Exclusive Research, Development, License And Manufacturing And Supply Agreement

EXHIBIT 10.33

FOIA CONFIDENTIAL TREATMENT REQUESTED

EXCLUSIVE RESEARCH, DEVELOPMENT, LICENSE AND MANUFACTURING

AND SUPPLY AGREEMENT

BY AND AMONG

NEKTAR THERAPEUTICS AL, CORPORATION

AND

BAXTER HEALTHCARE SA

AND BAXTER HEALTHCARE CORPORATION

DATED SEPTEMBER 26, 2005


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

TABLE OF CONTENTS

Page 1. DEFINITIONS 2 2. RESEARCH AND DEVELOPMENT ACTIVITIES 16 2.1 OVERVIEW 16 2.2 NEKTAR AL PAYMENTS 17 2.3 MARKETING AUTHORIZATION 18 2.4 MATERIALS 18 2.5 HANDLING 19 2.6 SELECTION OF POTENTIAL PRODUCTS AND [***] 20 2.7 DISCLAIMER OF WARRANTY WITH RESPECT TO BAXTER MATERIALS 20 3. GOVERNANCE 21 3.1 JOINT STEERING COMMITTEE 21 3.2 RESEARCH COMMITTEE 23 3.3 DEVELOPMENT AND PRODUCTION COMMITTEE 25 3.4 AMENDMENT; WAIVER 25 4. LICENSES TO NEKTAR AL LICENSED TECHNOLOGY AND BAXTER TECHNOLOGY 26


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-ii- 4.1 LICENSE TO BAXTER 26 4.2 TERMS OF SUBLICENSE 26 4.3 NEKTAR AL RESEARCH RIGHTS AND LIMITATIONS 27 4.4 NO IMPLIED RIGHTS OR LICENSES 28 4.5 LICENSE TO NEKTAR AL 28 4.6 MUTUAL COVENANT 28 5. MANUFACTURE AND SUPPLY OF SELECTED REAGENTS 29 5.1 [***] 29 5.2 SUPPLY PRIOR TO PIVOTAL TRIAL/SUPPLY AGREEMENT 29 5.3 PIVOTAL TRIAL AND COMMERCIAL PRODUCT SUPPLY AGREEMENT 30 6. SPECIFICATIONS AND MANUFACTURING WARRANTY FOR SELECTED REAGENTS 30 6.1 SPECIFICATIONS 30 6.2 COMPLIANCE AUDITS 31 6.3 WARRANTY 31 6.4 DISCLAIMER OF WARRANTY 32


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-iii- 7. EXCLUSIVITY; [***] 33 7.1 NEKTAR AL 33 7.2 BAXTER 33 8. QUALITY AND COMPLAINTS 34 8.1 ANALYSIS 34 8.2 ACCEPTANCE AND REJECTION 34 8.3 REPLACEMENT OF NONCONFORMING REAGENT 36 8.4 LIABILITY TO BAXTER FOR NONCONFORMING REAGENT 36 8.5 [INTENTIONALLY OMITTED] 37 8.6 FEES FOR MANUFACTURING AND SUPPLY OF SELECTED REAGENTS PRIOR TO PIVOTAL TRIAL 37 9. MILESTONES; ROYALTY PAYMENTS; ROYALTY REPORTS 38 9.1 MILESTONE PAYMENTS 38 9.2 ROYALTIES 42 9.3 SEPARATE COMPONENTS 44 9.4 COMMERCIAL DILIGENCE 45 9.5 REPORTS, EXCHANGE RATES 45 9.6 THIRD PARTY ROYALTIES, ETC 46


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-iv- 10. RECORDS; AUDITS; SHIPMENT TERMS; PAYMENT TERMS 47 10.1 RECORDS 47 10.2 AUDITS 47 10.3 INVOICING; PAYMENT TERMS 49 10.4 PAYMENT METHOD 49 10.5 TAXES 49 11. CONFIDENTIALITY 50 11.1 TERMINATION OF NON-DISCLOSURE AGREEMENT 50 11.2 IN GENERAL 50 11.3 ADDITIONAL PROTECTIONS 51 11.4 PERMITTED DISCLOSURES 52 11.5 IRREPARABLE INJURY 53 12. REGULATORY MATTERS 53 12.1 COMPLAINTS/ADVERSE EVENTS 53 12.2 SPECIFIC REQUIREMENTS 53 13. REPRESENTATIONS & WARRANTIES; COVENANTS 53 13.1 REPRESENTATIONS AND WARRANTIES 53


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-v- 13.2 COMPLIANCE WITH LAWS 54 14. LIMITATION OF LIABILITY; EXCLUSION OF DAMAGES 54 14.1 LIMITATION OF LIABILITY 54 14.2 REMEDIES 55 14.3 APPLICABILITY, EXCLUSIVITY OF REMEDIES 55 15. INDEMNIFICATION; INSURANCE 56 15.1 INDEMNITY 56 15.2 INSURANCE 57 15.3 PROCEDURES 57 16. INVENTIONS, KNOW-HOW AND PATENTS 59 16.1 EXISTING INTELLECTUAL PROPERTY 59 16.2 DISCLOSURE 59 16.3 OWNERSHIP OF INVENTIONS 59 16.4 NEKTAR AL CORE TECHNOLOGY INVENTIONS 60 16.5 BAXTER CORE TECHNOLOGY INVENTIONS 61 16.6 INDIVIDUAL PATENT FILINGS 61 16.7 JOINT PATENT FILINGS 61


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-vi- 16.8 DISPOSITION OF INVENTIONS 62 16.9 FURTHER ACTIONS 62 16.10 PATENT MARKING AND POTENTIAL PRODUCT AND COMMERCIAL PRODUCT MARKING 63 16.11 SUPPLEMENTAL PATENT PROTECTION 63 17. INFRINGEMENT 63 17.1 INFRINGEMENT OF THIRD PARTY RIGHTS 63 17.2 INFRINGEMENT BY THIRD PARTIES 65 18. [INTENTIONALLY OMITTED] 67 19. TERM AND TERMINATION 67 19.1 EXPIRATION 67 19.2 DISCRETIONARY TERMINATION 67 19.3 TERMINATION FOR CAUSE 67 19.4 TERMINATION FOR INSOLVENCY 68 19.5 TERMINATION/[***] FOR LACK OF DILIGENCE 68 19.6 TERMINATION ON CHALLENGE 71


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-vii- 19.7 EFFECT OF TERMINATION 71 20. ASSIGNMENT 74 21. NOTICES 74 22. MISCELLANEOUS 76 22.1 FORCE MAJEURE 76 22.2 SEVERABILITY 77 22.3 VARIATION 77 22.4 FORBEARANCE AND WAIVER 77 22.5 COUNTERPARTS; FACSIMILE 77 22.6 NO PARTNERSHIP 77 22.7 CONSTRUCTION 78 22.8 ENTIRE AGREEMENT 78 22.9 GOVERNING LAW 78 22.10 PUBLICITY 79


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-viii-

TABLE OF CONTENTS

(continued)


SCHEDULE I - RESEARCH PLAN

SCHEDULE II - MILESTONES

SCHEDULE III - QUALITY AGREEMENT

SCHEDULE IV - BAXTER DEVELOPMENT DILIGENCE TIMELINES

SCHEDULE V - TERMS AND CONDITIONS OF SUPPLY AGREEMENT SCHEDULE VI - MANUFACTURING COST

SCHEDULE VII - PERMITTED ACTIVITIES

EXHIBIT 1 - BAXTER RESEARCH PLAN

[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


-ix-

EXCLUSIVE RESEARCH, DEVELOPMENT, AND LICENSE

AGREEMENT

This Agreement (this " AGREEMENT" ) is made and entered into as of September 26, 2005 (the " EFFECTIVE DATE" ) by and among Nektar Therapeutics AL, Corporation, an Alabama corporation, having its principal place of business at 490 Discovery Drive, Huntsville, AL 35806 (" NEKTAR AL" ), Baxter Healthcare SA (" BHSA" ), a corporation organized and existing under the laws of Switzerland, and Baxter Healthcare Corporation (" BHC" ), a Delaware corporation, having its principal place of business at One Baxter Parkway, Deerfield, Illinois 60015 (BHSA and BHC collectively referred to as " BAXTER" ). NEKTAR AL and BAXTER may be referred to herein individually as a " PARTY" and collectively as the " PARTIES." RECITALS

WHEREAS, BAXTER is in the business of developing, making, marketing and selling biopharmaceutical products for the treatment of bleeding disorders;

WHEREAS, NEKTAR AL has proprietary technology useful for attaching poly(ethylene) glycol-based molecules to pharmaceutical compounds, and is engaged in the business of performing research in relation to REAGENTS and CONJUGATES and manufacturing bulk quantities of REAGENTS used in the manufacture of pharmaceutical products;

WHEREAS, BAXTER has developed proprietary technology concerning FACTOR VIII and [***], including the [***] for improving the half-life of FACTOR VIII, and desires to continue such development by entering into an exclusive research and development agreement with NEKTAR AL for the purpose of determining whether NEKTAR AL' s proprietary technology can improve the same, and NEKTAR AL desires to exclusively partner with BAXTER to perform such continued development for extending the half-life of FACTOR VIII using its proprietary technology directly with FACTOR VIII or [***];

[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


1

WHEREAS, BAXTER desires to provide NEKTAR AL with recombinant FACTOR VIII and [***] to use in developing SELECTED REAGENTS and CONJUGATES, and NEKTAR AL desires to, as provided for in this AGREEMENT, provide BAXTER with CONJUGATES and SELECTED REAGENTS for BAXTER' s evaluation and potential pre-clinical, clinical and/or commercial development;

WHEREAS, BAXTER shall bear all costs associated with the research and development of NEKTAR AL' s CONJUGATES and REAGENTS into POTENTIAL PRODUCTS and COMMERCIAL PRODUCTS, and shall have ultimate control over all product development decisions;

WHEREAS, NEKTAR AL desires to manufacture and supply BAXTER with all of its SELECTED REAGENT requirements (including pre-clinical, clinical trial, POTENTIAL PRODUCT and COMMERCIAL PRODUCT requirements) and BAXTER desires to satisfy all of its SELECTED REAGENT requirements from NEKTAR AL; and WHEREAS, BAXTER shall have an exclusive license to any POTENTIAL PRODUCTS or COMMERCIAL PRODUCTS developed in the course of this AGREEMENT. NOW, THEREFORE, in consideration of the foregoing and the covenants and promises contained in this AGREEMENT and in accordance with and subject to the terms and conditions specified below, the PARTIES agree as follows:

AGREEMENT 1.

Definitions

1.1

" AFFILIATE" means, with respect to any person or entity, any other person or entity that directly or indirectly controls, is controlled by, or is under common control with, such person or entity. For purposes of this definition only, " control," " controlled by" and " under common control with" shall mean the possession of the power to direct or


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


2

cause the direction of the management and policies of an entity, whether through the ownership of voting stock or partnership interest, by contract or otherwise. In the case of a corporation, the direct or indirect ownership of fifty percent (50%) or more of its outstanding voting shares or the ability otherwise to elect a majority of the board of directors or other managing authority of the entity shall in any event be deemed to confer control, it being understood that the direct or indirect ownership of a lesser percentage of such shares shall not necessarily preclude the existence of control. 1.2" BAXTER CORE TECHNOLOGY" means:

(i) [***];

(ii) a composition of a [***] as disclosed in any of the examples of the [***] on the EFFECTIVE DATE, or [***] shall not fall within the BAXTER CORE TECHNOLOGY and shall instead be considered JOINTLY OWNED TECHNOLOGY;

(iii) a method of: (a) [***]; provided that in each case none of such methods employs a NEKTAR PROPRIETARY METHOD on the EFFECTIVE DATE. (iv) methods of [***];

(v) methods of [***];

(vi) methods of [***];

(vii) [***];

(viii) methods of [***];

(ix) the methods [***]


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


3 (x) [***].

1.3" BAXTER CORE TECHNOLOGY INVENTIONS" has the meaning set forth in Section 16.5. 1.4" BAXTER INDEMNITEE" has the meaning set forth in Section 15.1.1.

1.5" BAXTER KNOW-HOW" means all KNOW-HOW [***]. For the avoidance of doubt, [***] are excluded from the definition of BAXTER KNOW-HOW. 1.6" BAXTER MATERIALS" has the meaning set forth in Section 2.4.2.

1.7" BAXTER PATENT RIGHTS" means all claims in those PATENTS and PATENT APPLICATIONS (i) [***] and (ii) that [***]. 1.8" BAXTER PROPRIETARY CONJUGATE" means a CONJUGATE, the composition of matter, manufacture, use, offer for sale, sale or import of which is covered by a claim of the [***].

1.9 [***] means BAXTER' s provisional patent applications [***] (the " PROVISIONALS" ), and any U.S. or other patent applications claiming priority therefrom, including any continuation, divisional, reissue, reexamination or substitution (and in each case any foreign counterpart thereto), and any extension, renewal or supplemental protection certificate; provided that the only additional information that may be added after the EFFECTIVE DATE to the disclosure of the PROVISIONALS (" ADDITIONAL INFORMATION" ) in the preparation of a U.S. or other patent application claiming priority from the PROVISIONALS shall be [***]. For avoidance of doubt, BAXTER agrees that (a) [***].

1.10

" BLA" means a Biologics License Application filed with the FDA pursuant to 21


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


4

C.F.R. a7 601.2 et seq., or any foreign equivalent filed with the regulatory authorities in a country or territory to obtain MARKETING AUTHORIZATION for a COMMERCIAL PRODUCT in such country or territory.

1.11" CLAIMS" has the meaning set forth in Section 15.1.1.

1.12" COMMERCIAL DILIGENCE THRESHOLD" has the meaning set forth in Section 9.4. 1.13" COMMERCIAL PRODUCT" means any POTENTIAL PRODUCT that has received MARKETING AUTHORIZATION which BAXTER, its AFFILIATES and/or SUBLICENSEES market and/or sell for administration to or use by humans or animals.

1.14" CONFIDENTIAL INFORMATION" has the meaning set forth in Section 11.2.

1.15" CONJUGATE(S)" means any chemical entity obtained by the PEGYLATION of a REAGENT to a therapeutic agent (including a THERAPEUTIC AGENT). 1.16" CONTRACT MANUFACTURER" means a THIRD PARTY who (a) manufactures POTENTIAL PRODUCT or COMMERCIAL PRODUCT on behalf of BAXTER as permitted herein, or (b) manufactures SELECTED REAGENT as permitted under and pursuant to Schedule V.

1.17" CONTROL(LED)" means the ability to grant a license or sublicense as provided for herein without violating the terms of any agreement or other arrangement with any THIRD PARTY and, with respect to KNOW-HOW, also means that which is not known to the other PARTY prior to disclosure thereto (whether under this AGREEMENT or the NON-DISCLOSURE AGREEMENT), nor freely available from the public domain or THIRD PARTIES.


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


5 1.18" DEVELOPMENT AND PRODUCTION COMMITTEE" means the committee described in Section 3.3. 1.19" DISCLOSING PARTY" means the PARTY disclosing CONFIDENTIAL INFORMATION to the other PARTY hereunder. 1.20" DOLLAR(S)" means United States dollars.

1.21" EMEA" means the European Medicines Evaluation Agency, and any successor agency thereto having the administrative authority to regulate the marketing of human pharmaceutical products, biological therapeutic products and delivery systems in the European Union.

1.22" ESTIMATED COST" has the meaning set forth in Schedule VI.

1.23 [***] means a compound that is a [***]. For clarity, [***].

1.24" FACTOR VIII" means a compound that is a Factor VIII molecule [***]. For clarity, [***]. 1.25" FDA" means the United States Food and Drug Administration or any successor entity that may be established hereafter which has substantially the same authority or responsibility currently vested in the United States Food and Drug Administration.

1.26" FIELD" means [***], either for use alone for the treatment of [***], in the treatment of Hemophilia A, or PEGYLATED FACTOR VIII or [***] for the treatment of Hemophilia A.

1.27" FIRST COMMERCIAL SALE" means, with respect to a COMMERCIAL PRODUCT, the first sale by BAXTER or its AFFILIATES or SUBLICENSEES to a THIRD PARTY following receipt of MARKETING AUTHORIZATION for such COMMERCIAL PRODUCT in the country of sale.


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


6 1.28" FTE" means the equivalent of an employee working [***] labor hours per year. 1.29" FTE RATE" has the meaning set forth in Section 2.2. 1.30 " GAAP" has the meaning set forth in Schedule VI. 1.31" INITIAL ROYALTY TERM" has the meaning set forth in Section 9.2.

1.32" INVENTIONS" means any and all ideas, concepts, methods, procedures, processes, improvements, inventions and discoveries, whether or not patentable, that are conceived or first reduced to practice during and in the course of the performance of activities conducted in connection with this AGREEMENT, including the development or manufacture of a POTENTIAL PRODUCT or a COMMERCIAL PRODUCT. 1.33" JOINT INVENTION" has the meaning set forth in Section 16.3.

1.34" JOINT PATENT APPLICATIONS" and " JOINT PATENT" have the meanings set forth in Section 16.7. 1.35" JOINT STEERING COMMITTEE" means the committee described in Section 3.1. 1.36" JOINTLY OWNED TECHNOLOGY" means an INVENTION covering the composition of [***]. 1.37

" KNOW-HOW" means all technical, scientific and other know-how, data, materials, information, trade secrets, ideas, formulae, inventions, discoveries, processes, machines, compositions of matter, improvements, protocols, techniques, works of authorship, and results of experimentation and testing (whether or not patentable) in written, electronic, oral or any other form that is not known to the other PARTY prior


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


7

to disclosure thereto (whether under this AGREEMENT or the NON-DISCLOSURE AGREEMENT), nor freely available from the public domain or from THIRD PARTIES.

1.38" LAW(S)" means any local, state or federal rule, regulation, statute or law in any jurisdiction relevant to the activities undertaken pursuant to this AGREEMENT or applicable to either of the PARTIES with respect to any matters set forth herein.

1.39" MAJOR MARKETS" has the meaning set forth in Section 9.2.1.

1.40" MANUFACTURING COST" has the meaning set forth in Schedule VI.

1.41" MARKETING AUTHORIZATION" means the requisite governmental approval for the marketing and sale of a COMMERCIAL PRODUCT in a given country. 1.42" MILESTONE" means the milestone payments set forth in Schedule II.

1.43" NEKTAR AL CORE TECHNOLOGY" means:

(i) [***];

(ii) methods of [***];

(iii) methods of [***];

(iv) methods of [***];

(v) methods of [***];

(vi) [***]

(vii) methods of [***].

1.44" NEKTAR AL CORE TECHNOLOGY INVENTIONS" has the meaning set forth in Section 16.4.


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


8 1.45" NEKTAR AL INDEMNITEE" has the meaning set forth in Section 15.1.2.

1.46" NEKTAR AL KNOW-HOW" means all KNOW-HOW [***].

1.47" NEKTAR AL LICENSED TECHNOLOGY" means, collectively, the NEKTAR AL PATENT RIGHTS and NEKTAR AL KNOW-HOW. 1.48" NEKTAR AL MATERIALS" has the meaning set forth in Section 2.4.1.

1.49" NEKTAR AL PATENT RIGHTS" means all of the claims in those PATENTS and PATENT APPLICATIONS CONTROLLED by NEKTAR AL which (i) pertain to [***].

1.50" NEKTAR PROPRIETARY METHODS" means (i) [***].

1.51" NEKTAR PROPRIETARY REAGENT" means a REAGENT, the composition of matter, manufacture, use, offer for sale, sale or import of which is covered by [***].

1.52" NET SALES" means the amount invoiced by BAXTER, its AFFILIATES or SUBLICENSEES for the sale to THIRD PARTIES of COMMERCIAL PRODUCT commencing with the FIRST COMMERCIAL SALE. [***]:

(i) [***];

(ii) [***];

(iii) [***];

(iv) [***]

(v) [***].


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


9

In addition to the foregoing [***], BAXTER may [***] of the aggregate gross amount invoiced on account of sales of a COMMERCIAL PRODUCT by BAXTER, its AFFILIATES or SUBLICENSEES to THIRD PARTIES in the relevant country during the relevant calendar quarter in respect of which royalties are being calculated or (b) [***] during the relevant calendar quarter in respect of which royalties are being calculated.

[***]. In addition, BAXTER' S NET SALES hereunder are subject to the following:

(A) [***];

(B) [***];

(C) [***].

1.53" NONCONFORMING REAGENTS" has the meaning set forth in Section 6.3.

1.54" NON-DISCLOSURE AGREEMENT" means that agreement entered into between the PARTIES on [***], providing for confidential treatment of the PARTIES' information.

1.55" PATENT" means any claim in a patent including any extension, substitution, registration, confirmation, reissue, supplemental protection certificate, re-examination or renewal of such patent, to the extent valid and enforceable rights are granted by a governmental authority thereunder (and in each case any foreign counterpart thereto). 1.56" PATENT APPLICATION" means any claim in an application for letters patent, including a provisional application, converted provisional application, continuation application, a continued prosecution application, a continuation-in-part application, a divisional application, a re-examination application, and a reissue application (and in each case any foreign counterpart thereto).

[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


10 1.57" PEG" means poly(ethylene) glycol.

1.58" PEGYLATION," with correlative meanings " PEGYLATED" or to " PEGYLATE" , means covalent chemical bonding of any REAGENT (including a SELECTED REAGENT and including covalent chemical bonding through linking groups), with or to another material or materials. Such materials include, without limitation, proteins, peptides, polymers, oligomers, oligonucleotides, other biomolecules, small molecules, therapeutic agents (including a THERAPEUTIC AGENT), diagnostic agents, imaging agents and detectable labels. Additional materials that may be PEGYLATED include, without limitation, polymers, liposomes, films, chemical separation and purification surfaces, solid supports, metal/metal oxide surfaces and other surfaces such as, by way of example but not limitation, those on implanted devices, and equipment, where a REAGENT is covalently chemically bonded to one or more reactive molecules on the surface of such device or equipment. " PEGYLATION" shall include the synthesis, derivatization, characterization, and modification of PEG for such purposes, together with the synthesis, derivatization, characterization, and modification of the raw materials and intermediates for the manufacture of REAGENTS (including SELECTED REAGENTS) or products (including POTENTIAL PRODUCTS and COMMERCIAL PRODUCTS) incorporating such REAGENT by means of covalent chemical bonding, and all methods of making and using each and all of the foregoing.

1.59" PHASE 1 CLINICAL TRIAL" means the first lawful study in humans, conducted in accordance with 21 C.F.R. a7312.21(a) (or the equivalent LAWS and regulations in jurisdictions outside the United States).


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


11 1.60" PHASE 2 CLINICAL TRIAL" means a controlled clinical trial, conducted in accordance with 21 C.F.R. a7312.21(b) (or the equivalent LAWS and regulations in jurisdictions outside the United States).

1.61" PIVOTAL TRIAL," also known as a Phase 3 clinical trial, means a controlled or uncontrolled clinical trial, conducted in accordance with a7 21 C.F.R. 312.21(c) (or the equivalent LAWS and regulations in jurisdictions outside the United States).

1.62" POTENTIAL PRODUCT" means (i) any chemical entity resulting from attachment of any THERAPEUTIC AGENT to a SELECTED REAGENT by means of PEGYLATION that is selected by the RESEARCH COMMITTEE or (ii) any product using PEGYLATION to extend or otherwise improve the half-life of [***] FACTOR VIII, whether by using PEGYLATION technology directly with [***] FACTOR VIII, or by means of the PEGYLATION of [***].

1.63" PURCHASE PRICE" has the meaning set forth in Section 8.6.1

1.64" QUALITY AGREEMENT(S)" shall include:

(i) the quality agreement governing the manufacture and supply of [***], which shall be negotiated by the PARTIES [***]; and (ii) the quality agreement governing the manufacture and supply of [***], which shall be negotiated by the PARTIES [***]. The QUALITY AGREEMENT(S) shall be in substantially the same form as Schedule III hereto. For purposes hereof, [***]. 1.65" REAGENT" means a PEG derivative used in the manufacture of a pharmaceutical or diagnostic product or medical device, including a SELECTED REAGENT.


[***] indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.


12 1.66" RECIPIENT" means the PARTY receiving CONFIDENTIAL INFORMATION hereunder.

1.67" RESEARCH COMMITTEE" means the committee described in Section 3.2.

1.68" RESEARCH PLAN" means the PARTIES' respective activities and responsibilities as set forth in the RESEARCH PLAN attached hereto as Schedule I, as amended and revised by the RESEARCH COMMITTEE from time to time.

1.69" RESPONSIBLE PARTY" has the meaning set forth in Section 16.7.

1.70" ROYALTY RATE" means the following:

(i) [***] NET SALES of all COMMERCIAL PRODUCTS sold in a calendar year;

(ii) [***] NET SALES of all COMMERCIAL PRODUCTS sold in such calendar year; and

(iii) (iii) [***] NET SALES of all COMMERCIAL PRODUCTS sold in such calendar year [***].

By way of example but not limitation, if NET SALES of all COMMERCIAL PRODUCTS sold in a calendar year are [***] then BAXTER shall pay to NEKTAR AL a royalty of [***] on the [***] of such NET SALES, [***] on the portion of such NET SALES between [***] and [***] and [***] on the portion of such NET SALES [***]. For clarity, the ROYALTY RATE shall be applied to the aggregate annual worldwide NET SALES of all COMMERCIAL PRODUCTS, and [***]. By way of example but not limitation, if during any one calendar year, there are two (2) COMMERCIAL PRO ...