Party’s rights and obligations concerning disclosure, non-use, and/or publication of the terms of this Services Agreement and/or any information exchanged or arising under this Services Agreement.

		8.	Indemnification; Insurance. The terms of ARTICLE 11 of the 2015 License Agreement will govern each Party’s indemnification and insurance obligations, respectively, with respect to this Services Agreement in relation to the Lipid Drugs and the terms of ARTICLE 11 of the 2018 License Agreement will govern each Party’s indemnification and insurance obligations, respectively, with respect to this Services Agreement in relation to the TTR Drugs.

		9.	Taxes. Notwithstanding anything to the contrary in this Services Agreement, for so long as Ionis and Akcea file consolidated federal and/or state tax returns, Ionis will retain all Akcea-generated tax attributes generated by Akcea’s activities for the relevant federal and/or state tax return. Following deconsolidation of federal and/or state tax returns, Akcea will file its own federal and/or state taxes as a separate entity and Akcea will retain such Akcea-generated tax attributes for the relevant federal and/or state tax return.

		10.	Disclaimer; Limitation of Liability.

		10.1	Disclaimer. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN SECTION 2 ABOVE, NO PARTY MAKES ANY REPRESENTATIONS OR EXTENDS ANY WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, QUALITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT, OR VALIDITY OF PATENT CLAIMS, WHETHER ISSUED OR PENDING. 

		10.2	Limitation of Liability. 

		10.2.1	Akcea acknowledges that Ionis is not in the business of providing Services and that Services are being provided pursuant to this Agreement as an accommodation to Akcea. Akcea’s sole and exclusive remedy and Ionis’ sole and exclusive liability for any breach of Section 1 or Section 2, and for any damages of Akcea suffered or incurred directly or indirectly in connection with the provision of Services (whether any claim related to such damages arises in contract, in tort, by statute or otherwise), will be the re-performance by Ionis of Services at such Ionis’ expense.

		10.2.2	OTHER THAN (A) A PARTY’S INDEMNIFICATION OBLIGATIONS SET FORTH UNDER SECTION 8, (B) AS A RESULT OF A PARTY’S WILLFUL MISCONDUCT OR A PARTY’S BREACH OF SECTION 7, NO PARTY WILL BE LIABLE TO THE OTHER PARTY OR ITS AFFILIATES FOR SPECIAL, INCIDENTAL, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, MULTIPLE OR OTHER INDIRECT DAMAGES ARISING OUT OF THIS SERVICES AGREEMENT OR THE EXERCISE OF RIGHTS HEREUNDER, OR FOR LOSS OF PROFITS, LOSS OF DATA, LOSS OF REVENUE, OR LOSS OF USE DAMAGES ARISING FROM OR RELATING TO ANY BREACH OF THIS SERVICES AGREEMENT, WHETHER BASED UPON WARRANTY, CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE, REGARDLESS OF ANY NOTICE OF SUCH DAMAGES. 

		11.	Effectiveness; Term. This Agreement will take effect automatically without further action of either Party upon the date on which the closing of the Stock Purchase Agreement dated as of the Execution Date by and between the Parties occurs (the “Effective Date”). The initial term of this Services Agreement will commence on the Effective Date and will expire on December 31, 2020 (the “Initial Term”). Following such Initial Term, this Services Agreement will automatically renew on an annual basis for periods of 12 months each (each, an “Additional Term”) unless one Party provides the other Party written notice that it does not wish to renew this Services Agreement at least 180 days in advance of the date of the expiration of the Initial Term or the then-current Additional Term, as applicable (the period commencing on the Effective Date and ending on latest to expire of the Initial Term or any Additional Term, the “Term”).

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		12.	Term and Termination.

		12.1	Termination Prior to the Effective Date. Notwithstanding anything to the contrary set forth in this Agreement, this Services Agreement may be terminated and the transactions contemplated herein be abandoned at any time prior to the Effective Date (in which case the 2015 Services Agreement will continue in full force and effect in accordance with its terms):

		(a)	by mutual written consent of Akcea and Ionis;

		(b)	by either Akcea or Ionis:

		(i)	if the Effective Date shall not have occurred on or prior to June 30, 2018; or

		(ii)	if any governmental authority having jurisdiction over Akcea or Ionis shall have enacted, issued, promulgated, enforced, or entered any Applicable Law or taken any other material action that has the effect of making the transactions contemplated by the Transaction Documents illegal or otherwise restraining or prohibiting the consummation of such transactions.

		12.2	Termination of License Agreements. This Services Agreement will automatically terminate upon the termination or expiration of both the License Agreements.

		12.3	Termination by Akcea for Breach by Ionis. At any time following the Effective Date, if Ionis breaches any material term of this Services Agreement, and such material breach is not cured by Ionis within sixty (60) days of notice therefor (or cannot be cured), then Akcea may terminate this Services Agreement. 

		12.4	Termination by Ionis for Breach by Akcea. At any time following the Effective Date, if Akcea breaches any material term of this Services Agreement, and such material breach is not cured by Akcea within sixty (60) days of notice therefor (or cannot be cured), then Ionis may stop performing Services hereunder until such breach is cured. 

		12.5	Effect of Termination or Expiration. Upon termination or expiration of this Services Agreement after the Effective Date, neither Ionis nor Akcea will have any further obligations under this Services Agreement, except that (unless otherwise agreed by the Parties or as set forth in the 2018 Investor Rights Agreement or the applicable License Agreement):

		12.5.1	Ionis will terminate all its Services in progress in an orderly manner as soon as practical and in accordance with a schedule agreed to by the Parties; 

		12.5.2	Ionis will deliver to Akcea or, at Akcea’s option, dispose of any Akcea Confidential Information developed through termination or expiration;

		12.5.3	Akcea will pay Ionis any undisputed monies due and owing, up to the time of termination or expiration, for Services properly performed and all expenses actually incurred; 

		12.5.4	Ionis will promptly return to Akcea all Confidential Information and copies thereof provided to Ionis under this Services Agreement, except for one (1) copy which Ionis may retain solely to monitor Ionis’ surviving obligations; and

		12.5.5	the provisions set forth in Section 5.3, Sections 6 through 10, this 12.5 and 13 will survive any such termination or expiration in accordance with its terms. 

		13.	Miscellaneous. 

		13.1	Assignment. Neither this Services Agreement nor any of the rights or obligations hereunder may be assigned by a Party without the prior written consent of the other Party, except that each Party may assign this Services Agreement and the rights, obligations and interests of such Party, in whole or in part, without the other Party’s consent, to any of its Affiliates, to any purchaser of all or substantially all of its business or assets to which this Services Agreement relates or to any successor corporation resulting from any merger, consolidation, share exchange or other similar transaction; provided, if Akcea or any of its Affiliates or Sublicensees transfers or assigns this Services Agreement or a Sublicense to one of its Affiliates that is incorporated in a jurisdiction that does not have a Bilateral 

7

Income Tax Treaty with the United States or in a jurisdiction where a Bilateral Income Tax Treaty requires withholding taxes on any payment described in this Services Agreement, then Akcea (or such Affiliate or Sublicensee), will increase (i.e., “gross up”) any payment due Ionis under Article 6 of the 2015 License Agreement or the 2018 License Agreement, as applicable, for the Incremental Tax Cost such that Ionis receives the amount Ionis would have otherwise received under Article 6 of the 2015 License Agreement or the 2018 License Agreement, as applicable, but for such transfer or assignment. In addition, Ionis may assign or transfer its rights to receive payments under this Agreement (but, subject to any right that Akcea may have under applicable Law), without Akcea’s consent, to an Affiliate or to a Third Party in connection with a payment factoring transaction. Any assignment not in accordance with the foregoing will be void. This Services Agreement will be binding upon, and will inure to the benefit of, all permitted successors and assigns. 

		13.2	Force Majeure. No Party will be held liable or responsible to any other Party nor be deemed to have defaulted under or breached this Services Agreement for failure or reasonable delay in fulfilling or performing any term of this Services Agreement (except any payment obligation) when such failure or delay is caused by or results from causes beyond the reasonable control of the affected Party, which may include, without limitation, embargoes, acts of war (whether war be declared or not), insurrections, riots, civil commotions, acts of terrorism, strikes, lockouts or other labor disturbances, or acts of God. The affected Party will notify the other Parties of such force majeure circumstances as soon as reasonably practical and will make every reasonable effort to mitigate the effects of such force majeure circumstances.

		13.3	Notices. Except where otherwise specifically provided in this Services Agreement, all notices, requests, consents, approvals and statements will be in writing and will be deemed to have been properly given by (i) personal delivery, (ii) electronic facsimile transmission, (iii) electronic mail or by (iv) nationally recognized overnight courier service, addressed in each case, to the intended recipient as set forth below:

	
To Akcea:

	
Akcea Therapeutics Inc.

55 Cambridge Parkway, Suite 100

Cambridge, MA 02142

Attention: Chief Executive Officer

	
   

	
 

	
With a copy to:

	
Akcea Therapeutics Inc.

55 Cambridge Parkway, Suite 100

Cambridge, MA 02142

Attention: Vice President, Legal

Email: legalnotices@akceatx.com

	
   

	
 

	
To Ionis:

	
Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, California 92010

Attention: Chief Financial Officer

	
   

	
 

	
With a copy to:

	
Ionis Pharmaceuticals, Inc.

 2855 Gazelle Court

Carlsbad, California 92010

 Attn: General Counsel

 Email: legalnotices@ionisph.com

Such notice, request, demand, claim or other communication will be deemed to have been duly given on (a) the date of personal delivery, (b) the date actually received if by facsimile or electronic mail or (c) on the next Business Day after delivery to a nationally recognized overnight courier service, as the case may be. Any Party may change the address to which notices, requests, demands, claims and other communications hereunder are to be delivered by giving the other Party notice in the manner herein set forth.

		13.4	Relationship of the Parties. It is expressly agreed that the Parties will be independent contractors 

8

hereunder and that the relationship among the Parties under this Services Agreement will not constitute a partnership, joint venture or agency. No Party will have the authority under this Services Agreement to make any statements, representations or commitments of any kind or to take any action that will be binding on any other Party, without the prior consent of such other Party. 

		13.5	Governing Law. This Services Agreement will in all respects be governed by and construed in accordance with the substantive laws of the State of New York, without regard to its choice of law rules. 

		13.6	Dispute Resolution. Any dispute arising under this Services Agreement will be resolved in accordance with the terms of Section 13.4 of the 2018 License Agreement.

		13.7	Severability. If one or more provisions of this Services Agreement are held by a proper court or arbitral tribunal to be unenforceable under applicable law, the unenforceable portions of such provisions, or such provisions in their entirety, to the extent necessary and permitted by law, will be severed herefrom, and the balance of this Services Agreement will be enforceable in accordance with its terms. 

		13.8	Entire Agreement. Except as otherwise expressly set forth in this Services Agreement, this Services Agreement, the 2018 Investor Rights Agreement and the License Agreements constitute the entire agreement among the Parties with respect to the subject matter herein and supersede all previous agreements whether written or oral, with respect to such subject matter. Unless otherwise expressly indicated, references herein to sections, subsections, paragraphs and the like are to such items within this Services Agreement. The Parties acknowledge that this Services Agreement is being executed and delivered concurrently with the execution and delivery by the Parties and/or their Affiliates of the 2018 Investor Rights Agreement and the 2018 License Agreement. In the event of any conflict, discrepancy or inconsistency between this Services Agreement and either the applicable License Agreement or the 2018 Investor Rights Agreement, the terms of the License Agreement or the 2018 Investor Rights Agreement, as the case may be, will control.

		13.9	Amendment and Waiver. This Services Agreement may not be amended, nor any rights hereunder waived, except in a writing signed by the properly authorized representatives of each Party.

		13.10	No Implied Waivers. The waiver by a Party of a breach or default of any provision of this Services Agreement by any other Party will not be construed as a waiver of any succeeding breach of the same or any other provision, nor will any delay or omission on the part of a Party to exercise or avail itself of any right, power or privilege that it has or may have hereunder operate as a waiver of any right, power or privilege by such Party.

		13.11	Counterparts. This Services Agreement 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, and will become effective when there exist copies hereof which, when taken together, bear the authorized signatures of each of the Parties hereto. Only one such counterpart signed by the Party against whom enforceability is sought needs to be produced to evidence the existence of this Services Agreement.

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IN WITNESS WHEREOF, the Parties hereby execute this Services Agreement as of the Effective Date.

	
 

	
AKCEA THERAPEUTICS INC.

	
   

	
 

	
 

	
By: 

	
/s/ Paula Soteropoulos

	
 

	
Print Name: 

	
Paula Soteropoulos

	
 

	
Title: 

	
Chief Executive Officer

	
 

	
IONIS PHARMACEUTICALS, INC.

	
 

	
 

	
 

	
 

	
By: 

	
/s/ Stanley T. Crooke

	
 

	
Print Name: 

	
Stanley T. Crooke

	
 

	
Title: 

	
Chief Executive Officer

 

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APPENDIX A

ALLOCATION METHODOLOGY

Akcea Support Services Assumptions

		1.	G&A

		a.	CEO 

		i.	Assumes no costs allocated to Akcea

		b.	COO 

		i.	% of effort – 5%

		ii.	Akcea pre-commercialization expenses and Goldman Sachs consulting excluded from allocations

		c.	CBO

		i.	% of effort – 6%

		1.	% of effort calculated using weighted average of salaries of individuals within this department based on time spent on Akcea activities

		2.	CBO – 3%

		3.	Patient Advocacy – 5%

		4.	Alex (25%) & Alissa (5%) – 20% - Competitive and Market Analysis

		d.	Corporate Communications

		i.	% of effort – 10%

		ii.	Costs associated with press releases, presentation development, website maintenance and update included within allocation cost base

		iii.	Initial website design is not included

		iv.	Cost associated with the Isis annual report, annual meeting, IR conference calls & webcasts, Thomson Reuters service and media consulting and investor targeting, Peter Steinerman, excluded from the allocation cost base ($613k)

		e.	Finance

		i.	% of effort – 10%

		1.	% of effort based on estimated number of FTE’s across all finance functions

		2.	Payroll – 0.2 FTE

		3.	General accounting 0.3 FTE

		4.	Tax, insurance and stock based comp – 0.1 FTE

		5.	Treasury services and other misc – 0.1 FTE

		6.	Controller – 0.15 FTE

		7.	FP&A – 0.5 FTE

		8.	CFO – 0.1 FTE

		9.	Costs associated with PCAOB, filing fees for 10K & Q’s, convertible debt, tax studies and tax returns excluded from the allocation cost base ($162k)

		f.	Human Resources

		i.	% of effort – 3%

		ii.	Based on overall headcount – assumed average 10 Akcea headcount for 2015

A-1

		iii.	10 / 415 = 2.4% X 7 employees = 0.17 FTE 

		iv.	Rounded to 0.2 FTE as will require slightly more effort as Akcea headcount are all new hires rather than just ongoing support

		v.	Costs associated with Isis board and executive compensation (Barney & Barney), employee events and certain office supplies excluded from allocation cost base ($390k)

		g.	Legal

		i.	% of effort – 10%

		ii.	Work includes clinical trial support & initial forming of company

		iii.	Costs associated with proxy advisors and proxy printing excluded from allocation cost base ($27k)

		h.	Occupancy costs

		i.	% of effort – 8%

		ii.	Based of FTE’s to support Akcea vs overall G&A headcount

		iii.	Cost base based on Gazelle Ct costs, including property taxes and insurance, with allocation to G&A based on square footage occupied

		iv.	Added 30% to office/cube space to allow for allocation of common space

		v.	Costs specifically related to Labs excluded from occupancy cost base (Nitrogen supplies, lab equipment service contracts, specialized lab janitorial services)

R&D Support

		a.	R&D Allocations

		i.	% of effort – 5%

		ii.	Based on FTE’s to support Akcea vs overall R&D Support headcount 

		iii.	Cost base includes D&O insurance

		iv.	Costs excluded relate to equity adjustments and promotions becuase they pertain to 2014, amortization of non-Akcea related license fees, property taxes and property insurance (allocated as part of occupancy cost) ($4.2M) 

		b.	Information technology 

		i.	% of effort - 2% 

		ii.	Includes support services and help desk support only 

		iii.	Costs excluded from allocation cost base relate to Carlsbad phone and internet services ($165k)

		c.	Alliane Management

		i.	Assumes no costs allocated to Akcea

		d.	Business Development

		i.	% of effort – 3%

		ii.	% of effort includes work on initial partner discussions, term sheets, agreement negotiations, due diligence, presentations, CDA’s

		iii.	Costs for data rooms, consulting and in-licensing excluded from allocation cost base ($137k)

A-2

		e.	Graphics

		i.	Assumes no costs allocated to Akcea

		f.	Purchasing

		i.	% of effort – 5%

		ii.	Work performed includes contract negotiations, set up purchasing contracts, clinical ops purchasing involvement

		iii.	All shipping and receiving costs excluded from allocation cost base ($239k)

		g.	Facilities

		i.	Assumes no costs allocated to Akcea

		h.	Patents

		i.	% of effort – 10%

		ii.	Excluded costs include patent write-off’s and patent amortization for non-lipid drugs ($1.9M)

		i.	Health & Safety

		i.	Assumes no cost allocation to Akcea

		j.	MBO Accrual – Other R&D

		i.	Costs excluded as relate to other departments

		k.	Occupancy Costs

		i.	% of effort – 4%

		ii.	Based on FTE’s to support Akcea vs overall R&D Support headcount

		iii.	Cost base based on Gazelle Ct costs, including property taxes and insurances, with allocation to R&D Support based on square footage occupied

		iv.	Added 30% to office/cube space to allow for allocation of common space

		v.	Costs specifically related to Labs excluded from occupancy cost base (Nitrogen supplies, lab equipment service contracts, specialized lab janitorial services)

A-3

APPENDIX B

AUDIT RIGHTS AND PROCEDURES

During the Agreement Term and for a period of 36 months thereafter, at the request and expense of Akcea, Ionis will permit an independent certified public accountant of nationally recognized standing appointed by Ionis and agreed to by Akcea (such agreement not to be unreasonably withheld), at reasonable times and upon reasonable notice, but not more than once per Calendar Year, to examine such records as are necessary to verify the calculation and reporting of out-of-pocket expenses and the correctness of any invoice submitted to Akcea for payment for Services under this Agreement. As a condition to examining any records of Ionis, such auditor will sign a nondisclosure agreement reasonably acceptable to Ionis. Any records of Ionis examined by such accountant will be deemed Ionis’ Confidential Information. Upon completion of the audit, the accounting firm will provide both Parties with a written report disclosing whether the amounts invoiced by Ionis for payment by Akcea are correct or incorrect and the specific details concerning any discrepancies (“Audit Report”). If the Audit Report shows that Ionis’ invoices under this Agreement were more than the amount that should have been invoiced, then Ionis will reimburse Akcea the difference between such amounts to eliminate any discrepancy revealed by said inspection within 30 days of receiving the Audit Report, with interest calculated under Section 6. If the Audit Report shows that Ionis’ invoiced amounts under this Agreement were less than the amount that should have been invoiced, then Akcea will reimburse Ionis equal to the difference between the amounts which should have been invoiced and the actual invoiced amount. Akcea will pay for such audit, except that if Ionis is found to have incorrectly invoiced Akcea by more than 5% of the amount that should have been invoiced, Ionis will reimburse Akcea’s reasonable costs of the audit.

B-1

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