Common use of Back-Up Compounds Clause in Contracts

Back-Up Compounds. Biogen Idec may, in its discretion, at any time during the Research Term, designate (i) any number of Development Compounds, (ii) any number of Lead Compounds that are Biogen Idec Proprietary Compounds and (iii) up to [***] Lead Compounds that are not Biogen Idec Proprietary Compounds as “Back-Up Compounds” with respect to any one Development Compound (such Development Compound, a “Primary Development Compound”). If Biogen Idec determines, in its sole discretion based on criteria similar to how Biogen Idec makes determinations with respect to its own therapeutic programs, taking into account such factors as development feasibility, commercial viability, and intellectual property protection, that the Development of a Primary Development Compound has not yielded sufficient progress and that Development activities with respect to such Primary Development Compound should be discontinued, then Biogen Idec may designate one of the Back-Up Compounds for such Primary Development Compound as a substitute for such Primary Development Compound, and such Back-Up Compound will then be considered the Primary Development Compound. In such case, the discontinued Primary Development Compound will be deemed to be a Back-Up Compound for such new Primary Development Compound. In order to maintain a Lead Compound as a Back-Up Compound, Biogen Idec will be required to establish that it is using Commercially Reasonable Efforts applicable to Back-Up Compounds in connection with the Development of such Back-Up Compound.

Back-Up Compounds. Biogen Idec Subject to Section 2.3(e) (Discontinued Compounds), Astellas may, in its discretion, at any time during the Research TermDevelopment Option Period for a Project, designate (i) any number of Development Compounds, (ii) any number of Lead Compounds that are Biogen Idec Proprietary Compounds and (iii) up to [***] Lead Active Compounds that are not Biogen Idec Proprietary Compounds from or derived from any Hit Series as “Back-Up Compounds” Compounds with respect to any one Development Compound Compound, in its discretion, (such Development Compound, a “Primary Development Compound”). If Biogen Idec determinesafter completion of the Research Term for a Project, Astellas determines in its sole discretion based on criteria similar to how Biogen Idec makes determinations with respect to its own therapeutic programs, taking into account such factors as development feasibility, commercial viability, and intellectual property protection, good faith that the Development of a Primary Development Compound for the applicable Project has not yielded sufficient progress and that Development activities with respect to such Primary Development Compound should be discontinued, then Biogen Idec Astellas may designate one of the Back-Up Compounds for such Primary Development Compound (an “Associated Back-Up Compound”) as a substitute for such Primary Development Compound, and such the Associated Back-Up Compound will then thereafter be considered the Primary Development CompoundCompound for such Project. In such case, the discontinued Primary Development Compound will thereafter be deemed considered to be a an Associated Back-Up Compound for such new Primary Development Compound. In order to maintain a Lead Compound as a Back-Up CompoundFor clarity, Biogen Idec will be required to establish that it is using Commercially Reasonable Efforts applicable to the substitution of any Back-Up Compounds for a Primary Development Compound is not the subject of the Research Milestone Payments with respect to “Designation by Astellas of each Development Compound” set forth in connection Section 6.3(a) (Research Milestones). With respect to any Associated Back-up Compounds, Astellas may pursue, at its sole discretion, IND-enabling Study and IND filing thereof in parallel with the Development of the Primary Development Compound, provided, however, that if Astellas commences clinical Development activities for an Associated Back-Up Compound in parallel with, or as a follow-on to, the Primary Development Compound (i.e., not as a substitute for the Primary Development Compound), then Astellas will pay to PTI the accumulated Research Milestone Payments that would have been payable to PTI if the applicable Associated Back-Up Compound had been designated by Astellas as a Development Compound from the outset, which accumulated Research Milestone Payments will become due on the date that the first human subject of the first Phase I Study receives a dose of such Associated Back-Up Compound.