[AMERICAN HOME PRODUCTS CORPORATION LETTERHEAD]
August 20, 1997
William L. Respess, Esq.
Senior Vice President
General Counsel, Government Affairs
Ligand Pharmaceuticals, Inc.
9393 Towne Centre Drive
San Diego, CA 92121
Dear Larry:
Enclosed please find one fully executed original of the Third Amendment to
the Agreement. Best regards.
Sincerely,
/s/ GARRETT L. STACKMAN
-----------------------
Garrett L. Stackman
cc: George Tarnowski, Esq.
Wyeth-Ayerst Laboratories
THIRD AMENDMENT TO AGREEMENT
This Third Amendment to Agreement, effective September 2, 1997, is by and
between AMERICAN HOME PRODUCTS CORPORATION ("AHP"), A Delaware corporation,
as represented by its Wyeth-Ayerst Research Division, having its principal
place of business at 533 East Lancaster Pike, St. Davids, Pennsylvania, and
LIGAND PHARMACEUTICALS INCORPORATED ("Ligand"), a Delaware corporation having
its principal place of business at 9393 Towne Centre Drive, San Diego,
California.
WHEREAS, AHP and Ligand have previously entered into a Research, Development
and License Agreement effective September 2, 1994 (the "Agreement") under
which inter alia, AHP sponsors research at Ligand with the goal of
discovering and or/designing small molecule compounds which act through the
estrogen and progesterone receptors and to develop pharmaceutical products
from such compounds;
WHEREAS, the scope of the Agreement was subject to an Option Agreement
effective September 2, 1994 under which AHP had the option exercisable on or
after January 1, 1996 inter alia, to expand the scope of research at Ligand,
which option was timely exercised by AHD;
WHEREAS, the Agreement was amended pursuant to an Amendment to Agreement
effective January 16, 1996, inter alia, to permit Wyeth-Ayerst to develop
certain compounds originating from Ligand;
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WHEREAS, the Agreement was amended pursuant to a Second Amendment to
Agreement effective May 24, 1996, inter alia, to bring within the scope of
the Agreement certain compounds under development by AHP;
WHEREAS, the Agreement as modified by exercise of the Option Agreement and by
adoption of the Amendment to the Agreement and Second Amendment to Agreement
defines a Research Program which is subject to a Research Program Term which
expires September 2, 1997, unless extended by AHP pursuant to Section 3.3 of
the Agreement or by mutual agreement of the parties; and
WHEREAS, the parties wish to extend the Research Program Term for an
additional year and otherwise amend the modified Agreement, inter alia, to
limit the research at Ligand supported by AHP to the discover and/or design of
drugs acting through the progesterone receptor.
NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants
hereinafter set forth, it is agreed by AHP and Ligand as follows:
1. Terms not otherwise defined herein shall have the meanings given them in
the Agreement, the Option Agreement, the Amendment to Agreement or Second
Amendment to Agreement.
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2. The Research Program Term is extended until September 2, 1998. The
aggregate Annual Research Fee for contract year 4 shall be $2,000,000.
3. The composition of the PMC shall be as follows:
Ligand Representatives AHP Representatives
---------------------- -------------------
Dr. Leonard Fish Dr. Richard Lyttle
Dr. William Schrader Dr. Magid Abou-Gharbia
Dr. Todd Jones Dr. Richard Jackson
Dr. Andres Negro-Vilar (Alternate) Dr. Richard Winneker
(Alternate)
4. Effective September 3, 1997, Section 1.20 of the Agreement is amended
to read as follows:
1.20 "Research Compound" shall mean compound, including an Existing
Compound for which AHP acquires rights under Article 7 of this
Agreement, which is identified or confirmed as acting through or
mediating the activity of a Designated Receptor, provided further,
that (i) in the case of a compound which acts through or mediates the
estrogen receptor, identification or confirmation by Ligand must
occur prior to September 3, 1997 and by AHP prior to March 3, 1999
and (ii) in the case of a compound which acts through or mediates the
progesterone receptor (all isoforms and splice variants),
identification or
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confirmation must occur (a) during the term of the Research Program
or (b), except in the case of termination by AHP under Section 16.3,
below, by AHP within eighteen (18) months after expiration or earlier
termination of the Research Program.
5. Effective September 3, 1997, Section 3.3 of the Agreement is amended
by adding the following sentence at the end of that section:
Notwithstanding the foregoing, the one year extension of the Research
Program provided for in the Third Amendment to the Agreement does not
give rise to the obligation under the Stock and Note Purchase
Agreement to make the third installment as defined therein.
6. Effective September 3, 1997, Section 3.5.1 of the Agreement is
amended by deleting the last sentence and adding the following:
Additionally, except as expressly permitted under this Agreement,
Ligand shall not engage in any activity with any third party in the
Field prior to March 3, 1998 with respect to the discovery,
development or commercialization of a compound which acts through or
mediates the activity of the estrogen receptor (all isoforms and
splice variants).
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7. Effective September 3, 1997, Section 3.5.2 of the Agreement shall read
as follows:
3.5.2 Notwithstanding the provisions of Section 3.5.1 above, but subject
to AHP's license rights under Article 6 below and the parties'
confidentiality obligations set forth in Articles 13 and 14 below, during
the Research Program Term Ligand shall have the right to use Designated
Receptors to engage in (a) pilot internal research programs in the Field;
(b) compound screening with or for non-commercial third parties;
provided, however, that no screening shall be done with or for a non-
commercial third party under terms which do not provide Ligand with
material rights to progesterone ligands discovered in such screening
which would permit their adoption as Research Compounds under this
Agreement; and (c), alone or with any Affiliate or third party, to engage
in (i) cross-reactivity testing and (ii) toxicology testing. These
activities will not use a compound or information supplied by AHP or
information gained from screening compounds supplied by AHP. In the event
that a compound identified by Ligand as a part of the screening activity
under (a) or (b) above shares activity on the progesterone receptor and
another receptor, such a compound will be deemed a Research Compound if
so designated by the PMC.
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8. Effective September 3, 1997, Section 3.8 of the Agreement shall read
as follows:
Ligand-in-Licensed Compounds. Ligand retains the right to in-license from
third parties and develop and commercialize on its own behalf and through
third parties, including Affiliates and sublicensees, compounds which are
agonists or antagonists of the Designated Receptors; provided, however, that
until expiration of the Research Program Term, such in-licensed compounds
are, if they act through the progesterone receptor, at least development
stage compounds, but including more advanced compounds up to and including
compounds approved for marketing. As used in this Section 3.8, a "development
stage" compound is a compound requiring only process and scale-up development
and preclinical toxicology and pharmacology investigation to complete IND
requirements.
9. Effective September 3, 1997, Article 8 of the Agreement is amended by
the addition thereto of the following new Section 8.7:
8.7 Limited Extension of Designation of a Ligand Compound.
Ligand, having completed the screening of the WARD compound library in
accordance with Section 8.1 and 8.2 of the Agreement, has provided AHP with a
list of screened compounds it has identified as a result of that screening.
Section 8.3 of the Agreement provides that Ligand must give notice to AHP of
its intention to designate any screened compound(s) as lead compound(s)
within one year of
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Ligand's initial screening of the compound(s). As of the date of this Third
Amendment, Ligand has not given AHP any notice as described above.
Accordingly, in order to provide Ligand additional time to complete a full
evaluation of the compounds it has identified from the WARD compound library,
AHP shall extend the time for Ligand to designate a screened compound as a
lead compound for further development by a period not to exceed six (6)
months from the effective date of this Third Amendment. During that six (6)
month period, Ligand can request resupply of compounds as provided under the
last sentence of Section 8.2 of the Agreement that it has previously
screened.
10. Except as expressly amended or supplemental by this Third Amendment
to Agreement, all of the terms and conditions of the Agreement, Option
Agreement, Amendment to Agreement, and Second Amendment to Agreement shall
remain in full force and effect in accordance with their terms. No agreement
or understanding bearing in this Third shall be binding on either party
hereto unless it shall be in writing and signed by the duly authorized
officers or represenatatives of each AHP and Ligand shall expressly refer to
this Third Amendment to Agreement.
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IN WITNESS WHEREOF, the parties have caused the Amendment to be executed
by their duly authorized representatives.
AMERICAN HOME PRODUCTS LIGAND PHARMACEUTICALS
CORPORATION INCORPORATED
BY: /s/ Gerald A. Jibilian BY: /s/ William L. Respess
----------------------- -----------------------
(Signature) (Signature)
Title: Vice President Titles: Sr. Vice President,
General Counsel,
Government Affairs
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