FINANCING AGREEMENT Dated as of April 29, 2010 between NEUROGESX, INC. and COWEN HEALTHCARE ROYALTY PARTNERS, L.P.

Exhibit 10.2

[***]CERTAIN INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

EXECUTION COPY

FINANCING AGREEMENT

Dated as of April 29, 2010

between

NEUROGESX, INC.

and

XXXXX HEALTHCARE ROYALTY PARTNERS, L.P.

TABLE OF CONTENTS


			Page

ARTICLE I DEFINITIONS			1

	Section 1.01	Definitions	1

ARTICLE II ASSIGNMENT			11

	Section 2.01	Assignments	11

	Section 2.02	Payments to CHRP	12

	Section 2.03	Advances to NeurogesX	13

	Section 2.04	No Assumed Obligations	13

	Section 2.05	Excluded Assets	14

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE ASSIGNOR			14

	Section 3.01	Organization	14

	Section 3.02	Corporate Authorization	14

	Section 3.03	Governmental Authorization	14

	Section 3.04	Ownership	15

	Section 3.05	Financial Statements	15

	Section 3.06	No Undisclosed Liabilities	16

	Section 3.07	Solvency	16

	Section 3.08	Litigation	16

	Section 3.09	Compliance with Laws	16

	Section 3.10	Conflicts	16

	Section 3.11	Subordination	17

	Section 3.12	Intellectual Property	17

	Section 3.13	Regulatory Approval	20

	Section 3.14	Material Contracts	20

	Section 3.15	Place of Business	22

	Section 3.16	Broker’s Fees	22

	Section 3.17	Information	22

	Section 3.18	Security Agreement	22

	Section 3.19	Bankruptcy Event	23

	Section 3.20	Material Adverse Effect	23

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	Section 3.21	Field of Use	23

	Section 3.22	No Other Representations	23

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF CHRP			23

	Section 4.01	Organization	23

	Section 4.02	Authorization	23

	Section 4.03	Broker’s Fees	24

	Section 4.04	Conflicts	24

	Section 4.05	Financial Capacity	24

ARTICLE V COVENANTS			24

	Section 5.01	Consents and Waivers	24

	Section 5.02	Access; Information	24

	Section 5.03	Material Contracts	25

	Section 5.04	Confidentiality; Public Announcement	27

	Section 5.05	Security Agreement	28

	Section 5.06	Further Assurance	28

	Section 5.07	Remittance to Initial Concentration Account	29

	Section 5.08	Intellectual Property	31

	Section 5.09	Negative Covenants	32

	Section 5.10	Competing Products	32

	Section 5.11	Notice	33

ARTICLE VI THE CLOSING; CONDITIONS TO CLOSING			33

	Section 6.01	Closing	33

	Section 6.02	Conditions Applicable to CHRP to Effect the Closing	33

	Section 6.03	Conditions Applicable to NeurogesX	35

ARTICLE VII TERMINATION			35

	Section 7.01	Term	35

	Section 7.02	Termination	35

	Section 7.03	Effects of Expiration or Termination	37

ARTICLE VIII MISCELLANEOUS			38

	Section 8.01	Survival	38

	Section 8.02	Specific Performance	38

	Section 8.03	Notices	38

	Section 8.04	Successors and Assigns	39

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Section 8.05	Indemnification	40

Section 8.06	Independent Nature of Relationship	41

Section 8.07	Tax	42

Section 8.08	Entire Agreement	42

Section 8.09	Amendments; No Waivers	42

Section 8.10	Interpretation	43

Section 8.11	Headings and Captions	43

Section 8.12	Counterparts; Effectiveness	43

Section 8.13	Severability	43

Section 8.14	Expenses	43

Section 8.15	Governing Law; Jurisdiction	43

Section 8.16	Waiver of Jury Trial	44

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EXHIBITS


Exhibit A	–	Form of Assignment Agreement
Exhibit B	–	CHRP Replacement License Agreement
Exhibit C	–	Copy of Existing License Agreement
Exhibit D	–	Form of Security Agreement
Exhibit E	–	Legal Opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, PC
		(Transaction Opinion – U.S.)
Exhibit F	–	Legal Opinion of Xxxxxxxx & Xxxxxxxx LLP (IP Opinion)
Exhibit G-1	–	Form of Astellas Consent
Exhibit G-2	–	Form of LTS Consent
Exhibit G-3	–	Form of The Regents Consent
Exhibit H	–	Form of Licensee Direction
Exhibit I	–	Form of Officer’s Certificate (NeurogesX)
Exhibit J	–	Form of Officer’s Certificate (CHRP)
Exhibit K	–	Form of Deposit Agreement
Exhibit L	–	Amortization Schedule
Exhibit M	–	Joint Press Release

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This FINANCING AGREEMENT (as amended, supplemented or otherwise modified from time to time in accordance herewith, this “Agreement”) is made and entered into as of April 29, 2010 between NeurogesX, Inc., a corporation organized under the laws of the State of Delaware (“NeurogesX”), and Xxxxx Healthcare Royalty Partners, L.P., a limited partnership organized under the laws of the State of Delaware (“CHRP”).

WHEREAS, NeurogesX has previously entered into the Existing License Agreement (as hereinafter defined) with Astellas (as hereinafter defined) relating to the development and commercialization of the Licensed Product (as hereinafter defined); and

WHEREAS, under the terms of the Existing License Agreement, NeurogesX has the right, among other things, to receive Sales Milestones, Earned Royalties, the Option Retention Fee and the Option Exercise Fee (as such terms are defined in the Existing License Agreement); and

WHEREAS, NeurogesX wishes to borrow the Revenue Investment Advance from CHRP and CHRP is willing to lend the Revenue Investment Advance to NeurogesX; and

WHEREAS, NeurogesX is willing to assign, convey and transfer to CHRP, and CHRP wishes to accept the assignment, conveyance, and transfer from NeurogesX of the Assigned Rights (as hereinafter defined), upon and subject to the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants, agreements representations and warranties set forth herein, the Parties hereto agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions

The following terms, as used herein, shall have the following meanings:

“Account Instruction” shall have the meaning set forth in the Deposit Agreement.

“Actual Knowledge” shall mean the actual knowledge of a key employee (i.e., officer, general manager and internal counsel) of NeurogesX relating to a particular matter.

“Affiliate” shall mean, with respect to a particular Party, any corporation or non-corporate business entity that, directly or indirectly, controls, is controlled by, or is under common control with such Party. For purposes of this definition, an entity will be regarded as in control of another entity (with correlative meanings for “controlled by” and “under common control with”) if: (a) such entity owns, directly or indirectly, at least fifty percent (50%) of the securities or capital stock with the ability to vote to elect directors (or similar controlling management) of such entity, or has other comparable ownership and voting interest with respect to any entity other than a corporation; or (b) it possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of the corporation or non-corporate

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business entity, as applicable, whether through the ownership or control of voting securities, by contract or otherwise.

“Agreement” shall have the meaning set forth in the first paragraph hereof.

“Assigned Rights” shall mean all rights of NeurogesX and its Subsidiaries under the License Agreement, in and to the Revenue Interest.

“Assignment Agreement” shall mean that agreement substantially in the form of Exhibit A pursuant to which NeurogesX shall, assign, convey and transfer to CHRP the Assigned Rights, all on the terms and conditions as set forth therein.

“Astellas” shall mean Astellas Pharma Europe Ltd., a company organized under the laws of the United Kingdom, and its permitted successors and assigns under the Existing License Agreement.

“Bankruptcy Event” shall mean with respect to a Person, the occurrence of any of the following:

(a) commencement by such Person of any case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, relief of debtors or the like, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its respective debts, or (B) seeking appointment of a receiver, trustee, custodian or other similar official for it or for all or any portion of its assets, or such Person shall make a general assignment for the benefit of its creditors; or

(b) there shall be commenced against such Person any case, proceeding or other action of a nature referred to in subsection (a) above which remains undismissed, undischarged or unbonded for a period of sixty (60) calendar days; or

(c) there shall be commenced against such Person any case, proceeding or other action seeking issuance of a warrant of attachment, execution or distraint or similar process against (A) all or any substantial portion of its assets and/or (B) the Licensed Product or any substantial portion of the Intellectual Property related to the Licensed Product, which results in the entry of an order for any such relief which shall not have been vacated, discharged, stayed, satisfied or bonded pending appeal within sixty (60) calendar days from the entry thereof; or

(d) such Person shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any case, proceeding or other action set forth in subsection (a), (b) or (c) above; or

(e) such Person shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due, shall be insolvent under any applicable law, or

(f) such Person does not have liquid assets equal to at least such Person’s liabilities due and payable during the immediately following three (3) months.

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“Business Day” shall mean any day other than a Saturday and Sunday, any day which is a legal holiday under the laws of the State of New York, or any day on which banking institutions located in the State of New York are required by law or other governmental action to close or are not otherwise open for banking business.

“CAP Amount” shall mean a rate of return at the Rate of Interest.

“CHRP” shall have the meaning set forth in the first paragraph hereof.

“CHRP Concentration Account” shall mean a segregated account established for the benefit of CHRP and maintained at the Depositary Bank pursuant to the terms of the Deposit Agreement and this Agreement. The CHRP Concentration Account shall be the account into which the funds first held in the Joint Concentration Account that are payable to CHRP pursuant to this Agreement are swept daily by the Depositary Bank in accordance with the terms of this Agreement and the Deposit Agreement.

“CHRP Indemnified Party” shall have the meaning set forth in Section 8.05(a).

“CHRP Replacement License Agreement” shall mean the License Agreement between NeurogesX and CHRP granting CHRP, subject to (i) the terms and conditions thereof, and (ii) the rights of Astellas under the Existing License Agreement, an irrevocable, royalty-free, assignable and sublicenseable license under the Intellectual Property with respect to the Licensed Products for the Territory, in the form of Exhibit B, annexed hereto, to protect CHRP’s interests in the event of a termination of the Existing License Agreement by enabling it to negotiate and enter into a Replacement License Agreement.

“Closing” shall have the meaning set forth in Section 6.01.

“Closing Date” shall mean the date on which the Revenue Interest Advance is received in the account designated by NeurogesX in accordance with Section 2.03(b).

“Collateral” shall have the meaning set forth in the Security Agreement.

“Competitive Product” shall have the meaning set forth in the Existing License Agreement.

“Confidential Information” shall mean, with respect to a Party, all secret, confidential or proprietary information or data, whether provided in writing, orally, graphically, electronically or other form, provided by such Party (the “Disclosing Party”) to the other Party (the “Receiving Party”), which may include without limitation information relating to the Disclosing Party’s existing or proposed research, development efforts, patent applications, business or products and any other materials that have not been made available by the Disclosing Party to the general public. Notwithstanding the foregoing, the term “Confidential Information” shall not include any information or materials that the Receiving Party can demonstrate by documentary evidence:

(a) were already known to the Receiving Party (other than under an obligation of confidentiality), at the time of disclosure by the Disclosing Party;

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(b) were generally available to the public or otherwise part of the public domain at the time of their disclosure to the Receiving Party;

(c) became generally available to the public or otherwise part of the public domain after their disclosure, other than through any act or omission of the Receiving Party in breach of its confidentiality obligations under this Agreement;

(d) were subsequently lawfully disclosed to the Receiving Party by a Third Party who had no obligation to the Disclosing Party not to disclose such information to others;

(e) were independently discovered or developed by or on behalf of the Receiving Party by individuals who had no access to and without the use of the Confidential Information belonging to the Disclosing Party; or

(f) is approved for general release by the Disclosing Party in writing.

“Deposit Accounts” shall mean, collectively, the Initial Concentration Account, the Joint Concentration Account, the NeurogesX Concentration Account and the CHRP Concentration Account, each established and maintained pursuant to the Deposit Agreement.

“Deposit Agreement” shall mean any agreement (including initially that certain Deposit Account Control Agreement substantially in the form of Exhibit K attached hereto) entered into by the Depositary Bank, NeurogesX and CHRP, pursuant to which, among other things, the Deposit Accounts shall be established and maintained.

“Depository Bank” shall mean JPMorgan Chase Bank, N.A. or such other bank or financial institution approved by each of CHRP and NeurogesX in their respective sole discretions.

“Development Cost” shall mean the actual and direct costs incurred in connection with the development and testing of a product, including actual costs of services provided by Third Parties, efforts of employees of NeurogesX or its Affiliates in performing activities at the actual costs of such employees determined in accordance with GAAP, costs of raw materials, supplies and other resources directly consumed in the development of the product and other direct, out of pocket costs, and “fixed costs”. For purposes of this definition, “fixed costs” shall mean the costs of facilities, utilities, insurance, facility, and equipment depreciation, and other fixed costs allocable on a reasonable basis to the development of the product, without xxxx-ups of NeurogesX or its Affiliates. All costs determinations shall be made in accordance with GAAP.

“Dispute” shall have the meaning set forth in Section 3.12(j).

“Dollars” or “$” shall mean U.S. Dollars.

“Earned Royalties” shall have the meaning set forth in the Existing License Agreement.

“Existing License Agreement” shall have the meaning set forth in the definition of License Agreement herein.

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“Excluded Liabilities and Obligations” shall have the meaning set forth in Section 2.04.

“Excluded Revenue Interests” shall have the meaning set forth in the definition of “Revenue Interest.”

“Exploit” shall mean, with respect to a product, the manufacture, sale, offer for sale (including marketing and promotion), importation, distribution or other commercialization or exploitation of such product; and “Exploitation” shall have the correlative meaning.

“FDA” shall mean the United States Food and Drug Administration or any successor federal agency thereto.

“Field” shall mean the [***] of any condition in humans.

“Financial Statements” shall mean the audited balance sheets of NeurogesX as of December 31, 2009 and 2008, and the related audited statements of operations, stockholders’ equity, and cash flows of NeurogesX for the year ended December 31, 2009 and 2008 and the accompanying footnotes thereto.

“First Commercial Sale” shall have the meaning set forth in the Existing License Agreement.

“First Stepdown” shall mean the sum of Revenue Interest Payments actually received by CHRP equals $90 million.

“GAAP” shall mean United States generally accepted accounting principles as interpreted and accepted by the Financial Accounting Standards Board, consistently applied through the applicable entity’s organization.

“Governmental Authority” shall mean any government, court, regulatory or administrative agency or commission, or other governmental authority, agency or instrumentality, whether foreign, federal, state or local (domestic or foreign), including any Patent Office, the FDA, the United States National Institutes of Health, or any other government authority in any country.

“Initial Concentration Account” shall mean the deposit account established and maintained at the Depositary Bank pursuant to the Deposit Agreement and this Agreement. The Initial Concentration Account shall be the account into which all payments made in respect of the Revenue Interest are to be remitted or deposited in the first instance in accordance with the terms of this Agreement and the Deposit Agreement.

“Intellectual Property” shall mean all proprietary information; trade secrets; Know-How; utility models; confidential information; inventions (whether patentable or unpatentable and whether or not reduced to practice or claimed in a pending patent application) and improvements thereto; Patents; registered or unregistered trademarks, trade names and service marks, including all goodwill associated therewith; registered and unregistered copyrights and all applications thereof; in each case that (i) are owned, controlled by, issued to, licensed to, licensed by or hereafter acquired by or licensed by NeurogesX or its Subsidiaries, including, without limitation,

[***]

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

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any intellectual property subject to the agreements listed on Schedule 3.12(b) and (ii) relating to, embodied by, covering or involving or necessary or used to (a) manufacture or have manufactured, the Licensed Products for Exploitation in the Territory or (b) sell, have sold, market, or have marketed, the Licensed Products, in each case in the Territory. For the sake of clarity, nothing contained in any Transaction Document shall be deemed to limit or otherwise restrict the rights of NeurogesX to manufacture or have manufactured Licensed Products inside or outside the Territory for commercialization outside of the Territory.

“Joint Concentration Account” shall mean a segregated account for the benefit of NeurogesX and CHRP and maintained at the Depositary Bank pursuant to the terms of the Deposit Agreement and this Agreement. The Joint Concentration Account shall be the account into which the Depositary Bank sweeps on a daily basis the funds held in the Initial Concentration Account in accordance with the terms of this Agreement and the Deposit Agreement.

“Know-How” shall mean all non-public information, results and data of any type whatsoever, in any tangible or intangible form (and whether or not patentable), including databases, practices, methods, techniques, specifications, formulations, formulae, knowledge, skill, experience, data and results (including pharmacological, medicinal chemistry, biological, chemical, biochemical, toxicological and clinical study data and results), analytical and quality control data, stability data, studies and procedures, and manufacturing process and development information, results and data.

“Knowledge” shall mean the actual knowledge of a key employee (i.e., officer, general manager and internal counsel) of NeurogesX relating to a particular matter and the knowledge of facts of which any of such key employees are reasonably expected to be aware in the prudent exercise of their duties and responsibilities on behalf of NeurogesX or its Subsidiaries.

“License Agreement” shall mean (i) the Distribution, Marketing and License Agreement, dated as of June 19, 2009, between NeurogesX and Astellas (as amended as of the date hereof), and as may be further amended, supplemented or modified as permitted under this Agreement (the “Existing License Agreement”) and (ii) in the event of the termination thereof, any Replacement License Agreement including, without limitation, any sublicense and subdistribution agreements which survive and are assigned to NeurogesX. A copy of the Existing License Agreement existing as of the date hereof is attached hereto as Exhibit C.

“Licensed Product(s)” shall mean any “Product” licensed to Astellas and any “Licensing Option Product” licensed to Astellas or a Third Party, and with respect to Section 5.03(b)(i) shall also include any Liquid Formulation Product, as those terms are defined in the Existing License Agreement.

“Licensees” shall mean, collectively, (i) Astellas and (ii) all Replacement Licensees; each a “Licensee”.

“Licensee Direction” shall mean the irrevocable direction by NeurogesX to Astellas and/or any Licensee to pay the Revenue Interest directly into the Initial Concentration Account, in substantially the form set forth in Exhibit H.

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“Lien” shall mean any lien, hypothecation, charge, security agreement, security interest, mortgage, pledge, or any encumbrance, right or claim of any other Person of any kind whatsoever whether xxxxxx or inchoate, filed or unfiled, noticed or unnoticed, recorded or unrecorded, contingent or non-contingent, material or non-material, known or unknown.

“Losses” shall mean, collectively, any and all claims, damages, losses, judgments, liabilities, costs and expenses (including reasonable expenses of investigation and reasonable attorneys’ fees and expenses in connection with any action, suit or proceeding).

“Material Adverse Effect” shall mean (i) a Bankruptcy Event; (ii) an adverse effect on the validity or enforceability of any material provision of the Transaction Documents; (iii) an adverse effect on the ability of NeurogesX to perform any of its material obligations under any of the Transaction Documents; (iv) an adverse effect on the material rights or remedies of CHRP under any of the Transaction Documents; (v) a material adverse effect on the right of CHRP to receive the Revenue Interest Payments or any other payment due to CHRP hereunder; or (vi) a material adverse effect on the Revenue Interest or any portion of the Collateral, including any a material adverse effect with respect to the Licensed Product or the ability of Licensee to distribute, market and/or sell the Licensed Product in the Territory in accordance with a License Agreement, (vii) a material breach by Licensee of a License Agreement (which is uncured within the time period therefor); or (viii) a right to terminate or receive damages inuring to the benefit of a Third Party arising from the material, uncured breach by NeurogesX under any Material Contract.

“Material Contract” shall mean any contract, agreement or other arrangement to which NeurogesX or any of its Subsidiaries is a party or any of NeurogesX’s or its Subsidiaries’ respective assets or properties are bound or committed (other than the Transaction Documents), in each case related to (i) the Exploitation of a Licensed Product in the Territory or (ii) the Intellectual Property (including the Existing License Agreement).

“Maturity Date” shall mean the latest to occur of the following: (i) ten (10) years from the last to occur of the First Commercial Sale in all countries in the Territory, or (ii) the expiration or abandonment of the last Valid Patent Claim covering any Licensed Product in all countries in the Territory or (iii) the expiration of all applicable periods of regulatory exclusivity covering all Licensed Products in all countries in the Territory.

“Net Sales” shall have the meaning set forth in the Existing License Agreement or any Replacement License Agreement, if applicable.

“NeurogesX” shall have the meaning set forth in the first paragraph hereof.

“NeurogesX Concentration Account” shall mean a segregated account established for the benefit of NeurogesX and maintained at the Depositary Bank pursuant to the terms of the Deposit Agreement and this Agreement. The NeurogesX Concentration Account shall be the account into which the funds remaining in the Joint Concentration Account after payment therefrom of the amounts payable to CHRP pursuant to this Agreement are swept daily in accordance with the terms of this Agreement and the Deposit Agreement.

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“NeurogesX Indemnified Party” shall have the meaning set forth in Section 8.05(b).

“Option Exercise Fee” shall have the meaning set forth in the Existing License Agreement.

“Option Retention Fee” shall have the meaning set forth in the Existing License Agreement.

“Party” shall mean NeurogesX or CHRP; and “Parties” shall mean NeurogesX and CHRP.

“Patent Office” shall mean, with respect to the particular country or jurisdiction, the respective patent office responsible for reviewing and issuing Patents for such country or jurisdiction.

“Patents” shall mean any and all issued patents and pending patent applications, including without limitation, all provisional applications, substitutions, continuations, continuations-in-part, divisions, and renewals, all letters patent granted thereon, and all patents-of-addition, reissues, reexaminations and extensions or restorations by existing or future extension or restoration mechanisms (including regulatory extensions), and all supplementary protection certificates, together with any foreign counterparts thereof anywhere in the Territory covering the Licensed Product, composition of matter, formulation, or methods of manufacture or use thereof that are issued or filed on or after the date hereof, including, without limitation, those identified in Schedule 3.12(a) in each case, which are owned, controlled by, issued to, licensed to or licensed by NeurogesX or any of its Affiliates.

“Permitted Liens” means (a) Liens for taxes not yet delinquent or Liens for taxes being contested in good faith and by appropriate proceedings for which adequate reserves have been established; (b) Liens in respect of property or assets imposed by law which were incurred in the ordinary course of business, such as carriers’, warehousemen’s, materialmen’s and mechanics’ Liens and other similar Liens arising in the ordinary course of business which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings; (c) Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security, and other Liens to secure the performance of tenders, statutory obligations, contract bids, government contracts, performance and return of money bonds and other similar obligations, incurred in the ordinary course of business, whether pursuant to statutory requirements, common law or consensual arrangements; (d) Liens in favor of CHRP; (e) Liens upon any equipment acquired or held by NeurogesX or any of its Subsidiaries to secure the purchase price of such equipment or indebtedness incurred solely for the purpose of financing the acquisition of such equipment, so long as such Lien extends only to the equipment financed, and any accessions, replacements, substitutions and proceeds (including insurance proceeds) thereof or thereto; (f) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of customs duties in connection with the importation of goods, (g) Liens of depository banks which constitute rights of setoff of a customary nature, whether arising by law or contract, with respect to funds deposited in deposit accounts maintained with such depository banks; (h) the License Agreement; and (i) Liens existing on the date of this Agreement which are set forth on

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Schedule 1. For avoidance of doubt a Permitted Lien may not affect the rights of CHRP to any Revenue Interest Payment.

“Person” shall mean an individual, corporation, partnership, limited liability company, association, trust or other entity or organization, but not including a government or political subdivision or any agency or instrumentality of such government or political subdivision.

“Rate of Interest” shall mean the rate of interest specified in the amortization schedule attached hereto as Exhibit L.

“Regulatory Agency” shall mean a Governmental Authority with responsibility for the approval of the marketing and sale of pharmaceuticals or other regulation of pharmaceuticals.

“Regulatory Approval” shall mean all approvals (including, without limitation, where applicable, pricing and reimbursement approval and schedule classifications), product and/or establishment licenses, registrations or authorizations of any Regulatory Agency necessary for the manufacture, use, storage, import, export, transport, offer for sale, or sale of the Licensed Product in the Territory in accordance with the License Agreement.

“[***]” shall mean any [***] after the date hereof pursuant to which (i) [***] or (ii) [***]

“[***]” shall have the meaning given in the definition of [***].

“Reports” shall mean, with respect to the relevant period, (i) the quarterly and year-end reports to be provided by Astellas pursuant to Section 4.6 of the Existing License Agreement, or, any such similar report under any Replacement License Agreement; (ii) quarterly and year-end statements of Revenue Interest paid and payable to CHRP prepared by NeurogesX for each calendar quarter and calendar year of the Term and, with respect to each quarterly report, for the twelve (12) consecutive months ending with the last month of such quarter report, together with information, including summaries of reports to the Joint Steering Committee (as that term is defined in the Existing License Agreement) regarding the status of development of the Liquid Formulation Product (as defined in the Existing License Agreement) and summaries of reports on the commercialization of the Licensed Products in the Territory, (iii) a reconciliation of such reports referred to in clause (ii) above to all information and data deliverable to NeurogesX, CHRP or their Affiliates by the Licensee, including, without limitation, the reports delivered pursuant to clause (i) above, together with relevant supporting documentation, and (iv) such additional information as CHRP may reasonably request.

[***]

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

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“Revenue Investment Advance” shall have the meaning set forth in Section 2.03(a).

“Revenue Interest” shall mean, with respect to the Existing License Agreement, any and all of NeurogesX’s rights to receive (i) any payments under Section 3 or Section 4 (except Section 4.4) of the Existing License Agreement, including, without limitation, rights to receive Sales Milestones under Section 3.2 of the Existing License Agreement, the Option Retention Fee under Section 3.3.2 of the Existing License Agreement, the Option Exercise Fee under Section 3.3.3 of the Existing License Agreement, and Earned Royalties under Section 4 of the Existing License Agreement, in each case payable on and after Xxxxx 0, 0000, (xx) any payments under Section 11.5.2 of the Existing License Agreement in amounts in the aggregate in excess of out-of-pocket costs and expenses (including reasonable attorneys’ and professional fees) incurred in connection with any Enforcement Action (as such term is defined in the Existing License Agreement), (iii) any payments similar to those described in clauses (i) and (ii) from Astellas or its affiliates with respect to Licensing Option Products, regardless of whether such Licensing Option Products are included under the Existing License Agreement or licensed to Astellas pursuant to a separate agreement, (iv) any payments similar to those described in clauses (i), (ii) and (iii) under any Replacement License Agreement, (v) any payments similar to those described in clauses (i) – (iv) made by a Licensee after rejection of the Existing License Agreement or Replacement License Agreement by NeurogesX in bankruptcy, and (vi) any other payments for or derived from the sale, offer for sale (including marketing and promotion), distribution or other commercialization or exploitation of Licensed Products in the Territory.

For clarity the Revenue Interest shall exclude all rights under any License Agreement to receive (a) payments or amounts which are used to pay Third Parties for rights to intellectual property necessary for or incorporated in the Licensed Products (including amounts payable (I) under Section 4.4 of the Existing License Agreement, (II) to The Regents of the University of California (“The Regents”) pursuant to Section 3.2 or Section 19.4 of that certain Exclusive License Agreement between NeurogesX and The Regents effective November 1, 2000 or (III) to LTS Xxxxxxx Therapie Systeme AG (“LTS”) pursuant to Section 7.3 of that certain Commercial Supply and License Agreement between NeurogesX and LTS dated January 2007), (b) any payments under the Supply Agreement (as entered into pursuant to and defined in Section 9.1 of the Existing License Agreement) and (c) any payment intended to reimburse for any costs or expenses (whether internal or external reasonably allocated in accordance with GAAP) incurred or to be incurred by NeurogesX with respect to activities under such License Agreement or otherwise with respect to the Licensed Product in the Territory (collectively, the “Excluded Revenue Interests”).

“Revenue Interest Payments” shall have the meaning set forth in Section 2.02(a).

“Sales Milestones” shall mean those payments payable to NeurogesX pursuant to Section 3.2 of the Existing License Agreement.

“Second Stepdown” shall mean the date on which the sum of Revenue Interest Payments actually received by CHRP equals $106 million.

“Security Agreement” shall mean the security agreement, by and between NeurogesX and CHRP, providing for, among other things; the grant by NeurogesX in favor of CHRP of a

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valid continuing, perfected lien on and security interest in, the Revenue Interest and the Collateral described therein, which Security Agreement shall be substantially in the form of Exhibit D.

“Security Documents” shall mean, collectively, the Assignment Agreement and the Security Agreement.

“Subsidiary” or “Subsidiaries” shall mean with respect to any Person (i) any corporation having at least a majority of the capital stock entitled to vote in the election of directors under ordinary circumstances owned, directly or indirectly, by such Person or (ii) any other Person of which at least a majority voting interest under ordinary circumstances is at the time, directly or indirectly, owned by such Person.

“Term” shall mean the term of this Agreement, as provided in Section 7.01 hereof.

“Territory” shall have the meaning set forth in the License Agreement.

“Third Party” shall mean any Person other than NeurogesX or CHRP or their respective Affiliates.

“Third Party Consents” shall mean the consents of Astellas, LTS and The Regents, substantially in the form of Exhibits G-1, G-2 and G-3, respectively.

“Transaction Documents” shall mean, collectively, this Agreement, the Assignment Agreement, the Security Agreement, the CHRP Replacement License Agreement, the Deposit Agreement, the Third Party Consents, and the Licensee Direction and all other documents delivered in connection therewith.

“UCC” shall mean the Uniform Commercial Code (or any similar or equivalent legislation) as in effect in any applicable jurisdiction.

“United States” shall mean the United States of America.

“Valid Patent Claim” shall have the meaning set forth in the License Agreement.

ARTICLE II

ASSIGNMENT

Section 2.01 Assignments

(a) Upon the terms and subject to the conditions set forth in this Agreement, on the Closing Date, NeurogesX agrees to assign, transfer and convey to CHRP, and CHRP agrees to accept the assignment, transfer and conveyance from NeurogesX, free and clear of all Liens (except the Permitted Liens and those Liens created in favor of CHRP pursuant to the Security Documents) and subject to the conditions set forth in ARTICLE VI, the Assigned Rights. CHRP’s ownership interest in the Assigned Rights so assigned and the Lien granted under the Security Documents shall vest simultaneously with and only upon NeurogesX’s receipt of the

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full, irrevocable, non-refundable and non-deductible Revenue Investment Advance pursuant to Section 2.03(a) for such Assigned Rights.

(b) Upon the occurrence of the First Stepdown, CHRP agrees to assign, transfer and convey to NeurogesX, and NeurogesX agrees to accept the assignment, transfer and conveyance from CHRP an undivided joint interest in and to the Assigned Rights, free and clear of all Liens other than the Permitted Liens and Liens in favor of CHRP under the Security Agreement. Further upon the earlier of (i) occurrence of the Second Stepdown, (ii) the payment to CHRP of any amount due under Section 2.02(e), or (iii) NeurogesX’s exercise and payment of its buy-out right under Section 7.02(c), CHRP agrees to assign, transfer and convey to NeurogesX, and NeurogesX agrees to accept the assignment, transfer and conveyance from CHRP any and all rights in and to the Assigned Rights not previously assigned to NeurogesX, free and clear of all Liens.

Section 2.02 Payments to CHRP

(a) Subject to CHRP paying to NeurogesX the Revenue Investment Advance pursuant to Section 2.03(a), from and after April 1, 2010 throughout the Term, CHRP shall be entitled to receive the following percentages of Revenue Interest (collectively, the “Revenue Interest Payments”):

(i) until the occurrence of the First Stepdown, 100% of Revenue Interest; plus

(ii) after the occurrence of the First Stepdown and until the occurrence of the Second Stepdown, 5% of Revenue Interest.

For clarity, as between the Parties, NeurogesX shall have the right to receive and retain (A) any and all Excluded Revenue Interests and (B) from and after the occurrence of the Second Stepdown any and all Revenue Interest.

In the event there is a good faith dispute whether payments receivable under the Existing License Agreement or a Replacement License Agreement not explicitly set forth herein are included within the Revenue Interest or are Excluded Revenue Interests which is not resolved after submission first to the officers and then to the chief executive officer of NeurogesX and managing directors of CHRP, or their designees, in the manner provided in Section 8.15(a), [***] of such payments shall be [***] the Revenue Interest subject to the provisions of this Section 2.02(a). In the event pursuant to the Existing License Agreement or a Replacement License Agreement, NeurogesX or its Affiliate licenses the Exploitation of a [***] to a Third Party in the Territory other than Licensee, all payments receivable by NeurogesX or its Affiliates with respect to [***].

(b) NeurogesX shall instruct the Licensee to deposit the Revenue Interest into the Initial Concentration Account, pursuant and subject to Section 5.07. In the event NeurogesX receives any portion of the Revenue Interest due to CHRP hereunder, NeurogesX shall hold such amounts in trust for the benefit of CHRP, provide CHRP with an accounting thereof, and, within ten (10) Business Days after receipt thereof, deliver such amounts to CHRP by wire transfer of immediately available funds.

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(c) In the event Licensee fails to pay any Revenue Interest Payment when due under the License Agreement (each such unpaid amount, a “Discrepancy”), then, provided such failure to pay is not due to an actual default by NeurogesX, NeurogesX shall not be obligated to pay to CHRP or otherwise compensate or make CHRP whole with respect to any such Discrepancy; provided, however, that NeurogesX shall use commercially reasonable efforts to enforce the terms of the License Agreement as if NeurogesX was the sole owner of the Revenue Interest (including taking actions reasonably requested by CHRP in furtherance of such enforcement) and upon any recovery of a Discrepancy and CHRP shall receive its portion of any such recovery as set out in Section 2.02(a). Accordingly, NeurogesX shall not be responsible with respect to any Revenue Interest receivable or payable under any License Agreement until actually received by or paid to NeurogesX thereunder unless Licensee’s failure to pay is due to an actual default by NeurogesX.

(d) NeurogesX agrees that CHRP is entitled to the Assigned Rights and may enforce such entitlement directly against NeurogesX, provided that unless due to the actions of NeurogesX, NeurogesX shall not be responsible for any Revenue Interest not paid to CHRP unless such amount has been received by NeurogesX. Notwithstanding any claim or set-off that NeurogesX may have against CHRP or that Astellas has against NeurogesX, NeurogesX agrees that, subject to the provisions of Section 5.07, it will require that Astellas remit all Revenue Interest that Astellas is required to pay to NeurogesX under the Existing License Agreement with respect to the Assigned Rights directly into the Initial Concentration Account, pursuant to the Licensee Direction.

(e) Unless this Agreement has been earlier terminated in accordance with the terms hereof, within ten (10) Business Days of the Maturity Date, NeurogesX shall pay to CHRP an amount equal to the Revenue Investment Advance less all Revenue Interest Payments received by CHRP. The foregoing shall be deemed a minimum repayment obligation of NeurogesX and shall not reduce or diminish the rights of CHRP to receipt of Revenue Interest Payments or as otherwise provided herein.

Section 2.03 Advances to NeurogesX.

(a) Revenue Investment Advance. Subject to the terms and conditions set forth herein, including, without limitation, Section 6.02, CHRP shall advance to NeurogesX the sum of Forty Million Dollars ($40,000,000.00) (the “Revenue Investment Advance”) no later than fifteen (15) Business Days following the date of this Agreement.

(b) Advance Procedure. The Revenue Investment Advance to be made by CHRP to NeurogesX under Section 2.03(a) shall be paid by wire transfer of immediately available funds to the account(s) designated by NeurogesX. If the conditions set forth in Section 6.02 for advancement of the Revenue Investment Advance are not satisfied within fifteen (15) Business Days following the date of this Agreement, then the provisions of Section 7.02 shall govern.

Section 2.04 No Assumed Obligations.

Notwithstanding any provision in this Agreement or any other Transaction Document or writing to the contrary, CHRP is accepting the assignment of only the Assigned Rights and is not

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assuming any liability or obligation of NeurogesX or any of its Affiliates of whatever nature, whether presently in existence or arising or asserted hereafter, whether known or unknown, and whether under the License Agreement or any Transaction Document or otherwise. All such liabilities and obligations shall be retained by and remain obligations and liabilities solely of NeurogesX or its Affiliates (the “Excluded Liabilities and Obligations”).

Section 2.05 Excluded Assets.

CHRP does not, by assignment of the rights granted hereunder or otherwise pursuant to any of the Transaction Documents, acquire any assets of NeurogesX or any of its Affiliates, other than to the Revenue Interest and the Assigned Rights.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE ASSIGNOR

Except with respect to any section of this ARTICLE III as set forth in the correspondingly identified section of the disclosure schedule delivered by NeurogesX to CHRP concurrently herewith (the “Disclosure Schedule”), NeurogesX hereby represents and warrants to CHRP, as of the date of this Agreement, the following:

Section 3.01 Organization.

NeurogesX is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Delaware, and has all corporate powers and all licenses, authorizations, consents and approvals required to carry on its business as now conducted and as proposed to be conducted and in connection with the transactions contemplated by the Transaction Documents. NeurogesX is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which it is required to be so qualified, except where the failure to be so qualified would not have a Material Adverse Effect.

Section 3.02 Corporate Authorization.

NeurogesX has all necessary power and authority to enter into, execute and deliver the Transaction Documents and to perform all of the obligations to be performed by it hereunder and thereunder and to consummate the transactions contemplated hereunder. The Transaction Documents have been duly authorized, executed and delivered by NeurogesX and each Transaction Document constitutes the valid and binding obligation of NeurogesX, enforceable against it in accordance with such Transaction Document’s respective terms, subject, as to enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or general equitable principles (regardless of whether enforcement is sought in equity or at law).

Section 3.03 Governmental Authorization.

The execution and delivery by NeurogesX of the Transaction Documents, and the performance by NeurogesX of its obligations hereunder and thereunder, does not require any

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notice to, action or consent by, or in respect of, or filing with, any Governmental Authority, except with respect to the Security Documents for the filing and registration of financing statements under the UCC, filings with any Patent Office, and such other notice, action, consent or filing as may be required to perfect the security interest granted in the Collateral.

Section 3.04 Ownership.

(a) Except as otherwise provided in or granted under the License Agreement and the Transaction Documents, NeurogesX owns, or holds a valid license under all of the Intellectual Property and the Regulatory Approvals, with respect to the Licensed Product free and clear of all Liens (other than Permitted Liens), and no license or covenant not to xxx under any Intellectual Property or Regulatory Approvals has been granted to any Third Party in the Territory.

(b) (i) NeurogesX, immediately prior to the assignment of the Assigned Rights, owns, and is the sole holder of, all rights to receive the Revenue Interest, free and clear of all Liens other than Permitted Liens; (ii) NeurogesX has not transferred, sold, conveyed, assigned, or otherwise disposed of, or agreed to transfer, sell, convey, assign, or otherwise dispose of any portion of the Revenue Interest or the Collateral other than as contemplated by this Agreement; (iii) no Person other than NeurogesX has any right to receive the payments payable under any License Agreement in the Territory, other than CHRP’s rights with respect to the Revenue Interest, from and after April 1, 2010; (iv) NeurogesX has the full right to transfer, convey and assign to CHRP the rights and interests in and to the Revenue Interest being transferred, conveyed and assigned to CHRP and to grant a security interest in the Collateral pursuant to this Agreement and the other Transaction Documents without any requirement to obtain the consent of any Person; (v) subject to the payment of the Revenue Investment Advance by CHRP to NeurogesX pursuant to Section 2.03(a), by the delivery to CHRP of the executed Assignment Agreement and the Licensee Direction, NeurogesX shall transfer, convey and assign to CHRP the rights and interests in and to the Revenue Interest being transferred, conveyed and assigned to CHRP pursuant to this Agreement and the Assignment Agreement, free and clear of any Liens, except the Permitted Liens and those Liens created in favor of CHRP pursuant to the Security Documents and any other Transaction Document; and (vi) subject to the payment of the Revenue Investment Advance by CHRP to NeurogesX pursuant to Section 2.03(a), at the Closing, and upon the delivery of the Assignment Agreement to CHRP by NeurogesX and delivery of the Licensee Direction by NeurogesX to the Licensee, CHRP shall have acquired good and valid rights and interests of NeurogesX in and to the Revenue Interest being transferred, conveyed and assigned to CHRP pursuant to this Agreement and the Assignment Agreement, free and clear of any and all Liens, except the Permitted Liens and those Liens created in favor of CHRP pursuant to the Security Documents and any other Transaction Document.

Section 3.05 Financial Statements.

The Financial Statements are complete and accurate in all material respects, were prepared in accordance with GAAP and present fairly in all material respects the financial position and the financial results of NeurogesX as of the dates and for the periods covered thereby.

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Section 3.06 No Undisclosed Liabilities.

Except for those liabilities (i) specifically identified on the face of the Financial Statements and (ii) incurred by NeurogesX in the ordinary course of business since December 31, 2009, there are no material liabilities of NeurogesX taken as a whole, of any kind whatsoever, whether accrued, contingent, absolute, determined or determinable.

Section 3.07 Solvency.

No event has occurred which with the passage of time or the giving of notice would constitute a Bankruptcy Event with respect NeurogesX. Assuming consummation of the transactions contemplated by the Transaction Documents, (i) the present fair saleable value of NeurogesX’s assets is greater than the amount required to pay its debts as they become due, (ii) NeurogesX does not have unreasonably small capital with which to engage in its business, and (iii) NeurogesX has not incurred, nor does it have present plans to or intend to incur, debts or liabilities beyond its ability to pay such debts or liabilities as they become absolute and matured.

Section 3.08 Litigation.

There is no (i) action, suit, arbitration proceeding, claim, investigation or other proceeding pending or, to the Actual Knowledge of NeurogesX, threatened against NeurogesX, or its Subsidiaries or (ii) governmental inquiry pending or, to the Actual Knowledge of NeurogesX, threatened against NeurogesX or its Subsidiaries, in each case with respect to clauses (i) and (ii) above, which, if adversely determined, would question the validity of, or would reasonably be expected to adversely affect the transactions contemplated by any of the Transaction Documents or would reasonably be expected to have a Material Adverse Effect. There is no action, suit, claim, proceeding or investigation pending or, to the Actual Knowledge of NeurogesX, threatened against NeurogesX or its Subsidiaries or, to the Actual Knowledge of NeurogesX, any other Person relating to the Revenue Interest, which, if adversely determined, would question the validity of, or would affect the transactions contemplated by any of the Transaction Documents or would have a Material Adverse Effect.

Section 3.09 Compliance with Laws.

None of NeurogesX or any of its Subsidiaries (i) is in violation of, has violated, or to the Knowledge of NeurogesX is under investigation with respect to, and (ii) has been, or to the Knowledge of NeurogesX threatened to be, charged with or been given notice of any violation of any law, rule, ordinance or regulation of, or any judgment, order, writ, decree, permit or license entered by any Governmental Authority applicable to NeurogesX or the Revenue Interest which would reasonably be expected to have a Material Adverse Effect.

Section 3.10 Conflicts.

(a) Neither the execution and delivery of any of the Transaction Documents nor the performance or consummation of the transactions contemplated hereby and thereby will: (i) contravene, conflict with, result in a breach or violation of, constitute a default under, or accelerate the performance provided by, in any material respects any provisions of: (A) any law,

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rule, ordinance or regulation of any Governmental Authority, or any judgment, order, writ, decree, permit or license of any Governmental Authority, to which NeurogesX or any of its Subsidiaries or any of their respective assets or properties related to the Exploitation of the Licensed Product in the Territory may be subject or bound; or (B) any contract, agreement, commitment or instrument to which NeurogesX or its Subsidiaries is a party or by which NeurogesX or any of its Subsidiaries or any of their respective assets or properties related to the Exploitation of the Licensed Product in the Territory is bound or committed; (ii) contravene, conflict with, result in a breach or violation of, constitute a default under, or accelerate the performance provided by, any provisions of the certificate of incorporation or by-laws (or other organizational or constitutional documents) of NeurogesX; (iii) except for the filing of the UCC-1 financing statements required hereunder and filings with the United States Patent and Trademark Office or any foreign equivalents thereof in the Territory, the Third Party Consents, and such other notifications, filings and consents as may be required to perfect the security interest in the Collateral, require any notification to, filing with, or consent of, any Person or Governmental Authority; (iv) give rise to any right of termination, cancellation or acceleration of any right or obligation of NeurogesX or any other Person or to a loss of any benefit, in each case relating to the Revenue Interest; or (v) result in the creation or imposition of any Lien on (y) the assets or properties of NeurogesX related to the Exploitation of the Licensed Product in the Territory, or (z) the Revenue Interest or any Collateral, other than Liens on behalf of CHRP.

(b) Neither NeurogesX nor its Subsidiaries have granted, nor does there exist, any Lien on the Revenue Interest or any Collateral other than pursuant to the Security Documents, the Permitted Liens and the License Agreement.

Section 3.11 Subordination.

The claims and rights of CHRP created by any Transaction Document in and to the Revenue Interest and other Assigned Rights and any other Collateral are not subordinated to any creditor of NeurogesX or any other Person.

Section 3.12 Intellectual Property.

(a) Schedule 3.12(a) sets forth an accurate, true and complete list (by category and family) of (1) Patents (including pending Patent applications) and utility models, (2) trade names, common law trademarks, common law service marks, registered trademarks, registered service marks, and applications for trademark registration or service xxxx registration, (3) registered and unregistered copyrights and (4) domain name registrations and websites owned by NeurogesX, in each case with respect to clauses (1), (2), (3) and (4) above in this subsection (a) that are owned by, or licensed to, NeurogesX and are necessary or used to make, have made, use, sell, have sold, offer for sale, import, develop, promote, market, distribute, manufacture, commercialize or otherwise Exploit the Licensed Product in the Territory by NeurogesX, its Affiliates or Licensees in accordance with the License Agreement. For each item of Intellectual Property listed on Schedule 3.12(a), NeurogesX has identified, as applicable, [***] Except as disclosed therein, (1) each item of Intellectual Property listed on Schedule 3.12(a) and owned by NeurogesX is valid and subsisting and no such listed Intellectual Property has lapsed, expired, been cancelled or become abandoned and (2) to the Knowledge of NeurogesX, each item of Intellectual Property listed on Schedule 3.12(a) which is licensed by NeurogesX from a Third

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Party is, to the Knowledge of NeurogesX, valid and subsisting and no such listed Intellectual Property has lapsed, expired, been cancelled or become abandoned. To the Knowledge of NeurogesX the Patent applications listed in Schedule 3.12(a) have been and continue to be prosecuted by competent Patent counsel in a commercially reasonable manner consistent with standards in the biotechnology industry for similarly situated entities. Except for references identified to the applicable Patent Office as of December 31, 2009, during prosecution of the patent applications, to the Knowledge of NeurogesX, there are no published patents, patent applications, articles, prior art references or other factors or circumstances that would materially adversely affect the validity or enforceability of any of the Patents listed in Schedule 3.12(a)(1) or have a Material Adverse Effect. To the Knowledge of NeurogesX, each of the Patents and Patent applications listed in Schedule 3.12(a) correctly identifies each and every inventor of the claims thereof as determined in accordance with the laws of the jurisdiction in which such Patent is issued or such Patent application is pending. [***]

(b) Schedule 3.12(b) sets forth an accurate, true and complete list of all agreements, whether oral or written, express or implied, including, without limitation, assignments, licenses, options, franchise, distribution, marketing and manufacturing agreements, sponsorships, project agreements, collaboration agreements, joint development agreements, agreements not to enforce, consents, settlements, assignments, Liens or mortgages, and any amendments(s) renewal(s), novation(s) and termination(s) pertaining thereto, pursuant to which NeurogesX has the legal right to exploit intellectual property that is owned by a Third Party with respect to the Exploitation of the Licensed Product in the Territory or the manufacture or supply of Licensed Products for sale in the Territory. There are no unpaid fees or royalties under any agreement listed on Schedule 3.12(b) that have become due, or are expected to become overdue, as of the Closing Date.

(c) To the Knowledge of NeurogesX, each agreement listed in Schedule 3.12(b) is legal, valid, binding, enforceable, and in full force and effect. Each of NeurogesX or its Subsidiaries is not in breach of such listed agreements and, to the Knowledge of NeurogesX, no circumstances or grounds exist that would give rise to a claim of breach or right of rescission, termination, revision, or amendment of any of the agreements specified in Schedule 3.12(b), including, without limitation, the execution, delivery and performance of this Agreement and the other Transaction Documents.

(d) Except for Intellectual Property licensed to NeurogesX pursuant to any agreement listed on Schedule 3.12(b) and Intellectual Property owned by NeurogesX, to the Knowledge of NeurogesX, no other Intellectual Property is necessary to make or have made the Licensed Products in the Territory or for sale in the Territory and to Exploit the Licensed Product in the Territory. To the Knowledge of NeurogesX, the manufacture, use or sale of the Licensed Product by Licensee as contemplated in the Existing License Agreement will not infringe upon any valid and enforceable Third Party’s patents. NeurogesX has not received any written notice from a Third Party alleging that the manufacture, use or sale of the Licensed Product infringes on any rights of a Third Party.

(e) NeurogesX possesses sole, exclusive, valid, marketable and unencumbered title to the Intellectual Property for which it is listed as the owner on Schedule 3.12(a), and is a party to the agreements listed on Schedule 3.12(b); all assignments from each inventor, as the case may

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be, to NeurogesX or to a predecessor in interest of NeurogesX, have been executed and recorded for each of the Patents for which NeurogesX is listed as the owner on Schedule 3.12(a)(1); there are no Liens on or to any Intellectual Property listed on Schedule 3.12(a) that it owns or agreement listed on Schedule 3.12(b), except the Permitted Liens and Liens created by the Existing License Agreement or the Transaction Documents.

(f) NeurogesX has the full right, power and authority to grant all of the rights and interests granted to CHRP in this Agreement and to Astellas under the Existing License Agreement.

(g) There are no maintenance, annuity or renewal fees that are currently overdue beyond their allotted grace period for any of the Intellectual Property listed on Schedule 3.12(a), nor have any applications or registrations therefor lapsed or become abandoned, been cancelled or expired.

(h) No payments by NeurogesX are due to any other Person in respect of the Licensed Product or the Intellectual Property, other than pursuant to those agreements listed on Schedule 3.12(b) and those fees payable to Patent Offices in connection with the prosecution and maintenance of such Intellectual Property and associated attorney fees. It being acknowledged by NeurogesX that CHRP shall have no obligation to make such payments.

(i) None of NeurogesX, or, to the Actual Knowledge of NeurogesX, any other Person, has undertaken or omitted to undertake any acts, and no circumstance or grounds exist, that would invalidate, reduce or eliminate, in whole or in part, the enforceability or scope of (i) any Intellectual Property or, in the case of Intellectual Property owned or licensed by NeurogesX, NeurogesX’s entitlement to exclusively exploit such Intellectual Property, or (ii) NeurogesX’s right to enjoy any Revenue Interest, in each case that would reasonably be expected to have a Material Adverse Effect.

(j) There is no pending, decided or settled opposition, interference proceeding, reexamination proceeding, cancellation proceeding, injunction, lawsuit, hearing, investigation, complaint, arbitration, mediation, demand, International Trade Commission investigation, decree, or any other dispute, disagreement, or claim, in each case alleged in writing to NeurogesX (collectively referred to hereinafter as “Disputes”), nor has any such Dispute to the Actual Knowledge of NeurogesX been threatened, in each case challenging the legality, validity, enforceability or ownership of any Intellectual Property or the Licensed Product or which would give rise to a credit or right of set off against any Revenue Interest.

(k) There is no pending or, to the Actual Knowledge of NeurogesX, threatened action, suit, or proceeding, or any investigation or claim by any Governmental Authority to which NeurogesX is a party (1) that would be the subject of a claim for indemnification by any Person or Third Party under any agreement, or (2) that alleges that the marketing, sale or distribution of the Licensed Product worldwide by NeurogesX or its Licensees pursuant to the related License Agreement, as applicable, does or will infringe on any patent or other intellectual property rights of any other Person, and, to the Knowledge of NeurogesX, there is no basis for any such action, suit, proceeding, investigation or claim of the type described in clause (1) or (2) above. There are no pending published, or to the Actual Knowledge of NeurogesX unpublished,

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United States, international or foreign patent applications owned by any other Person, which, if issued, would limit or prohibit, in any material respect, the use of the Licensed Product in the Territory or the licensed Intellectual Property relating to the Licensed Product in the Territory.

(l) NeurogesX has previously made available to CHRP all documents related to the Intellectual Property specifically requested in writing by CHRP or its counsel.

Section 3.13 Regulatory Approval.

(a) NeurogesX has previously made available to CHRP the Regulatory Approvals, all material correspondence with Regulatory Agencies (including, without limitation, the EMEA and the FDA), and all adverse event reports with respect to the Licensed Product and all requested documents related to the Licensed Product in each case in the possession and control of NeurogesX and NeurogesX has not withheld any document or information with respect to the Licensed Product that would reasonably be considered to be material to CHRP’s decision to make the Revenue Investment Advance.

(b) NeurogesX and its Subsidiaries, and, to the Knowledge of NeurogesX, NeurogesX’s licensees (including Licensee), are in compliance with, and have materially complied with, all applicable federal, state, local and foreign laws, rules, regulations, standards, orders and decrees governing its business, including all regulations promulgated by each Regulatory Agency in the Territory, the failure of compliance with which would result in a Material Adverse Effect; NeurogesX has not received in the Territory any notice citing action or inaction by any of them that would constitute any non-compliance with any applicable federal, state, local and foreign laws, rules, regulations, or standards, which would result in a Material Adverse Effect.

(c) To the Knowledge of NeurogesX the studies, tests and preclinical and clinical trials conducted relating to the Licensed Product in the Territory were conducted in all material respects in accordance with experimental protocols, procedures and controls pursuant to, where applicable, accepted professional and scientific standards at the time when conducted; the descriptions of the results of such studies, tests and trials provided to CHRP are accurate in all material respects; and NeurogesX has not received any notices or correspondence from any Regulatory Agency in the Territory or comparable authority requiring the termination, suspension, or material modification or clinical hold of any such studies, tests or preclinical or clinical trials conducted by or on behalf of NeurogesX, which termination, suspension, material modification or clinical hold would reasonably be expected to result in a Material Adverse Effect.

Section 3.14 Material Contracts.

(a) There are no Material Contracts other than those set forth on Schedule 3.14(a). Neither NeurogesX nor any of its Subsidiaries is in breach of or in default under any Material Contract, which default, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect. To the Actual Knowledge of NeurogesX, nothing has occurred and no condition exists that would permit any other party thereto to terminate any Material Contract. NeurogesX has not received any notice or, to the Actual Knowledge of NeurogesX, any threat of

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termination of any such Material Contract. To the Actual Knowledge of NeurogesX, no other party to a Material Contract is in material breach of or in material default under such Material Contract. All Material Contracts are valid and binding on NeurogesX and, to the Knowledge of NeurogesX, on each other party thereto, and are in full force and effect.

(b) Without limiting the generality of the foregoing, with respect to the License Agreement:

i. Exhibit C contains a true, complete and correct copy of the Existing License Agreement. Neither NeurogesX nor, to the Knowledge of NeurogesX, Licensee, has impaired, waived, altered or modified in any respect, whether by way of any sublicense or consent or otherwise, the Existing License Agreement or any provisions thereof. To the Actual Knowledge of NeurogesX, Licensee has not granted any sublicense under or with respect to the Existing License Agreement.

ii. NeurogesX has not released Licensee, in whole or in part, from any of its material obligations under the Existing License Agreement.

iii. NeurogesX has not received any notice from Licensee requesting any amendment, alteration, modification or termination of the Existing License Agreement, nor has Licensee communicated in writing any desire or intent to do so.

iv. To the Knowledge of NeurogesX, no event has occurred and no condition exists that would adversely affect the right of NeurogesX to receive any Revenue Interest payable under the Existing License Agreement. Neither NeurogesX nor, to the Actual Knowledge of NeurogesX, Licensee, has taken any action or omitted to take any action, that would reasonably be expected to result in a Material Adverse Effect.

v. The Existing License Agreement is enforceable against NeurogesX and, to the Actual Knowledge of NeurogesX, Licensee, in accordance with its terms, subject, as to enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and by general equitable principles (regardless of whether enforcement is sought in equity or at law). The execution, delivery and performance of the Existing License Agreement was and is within the corporate powers of NeurogesX and, to the Knowledge of NeurogesX, Licensee. The Existing License Agreement was duly authorized by all necessary action on the part of, and validly executed and delivered by, NeurogesX and, to the Knowledge of NeurogesX, Licensee. There is no breach or default, or event which, upon notice or the passage of time, or both, could give rise to any breach or default, in the performance of the Existing License Agreement by NeurogesX or, to the Actual Knowledge of NeurogesX, Licensee.

vi. There has been no correspondence or other written communication sent by or on behalf of NeurogesX to, or received by or on behalf of NeurogesX from, Licensee, the subject matter of which would reasonably be expected to result in a Material Adverse Effect.

vii. Licensee has no right of set-off against any Revenue Interest or any other amount payable to NeurogesX under the Existing License Agreement.

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viii. Licensee has not communicated in writing any desire or intent to replace the Licensed Product with an alternative product, nor has Licensee communicated in writing any desire or intent to reduce materially its efforts to develop and commercialize the Licensed Product.

ix. Schedule 3.14(b) sets forth to the Actual Knowledge of NeurogesX without further investigation a true and complete list of all Net Sales and Revenue Interest paid by Licensee pursuant to the Existing License Agreement through March 31, 2010.

Section 3.15 Place of Business.

NeurogesX’s principal place of business is set forth on Schedule 3.15.

Section 3.16 Broker’s Fees.

Neither NeurogesX nor any of its Affiliates have taken any action that would entitle any Person to any commission or broker’s fee in connection with the transactions contemplated by the Transaction Documents.

Section 3.17 Information.

No written statement, information, report or materials prepared by or on behalf of NeurogesX and its Subsidiaries and furnished to CHRP by or on behalf of NeurogesX in connection with any Transaction Document or any transaction contemplated hereby or thereby, no written representation, warranty or statement made by NeurogesX in any Transaction Document, and no Schedule or Exhibit hereto, in each case taken in the aggregate, contains any untrue statement of a material fact or omits any statement of material fact necessary in order to make the statements made therein in light of the circumstances under which they were made not materially misleading.

Section 3.18 Security Agreement.

The Security Agreement, when executed and delivered by NeurogesX and CHRP creates in favor of CHRP a legal, valid and enforceable (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (regardless of whether enforcement is sought in equity or at law)) security interest in the Collateral and proceeds thereof. In the case of the Collateral described in the Security Agreement, when financing statements and other filings specified on Schedule 3.18 in appropriate form are or have been filed in the offices specified on Schedule 3.18, the Security Agreement shall constitute a fully perfected Lien on, and first priority security interest, subject to the Permitted Liens, in, all right, title and interest of NeurogesX in the Collateral and the proceeds thereof to the extent a security interest therein can be perfected by such filings as security for the Obligations (as defined in the Security Agreement).

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Section 3.19 Bankruptcy Event.

No Bankruptcy Event has occurred with respect to NeurogesX or, to the Actual Knowledge of NeurogesX, with respect to Licensee.

Section 3.20 Material Adverse Effect.

Since the filing of NeurogesX’s Annual Report, to the Knowledge of NeurogesX no event has occurred which with the passage of time and/or the giving of notice would constitute a Material Adverse Effect and no Material Adverse Effect has occurred with respect to NeurogesX or, to the Actual Knowledge of NeurogesX, with respect to Licensee.

Section 3.21 Field of Use.

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Section 3.22 No Other Representations.

Except as expressly set forth in the Transaction Documents, NeurogesX and its Affiliates make no representation or warranty, express or implied, at law or in equity, in respect of NeurogesX or any of its Affiliates or any of their respective assets, liabilities or operations, including, without limitation, with respect to any License Agreement and the Assigned Rights, and any such other representations or warranties are hereby expressly disclaimed.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF CHRP

CHRP represents and warrants to NeurogesX the following:

Section 4.01 Organization.

CHRP is a limited partnership duly formed and validly existing under the laws of the State of Delaware.

Section 4.02 Authorization.

CHRP has all necessary power and authority to enter into, execute and deliver the Transaction Documents and to perform all of the obligations to be performed by it hereunder and thereunder and to consummate the transactions contemplated hereunder and thereunder. The Transaction Documents have been duly authorized, executed and delivered by CHRP and each Transaction Document constitutes the valid and binding obligation of CHRP, enforceable against CHRP in accordance with their respective terms, subject, as to enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally or general equitable principles (regardless of whether enforcement is sought in equity or at law).

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Section 4.03 Broker’s Fees.

CHRP has not taken any action that would entitle any Person to any commission or broker’s fee in connection with the transactions contemplated by the Transaction Documents.

Section 4.04 Conflicts.

Neither the execution and delivery of this Agreement or any other Transaction Document nor the performance or consummation of the transactions contemplated hereby or thereby will: (i) contravene, conflict with, result in a breach or violation of, constitute a default under, or accelerate the performance provided by, in any material respects any provisions of: (A) any law, rule or regulation of any Governmental Authority, or any judgment, order, writ, decree, permit or license of any Governmental Authority, to which CHRP or any of its assets or properties may be subject or bound; or (B) any contract, agreement, commitment or instrument to which CHRP is a party or by which CHRP or any of its assets or properties is bound or committed; (ii) contravene, conflict with, result in a breach or violation of, constitute a default under, or accelerate the performance provided by, any provisions of the organizational or constitutional documents of CHRP; or (iii) require any notification to, filing with, or consent of, any Person or Governmental Authority.

Section 4.05 Financial Capacity.

CHRP has and will have at the Closing sufficient funds, from cash and cash equivalents on hand and/or from proceeds of credit facilities available to it, for CHRP to make the Revenue Interest Advance.

ARTICLE V

COVENANTS

During the Term, the following covenants shall apply:

Section 5.01 Consents and Waivers.

NeurogesX shall use its commercial reasonable efforts to obtain and maintain any required consents, acknowledgements, certificates or waivers so that the transactions contemplated by this Agreement or any other Transaction Document may be consummated and shall not result in any default or breach or termination of any of the Material Contracts.

Section 5.02 Access; Information.

(a) Promptly after receipt by NeurogesX or any of its Subsidiaries of notice of any action, claim, investigation, proceeding (commenced or threatened in writing), certificate, offer, proposal, material correspondence or other material written communication relating to the transactions contemplated by this Agreement, any other Transaction Document, the Revenue Interest, or any License Agreement relating to the sale of the Licensed Product in the Territory, then, NeurogesX shall inform CHRP of the receipt of such notice and the substance of such action, claim, investigation, proceeding, certificate, offer, proposal, correspondence or other

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written communication and shall furnish CHRP with a copy of such notice and any related materials with respect to such action, claim, investigation, proceeding, certificate, offer, proposal, correspondence or other written communication.

(b) NeurogesX shall keep and maintain, or use commercially reasonable efforts (as if it were the sole owner of the Revenue Interest) to cause Astellas or any other Licensee to keep and maintain, at all times full and accurate books of account and records adequate to reflect correctly all payments paid and/or payable with respect to the Revenue Interest as required by the License Agreement. NeurogesX shall provide (or cause the Licensee to provide) to CHRP any Report required under the License Agreement. In the event that Astellas or any other Licensee does not provide copies of such Reports to CHRP, NeurogesX shall provide CHRP with copies of all such Reports received by NeurogesX pursuant to the License Agreement. Upon written request of CHRP, NeurogesX shall audit the books and records of Licensee as provided for and to the extent NeurogesX has the right to do so in Section 10.4.1 of the Existing License Agreement, at the sole cost and expense of NeurogesX; provided, however, that in the event any audit does not reveal the existence of a underpayment by Astellas or any other Licensee of at least five percent (5%) of amounts due for the period audited, the immediate following audit (if any) requested by CHRP pursuant to this Section 5.02(b), which does not reveal the existence of a underpayment by Astellas or any other Licensee of at least five percent (5%) of amounts due for the period audited shall be at CHRP’s sole cost and expense. In addition, within a reasonable time after completion of any audit of Astellas or any other Licensee by NeurogesX in accordance with the License Agreement, NeurogesX shall deliver to CHRP an audit report summarizing the results of such audit.

(c) CHRP and any of CHRP’s representatives shall have the right, from time to time upon prior written notice given in accordance with this Section 5.02(c), to visit NeurogesX’s and its Subsidiaries’ offices and properties where NeurogesX and its Subsidiaries keep and maintain books and records relating or pertaining to the Revenue Interest and the Collateral for purposes of conducting an audit of such books and records with respect thereto, and to inspect, copy and audit such books and records, during normal business hours. Upon ten (10) Business Days’ written notice given by CHRP to NeurogesX, NeurogesX will provide CHRP and any of CHRP’s representatives reasonable access to such books and records, and shall permit CHRP and any of CHRP’s representatives to discuss the business, operations, properties and financial and other condition of NeurogesX with respect to matters relating to the Revenue Interest and the Collateral with NeurogesX’s officers and with its independent certified public accountants (to the extent such independent certified accountants agree to discuss such matters with CHRP).

(d) NeurogesX shall maintain a system of accounting established and administered in accordance with sound business practices to permit preparation of financial statements in accordance with GAAP.

Section 5.03 Material Contracts.

(a) NeurogesX shall use commercially reasonable efforts (as if it was the sole owner of the Revenue Interest) to comply with all terms and conditions of and fulfill all of its obligations under all Material Contracts relating to the Revenue Interest (including any License Agreement). NeurogesX shall not amend any such Material Contract or issue any consents or

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other approvals under any such Material Contract in a manner which would materially adversely affect CHRP’s rights hereunder (including, without limitation, the right to receive the Revenue Interest Payments) without the prior written consent of CHRP, which consent shall not be unreasonably withheld, conditioned or delayed. NeurogesX shall use commercially reasonable efforts (as if it was the sole owner of the Revenue Interest) to take all actions necessary to enforce its rights and the rights of CHRP under any such Material Contract (subject to consultation with and reasonable direction and approval of CHRP, which approval shall not be unreasonably withheld, conditioned or delayed) and perform all of its obligations under any such Material Contract. In the event NeurogesX fails to take such action, NeurogesX hereby appoints CHRP and any officer thereof, its agent-in-fact to take all such actions and exercise and enforce all such rights.

(b) In the event any License Agreement is terminated for any reason whatsoever, NeurogesX shall (in consultation and coordination with CHRP) take prompt and commercially reasonable action (as if it were the sole owner of the Revenue Interests) to preserve the market for the Licensed Products in the Territory and commercialize the Licensed Products. NeurogesX shall as promptly as practicable upon or following such termination notify CHRP in writing of all immediate and short term activities it proposes to conduct, and [***] of such termination advise CHRP [***] to (I) [***] provided, however, that NeurogesX has, [***], or (II) [***]; provided, that [***] NeurogesX shall consult with CHRP with respect to the appropriate alternative and the basis therefore, and shall respond to CHRP’s inquires, acting at all times in good faith to [***].

(i) [***] In such case, NeurogesX shall (A) provide to CHRP reports in form, substance and timing identical to the Reports required to be provided by Astellas to NeurogesX under Section 4.6 of the Existing License Agreement, (B) consult and meet regularly with CHRP through establishment of committees which operate similar to the JCC, JDC, JSC and JRC under the Existing License Agreement (except that, to the extent applicable, NeurogesX shall act in the same capacity as Astellas and CHRP shall act in the capacity that NeurogesX had acted under the Existing License Agreement with respect to such matters) and (C) [***]For clarity and without limiting the foregoing, [***] NeurogesX may in consultation with CHRP and with CHRP’s written consent, not to be unreasonably withheld, conditioned or delayed, [***]

(ii) [***] provided that (1) [***] and NeurogesX agrees to undertake in connection with [***]such obligations and liabilities as it has under the [***], as defined in the Existing License Agreement, has not expired prior to the termination of the Existing License Agreement, an option on terms and conditions materially similar to those set forth in Section 2.3 of the Existing License Agreement for any such remaining period of the Option Period had the Existing License Agreement not been terminated), (2) any [***] shall execute a letter [***], and (3) CHRP may, but without any obligation, also seek to locate and secure a [***], and NeurogesX shall in good faith consider candidates proposed by CHRP. If NeurogesX does not secure [***] of termination of the Licensee’s right to commercialize Licensed Product in the Territory (including any Wind-down Period (as defined in the Existing License Agreement)) under the Existing License Agreement (or termination of the right to commercialize Licensed Product in the Territory under any subsequent Replacement License Agreement), CHRP may

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(but shall have no obligation to) upon written notice to NeurogesX (A) [***] itself or through an Affiliate on and subject to the provisions of the CHRP Replacement License Agreement or (B) [***]; provided that in such case CHRP shall consult with NeurogesX and keep NeurogesX reasonably informed as to the progress thereof and NeurogesX shall have the right to [***], such approval not to be unreasonably withheld, conditioned or delayed (taking into account the respective interests of the Parties in the Revenue Interest). NeurogesX shall, upon consultation with CHRP, and at CHRP’s request, request and accept assignment of [***] or pursuant to any [***]. If the event NeurogesX fails to take such action, NeurogesX hereby appoints CHRP and any officer thereof, its agent-in-fact to take all such actions and exercise and enforce all such rights.

Section 5.04 Confidentiality; Public Announcement.

(a) All Confidential Information furnished by the Disclosing Party, in connection with this Agreement and any other Transaction Document and the transactions contemplated hereby and thereby shall be kept confidential by the Receiving Party, and shall be used by the Receiving Party only in connection with this Agreement and any other Transaction Document and the transactions contemplated hereby and thereby. Notwithstanding the foregoing, the Receiving Party may disclose such Confidential Information to its existing or potential acquirers, partners, directors, employees, managers, officers, investors, bankers, lenders or other sources of financing, advisors (including, without limitation, financial advisors, attorneys and accountants), trustees, representatives, and other Persons on a need to know basis provided that such Persons shall be informed of the confidential nature of such information and shall be obligated to keep such information confidential pursuant to the terms of this Section 5.04(a) and the Receiving Party shall be responsible for such Person’s failure to comply with such obligations.

(b) Each Party agrees not to disclose to any Third Party the terms and conditions of this Agreement or any other Transaction Document or issue any press release with respect to this Agreement or any other Transaction Document without the prior approval of the other Party, except a Party may disclose the terms and conditions hereof (i) to its existing or potential acquirers, partners, directors, employees, managers, officers, investors, bankers, lenders or other sources of financing, advisors (including, without limitation, financial advisors, attorneys and accountants), trustees, representatives, and other Persons on a need to know basis, provided that such Persons shall be informed of the confidential nature of such information and shall be obligated to keep such information confidential pursuant to the terms of this Section 5.04(b) and the Party disclosing such terms and conditions shall be responsible for such Person’s failure to comply with such obligations. Notwithstanding the foregoing, the Parties agree upon a joint press release to announce the execution of this Agreement, which is attached hereto as Exhibit M; thereafter, either Party may each disclose to Third Parties the information contained in such press release without the need for further approval by the other Party.

(c) In addition, a Party may disclose the Confidential Information of the other Party and the terms and conditions of this Agreement or the other Transaction Documents (i) as necessary to enforce the terms of this Agreement or the other Transaction Documents and (ii) comply with applicable law or the rules of a recognized stock exchange or order of any court, administrative agency or other tribunal of competent jurisdiction, provided, however, that if a Party is required by applicable law, stock exchange or order to make any such disclosure it will

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give reasonable advance notice to the other Party of such disclosure requirement and use its reasonable efforts to secure confidential treatment thereof and shall only disclose that portion thereof that, in the opinion of its legal counsel, is required to be disclosed. Further, with respect to any such disclosures made pursuant to applicable securities laws or made to investment or other analysts each Party shall consult with the other Party regarding the form, content and timing of such disclosures, provided that nothing in any Transaction Document shall prevent a Party from fully complying with applicable law or regulation.

(d) This Agreement supersedes the Confidentiality Agreement between the Parties dated August 12, 2009 (the “Prior CDA”) with respect to information disclosed thereunder. All information exchanged between the Parties under the Prior CDA shall be deemed Confidential Information of the Disclosing Party and shall be subject to the terms of this Section 5.04.

(e) Except with respect to CHRP’s internal communications or private communications with its representatives, CHRP shall not, and shall cause its representatives, its Affiliates and its Affiliates’ representatives not to make use of the name, nickname, trademark, logo, service xxxx, trade dress or other name, term, xxxx or symbol identifying or associated with NeurogesX without NeurogesX’s prior written consent to the specific use in question, provided that the consent of NeurogesX shall not be required with respect to publication of NeurogesX’s name and logos in CHRP’s promotional materials, including without limitation the websites for CHRP and its Affiliates consistent with its use of other similarly situated Third Parties’ names and logos.

Section 5.05 Security Agreement.

NeurogesX hereby grants, and shall maintain, at all times during the term of this Agreement, in favor of CHRP a valid, continuing, first priority perfected lien, subject to Permitted Liens, on and security interest in the Revenue Interest, the Intellectual Property and other Collateral described in the Security Agreement in accordance therewith, and NeurogesX shall perform all of its obligations under the Security Agreement. Furthermore, subject to any limitations set forth in the Security Agreement, NeurogesX agrees to perform such actions and execute, file, register, and deliver such documents as reasonably requested by CHRP to perfect the security interest of CHRP in the Revenue Interest, the Intellectual Property and other Collateral described in the Security Agreement.

Section 5.06 Further Assurance.

(a) Subject to the terms and conditions of this Agreement, each of CHRP and NeurogesX shall use its commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary under applicable laws and regulations to consummate the transactions contemplated by this Agreement and any other Transaction Document. CHRP and NeurogesX agree to execute and deliver such other documents, certificates, agreements and other writings (including any financing statement filings requested by CHRP) and to take such other actions as may be reasonably necessary in order to consummate or implement expeditiously the transactions contemplated by this Agreement and any other Transaction Document and to vest in CHRP good, valid and marketable rights and interests in and to the Revenue Interest free and clear of all Liens, except the Permitted Liens and those

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Liens created in favor of CHRP pursuant to the Security Documents and any other Transaction Document and NeurogesX retained interest therein, and to perform the covenants and obligations contained herein.

(b) CHRP and NeurogesX shall execute and deliver such additional documents, certificates and instruments, and to perform such additional acts, as may be reasonably requested and necessary or appropriate to carry out and effectuate all of the provisions of this Agreement and any other Transaction Document and to consummate all of the transactions contemplated by this Agreement and any other Transaction Document.

(c) Except for disputes between the Parties, CHRP and NeurogesX shall cooperate and provide assistance as reasonably requested by the other respective Party in connection with any litigation, arbitration or other proceeding (whether threatened, existing, initiated, or contemplated prior to, on or after the date hereof) to which either Party or any of its officers, directors, shareholders, agents or employees is or may become a Party or is or may become otherwise directly or indirectly affected or as to which any such Persons have a direct or indirect interests, in each case relating to this Agreement, any other Transaction Document, the Revenue Interest or any Collateral, or the transactions described herein or therein.

Section 5.07 Remittance to Initial Concentration Account.

(a) On or before the Closing Date, NeurogesX and CHRP shall enter into a Deposit Agreement, substantially in the form of Exhibit K attached hereto, which will provide for, among other things, the establishment and maintenance of an Initial Concentration Account, a Joint Concentration Account, a NeurogesX Concentration Account and a CHRP Concentration Account in accordance with the terms herein and therein. Any CHRP Concentration Account shall be held solely for the benefit of CHRP, but shall be subject to the terms and conditions of the Transaction Documents. Funds deposited into the Initial Concentration Account shall be treated as provided in the Deposit Agreement. CHRP shall have immediate and full access to and control of any funds held in the CHRP Concentration Account and such funds shall not be subject to any conditions or restrictions whatsoever. After all amounts payable to CHRP under Section 2.02 are swept into the CHRP Concentration Account, as provided in the Deposit Agreement, the amounts remaining in the Joint Concentration Account which are payable to NeurogesX shall then be swept into the NeurogesX Concentration Account on a daily basis. NeurogesX shall have immediate and full access to and control of any funds held in the NeurogesX Concentration Account and such funds shall not be subject to any conditions or restrictions whatsoever other than those of the Depositary Bank. The foregoing shall not (i) affect or reduce NeurogesX’s obligations to pay in full all amounts due to CHRP under this Agreement or (ii) in any manner limit or expand the recourse of CHRP to the assets of NeurogesX to satisfy NeurogesX’s payment obligations hereunder.

(b) NeurogesX shall pay all fees, expenses and charges of the Depository Bank in respect of the Deposit Accounts.

(c) At all times during the Term, NeurogesX shall instruct and use commercially reasonable efforts to cause Licensee to pay directly into the Initial Concentration Account all Revenue Interest, and on or before the Closing Date, NeurogesX shall send the letter attached

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hereto as Exhibit H to Licensee. Without in any way limiting the foregoing, commencing on the Closing Date, subject to the provisions of Section 2.02, any and all payments in respect of Revenue Interest received by NeurogesX shall be held in trust for the benefit of CHRP and directed into the Initial Concentration Account within five (5) Business Days of NeurogesX’s receipt thereof and, any and all payments in respect of Excluded Revenue Interests received by CHRP shall be held in trust for the benefit of NeurogesX and remitted to NeurogesX within five (5) Business Days of CHRP’s receipt thereof. Accordingly, from and after the Closing Date NeurogesX shall not establish or maintain any account (as defined in the UCC) other then the Initial Concentration Account for the collection or deposit of any Revenue Interest.

(d) With respect to any License Agreement entered into by NeurogesX during the Term regarding the sale of a Licensed Product in the Territory, NeurogesX shall (i) at the time of the execution and delivery of such License Agreement, instruct the Licensee to remit to the Initial Concentration Account when due all payments of Revenue Interest that are due and payable to NeurogesX during the Term and (ii) in the case of any License Agreement, deliver to CHRP written evidence of such instruction and of such Licensee’s agreement thereto. For purposes of the Existing License Agreement, NeurogesX providing the Licensee the form of Licensee Direction attached hereto as Exhibit H in accordance with the provision of Section 20.5 of the Existing License Agreement and obtaining the consent and agreement of Licensee in accordance with Section 6.02(c) shall be deemed to fulfill the obligation set forth in subclause (i).

(e) The Parties acknowledge that for administrative and recordkeeping purposes, Astellas has requested that NeurogesX provide to Astellas invoice with respect to amounts payable by Astellas to NeurogesX under the Existing License Agreement. [***] All invoices shall reflect that Revenue Interest payments shall be made by Astellas to the Initial Concentration Account. In the event the Parties determine that an amount being paid by Astellas to the Initial Concentration Account is an Excluded Revenue Interest, the Parties shall promptly (and in any event within five (5) Business Days of the issuance of an invoice) mutually establish a written Account Instruction with respect to the Excluded Revenue Interest amount to be paid by Astellas to the Initial Concentration Account and swept into the Joint Concentration Account based on such invoice to implement the payment requirements of Section 2.02 which joint Account Instruction shall be issued to the Depository Bank by CHRP.

(f) Except as otherwise provided in the Deposit Agreement, neither Party hereto shall have any right to terminate the Depositary Bank during the Term with respect to its rights and obligations under the Deposit Agreement without the other Party’s prior written consent. Any such consent, which the other Party may grant or withhold in its discretion, shall be subject to the satisfaction of each of the following conditions to the satisfaction of the other Party:

(i) a successor Depositary Bank shall be appointed by mutual agreement of the Parties;

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(ii) CHRP and NeurogesX and the successor Depositary Bank shall have entered into a deposit account control agreement substantially in the form of the Deposit Agreement attached hereto as Exhibit K;

(iii) all funds and items in the accounts subject to the Deposit Agreement to be terminated shall be transferred to the new accounts held at the successor Depositary Bank prior to the termination of the then existing Depositary Bank; and

(iv) CHRP shall have received written evidence that prior to termination Licensee has been instructed to remit all future payments of Revenue Interest to the new accounts held at the successor Depositary Bank.

Section 5.08 Intellectual Property.

(a) To the extent NeurogesX has the right to do so, it shall use commercially reasonable efforts (as if it were the sole owner of the Revenue Interest) to, at its sole expense, either directly or by causing any Licensee or licensor, as applicable to do so, take any and all actions (including taking legal action to specifically enforce the applicable terms of any License Agreement) and prepare, execute, deliver and file any and all agreements, documents or instruments which are necessary or desirable to (i) diligently prosecute and maintain the applicable Intellectual Property (including Patents therein) and (ii) diligently defend or assert such Intellectual Property and such Patents against commercially significant infringement or interference by any other Persons, and against any claims of invalidity or unenforceability, in any jurisdiction (including, without limitation, by bringing any legal action for infringement or defending any counterclaim of invalidity or action of a Third Party for declaratory judgment of non-infringement or non-interference) in the Territory. Consistent with NeurogesX’s rights under any License Agreement and the agreements listed on Schedule 3.12(b), [***] NeurogesX shall not, and shall use its commercially reasonable efforts (as if it were the sole owner of the Revenue Interest) to cause any Licensee or licensor, as applicable, not to, disclaim or abandon, or fail to take any action necessary or desirable to prevent the disclaimer or abandonment of Intellectual Property, in each case that would have a Material Adverse Effect. Subject to the rights of Licensee and parties to any Material Contract, if, in CHRP’s reasonable judgment, NeurogesX does not exercise such commercially reasonable efforts with respect to its rights under the License Agreement relating to the prosecution or maintenance of the Patents or enforcement or defense of the Patents (taking into account the Revenue Interest in the Territory), then CHRP may, in its sole discretion, upon written notice to NeurogesX, assume control of the prosecution and maintenance of the Patents or prosecution or defense of such action or proceeding, at NeurogesX’s sole cost and expense; notwithstanding the foregoing, NeurogesX shall not be required to prosecute and maintain a Patent or prosecute or defend an action or proceeding or reimburse CHRP for any such action or proceeding which (i) a de minimus or insubstantial benefit would be obtained if successful or (ii) the failure to undertake the same would not cause a Material Adverse Effect to occur.

(b) NeurogesX shall use its commercially reasonable efforts (as if it were the sole owner of the Revenue Interest) to prosecute all pending Patent applications within the Intellectual Property in the Territory as listed in Schedule 3.12(a)(1) consistent with standards in the biotechnology industry for similarly situated entities.

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(c) NeurogesX shall directly take, or cause Licensee to take, any and all actions and prepare, execute, deliver and file any and all agreements, documents or instruments that are necessary or commercially reasonable or desirable to secure and maintain all Regulatory Approvals consistent with the License Agreement. To the extent that NeurogesX has the right to the control the same under the applicable License Agreement, NeurogesX shall not withdraw or abandon, or fail to take any action necessary to prevent the withdrawal or abandonment of, any Regulatory Approval once obtained without the prior written consent of CHRP, which consent shall not be unreasonably withheld, conditioned or delayed.

Section 5.09 Negative Covenants.

NeurogesX and its Subsidiaries shall not, without the prior written consent of CHRP:

(a) forgive, release, delay, postpone or compromise payment of any Revenue Interest;

(b) waive, amend, cancel or terminate, exercise or fail to exercise, any material rights constituting or relating to any Material Contract, the Revenue Interest or the Collateral, in each case which could have a material adverse effect on the rights of CHRP or otherwise would reasonably be expected to have a Material Adverse Effect;

(c) amend, modify, restate, cancel, supplement, terminate or waive any provision of any Material Contract (including the License Agreement) in the Territory, or grant any consent thereunder, or agree to do any of the foregoing, including, without limitation, entering into any agreement with any Licensee under the provisions of such License Agreement in the Territory, in each case which would have a Material Adverse Effect;

(d) create, incur, assume or suffer to exist any Lien, or exercise any right of rescission, offset, counterclaim or defense, upon or with respect to the Revenue Interest or Collateral, or agree to do or suffer to exist any of the foregoing, except for any Permitted Lien or Lien or agreements in favor of CHRP granted under or pursuant to this Agreement and the other Transaction Documents;

(e) sell, lease, license, transfer or assign (or attempt to do any of the foregoing) all or any portion of the Revenue Interest or, except as set forth in Section 5.03(b), any rights to the Licensed Product in the Territory; or

(f) default under, or take any action or fail to take any action which with the passage of time or the giving of notice or both would constitute a default or event of default under any Material Contract.

Section 5.10 Competing Products.

NeurogesX shall not violate any of its obligations under the Existing License Agreement, any Replacement License Agreement and the CHRP Replacement License Agreement, in each case with respect to Competing Products.

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Section 5.11 Notice.

NeurogesX shall provide CHRP with written notice as promptly as practicable (and in any event within five (5) Business Days) after becoming aware of any of the following:

(a) any material breach or default by NeurogesX of any covenant, agreement or other provision of this Agreement or any other Transaction Document;

(b) any express representation or warranty made by NeurogesX in any of the Transaction Documents or in any certificate delivered to CHRP pursuant hereto shall prove to be untrue, inaccurate or incomplete in any material respect;

(d) the occurrence of a Bankruptcy Event with respect to either NeurogesX or Licensee; and

(e) any material breach or default by Licensee under any License Agreement, or the termination of any License Agreement.

ARTICLE VI

THE CLOSING; CONDITIONS TO CLOSING

Section 6.01 Closing.

Subject to the closing conditions set forth in Sections 6.02 and 6.03, the payment of the Revenue Interest Advance and the assignment of the Revenue Interest (the “Closing”) shall take place at the offices of Xxxxx Xxxxxx Xxxxxxxx & Xxxxxx P.C., 000 Xxxxxxxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000 on the Closing Date.

Section 6.02 Conditions Applicable to CHRP to Effect the Closing.

The obligations of CHRP to effect the Closing shall be subject to the satisfaction of the following conditions, as of the Closing Date, any of which may be waived in writing by CHRP in its sole discretion. In the event the conditions set forth below have not been satisfied within fifteen (15) Business Days following the date of this Agreement, then the making of the Revenue Interest Advance shall be deferred until such time as all of such conditions have been satisfied (or waived in writing by CHRP) unless this Agreement is terminated in accordance with Section 7.02(a):

(a) Accuracy of Representations and Warranties. At Closing, the representations and warranties set forth in the Transaction Documents shall be true and correct in all material respects.

(b) No Adverse Circumstances. There shall not have occurred any event or circumstance (including, without limitation, any development with respect to the efficacy of the

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Licensed Product or the validity or enforceability of the Intellectual Property) that would reasonably be expected to have a Material Adverse Effect.

(c) Third Party Consents. All notices to, consents, approvals, authorizations and waivers from Third Parties and Governmental Authorities that are required for the consummation of the transactions contemplated by this Agreement or any of the Transaction Documents shall have been obtained or provided for and shall remain in effect. CHRP shall have received the Third Party Consents, in the form of Exhibits G-1, G-2 and G-3 hereto.

(d) CHRP Replacement License Agreement. The CHRP Replacement License Agreement shall have been executed and delivered by NeurogesX, and CHRP shall have received the same and a copy of the CHRP Replacement License Agreement or a memorandum of such agreement or other applicable document shall have been filed with all applicable Patent Offices to the extent necessary to protect CHRP’s interests therein.

(e) Officer’s Certificate. CHRP shall have received a certificate of an executive officer of NeurogesX pursuant to which such officer certifies to such officer’s Knowledge that the conditions set forth in Sections 6.02(a), (b) and (j) have been satisfied in all respects.

(f) Assignment Agreement. The Assignment Agreement shall have been executed and delivered by NeurogesX to CHRP, and CHRP shall have received the same.

(g) Security Agreement. The Security Agreement shall have been duly executed and delivered by the Parties, together with proper financing statements or other documents for filing under the UCC and/or any other applicable law, rule, statute or regulation relating to the perfection of a security interest in filing offices in the jurisdictions listed on Schedule 6.02(g). The Security Agreement shall be in full force and effect. The UCC-1 Financing Statement shall have been duly filed and a first priority security interest, subject to Permitted Liens, in the collateral under the Security Agreement shall have been created and all requisite fees in connection with such filing shall have been paid.

(h) Legal Opinions.

(i) CHRP shall have received an opinion of Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, PC, transaction counsel to NeurogesX, in form and substance set forth in Exhibit E.

(ii) CHRP shall have received an opinion of Xxxxxxxx & Xxxxxxxx LLP, intellectual property counsel to NeurogesX, in form and substance set forth in Exhibit F.

(i) Corporate Documents of NeurogesX. CHRP shall have received a certificate of an executive officer of NeurogesX to the effect set forth in Exhibit I (the statements made in which shall be true and correct on and as of the Closing Date) together with a copy of the incorporation of NeurogesX certified by the Secretary of State of the State of Delaware and a certificate of good standing of NeurogesX issued by the Secretary of State of the State of Delaware, in each case dated not more than twenty (20) days prior to the Closing Date.

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(j) Covenants. NeurogesX shall have complied in all material respects with its covenants set forth in the Transaction Documents.

(k) Licensee Direction. A copy of the Licensee Direction shall have been signed and delivered by NeurogesX to CHRP, and CHRP shall have received the same.

Section 6.03 Conditions Applicable to NeurogesX.

The obligations of NeurogesX to effect the Closing shall be subject to the satisfaction of the following conditions, as of the Closing Date, any of which may be waived in writing by NeurogesX in its sole discretion:

(a) Accuracy of Representations and Warranties. The representations and warranties of CHRP set forth in the Transaction Documents shall be true, correct and complete in all material respects.

(b) Officer’s Certificate. NeurogesX shall have received a certificate of an executive officer of CHRP pursuant to which such officer certifies to such officer’s knowledge that the conditions set forth in Section 6.03(a) and (d) have been satisfied in all respects.

(c) Corporate Documents of CHRP. NeurogesX shall have received a certificate of an executive officer of CHRP to the effect set forth in Exhibit J (the statements made in which shall be true and correct on and as of the Closing Date).

(d) Covenants. CHRP shall have complied in all material respects with its covenants set forth in the Transaction Documents.

ARTICLE VII

TERMINATION

Section 7.01 Term.

Unless sooner terminated as provided in Section 7.02, the term of this Agreement shall commence on the date hereof and continue in effect until the earlier to occur of (i) the Maturity Date and (ii) the Second Stepdown (the “Term”).

Section 7.02 Termination.

(a) Non-occurrence of the Closing Date. In the event that the Closing does not occur:

(i) on or before [***] after the date of this Agreement and such failure is not a result of a breach of CHRP’s obligations under this Agreement or any of the other Transaction Documents, then CHRP shall have the right to terminate this Agreement upon written notice to NeurogesX referencing this Section 7.02(a), provided that the conditions set forth in Section 6.02 and Section 6.03 have not been fulfilled or waived in accordance therewith prior to the date of such notice;

[***]

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

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(ii) on or before [***] after the date of this Agreement and such failure is not a result of a breach of NeurogesX’s obligations under this Agreement or any of the other Transaction Documents, then NeurogesX shall have the right to terminate this Agreement upon written notice to CHRP referencing this Section 7.02(a), provided that the conditions set forth in Section 6.02 and Section 6.03 have not been fulfilled or waived in accordance therewith prior to the date of such notice.

(b) Events of Default. Upon the occurrence of an Event of Default and so long as such Event of Default is continuing, CHRP may upon written notice to NeurogesX (or upon not less than ten (10) Business Days written notice if the Event of Default is the event described in clause (f) in the definition Bankruptcy Event and such event is not cured within [***]referencing this Section 7.02(b) terminate this Agreement and declare the an amount equal to (i) the Revenue Investment Advance to be immediately due and payable by NeurogesX together with interest accrued thereon from the Closing Date to the date of repayment at a rate equal to the lesser of (A) the Rate of Interest or (B) the maximum rate permitted by law, less (ii) Revenue Interest Payments received by CHRP, so that amounts paid to CHRP shall be in accordance with the Amortization Schedule annexed hereto as Exhibit L. For purposes of the foregoing, an “Event of Default” shall mean any of:

(i) A material misrepresentation by or breach by NeurogesX of any covenant or warranty contained herein or in any of the Transaction Documents that would have a Material Adverse Effect, which misrepresentation or breach is not remedied within [***] of NeurogesX’s receipt of notice from CHRP specifying such misrepresentation or breach and referencing this Section 7.02(b); or

(ii) The occurrence of a Bankruptcy Event with respect to NeurogesX.

(c) Buy-Out Rights. At anytime during the Term, NeurogesX shall have the right to terminate this Agreement upon thirty (30) days prior written notice to CHRP referencing this Section 7.02(c) and delivery to CHRP an amount equal to:

(i) If such notice is given in connection with or within [***] the close of a Change of Control, then the greater of (A) $68 million and (B) an amount that would generate the return of the Revenue Investment Advance together with interest accruing at an internal rate of return (utilizing the actual date of each payment and the same methodology utilized by the XIRR function in Microsoft Excel) to CHRP of [***] in respect of the Revenue Investment Advance from the date of the making of the Revenue Investment Advance through the date of payment of the Buy-Out amount, in each case less all Revenue Interest Payments previously received by CHRP; or

(ii) If such notice is not given in connection with or within [***] the close of a Change of Control, then the greater of (A) $76 million and (B) an amount that would generate the return of the Revenue Investment Advance together with interest accruing at an internal rate of return (utilizing the actual date of each payment and the same methodology utilized by the XIRR function in Microsoft Excel) to CHRP of [***] in respect of the Revenue Investment Advance from the date of the making of the Revenue Investment Advance through the date of

[***]

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

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payment of the Buy-Out amount, in each case less all Revenue Interest Payments previously received by CHRP.

(iii) For purposes of the foregoing, “Change of Control” shall mean, with respect to NeurogesX, any transaction or series of related transactions that would occasion: (A) any consolidation, merger, share exchange, conversion or other form of corporate reorganization or business combination involving NeurogesX, other than any such consolidation merger, share exchange, conversion or other form of corporate reorganization or business combination which would result in the record and beneficial owners of the voting securities of NeurogesX outstanding immediately prior to such event continuing to own, in substantially the same proportions, voting securities representing (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) a majority of the voting power of the voting securities of the surviving or resulting person, (B) a sale, lease, or other transfer of all or substantially all of the assets of NeurogesX to a person or group; (C) any sale, transfer, tender offer or exchange offer for fifty percent (50%) or more of the outstanding voting securities of NeurogesX; or (D) any person or group acting in concert to control NeurogesX having acquired beneficial ownership or the right to acquire beneficial ownership of fifty percent (50%) or more of the outstanding voting securities of NeurogesX. For purposes of the foregoing, a person or group shall not be deemed to have “beneficial ownership” of any shares that any such person or group has the right to acquire, if such right has not been exercised and any required consideration therefore has not been paid and “person” and “group” shall have the meanings given to such terms when used in Sections 13(d) and 14(d) of the United States Securities Exchange Act of 1934.

Section 7.03 Effects of Expiration or Termination.

(a) Accrued Obligations. Expiration or termination of this Agreement for any reason shall not release either Party any obligation or liability which, at the time of such expiration or termination, has already accrued to the other Party or which is attributable to a period prior to such expiration or termination. Accordingly, if any payments are required to be made by a Party to the other Party hereunder after the expiration of the Term, this Agreement shall remain in full force and effect until any and all such payments have been made in full, and solely for that purpose.

(b) Non-exclusive Remedy. Notwithstanding anything herein to the contrary, termination of this Agreement by a Party shall be without prejudice to other remedies such Party may have at law or equity (including any enforcement of its rights under any of the Transaction Documents).

(c) General Survival. ARTICLE 1 and Sections 2.01(b) (last sentence), 2.05, 5.04, 5.06(c), 7.03, 8.03, 8.04, 8.05 (with respect to activities during the Term), 8.06, 8.10, 8.11, 8.13, 8.14, 8.15 and 8.16 shall survive expiration or termination of this Agreement for any reason. Except as otherwise provided in this Section 7.03, all rights and obligations of the Parties under this Agreement shall terminate upon expiration or termination of this Agreement for any reason.

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ARTICLE VIII

MISCELLANEOUS

Section 8.01 Survival.

(a) All representations and warranties made herein and in any other Transaction Document, any certificates or in any other writing delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement and the Closing until the expiration or termination of this Agreement for any reason.

(b) Any investigation or other examination that may have been made or may be made at any time by or on behalf of the Party to whom representations and warranties are made shall not limit, diminish or in any way affect the representations and warranties in the Transaction Documents, and the Parties may rely on the representations and warranties in the Transaction Documents irrespective of any information obtained by them by any investigation, examination or otherwise.

Section 8.02 Specific Performance.

Each of the Parties hereto acknowledges that the other Party will have no adequate remedy at law if it fails to perform any of its obligations under any of the Transaction Documents. In such event, each Party agrees that the other Party shall have the right, in addition to any other rights it may have (whether at law or in equity), to specific performance of this Agreement.

Section 8.03 Notices.

All notices, consents, waivers and communications hereunder given by any Party to the other shall be in writing (including facsimile transmission and electronic mail) and delivered personally, by facsimile (receipt confirmed), by electronic mail (read receipt confirmed), by a recognized overnight courier, or by dispatching the same by certified or registered mail, return receipt requested, with postage prepaid, in each case addressed:

If to CHRP to:

Xxxxx Healthcare Royalty Partners, L.P.

000 Xxxxx Xxxxxx, Xxxxx 0000

Xxxxxxxx, XX 00000

Attention: [***]

Facsimile No.: [***]

Email: [***]

[***]

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

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with a copy to:

Xxxxx Xxxxxx Xxxxxxxx & Xxxxxx P.C.

000 Xxxxxxxxx Xxxxxx, Xxxxx 0000

Xxx Xxxx, XX 00000

Attention: [***]

Facsimile No.: [***]

Email: [***]

If to NeurogesX or its Subsidiaries, to:

NeurogesX, Inc.

0000 Xxxxxxxxxxxx Xxxxxxx, Xxxxx 000

Xxx Xxxxx, Xxxxxxxxxx 00000

Attention: [***]

Facsimile No.: [***]

Email: [***]

with a copy to:

Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx, P.C.

000 Xxxx Xxxx Xxxx

Xxxx Xxxx, Xxxxxxxxxx 00000-0000

Attention: [***]

Facsimile No.: [***]

Email: [***]

or to such other address or addresses as CHRP or NeurogesX may from time to time designate by notice as provided herein, except that notices of changes of address shall be effective only upon receipt. All such notices, consents, waivers and communications shall: (a) when posted by certified or registered mail, postage prepaid, return receipt requested, be effective three (3) Business Days after dispatch, (b) when facsimiled or sent by electronic mail, be effective upon confirmation of receipt, or (c) when delivered by a recognized overnight courier or in person, be effective upon receipt when hand delivered.

Section 8.04 Successors and Assigns.

The provisions of this Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and assigns. NeurogesX shall not be entitled to assign any of its obligations and rights under the Transaction Documents without the prior written consent of CHRP, which consent shall not be unreasonably withheld, conditioned or delayed; provided, however that NeurogesX may, without the consent of CHRP, assign any of its obligations and rights under the Transaction Documents to any other Person with which it may merge or consolidate or to which it may sell all or substantially all of its assets; provided, further, however that no assignment by NeurogesX shall relieve NeurogesX of its obligations hereunder or under any Transaction Document even if such assignment has been consented to by CHRP and such assignee shall be jointly and severally liable with NeurogesX to CHRP. CHRP may

[***]

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

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assign without consent of NeurogesX any of its rights under the Transaction Documents without restriction.

Section 8.05 Indemnification.

(a) NeurogesX hereby indemnifies and holds CHRP and its Affiliates and any of their respective partners, directors, managers, members, officers, employees and agents (each a “CHRP Indemnified Party”) harmless from and against any and all Losses (including all Losses in connection with any product liability claims or claims of infringement or misappropriation of any intellectual property rights of any Third Parties to the extent that such Losses are directly or indirectly incurred by a CHRP Indemnified Party) incurred or suffered by any CHRP Indemnified Party as a result of a claim by a Third Party arising out of any breach of any representation, warranty or certification made by NeurogesX in any of the Transaction Documents or certificates given by NeurogesX in writing pursuant hereto or thereto or any breach of or default under any covenant or agreement by NeurogesX pursuant to any Transaction Document, including any failure by NeurogesX to satisfy any of the Excluded Liabilities and Obligations to the extent that any such Losses are not caused by a CHRP Indemnified Party or otherwise subject to indemnification by CHRP pursuant to Section 8.05(b).

(b) CHRP hereby indemnifies and holds NeurogesX, its Affiliates and any of their respective partners, directors, managers, officers, employees and agents (each a “NeurogesX Indemnified Party”) harmless from and against any and all Losses incurred or suffered by a NeurogesX Indemnified Party as a result of a claim by a Third Party arising out of any breach of any representation, warranty or certification made by CHRP in any of the Transaction Documents or certificates given by CHRP in writing pursuant hereto or thereto or any breach of or default under any covenant or agreement by CHRP pursuant to any Transaction Document to the extent that any such Losses are not caused by a NeurogesX Indemnified Party or otherwise subject to indemnification by NeurogesX pursuant to Section 8.05(a).

(c) If any claim, demand, action or proceeding (including any investigation by any Governmental Authority) shall be brought or alleged against an indemnified Party in respect of which indemnity is to be sought against an indemnifying Party pursuant to the preceding paragraphs, the indemnified Party shall, promptly after receipt of notice of the commencement of any such claim, demand, action or proceeding, notify the indemnifying Party in writing of the commencement of such claim, demand, action or proceeding, enclosing a copy of all papers served, if any; provided, that the omission to so notify such indemnifying Party will not relieve the indemnifying Party from any liability that it may have to any indemnified Party under the foregoing provisions of this Section 8.05 unless, and only to the extent that, such omission results in the forfeiture of, or has a material adverse effect on the exercise or prosecution of, substantive rights or defenses by the indemnifying Party. In case any such action is brought against an indemnified Party and such indemnified Party notifies the indemnifying Party of the commencement thereof, the indemnifying Party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying Party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified Party, and after notice from the indemnifying Party to such indemnified Party of its election so to assume the defense thereof, the indemnifying Party will not be liable to such indemnified Party under this Section 8.05 for any legal or other expenses subsequently incurred by such indemnified Party in

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connection with the defense thereof other than reasonable costs of investigation. In any such proceeding, an indemnified Party shall have the right to retain its own counsel, but the reasonable fees and expenses of such counsel shall be at the expense of such indemnified Party unless (i) the indemnifying Party and the indemnified Party shall have mutually agreed to the retention of such counsel, (ii) the indemnifying Party has assumed the defense of such proceeding and has failed within a reasonable time to retain counsel reasonably satisfactory to such indemnified Party or (iii) the named Parties to any such proceeding (including any impleaded Parties) include both the indemnifying Party and the indemnified Party and representation of both Parties by the same counsel would be inappropriate due to actual or potential conflicts of interests between them based on the advice of such counsel. It is agreed that the indemnifying Party shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the reasonable fees and expenses of more than one separate law firm (in addition to local counsel where necessary) for all such indemnified Parties. The indemnifying Party shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying Party agrees to indemnify the indemnified Party from and against any loss or liability by reason of such settlement or judgment. No indemnifying Party shall, without the prior written consent of the indemnified Party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified Party is or could have been a Party and indemnity could have been sought hereunder by such indemnified Party, unless such settlement includes an unconditional release of such indemnified Party from all liability on claims that are the subject matter of such proceeding.

(d) UNLESS CAUSED BY THE BREACH OF Section 5.04(a), THE GROSS NEGLIGENCE, FRAUD, INTENTIONAL OR WILLFUL MISCONDUCT, OR BAD FAITH OF CHRP, IN NO EVENT SHALL CHRP BE LIABLE TO NEUROGESX FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL OR PUNITIVE DAMAGES, INCLUDING LOSS OF FUTURE REVENUE, INCOME OR PROFITS, DIMINUTION OF VALUE OR LOSS OF BUSINESS REPUTATION OR OPPORTUNITY RELATING TO THE BREACH OR ALLEGED BREACH HEREOF.

(e) UNLESS CAUSED BY THE BREACH OF Section 5.04(a), THE GROSS NEGLIGENCE, FRAUD, INTENTIONAL OR WILLFUL MISCONDUCT, OR BAD FAITH OF NEUROGESX, IN NO EVENT SHALL NEUROGESX BE LIABLE TO CHRP FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL OR PUNITIVE DAMAGES, INCLUDING LOSS OF FUTURE REVENUE, INCOME OR PROFITS, DIMINUTION OF VALUE OR LOSS OF BUSINESS REPUTATION OR OPPORTUNITY RELATING TO THE BREACH OR ALLEGED BREACH HEREOF WHICH EXCEEDS THE “CAP AMOUNT”.

Section 8.06 Independent Nature of Relationship.

(a) The relationship between NeurogesX and its Subsidiaries, on the one hand, and CHRP, on the other hand, is solely that of lender and a borrower and an assignor and assignee, and neither CHRP, on the one hand, nor NeurogesX or its Subsidiaries, on the other hand, has any fiduciary or other special relationship with the other or any of their respective Affiliates.

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(b) No officer or employee of CHRP will be located at the premises of NeurogesX or any of its Affiliates, except in connection with an audit performed pursuant to Section 5.02. No officer, manager or employee of CHRP shall engage in any commercial activity with NeurogesX or any of its Affiliates other than as contemplated herein and in the other Transaction Documents.

Section 8.07 Tax.

(a) For United States federal, state and local tax purposes, NeurogesX and CHRP.[***] Each Party hereto agrees [***] unless (i) the other Party to this Agreement has consented to such actions, or (ii) as a result of a material change in applicable law following the date hereof, counsel for such Party has advised it in writing that it is more likely than not (x) [***] as amended.

(b) NeurogesX shall be entitled to [***]; provided however that if CHRP will not [***]. To the extent such [***].

(c) This Agreement is not intended to create a deemed partnership, association or joint venture between CHRP and NeurogesX. Each Party agrees not to refer to the other as a “partner” or the relationship as a “partnership” or “joint venture”.

Section 8.08 Entire Agreement.

This Agreement, together with the Exhibits and Schedules hereto (which are incorporated herein by reference), and the other Transaction Documents constitute the entire agreement between the Parties with respect to the subject matter hereof and supersede all prior agreements (including the Letter of Intent dated February 18, 2010, between CHRP and NeurogesX), understandings and negotiations, both written and oral, between the Parties with respect to the subject matter of this Agreement, including the Prior CDA. No representation, inducement, promise, understanding, condition or warranty not set forth herein (or in the Exhibits, Schedules or other Transaction Documents) has been made or relied upon by either Party hereto. None of this Agreement, nor any provision hereof, is intended to confer upon any Person other than the Parties hereto any rights or remedies hereunder.

Section 8.09 Amendments; No Waivers.

(a) This Agreement or any term or provision hereof may not be amended, changed or modified except with the written consent of the Parties hereto. No waiver of any right hereunder shall be effective unless such waiver is signed in writing by the Party against whom such waiver is sought to be enforced.

(b) No failure or delay by either Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.

[***]

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

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Section 8.10 Interpretation.

When a reference is made in this Agreement to Articles, Sections, Schedules or Exhibits, such reference shall be to an Article, Section, Schedule or Exhibit to this Agreement unless otherwise indicated. The words “include,” “includes” and “including” when used herein shall be deemed in each case to be followed by the words “without limitation”. Neither Party hereto shall be or be deemed to be the drafter of this Agreement for the purposes of construing this Agreement against one Party or the other.

Section 8.11 Headings and Captions.

The headings and captions in this Agreement are for convenience and reference purposes only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.

Section 8.12 Counterparts; Effectiveness.

This Agreement may be executed in two (2) or more counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. This Agreement shall become effective when each Party hereto shall have received a counterpart hereof signed by the other Party hereto. Any counterpart may be executed by facsimile or pdf signature and such facsimile or pdf signature shall be deemed an original.

Section 8.13 Severability.

If any provision of this Agreement is held to be invalid or unenforceable, the remaining provisions shall nevertheless be given full force and effect.

Section 8.14 Expenses.

Each Party hereto will pay all of its own fees and expenses in connection with entering into and consummating the transactions contemplated by this Agreement; provided, that NeurogesX agrees to reimburse CHRP for CHRP’s actual, reasonable and documented out-of-pocket expenses to cover due diligence and other, including legal, expenses associated with the transactions contemplated hereby.

Section 8.15 Governing Law; Jurisdiction.

(a) This Agreement shall be governed and construed in accordance with the laws of the State of New York, USA, without giving effect to any choice of law provisions thereof. Each Party hereby submits itself for the purpose of this Agreement and any controversy arising hereunder to the exclusive jurisdiction of the state and federal courts located in the County of New York, State of New York, USA, and any courts of appeal therefrom, and waives any objection on the grounds of lack of jurisdiction (including, without limitation, venue) to the exercise of such jurisdiction over it by any such courts. Prior to bringing a legal action against the other Party (other than an action for injunctive relief, which may be brought at any time), such dispute shall be separately negotiated by the Parties hereto in good faith and all reasonable efforts undertaken to settle amicably such matters before resorting to further legal recourse, as

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follows: upon the occurrence of a dispute between the Parties, including, without limitation, any breach of this Agreement or any obligation relating thereto, the matter shall be referred first to the officers of NeurogesX and CHRP having responsibility for the subject matter of the dispute, or their designees. The officers, or their designees, as the case may be, shall negotiate in good faith to resolve such dispute in a mutually satisfactory manner for up to thirty (30) days. If such efforts do not result in mutually satisfactory resolution of the dispute, the matter shall be referred to the chief executive officer of NeurogesX and the managing director of CHRP, or their designees. The chief executive officer and managing director, or their designees, as the case may be, shall negotiate in good faith to resolve such dispute in a mutually satisfactory manner for up to thirty (30) additional days, or such longer period of time to which the chief executive officer and managing director may agree. In the event the dispute has not been resolved at the end of such thirty (30) day period (or such longer period as agreed to by the chief executive officer and managing director of the Parties), either Party shall be entitled to bring an action in accordance with Section 8.15(a) and (b).

(b) Each Party hereto hereby irrevocably consents to the service of process out of any of the courts referred to in subsection (a) above of this Section 8.15 in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to it at its address set forth in this Agreement. Each Party hereto hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any suit, action or proceeding commenced hereunder or under any other Transaction Document that service of process was in any way invalid or ineffective. Nothing herein shall affect the right of a Party to serve process on the other Party in any other manner permitted by law. In the event of any litigation under this Section 8.15, the prevailing Party shall be entitled to reimbursement of any reasonable and documented out-of-pocket expenses (including reasonable fees and expenses of legal counsel) incurred by the prevailing Party in connection with asserting or enforcing such action hereunder, including, without limitation, in the case CHRP is the prevailing Party in connection with any Bankruptcy Event with respect to NeurogesX and the non-prevailing Party agrees to reimburse and indemnify the prevailing Party for such expenses.

Section 8.16 Waiver of Jury Trial.

Each Party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any action, proceeding, claim or counterclaim arising out of or relating to any Transaction Document or the transactions contemplated under any Transaction Document. This waiver shall apply to any subsequent amendments, renewals, supplements or modifications to any Transaction Document.

[SIGNATURE PAGE FOLLOWS]

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


COMPANY:	NEUROGESX, INC.

	By:	/s/ Xxxxxxx Xxxxxxxxx
	Name:	Xxxxxxx Xxxxxxxxx
	Title:	EVP, COO, CFO

CHRP:	XXXXX HEALTHCARE ROYALTY PARTNERS, L.P.

	By	Xxxxx Healthcare Royalty GP, LLC
		Its General Partner

	By:	/s/ Xxxxxxx X. Xxxxx, M.D.
	Name:	Xxxxxxx X. Xxxxx, M.D.
	Title:	Managing Director

[SIGNATURE PAGE TO FINANCING AGREEMENT]

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EXHIBIT A

FORM OF ASSIGNMENT AGREEMENT

- 1 -

EXECUTION COPY

ASSIGNMENT

This ASSIGNMENT (this “Assignment”), dated as of April 29, 2010, is made and entered into by and between NeurogesX Inc., a Delaware corporation (the “Assignor”), and Xxxxx Healthcare Royalty Partners, L.P., a Delaware limited partnership (together with its Affiliates, the “Assignee”). All capitalized terms used and not defined herein shall have the meanings ascribed to them in the Financing Agreement referred to below.

WHEREAS, the Assignor and the Assignee are parties to that certain Financing Agreement, dated even herewith (the “Financing Agreement”), pursuant to which, among other things, the Assignor agrees to assign, transfer and convey to the Assignee, and the Assignee agrees to accept the assignment, transfer and conveyance from the Assignor, all of the Assignor’s right, title and interest in and to the Assigned Rights, as that term is defined in the Financing Agreement, for consideration in the amount and on the terms and conditions provided therein; and

WHEREAS, the parties now desire to carry out the purposes of the Financing Agreement by the execution and delivery of this instrument evidencing the Assignee’s purchase and acceptance of the Revenue Interest and the Assigned Rights.

NOW, THEREFORE, in consideration of the foregoing premises and of other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1. Assignment and Assumption of Assigned Rights. The Assignor hereby assigns, transfers and conveys to the Assignee free and clear of all Liens (except for the Permitted Liens and Liens created in favor of CHRP), and the Assignee hereby accepts, all of the Assignor’s right, title and interest in and to all of the Assigned Rights, subject to Section 2 below. The Assignor hereby represents and warrants to the Assignee that the assignment of the Assigned Rights effected hereby is sufficient to vest in the Assignee a valid ownership interest in all of the Assigned Rights, including, without limitation the Assigned Rights that are “payment intangibles” as defined in the UCC.

2. No Assumption of Obligations. The parties acknowledge that the Assignee is not assuming any debt, liability or obligation of the Assignor, known or unknown, fixed or contingent, in connection with the Assigned Rights, including, without limitation, the Excluded Liabilities and Obligations.

3. Further Assurances. Each party hereto shall execute, acknowledge and deliver to the other party any and all documents or instruments, and shall take any and all actions, reasonably required by such other party from time to time, to confirm or effect the matters set forth herein, or otherwise to carry out the purposes of the Financing Agreement and this Assignment and the transactions contemplated thereby and hereby.

4. Financing Agreement. This Assignment is entered into pursuant to and is subject in all respects to all of the terms, provisions and conditions of the Financing Agreement, and nothing herein shall be deemed to modify any of the representations, warranties, covenants and obligations of the parties thereunder. For clarity, the parties acknowledge that Assignee has

certain obligations to assign back rights in and to the Assigned Rights as set forth in Section 2.01(b) of the Financing Agreement.

5. Interpretation. In the event of any conflict or inconsistency between the terms, provisions and conditions of this Assignment and the Financing Agreement, the terms, provisions and conditions of the Financing Agreement shall govern.

6. Counterparts; Effectiveness. This Assignment may be executed in two (2) or more counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. This Assignment shall become effective when each party hereto shall have received a counterpart hereof signed by the other party hereto. Any counterpart may be executed by facsimile or pdf signature and such facsimile or pdf signature shall be deemed an original.

7. Governing Law; Jurisdiction; Service of Process; Waiver of Jury Trial.

(a) This Assignment shall be governed and construed in accordance with the laws of the State of New York, USA, without giving effect to any choice of law provisions thereof. Each party hereby submits itself for the purpose of this Assignment and any controversy arising hereunder to the exclusive jurisdiction of the state and federal courts located in the County of New York, State of New York, USA, and any courts of appeal therefrom, and waives any objection on the grounds of lack of jurisdiction (including, without limitation, venue) to the exercise of such jurisdiction over it by any such courts. Prior to bringing a legal action against the other party (other than an action for injunctive relief, which may be brought at any time), such dispute shall be separately negotiated by the parties hereto in good faith and all reasonable efforts undertaken to settle amicably such matters before resorting to further legal recourse, as follows: upon the occurrence of a dispute between the parties, including, without limitation, any breach of this Assignment or any obligation relating thereto, the matter shall be referred first to the officers of NeurogesX and CHRP having responsibility for the subject matter of the dispute, or their designees. The officers, or their designees, as the case may be, shall negotiate in good faith to resolve such dispute in a mutually satisfactory manner for up to thirty (30) days. If such efforts do not result in mutually satisfactory resolution of the dispute, the matter shall be referred to the chief executive officer of NeurogesX and the managing director of CHRP, or their designees. The chief executive officer and managing director, or their designees, as the case may be, shall negotiate in good faith to resolve such dispute in a mutually satisfactory manner for up to thirty (30) additional days, or such longer period of time to which the chief executive officer and managing director may agree. In the event the dispute has not been resolved at the end of such thirty (30) day period (or such longer period as agreed to by the chief executive officer and managing director), either party shall be entitled to bring an action in accordance with Section 7(a) and (b).

(b) Each party hereto hereby irrevocably consents to the service of process out of any of the courts referred to in subsection (a) above of this Section 7 in any such suit, action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to it at its address set forth in Section 8.03 of the Financing Agreement. Each Party hereto hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any suit, action or proceeding commenced hereunder or under any

other Transaction Document that service of process was in any way invalid or ineffective. Nothing herein shall affect the right of a party to serve process on the other party in any other manner permitted by law. In the event of any litigation under this Section 7, the prevailing party shall be entitled to reimbursement of any reasonable and documented out-of-pocket expenses (including reasonable fees and expenses of legal counsel) incurred by the prevailing party in connection with asserting or enforcing such action hereunder, including, without limitation, in the case CHRP is the prevailing party in connection with any Bankruptcy Event with respect to NeurogesX and the non-prevailing party agrees to reimburse and indemnify the prevailing party for such expenses.

(c) Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any action, proceeding, claim or counterclaim arising out of or relating to this Assignment. This waiver shall apply to any subsequent amendments, renewals, supplements or modifications to this Assignment.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Assignment to be duly executed by their respective authorized officers as of the date first above written.


ASSIGNOR: NEUROGESX INC.
ASSIGNOR: NEUROGESX INC.

By:
Name:
Title:

ASSIGNEE:

XXXXX HEALTHCARE ROYALTY PARTNERS, L.P.

By Xxxxx Healthcare Royalty GP, LLC Its General Partner

By:
Name:
Title:

[SIGNATURE PAGE TO ASSIGNMENT]

EXHIBIT B

CHRP REPLACEMENT LICENSE AGREEMENT

- 1 -

EXECUTION COPY

DATED April 29, 2010

NEUROGESX INC.

and

XXXXX HEALTHCARE ROYALTY PARTNERS, L.P.

CHRP

DISTRIBUTION, MARKETING AND LICENSE AGREEMENT

Confidential

DISTRIBUTION, MARKETING AND LICENSE AGREEMENT

This DISTRIBUTION, MARKETING AND LICENSE Agreement (hereinafter “Agreement”), made effective as of the 29th day of April, 2010 (the “Effective Date”), between NeurogesX Inc., a Delaware corporation having a place of business at 0000 Xxxxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of America (“NGX”) and Xxxxx Healthcare Royalty Partners, L.P., a Delaware limited partnership having a place of business at 000 Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxx, XX 00000 (“CHRP”). Each of NGX and CHRP shall be a “Party,” and together the “Parties.”

RECITALS

A. NGX has entered into a Distribution, Marketing and License Agreement, dated June 19, 2009 (the “Astellas License Agreement”), with Astellas Pharma Europe Ltd. (“Astellas”), granting to Astellas (i) an exclusive right to commercialize and distribute the Existing Product during the term thereof, and (ii) an option to obtain the exclusive right to co-develop, commercialize and distribute the Liquid Formulation Product in the Territory, all on the terms and conditions set forth therein.

B. NGX is entering into a Financing Agreement with CHRP, dated the date hereof (the “Financing Agreement”), providing for, among other things, the collateral assignment of certain rights relating to the Patent Rights, NGX Know-How and the Astellas License Agreement, to secure the repayment of the amounts advanced by CHRP under the Financing Agreement and the obligations of NGX to CHRP thereunder (together, the “Financing Agreement Obligations”).

C. In connection with and as a condition to CHRP’s entry into the Financing Agreement, to further secure the payment due and performance of the Financing Agreement Obligations, CHRP desires to obtain from NGX, and NGX desires to grant to CHRP, exclusive rights in the Territory to the Patent Rights and NGX Know-How (as defined below) to manufacture and commercialize the Products, subject, however, to the rights of Astellas under the Astellas License Agreement, so that, in the event the exclusive rights granted to Astellas under the Astellas License Agreement are terminated for any reason or become non-exclusive, with respect to one or more Products in a country or region in the Territory or in their entirety, CHRP may secure in accordance with the provisions of Section 5.03(b) of the Financing Agreement a Sublicensee or otherwise commercialize the Products in the Territory, subject, however, to any and all remaining rights of Astellas.

NOW, THEREFORE, in consideration of the foregoing premise and the mutual representations, covenants and agreements contained herein, CHRP and NGX, intending to be legally bound, hereby agree as follows:

AGREEMENT

1.	DEFINITIONS

1.1 Capitalized terms used herein which are not otherwise defined herein shall have the meanings ascribed to such terms in the Astellas License Agreement. However, the definitions of the following terms used herein shall have the meanings given to them in the Astellas License Agreement with the following modifications:

1.1.1 The reference in the definition of “Commercially Reasonable Efforts” to “Astellas” shall mean a “Party” as defined in the preamble to this Agreement.

1.1.2 “Exhibit 2.2.1” shall mean the terms of provisions of Exhibit 2.2.1 to the Astellas License Agreement, except that all references to “Astellas” thereunder shall be deemed to refer to “CHRP or its Sublicensee”.

1.1.3 Each reference in the definition of “Liquid Formulation Product” to “Astellas” shall be deemed to refer to “Astellas, CHRP or any Sublicensee”.

1.1.4 “NGX Know-How” shall also include, subject to the provisions of Section 2.6, any rights to Third Party IP granted to Astellas pursuant to Section 2.5 of the Astellas License Agreement.

1.1.5 “Patent Rights” shall also include (i) subject to the provisions of Section 2.6, any rights to Third Party IP granted to Astellas pursuant to Section 2.5 of the Astellas License Agreement and (ii) patent rights within the Astellas Improvements in the Territory granted to NGX pursuant to Section 11.1.4 of the Astellas License Agreement and (iii) patent rights comprising the NGX Improvements.

1.1.6 “Product(s)” shall include (i) Existing Products, (ii) the Liquid Formulation Product if Astellas exercised its Option with respect thereto in accordance with Section 2.3 of the Astellas License Agreement or if CHRP exercises the LFP Option as described in Section 2.4 herein below and (iii) any Competitive Products licensed to Astellas.

1.2 “Deposit Agreement” shall have the meaning set forth in the Financing Agreement.

1.3 “Exploit” and “Exploitation” shall have the meaning set forth in the Financing Agreement.

1.4 “Replacement License Agreement” and “Replacement Licensee” shall have the meanings set forth in the Financing Agreement.

1.5 “Revenue Interest” shall have the meaning set forth in the Financing Agreement.

1.6 “Revenue Interest Advance” shall have the meaning set forth in the Financing Agreement.

1.7 “Revenue Interest Payments” shall have the meaning set forth in the Financing Agreement.

1.8 “Security Agreement” shall have the meaning set forth in the Financing Agreement.

1.9 “Subdistributor” shall mean a Third Party appointed by a Sublicensee as a distributor of a Product, in accordance with Section 2.5.2, which Third Party purchases Product in the Territory from such Sublicensee and resells the Product in its respective territory. Notwithstanding the foregoing, if a Sublicensee grants the rights to market and promote a Product in a country to one entity and sells the Product to another entity in the same country for distribution and resale then both entities shall be considered to be Subdistributors. For the avoidance of doubt, “Subdistributor” shall specifically exclude Sublicensees.

1.10 “Sublicensee” shall mean any Replacement Licensee to whom CHRP has granted, pursuant to Section 2.5, a sublicense under the Patent Rights and/or NGX Know-How to Manufacture, package and have packaged, develop, register, keep, import, offer for sale, sell, have sold, use, market, distribute and/or promote a Product in any country or countries in the Territory.

1.11 “Third Party” shall mean any entity other than CHRP, NGX and their Affiliates.

1.12 “Transaction Documents” shall have the meaning set forth in the Financing Agreement.

1.13 References. Unless otherwise specified herein references to any Section, Article or Exhibit shall mean the Sections, Articles and Exhibits to this Agreement.

GRANT

2.1 Certain Limitations. IT IS EXPRESSLY ACKNOWLEDGED AND AGREED BY CHRP THAT NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY ALL OF THE RIGHTS AND LICENSES OF CHRP AND ANY SUBLICENSEE SHALL BE SUBJECT AND SUBORDINATE TO THE RIGHTS OF ASTELLAS UNDER THE ASTELLAS LICENSE AGREEMENT, AND CHRP ACKNOWLEDGES AND AGREES THAT TO THE EXTENT THE ASTELLAS LICENSE AGREEMENT IS IN EFFECT, CHRP SHALL NOT TAKE ANY ACTION WHICH IS INCONSISTENT WITH THE RIGHTS AND LICENSES OF ASTELLAS UNDER THE ASTELLAS LICENSE AGREEMENT. FOR FURTHER CLARITY, CHRP ACKNOWLEDGES THAT NGX HAS PREVIOUSLY GRANTED EXCLUSIVE RIGHTS AND LICENSES TO ASTELLAS WITH RESPECT TO THE TERRITORY AS SET FORTH IN THE ASTELLAS LICENSE AGREEMENT AND TO THE EXTENT THAT SUCH RIGHTS OR LICENSES ARE CONVERTED TO NON-EXCLUSIVE OR THAT ONE OR MORE COUNTRY(IES) IS REMOVED FROM THE TERRITORY IN ACCORDANCE WITH THE TERMS OF THE ASTELLAS LICENSE AGREEMENT, THEN THE RIGHTS AND LICENSES GRANTED TO CHRP SHALL BE LIMITED TO THE EXTENT THAT NGX HAS THE RIGHT TO GRANT THE SAME WITHOUT BEING IN BREACH OF THE RIGHTS AND LICENSES GRANTED TO

ASTELLAS PURSUANT TO THE ASTELLAS LICENSE AGREEMENT. CHRP FURTHER ACKNOWLEDGES AND AGREES IT SHALL ONLY EXERCISE THE RIGHTS AND LICENSES GRANTED TO IT HEREIN CONSISTENT WITH THE PROVISIONS OF SECTION 5.03(b) OF THE FINANCING AGREEMENT. CHRP FURTHER ACKNOWLEDGES AND AGREES THAT NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY NGX’S OBLIGATIONS HEREUNDER ARE (A) SUBJECT TO AND SUBORDINATE TO NGX’S OBLIGATIONS UNDER THE ASTELLAS LICENSE AGREEMENT AND NOTHING HEREIN SHALL BE DEEMED TO REQUIRE NGX TO PERFORM OR FOREBEAR ANY ACT THAT IS IN CONTRAVENTION WITH OR WOULD OTHERWISE REQUIRE NGX TO BE IN BREACH OF THE ASTELLAS LICENSE AGREEMENT AND (B) SUBJECT TO THE TERMS OF SECTION 5.03(b) OF THE FINANCING AGREEMENT

2.2 Appointment. Subject to the terms of this Agreement and the rights of Astellas under the Astellas License Agreement, NGX hereby grants to CHRP the right (even as to NGX and its Affiliates) to enter into one or more Replacement License Agreements in accordance with the provisions of Section 5.03(b) of the Financing Agreement and to sublicense to the applicable Sublicensee the right to distribute and market the Products in the Field in the Territory as set forth in this Agreement below. CHRP shall be responsible for the acts and omissions of any its Affiliates hereunder as if such acts and omissions were those of CHRP.

2.3 Licenses

2.3.1 Subject to the terms and conditions of this Agreement and the rights of Astellas under the Astellas License Agreement, NGX grants to CHRP:

(a) an exclusive (even as to NGX and its Affiliates), irrevocable, royalty-free (except as otherwise provided in Sections 2.5 and 4), sublicensable (in accordance with Section 2.5) license during the term of this Agreement under the Patent Rights and NGX Know-How to: (i) register (including conducting such clinical trials as may be required to support such registrations) the Existing Product (ii) import, keep, package and have packaged the Components supplied by NGX, and (iii) promote, market, offer for sale, sell, have sold, import and otherwise distribute and use the Existing Product in the Territory for any and all indications in the Field;

(b) an irrevocable, royalty-free, sublicensable (in accordance with Section 2.5) license (co-exclusive with NGX and its designees) during the term of this Agreement under the Patent Rights and NGX Know-How to Manufacture Components for the exclusive use in the Territory and Field; and

(c) in the event (I) Astellas exercises the Option in accordance with the Astellas License Agreement or (II) CHRP exercises the LFP Option in accordance with this Agreement, (i) an exclusive (even as to NGX and its Affiliates), irrevocable, royalty-free (except as otherwise provided in Sections 2.5 and 4), sublicensable (in accordance with Section 2.5) license during the term of this Agreement under the Patent Rights and NGX Know-How to (A) co-develop (together with NGX), register (including conducting such clinical trials as may be required to support such registrations), promote, market, sell, have sold, keep, import and

otherwise distribute and use the Liquid Formulation Product in the Territory for any and all indications in the Field; (B) make, have made, package and have packaged the Liquid Formulation Product for the exclusive use in the Territory and Field provided that NGX and CHRP shall use (or CHRP shall cause its Sublicensees to use) commercially reasonable endeavors to use the same manufacturer(s) to supply the Liquid Formulation Product for both inside and outside the Territory; and (ii) the right to (X) carry out marketing activities outside the Territory, in cooperation with NGX, for the promotion of sales of Liquid Formulation Product (by CHRP or its Affiliates, any Sublicensee or Subdistributor) in the Territory strictly in accordance with the license and terms of Section 1.2 of Exhibit 2.2.1 and (Y) carry out clinical trials outside the Territory, in cooperation with NGX, for the development (by CHRP or its Affiliates, or any Sublicensee) of Liquid Formulation Product which is to be promoted, marketed and sold in the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1. For clarity, NGX shall retain the right to (x) carry out marketing activities and clinical trials in the Territory, in cooperation with the applicable Sublicensee, for the promotion of sales of Liquid Formulation Product (by NGX, any NGX Affiliate or their licensees) outside of the Territory strictly in accordance with the license and terms set forth in Section 1.3 of Exhibit 2.2.1 and (y) carry out clinical trials inside the Territory, in cooperation with the applicable Sublicensee, for the development by NGX of Liquid Formulation Product which is to be promoted, marketed and sold outside the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1.

Notwithstanding the foregoing, it is understood that the [***] has been obtained.

NGX reserves all rights not expressly granted herein. Additionally it is understood and agreed that, subject to the rights of Astellas under the Astellas License Agreement, CHRP shall have the right to: (x) carry out marketing activities outside the Territory, in cooperation with NGX, for the promotion (by CHRP, its Affiliates, Sublicensees or Subdistributors) of sales of Products in the Territory strictly in accordance with the license and terms set forth in Section 1.2 of Exhibit 2.2.1; and (y) carry out clinical trials outside the Territory, in cooperation with NGX, for the development (by CHRP, its Affiliates, or any Sublicensee) of Products which is to be promoted, marketed and sold in the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1.

2.3.2 NGX shall not, and shall not license or authorize any Affiliate or Third Party to develop (save in accordance with this Agreement, Section 5.03(b) of the Financing Agreement and the Astellas License Agreement), register, promote, market, offer for sale, sell, have sold, import and otherwise distribute or sell:

(a) Components and/or Existing Product within the Field and Territory during the term of this Agreement; or

(b) Liquid Formulation Product within the Field and Territory during the LFP Option Period (if any) and thereafter during the remainder of the term of this Agreement only if Astellas exercises the Option in accordance with the Astellas License Agreement or CHRP exercises the LFP Option in accordance with this Agreement;

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

provided that notwithstanding the foregoing, NGX shall have the right to (x) carry out marketing activities in the Territory, in cooperation with CHRP, its Affiliate or Sublicensee, as applicable, for the promotion of sales of Existing Product and Liquid Formulation Product (by NGX, any NGX Affiliate or their licensees) outside of the Territory strictly in accordance with the license and terms set forth in Section 1.3 of Exhibit 2.2.1 and (y) carry out clinical trials inside the Territory, in cooperation with CHRP, its Affiliate or Sublicensee, as applicable, for the development by NGX of Existing Product which is to be promoted, marketed and sold outside the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1. For clarity, nothing herein is intended to prevent NGX from performing or having others perform any preclinical or non-clinical tests or development with respect to any Product in the Field in the Territory.

2.4 LFP Option

2.4.1 Pursuant to the Astellas License Agreement, NGX has granted to Astellas an exclusive option to include the Liquid Formulation Products as a Product under the Astellas License Agreement on the terms and conditions as set forth therein. Subject to the rights of Astellas under the Astellas License Agreement, NGX hereby grants to CHRP an exclusive option, to include the Liquid Formulation Product as a Product under this Agreement (the “LFP Option”) on the terms and conditions set forth in this Section 2.4 below.

2.4.2 For clarity, in the event Astellas exercises the Option (as such term is defined in the Astellas License Agreement), and the Liquid Formulation Product becomes a “Product” (as term is defined in the Astellas License Agreement), the Liquid Formulation Product shall be licensed to CHRP hereunder in accordance with Section 2.3.1(c), subject to the rights of Astellas under the Astellas License Agreement.

2.4.3 In the event, prior to the termination of the Astellas License Agreement, the Option Period has expired or otherwise terminated without Astellas having exercised its rights, in accordance with the terms of the Astellas License Agreement, to include Liquid Formulation Products as a Product under the Astellas License Agreement, the LFP Option shall terminate and CHRP shall have no rights to any Liquid Formulation Product.

2.4.4 In the event, upon termination of the Astellas License Agreement, the Option Period shall be continuing (but for termination of the Astellas License Agreement), CHRP shall be entitled to exercise the LFP Option on the same terms and conditions of the Option granted to Astellas under the Astellas License Agreement (including Sections 2.3.4 – 2.3.16 and Sections 3.3.2 and 3.3.3 of the Astellas License Agreement) all of which terms are hereby incorporated by reference, and, in such case, NGX shall perform all of its obligations with respect to the Liquid Formulation Product so incorporated for the benefit of CHRP.

2.4.5 For clarity, CHRP shall have no right to exercise the LFP Option prior to termination of the Astellas License Agreement, it being acknowledged and agreed that so long as the Astellas License Agreement has not been terminated or expired on its terms, the rights of CHRP to exercise the LFP Option are expressly subordinated to the rights of Astellas.

2.5 Sublicensees. Subject to the rights of Astellas under the Astellas License Agreement, CHRP shall have the right, upon the approval of NGX to grant sublicenses to Sublicensees under the Patent Rights and/or NGX Know-How to Manufacture, package and have packaged, develop, register, keep, import, offer for sale, sell, have sold, use, market, distribute and/or promote any Product in any country or countries in the Territory, provided that NGX shall not withhold or delay any such approval for economic reasons (i) prior to such time as CHRP has received Revenue Interest Payments under the Financing Agreement in an amount equal to 1.75 times the Revenue Investment Advance, provided, however, that CHRP shall act in good faith to maximize the Revenue Interest (both during the term of this Agreement and thereafter) derived from such sublicense; (ii) after such time as CHRP has received Revenue Interest Payments under the Financing Agreement in an amount equal to [***] the Revenue Investment Advance, if the economics in consideration with such sublicense are reasonable taking into consideration all relevant factors including CHRP’s and NGX’s respective interest in the Revenue Interest generated therefrom; provided that in all events each Sublicensee shall be responsible for and reimburse NGX for any and all amounts due by NGX to Third Parties in consideration of any rights to the NGX Know-How or Patent Rights as a result of the grant to or exercise of by or under authority of such Sublicensee (including amounts due by NGX to LTS under the LTS Agreement and UC under the UC License Agreement) and (iii) any other obligations of NGX thereunder is no more onerous on NGX and materially similar to those set forth in the Astellas License Agreement with respect to Astellas. For clarity, unless NGX otherwise agrees (such agreement not to be unreasonably withheld or delayed) any such sublicense shall (a) be pursuant to a written agreement (each, a “Sublicense Agreement”) that includes the provisions materially similar to the provisions of Sections 2.6 (No Modifications to the Product), 2.7.1 – 2.7.3 (Competitive Products; Astellas, for the Exclusivity Period and scope described therein), 2.7.8 (Ex-Territory; No Exploitation except as Licensed), 4.3 (Extraterritorial DPR), 4.4 (Existing NGX Third Party Royalties), 4.5 (Discounting), 4.6 (Royalty Reports), 5.1 (with references to “JSC” meaning the JSC as established by NGX and CHRP hereunder and references to “Existing Product” replaced by “each Product”), 8 (Commercialization), 10 (Payments; Book and Records), 11 (Intellectual Property), 12 (Trademarks), 13 (Confidentiality), 15 (Liability), 16 (Indemnification), 17 (Term and Termination), 18 (Effect of Expiration or Termination), 19 (Dispute Resolution) and 20 (Miscellaneous) of the Astellas License Agreement with the applicable Sublicensee in place of Astellas in such provisions, (b) include a provision materially similar to Section 2.3.2 hereof with the applicable Sublicensee in place of CHRP, (c) otherwise consistent with the terms and conditions of this Agreement, including the assignment to NGX upon expiration hereof as provided in Section 2.5.3 below and (d) NGX shall be either a (I) signatory thereto or (II) a named and intended third party beneficiary thereof, in either case with the right to enforce the terms and conditions thereof in consultation with CHRP.

2.5.1 Economic Considerations. NGX and CHRP shall treat all amounts received by CHRP or NGX or their Affiliates in connection with any Sublicense Agreement in the same manner as payments received under the Astellas License Agreement, namely any Revenue Interest shall be shared by and paid to the Parties as set forth in Section 2.02 of the Financing Agreement and any Excluded Revenue Interests (as defined in the Financing Agreement) shall inure to the benefit of and paid to NGX.

2.5.2 Subdistributors. Subject to the rights of Astellas under the Astellas License Agreement, Sublicensees shall have the right, upon the approval of NGX, not to be unreasonably withheld or delayed, to appoint Third Parties as Subdistributors to distribute, sell, market and promote the Product in the Territory, provided that (i) each such appointment be made pursuant to a written agreement consistent with the terms and conditions hereof and the Sublicense Agreement (each, a “Subdistributor Agreement”) and (ii) the applicable Sublicensee shall promptly notify NGX of the execution of each Subdistributor Agreement and provide a copy thereof to NGX. The Sublicensee appointing any such Subdistributor shall be responsible for the failure by each such Subdistributor to comply with, and shall guarantee the compliance by each of its Subdistributor with, all relevant restrictions, limitations and obligations in this Agreement and the applicable Sublicense Agreement.

2.5.3 Upon Expiration. Upon the expiration of this Agreement, CHRP shall, without further consideration, assign its rights under any and all Sublicense Agreements to NGX.

2.6 NGX IP Acquired after the Effective Date. Section 2.5 of the Astellas License Agreement is hereby incorporated by reference as if set forth herein in full, with all references thereunder to Astellas being deemed to refer to CHRP, provided however, (i) CHRP’s rights thereunder are subject and subordinate to the rights of Astellas; (ii) except as provided in Section 4,[***]; (iii) to the extent [***]as described above; and (iv) except as provided in Section 4, CHRP shall have[***], its [***]being to include such an[***].

2.7 No Conflict

2.7.1 Competitive Products: NGX. Subject to Sections 2.7.2 - 2.7.4, NGX and its Affiliates shall not, by themselves or through any Third Party(ies) conduct any sales, marketing, promotion or distribution activities in the Territory[***].

2.7.2 NGX shall not be in breach of Section 2.7.1 if, during the Exclusivity Period, NGX is acquired by any Third Party (whether by purchase, merger or otherwise), which Third Party at the date of such acquisition was commercializing a Competitive Product or has a Competitive Product in development beyond the commencement of Phase III clinical trials and following such acquisition NGX and/or the new entity commercializes such Competitive Product during the Exclusivity Period. For the avoidance of doubt, if the Third Party has a Competitive Product in development at an earlier stage than Phase III clinical trials neither NGX nor the new entity can commercialize such Competitive Product during the Exclusivity Period.

2.7.3 NGX shall not be in breach of Section 2.7.1 if NGX acquires (whether by purchase, merger or otherwise) any Third Party which Third Party at the date of its acquisition by NGX was commercializing a Competitive Product provided that NGX disposes of such Competitive Product within a period of [***] following the date that such acquisition is completed, and the terms of such divestiture provides that NGX (or its Affiliates) no longer retain any rights to receive any future royalties or other payments based on the sales of such Competitive Product.

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

2.7.4 License in Respect of Competitive Products Licensed to Astellas. For clarity if, at any time during the term of this Agreement, [***], (i) such [***]shall be [***]and (ii) the[***], but in all cases shall be limited to the Territory.

2.7.5 License in Respect of Competitive Products After Termination of the Astellas License Agreement. If, at any time after the termination of the Astellas License Agreement and prior to the end of the Exclusivity Period, NGX wishes to out-license the development and commercialization of a[***]:

(a) when NGX decides that it wishes to[***], it will notify CHRP in writing and provide CHRP with a description of [***]of the general type and quantity that NGX would typically provide to its potential development partners, to enable CHRP to make an[***];

(b) within thirty (30) days (or such other longer period as the Parties may agree) of receipt of the notice and dossier in Section 2.7.5(a) above (the “[***]”), CHRP will inform NGX in writing whether it wishes to enter into an exclusive license for the[***];

(c) If CHRP notifies NGX that it wishes to exercise the [***]in relation to [***]that is the subject of the notice in Section 2.7.5(a), then the Parties will enter into negotiations to[***]. In such negotiations the Parties will act reasonably, diligently and in good faith to achieve an agreement which is acceptable to both Parties. Such diligence shall be consistent with the aim of achieving[***]; and

(d) If CHRP notifies NGX pursuant to Section 2.7.5(b) that it does not wish [***]that is the subject of the notice in Section 2.7.5(a), or CHRP does not respond within the period in Section 2.7.5(b) above, or a final agreement in accordance with Section 2.7.5(c) is not achieved in such four (4) month period then NGX will have no further obligations to CHRP under this Section 2.7.5 and shall be[***]. Without limiting the foregoing, the Parties understand that the revenues received by NGX from NGX’s license of such [***]respect to the Territory or such Third Party’s sale or other commercialization thereof in the Territory shall be shared by the Parties in accordance with Section 2.02 of the Financing Agreement.

2.7.6 Ex-Territory; No Exploitation Except as Licensed. Except as otherwise permitted under Sections 1.2 and 3 of Exhibit 2.2.1 or required by applicable law, neither CHRP nor its Affiliates will develop, file for marketing approval with respect to, use, market, import, export, distribute, promote or sell Product anywhere in the world, except in the Territory, and, within the Territory, only in accordance with and under this Agreement. CHRP agrees that it and its Affiliates shall not use nor otherwise exploit Patent Rights, Data and the Product Trademark, except as licensed in this Agreement.

3.	INTENTIONALLY LEFT BLANK

4.	DIRECT COMMERCIALIZATION BY CHRP OR ITS AFFILIATES

Notwithstanding anything herein to the contrary, in the event CHRP (itself or through one or more Affiliates) elects to directly markets, sells or otherwise commercializes any Product in the Territory hereunder as set forth in, and consistent with, Section 5.03(b) of the Financing Agreement, the following shall apply:

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

4.1 Incorporation by Reference. The following provisions of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full except, in each case “Astellas” being replaced by “CHRP”): Sections 2.5 (NGX IP Acquired after the Effective Date; with respect to payment that would have been due by Astellas thereunder had the Astellas License Agreement not been terminated), 2.6 (No Modifications to the Product), 2.7.1 – 2.7.3 (Competitive Products; Astellas, for the Exclusivity Period and scope described therein), 2.7.8 (Ex-Territory; No Exploitation except as Licensed), 4.3 (Extraterritorial DPR), 4.4 (Existing NGX Third Party Royalties), 4.5 (Discounting), 4.6 (Royalty Reports), 5.1 (with references to “JSC” meaning the JSC as established by NGX and CHRP hereunder and references to “Existing Product” replaced by “each Product”), and 10 (Payments; Book and Records) of the Astellas License Agreement.

4.2 Economics. During the term hereof, an amount equal to the royalty that would have been due to NGX under Section 4.1 of the Astellas License Agreement (had Astellas made the sale of such Product) with respect to all Net Sales of all Products by or under authority of CHRP and its Affiliates (the “Royalty Equivalent Amount”) shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement and paid into the Initial Concentration Account as required by Section 5.07 of the Financing Agreement and the Deposit Agreement.

5.	COOPERATION

5.1 In the event the Astellas License Agreement is terminated for any reason, NGX and CHRP shall each use commercially reasonable efforts and cooperate with one another as set forth in Section 5.03(b) of the Financing Agreement. If NGX (i) [***] or (ii) [***] to (a) the rights of NGX to so develop and commercialize the Products in the Territory itself or (b) the rights and licenses of the applicable [***]in the same manner such rights, licenses and obligations are subject and subordinated to the rights of Astellas under and otherwise to the Astellas License Agreement as described in Section 2.1.

5.2 If (i) the Astellas License Agreement is terminated and (ii) NGX does not elect to develop and commercialize (including applicable promotion, marketing and sales) the Products in the Territory itself pursuant to the provisions of Section 5.03(b) of the Financing Agreement, the provisions of Sections 5.2, 5.3, 5.4, 5.6 and 5.7 of the Astellas License Agreement are incorporated herein by reference as if fully set forth herein, except that CHRP (or upon its selection, a Sublicensee) shall have all the rights which are granted to Astellas under such sections of the Astellas License Agreement.

6.	TRANSFER OF THE MARKETING AUTHORIZATION

6.1 MAA Approval Transfer. To the extent that any MAA or MAA Approval with respect to a Product in any country in the Territory is acquired by NGX (whether pursuant to assignment with respect to a Terminated Product pursuant to Sections 18.3.2, 18.5.2 or 18.6 of the Astellas License Agreement or otherwise) NGX shall hold such MAA or MAA Approval in trust on behalf of CHRP, and use commercially reasonable efforts to maintain, renew or obtain final approval of such MAA or MAA Approval, as applicable, and each such MAA or MAA Approval free and clear of all liens, claims or encumbrances, in each case in coordination with CHRP and in accordance with CHRP’s instructions; provided, however, NGX shall not have any

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obligation to perform any clinical development or otherwise incur any material costs or expenses (other than filing or maintenance fees) unless CHRP agrees to reimburse NGX with respect to all costs and expenses therefor. After the termination of the Astellas License Agreement and upon CHRP’s written request reasonably in connection with CHRP’s protection of its collateral interest in and to the XXXx or MAA Approvals under the Security Agreement, NGX shall transfer and assign, and provide all reasonable assistance requested by CHRP to receive, the benefit of and interest in any MAA or MAA Approval to CHRP free from all encumbrances (other than those encumbrances created by this Agreement) on the terms of and in accordance with this Section 6 and in such case the cost of such transfer shall be at the expense of NGX. From and after such time as CHRP has elected to (i) take the lead in locating and securing a Replacement Licensee or (ii) Exploit the Products itself or through an Affiliate, in either case in accordance with Section 5.03(b) of the Financing Agreement, then upon CHRP’s request NGX shall transfer and assign, and provide all reasonable assistance requested by CHRP or its designated Sublicensee to receive, the benefit of and interest in any MAA or MAA Approval to CHRP, its Affiliate or its designated Sublicensee, free from all encumbrances (other than those encumbrances created by this Agreement) on the terms of and in accordance with this Section 6 (and at all times until transfer, and to the extent not so transferable or assignable, NGX shall make all such regulatory filings, XXXx and MAA Approvals available to CHRP, its Affiliate or its Sublicensees) and in such case the cost of such transfer shall initially be borne by NGX, provided, however, (i) such amount shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement if paid on behalf of CHRP or its Affiliates, or (ii) if paid by NGX on behalf of a Sublicensee, such amount shall be reimbursed to NGX by the Sublicensee or CHRP.

6.2 Parties’ Obligations. CHRP shall be solely responsible for preparing and submitting all notices, applications, submissions, reports and other instruments, documents, correspondence or filings necessary to obtain a transfer to CHRP, its Affiliate or its designated Sublicensee of any such regulatory filings, XXXx and MAA Approvals in accordance with Section 6.1. In connection therewith, NGX shall or shall procure that any of its Affiliates will:

6.2.1 as soon as reasonably possible after the transfer of an MAA or MAA Approval sign any document presented to it by CHRP, its Affiliate or its designated Sublicensee that are necessary for: (i) the transfer to CHRP, its Affiliate or its designated Sublicensee of such MAA or MAA Approval, as applicable; or (ii) maintaining, renewing or varying the MAA or MAA Approval;

6.2.2 as soon as reasonably possible provide notice of its consent to the transfer of the MAA or MAA Approval, as applicable, to CHRP, its Affiliate or its designated Sublicensee if required by any applicable governmental or regulatory authority; and

6.2.3 as soon as reasonably possible conduct all communications with the EMEA relating to the transfer of the MAA or MAA Approval, as applicable, at the direction of CHRP, its Affiliate or its designated Sublicensee.

6.3 Prior to MAA Approval Transfer. So long as NGX is holding a MAA or MAA Approval in trust for CHRP as required in Section 6.2, NGX shall not encumber, amend, cancel or surrender the Existing Product MAA Approval and other MAA Approval, as applicable, or

take any step in relation thereto unless requested to do so by CHRP or any applicable governmental or regulatory authority (any such request of a governmental or regulatory authority a “Regulatory Request”). Before taking any such step pursuant to a Regulatory Request, NGX shall act in accordance with any reasonable instruction given by CHRP in relation to such Regulatory Request unless action is required to be taken urgently by the relevant governmental or regulatory authority, in which case NGX shall inform CHRP of such action as soon as possible thereafter.

6.4 After MAA Approval Transfer. Following transfer to CHRP, its Affiliate or its designated Sublicensee of an MAA Approval, CHRP, its Affiliate or its designated Sublicensee, as the case may be shall be responsible for the Maintenance of the such MAA Approval, as well as for the filing and Maintenance of all additional XXXx filed and MAA Approvals obtained in its name in the Territory, in each case at its own cost, provided that NGX shall, upon CHRP’s request, provide to CHRP reasonable assistance in relation with such Maintenance, as well as all electronic documents in its possession and under its Control that are reasonably necessary to perform such Maintenance, including without limitation the relevant dossier for the MAA or MAA Approval in the format of an electronic common technical document (eCTD). NGX shall also within thirty (30) days of the applicable transfer date thereof provide CHRP with all original documents comprising the MAA or MAA Approval and to the extent that such original documents are required by NGX for regulatory filings outside the Territory, NGX shall allow CHRP to have access to and to copy such original documents at all reasonable times on reasonable notice for the purpose of the Maintenance of the MAA Approvals and filing of XXXx in relation to developments of the Products in the Territory. As used in this Section 6.4, “Maintenance” with respect to MAA Approvals and/or MAA shall include, without limitation, payment of the annual fees, renewal of the MAA Approval, implementation of any variations with respect to such MAA Approval and/or MAA and responding to requests by the relevant regulatory authorities.

6.5 Communications with Regulatory Authorities. Subject to applicable laws, following transfer of any MAA Approval to CHRP, its Affiliate or its designated Sublicensee, CHRP or such designated Sublicensee, as the case may be, shall be the party responsible for communicating directly with and appearing before the EMEA or any other regulatory authority, provided that CHRP or its designated Sublicensee shall keep NGX reasonably informed in advance as to any meetings CHRP, its Affiliate or its designated Sublicensee may have with the EMEA or any other regulatory authority with respect to any Product and at NGX’s request, allow NGX to participate in such meetings and/or promptly provide NGX with any minutes of such meetings. NGX agrees, upon CHRP’s request, to provide CHRP with reasonable assistance in connection with any such communications and meetings.

6.6 The Parties acknowledge and agree that in the event NGX does not transfer the Existing Product MAA Approval and the other MAA Approvals to CHRP or its designees promptly following when it is obligated to do so, CHRP may suffer irreparable damage for which an adequate remedy at law may not exist, and, accordingly, NGX agrees that CHRP may, in addition to all remedies available to it at law, seek equitable relief without the posting of any bond, requiring NGX to transfer the Existing Product MAA Approval and the other MAA Approvals to CHRP or its designees.

7.	DEVELOPMENT

7.1 Development of Existing Product

(a) Neither Party shall be under any obligation to perform any study, including, without limitation, any open label safety study, PDN Trial, post-marketing study or clinical trial with respect to the Products for the Territory in the Field, it being understood that any applicable Sublicense Agreement, may to the extent deemed necessary or desirable by CHRP and NGX, contain provisions obligating the corresponding Sublicensee to perform some or all of such studies and trials.

(b) In the event the Astellas License Agreement has been terminated and either Party wishes to develop the Existing Product for a new indication (i.e., an indication other than PNP and PDN) or to modify or improve the Existing Product, including but not limited to, developing an improved Gel, then it shall raise the issue at the JSC. If the JSC agrees to such further development then the JDC shall be responsible for drawing up a development plan which it shall present to the JSC for approval.

(1) If both Parties wish to participate in the development then the JDC shall oversee the performance of such development and shall allocate responsibility for the performance of the various tasks required in connection with such studies based upon which Party is better situated to perform such tasks, taking into account among other things, the estimated costs associated with having each Party perform such task. The aim of the development plan will be to generate clinical data which is intended for, and in the correct format for, submission to satisfy the requirements of both the EMEA and the FDA. To the extent that any activities under the development plan are necessary to satisfy the requirements of both the EMEA and FDA then the Development Expenses for such activities will be borne equally by the Parties. To the extent that any activity is necessary to satisfy the requirements of only the EMEA or only the FDA then CHRP and NGX respectively shall be solely responsible for the Development Expenses for such activity.

(2) If only one Party wishes to carry out any development under this Section 7.1.(b) (the “Developing Party”), and the JSC has approved the development plan then the Developing Party shall carry out the activities under such development plan and shall be solely responsible for all Development Expenses related to such activities. If the other Party subsequently wishes to include any of the Data that has been created as a result of such development in its regulatory filings for Product in its territory, then it can only do so if it reimburses the Developing Party fifty percent (50%) of all the Developing Party’s Development Expenses incurred in relation to all the activities under the development plan.

7.2 Exchange of Data. If CHRP elects to (i) take the lead in locating and securing a Replacement Licensee or (ii) Exploit the Licensed Products itself or through an Affiliate, in either case in accordance with Section 5.03(b) of the Financing Agreement, then NGX shall provide to CHRP or its designated Sublicensee and CHRP shall and shall cause each such Affiliate and Sublicensee to provide to NGX all Data for use for the purposes set forth in Section 7.2.1 in a timely fashion and as promptly as possible upon request of the other Party. In addition in such circumstances, (a) NGX shall provide CHRP with all Data submitted to the FDA

within fourteen (14) days of such submission, and (b) CHRP shall provide NGX with all Data submitted by CHRP or its Affiliates or Sublicensees to the EMEA or any other regulatory authority in the Territory within fourteen (14) days of such submission. Each Party shall have the right to withhold Data for a reasonable period to allow it to file for patent protection relating to such Data consistent with the provisions of Section 11. Further is such circumstances, NGX shall provide CHRP with copies of all Data submitted to or received by NGX from Astellas under Section 7.2 of the Astellas License Agreement or by any Replacement Licensee within thirty (30) days of request therefor with respect to any Product or country or region in which the rights of Astellas have been terminated or become non-exclusive, and thereafter shall promptly provide CHRP with copies of all Data submitted to or received from Astellas under such Section 7.2 or a Replacement Licensee on an ongoing basis.

7.2.1 Use; Disclosure.

(a) If CHRP or its Sublicensee shall desire to obtain and/or maintain MAA Approval for Products in the Territory including without limitation cross referencing drug master files or other regulatory filings outside the Territory in each case to the extent it has the right to do so hereunder and for commercialization of Products inside the Territory; provided, however, that in no event shall CHRP or its Sublicensee take such action to the extent such action would conflict with or violate any exclusive rights of Astellas. CHRP or its Sublicensee may and will only use and disclose Data to Third Parties as required to obtain and maintain any such MAA Approval and NGX gives CHRP and its Sublicensees the right to so cross-reference as may be necessary in performing its obligations and exercising its rights granted under this Agreement or pursuant to the applicable Sublicense Agreement, i.e. development activities, marketing activities, medical education activities, professional services activities and public relations activities; or for purposes of obtaining consultation services in the normal course of business (such as business consultants, advertising agencies, law firms, accounting firms, etc.) in each case solely to the extent necessary for development and commercialization of Products in the Territory in accordance herewith; or as may otherwise be agreed by NGX and CHRP. CHRP may not use any Data (or permit any Third Party (including any Affiliate or Sublicensee) to use Data) outside the Territory, or outside the Field or for any products other than the Products, except for the assessment and validation of the Data by Affiliates or Third Party consultants outside the Territory but solely for purposes of developing or commercializing Products within the Territory. NGX may not use any Data provided by CHRP or its Affiliates or Sublicensees (or permit any Third Party to use such Data) inside the Territory (except as required to fulfill any development obligations it may have under a development plan agreed with CHRP), or outside the Field or for any products other than the Products, except for the assessment and validation of the Data by Affiliates or Third Party consultants inside the Territory but solely for purposes of developing or commercializing products outside the Territory. Notwithstanding anything to the contrary in this Section 7.2.1(a) or Section 7.2.1(b) below, each Party’s right to use Data generated by the other Party under Section 7.1(b) shall be subject to the requirements set forth therein.

(b) CHRP hereby grants NGX a non-exclusive sublicensable right and license to use Data provided by CHRP (whether directly or through an Affiliate or Sublicensee), and to disclose such Data to Third Parties, in each case as is reasonably necessary or useful for commercialization of Products outside the Territory including without limitation for use by

NGX’s licensees of the Products and for cross referencing drug master files or other regulatory filings (and CHRP hereby gives NGX the right to so cross-reference), in each case for commercialization outside the Territory, provided that any disclosure of such Data to a non-governmental Third Party is made under reasonable and customary confidentiality restrictions. Notwithstanding the foregoing, upon expiration or termination of this Agreement, the scope of NGX’s license to Data provided by CHRP shall thereafter be worldwide.

7.2.2 Third Parties.

(a) After the termination of the Astellas License Agreement, in all agreements with Third Parties or Affiliates involving the development of Data, CHRP and NGX, respectively, shall require that such Third Parties and Affiliates provide the other Party access to all such Data, to the extent that such Data is required for preparation of XXXx and filing of XXXx with the applicable regulatory authorities in and outside the Territory in accordance with this Agreement.

(b) Notwithstanding Section 7.2.2(a) above, CHRP acknowledges that under NGX’s agreement(s) with LTS prior to and after the Effective Date, NGX may not have the right to obtain certain Data in the possession of LTS relating to its manufacturing or patch trade secrets, but LTS will file such Data directly with regulatory authorities upon the request of NGX, subject to acceptance of such direct filing by the regulatory authorities. If any regulatory authority does not accept such a direct filing by LTS then the Parties and LTS shall cooperate to find an alternative route by which such LTS Data shall be filed with such regulatory authority. Such arrangement with LTS shall not be deemed a breach by NGX of this Section 7.2.2. It is understood that NGX shall ensure that it obtains reference rights to such Data filed by LTS directly with regulatory authorities for the use by each of NGX and CHRP as set forth in this Section 7.2.

7.2.3 Subject to the rights of Astellas under the Astellas License Agreement, as between the Parties, all XXXx and MAA Approvals and any other regulatory filings relating to developments of the Product in the Territory shall be owned by CHRP, its Affiliate or its designated Sublicensee.

7.3 Development of Liquid Formulation Product. In the event that Astellas License Agreement is terminated and the Liquid Formulation Product is or becomes a Product under this Agreement and CHRP elects to (i) take the lead in locating and securing a Replacement Licensee or (ii) Exploit the Licensed Products itself or through an Affiliate, in either case in accordance with Section 5.03(b) of the Financing Agreement, then, CHRP (or its Affiliate or designated Sublicensee) shall have the right to file all XXXx, with respect to the Liquid Formulation Product in the Territory, in each case at its own cost, provided that NGX shall, upon CHRP’s request, provide reasonable assistance in relation to such activities.

7.4 Coordination. Upon the other Party’s reasonable request after the termination of the Astellas License Agreement, each Party shall keep the other reasonably informed as to the progress of the clinical development and regulatory activities relating to the Liquid Formulation Product in and outside the Territory, including its correspondence and meetings with regulatory authorities as reasonably requested by the other Party. If CHRP elects to (a) take the lead in

locating and securing a Replacement Licensee or (b) Exploit the Licensed Products itself or through an Affiliate, in either case in accordance with Section 5.03(b) of the Financing Agreement, then, each Party shall reasonably consider and promptly respond to any comments provided by the other Party with respect to such clinical development and regulatory activities. Subject to CHRP’s obligation to assign to NGX any and all regulatory filings, XXXx and MAA Approvals upon expiration of this Agreement, and the rights of Astellas under the Astellas License Agreement, all MAA filings and MAA Approvals in the Territory for the Liquid Formulation Product (including all variations and line extensions) shall be in the name of, and owned by, CHRP, its Affiliate or its designated Sublicensee, as the case may be, and in the event Astellas has obtained MAA Approvals in the Territory for the Liquid Formulation Product (including all variations and line extensions) and assigned such MAA Approvals to NGX pursuant to the Astellas License Agreement, NGX shall, upon CHRP’s request, assign such MAA Approvals to CHRP or its designated Sublicensee.

8.	COMMERCIALIZATION

It the event the Astellas License Agreement has been terminated with respect to a Product in a country or region in the Territory, or the Astellas License Agreement has been terminated in its entirety, or the rights of Astellas with respect to a Product in a country or region in the Territory become non-exclusive, except as otherwise provided in Section 4, CHRP shall have no obligation to commercialize the Products; provided, however, that any Sublicense Agreement entered into by CHRP shall contain provisions obligating the Sublicensee to commercialize the Products substantially similar to manner in which Astellas is obligated to commercialize the Products pursuant to Section 8 of the Astellas License Agreement, and provided further, however, that NGX shall continue to perform its obligations contained in Section 8 of the Astellas License Agreement as if such agreement were still in full force and effect and the Sublicensee was the licensee thereunder.

9.	SUPPLY OF EXISTING PRODUCT

If CHRP elects to (i) take the lead in locating and securing a Replacement Licensee or (ii) Exploit the Licensed Products itself or through an Affiliate, in either case in accordance with Section 5.03(b) of the Financing Agreement, then until such time as CHRP or its Sublicensee enters into a direct contractual relationship with the Third Party contractors for the supply of Products or Components, NGX shall be obligated to supply such Components or Products to CHRP or its Sublicensee or any Replacement Licensee to the same extent and on the same terms and conditions as it was obligated to supply Astellas under the Astellas License Agreement on the Effective Date thereof; provided, however, the reasonable and documented costs associated with the reestablishment of such supply, to the extent not reimbursed by CHRP or its Sublicensee or any Replacement Licensee, as the case may be, shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement.

10.

BOOKS AND RECORDS

Each Party shall maintain records, in sufficient detail and in good scientific manner appropriate for patent and regulatory purposes, which shall accurately reflect all work done and results achieved in the performance of the development and regulatory program regarding

Products by or on behalf of such Party (or its Affiliate or Sublicensee) for the Territory in the Field.

11.

INTELLECTUAL PROPERTY

11.1 General. As between the Parties, NGX shall be responsible for the prosecution, maintenance and enforcement of the Patent Rights in accordance with and without limiting Section 5.08(a) and (b) of the Financing Agreement.

11.2 Patent Marking. CHRP agrees to xxxx and have its Affiliates and Sublicensees and their Subdistributors xxxx all patented Products they sell or distribute pursuant to this Agreement in accordance with the applicable patent statutes or regulations in the country or countries of manufacture and sale thereof.

11.3 If CHRP elects to Exploit the Licensed Products itself or through an Affiliate, in accordance with Section 5.03(b) of the Financing Agreement, the following provisions shall apply:

11.3.1 The provisions of Section 11.1-11.2 of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full except that for purposes of this Agreement, all references in such Sections to “Astellas” shall be deemed references to “CHRP or its Affiliates.” As between the Parties, NGX shall be responsible for the prosecution, maintenance and enforcement of the Patent Rights in accordance with and without limiting Section 5.08(a) and (b) of the Financing Agreement; provided, however, all reasonable and documented costs associated with such prosecution, maintenance and enforcement shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement.

11.3.2 The provisions of Section 11.3 of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full except that for purposes of this Agreement, all references in such Sections to “Astellas” shall be deemed references to “CHRP or its Affiliates” and provided further, that (i) in the event Astellas shall at any time exercise the Option under Section 2.3.12 of the Astellas License Agreement with respect to the Liquid Formulation Product, [***] (ii) in the event[***]; (iii) in the event NGX fails to maintain or shall abandon any Patent Right, CHRP or its designee shall have the right, but not the obligation, at CHRP’s sole cost and expense (including, without limitation, reasonable attorney’s fees) to assume responsibility for the prosecution and maintenance of such Patent Right; provided, however, all reasonable and documented costs associated with such prosecution and maintenance shall be credited against the Royalty Equivalent Amount otherwise to be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement; and (iv) the cost of any agreed upon extensions of the terms of Patent Rights in the Territory shall be at the expense of NGX; provided, however, all reasonable and documented costs associated with such extensions shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement.

11.3.3 Third Party Patents and Trademarks.

(a) Each Party shall promptly notify the other Party hereto in writing of any Infringement Action brought against such Party. NGX, shall be obligated to defend such

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Infringement Action using counsel of its own choice reasonably acceptable to CHRP, and the Infringement Action shall be at NGX’s own expense; provided, however, that CHRP may participate in the defense and/or settlement thereof at its own expense with counsel of its choice. NGX agrees to keep CHRP reasonably informed of all material developments in connection with any such Infringement Action. CHRP agrees not to (i) make admissions regarding infringement by the Product of any patents outside of the Patent Rights, or (ii) settle such Infringement Action, or make any admissions or assert any position in such Infringement Action, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent Rights in or outside the Territory, in each case without obtaining the prior written consent of NGX which shall not be unreasonably withheld, conditioned or delayed. In respect of any infringement actions outside the Territory, NGX agrees not to settle such infringement action, or make any admissions or assert any position in such infringement action, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent Rights inside the Territory, without obtaining the prior written consent of CHRP which shall not be unreasonably withheld, conditioned or delayed.

(b) Oppositions to Third Party Patents and Trademarks. NGX, at CHRP’s reasonable request and at NGX’s cost and expense, shall bring an Adverse Proceeding against any Third Party asserting a Third Party Right, using counsel of its own choice reasonably acceptable to CHRP; provided, however, all reasonable and documented costs associated with such Adverse Proceeding with respect to the Territory shall be treated as Revenue Interest Payments under Section 2.02 of the Financing Agreement. NGX shall keep CHRP reasonably informed of all material developments in connection with any such Adverse Proceedings and shall comply with CHRP’s advice and requests with respect to such Adverse Proceeding.

11.3.4 Enforcement of Patent Rights and Trademarks. The provisions [***]

11.3.5 Third Party Patent Rights.

(a) Subject to Section 11.3.5(b), the obligations of NGX and the rights of CHRP under this Section 11.3 shall be subject to, and limited by, any agreements pursuant to which NGX acquired or licensed any particular Patent Rights or Data, including without limitation the UC License Agreement and LTS Agreement. Without limiting the foregoing, with respect to the prosecution or enforcement of Patent Rights licensed by NGX from a Third Party, to the extent NGX has the right to do so, NGX shall cooperate with CHRP to prosecute and enforce such Patent Rights in the Territory in the same manner as set forth in Sections 11.3.3 and 11.3.4 above. As between NGX and CHRP, any recoveries from enforcement of such Patent Rights licensed from a Third Party (including any amounts that NGX receives from the Third Party licensor as a result of such enforcement) shall be shared in accordance with Section 11.5.2 of the Astellas License Agreement as incorporated herein by reference, after deducting from such recoveries any amounts owed to the Third Party licensor for such enforcement; provided that any Enforcement Actions initiated by the Third Party licensor shall be deemed initiated by NGX for purposes of such Section 11.5.2, and the costs and expenses incurred by NGX in such Enforcement Action shall include any costs and expenses reimbursed or required to be reimbursed by NGX to the Third Party licensor in such Enforcement Action.

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(b) NGX shall not exercise its right to terminate any Patent Rights licensed under the UC License Agreement pursuant to Section 17.7 of the UC License Agreement.

(c) If NGX receives notification from LTS under Section 7.2(d) of the LTS Agreement that LTS has elected not to file, prosecute or maintain any patent or patent application licensed by NGX from LTS, then NGX shall so notify CHRP within five (5) days of NGX’s receipt of such notification. If CHRP wishes NGX to file, prosecute or maintain such patent or patent application it shall inform NGX within forty-five (45) days of receipt of the notice from NGX and NGX shall immediately (and in any event within the sixty (60) day period in Section 7.2(d) of the LTS Agreement) so inform LTS such that the provisions of Sections 7.2(d) and (e) of the LTS Agreement take effect.

12.

TRADEMARKS

The provisions of Section 12 of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full, except that all references in said Section to “Astellas” shall be deemed to refer to “CHRP or its Affiliate”, provided, however, that provision of Section 12.9 thereof shall be deemed to apply if either Astellas exercises the Option pursuant to Section 2.3.12 of the Astellas License Agreement or CHRP exercises the LFP Option hereunder.

13.

CONFIDENTIALITY

The provisions of Section 13 of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full, provided, however, that all references in such Section to “Parties” or a “Party” shall have the meanings set forth in the preamble to this Agreement.

14.

REPRESENTATIONS AND WARRANTIES

14.1 Mutual Warranties. Each Party warrants and represents to the other that the Agreement is a legal and valid obligation binding upon such Party and enforceable in accordance with its terms. The execution, delivery and performance of the Agreement by such Party does not conflict with any agreement, instrument or understanding, oral or written, to which it is a party or by which it is bound, nor to such Party’s knowledge, violate any law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it.

14.2 NGX Warranty. NGX warrants and represents to CHRP that it has the full right and authority to enter into this Agreement and grant the rights and licenses granted herein.

14.3 NGX Covenants. NGX covenants to CHRP that, subject to the rights of Astellas under the Astellas License Agreement and its right to enter into Replacement License Agreements in accordance with the terms of Section 5.03(b) of the Financing Agreement, during the term of this Agreement (a) it shall not grant any right, license or interest in or to the Patent Rights and NGX Know-How, or any portion thereof, that is in conflict with the rights or licenses granted under this Agreement, and (b) it shall not xxxxx x xxxx or other encumbrances on any of the subject matter of this Agreement or on any of NGX’s rights, benefits or obligations hereunder or on any of the Patent Rights, which would conflict with the rights or licenses of CHRP hereunder.

15.

LIABILITY

15.1 DISCLAIMER. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT TO THE CONTRARY, NEITHER PARTY MAKES ANY REPRESENTATION OR EXTENDS ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT, OR VALIDITY OF ANY PATENTS ISSUED OR PENDING.

15.2 LIMITATION OF LIABILITY. NOTWITHSTANDING ANYTHING IN THIS AGREEMENT OR OTHERWISE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT, WHETHER UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY, FOR ANY INCIDENTAL, INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE, MULTIPLE, OR CONSEQUENTIAL DAMAGES, LOST PROFITS, LOSS OF ROYALTIES AND MILESTONE PAYMENTS, LOSS OF USE, DAMAGE TO GOODWILL, OR LOSS OF BUSINESS.

15.3 Exceptions. Nothing in this Agreement shall limit any Party’s liability (a) caused by that Party’s willful misconduct, (b) for death or personal injury caused by that Party’s negligence, or (c) for fraudulent misrepresentation by that Party.

16.

INDEMNIFICATION

16.1 Indemnification of NGX. Subject to Section 16.3, in the event the Astellas License Agreement is terminated and (i) CHRP elects to Exploit the Licensed Products itself or through an Affiliate or (ii) CHRP enters into any Sublicense Agreement, in either case in accordance with Section 5.03(b) of the Financing Agreement, CHRP hereby agrees to, or such Sublicense Agreement shall require any such Sublicensee and Subdistributor to, indemnify, defend and hold harmless the NGX Indemnitees from and against Liabilities from a Third Party Claim incurred by any NGX Indemnitee as a result of the use, marketing, distribution or sale of any Product by CHRP or its Affiliates or such Sublicensee or its Subdistributors, as applicable in the Territory including any Product Liability Claim (but not an Infringement Action, except to the extent arising from actions by CHRP or any Sublicensee or their Subdistributors occurring after the expiration of this Agreement).

16.2 Indemnification of CHRP. Subject to Section 16.3, NGX hereby agrees to indemnify, defend and hold harmless CHRP, its Affiliates, Sublicensees and their respective directors, officers, employees, agents and their respective successors, heirs and assigns (the “CHRP Indemnitees”) from and against any Liabilities from any Third Party Claims incurred by any CHRP Indemnitee as a result of: (a) the use, marketing, distribution or sale of any Product by NGX or its licensee outside the Territory, including, without limitation, any Products Liability Claims or Third Party infringement claims arising from NGX’s marketing of Products outside the Territory, or (b) any material breach of any representations, warranties or covenants by NGX in Section 14 above.

16.3 Procedure. Except with respect to Third Party infringement claims subject to Section 11.3.3 above, a Party that intends to claim indemnification under this Section 16 (the “Indemnitee”) shall promptly notify the other Party (the “Indemnitor”) in writing of any Third Party Claim, in respect of which the Indemnitee intends to claim such indemnification, and the Indemnitor shall have sole control of the defense and/or settlement thereof; provided, that the Indemnitee shall have the right to participate in the defense or settlement of such Third Party Claim with counsel of its own choosing at its expense. The Indemnitor shall keep the Indemnitee fully informed of the progress of any such Third Party Claim. The indemnity arrangement in this Section 16 shall not apply to amounts paid in settlement of any action with respect to a Third Party Claim, if such settlement is effected without the consent of the Indemnitor, which consent shall not be withheld, delayed or conditioned unreasonably. The failure to deliver written notice to the Indemnitor within a reasonable time after the commencement of any action with respect to a Third Party Claim, if prejudicial to its ability to defend such action, shall relieve such Indemnitor of any liability to the Indemnitee under this Section 16 to the extent it is so prejudiced, but the omission to so deliver written notice to the Indemnitor shall not relieve the Indemnitor of any liability that it may have to any Indemnitee otherwise than under this Section 16. The Indemnitee under this Section 16 shall cooperate fully with the Indemnitor and its legal representatives in the investigation of any action with respect to a Third Party Claim covered by this indemnification.

16.4 [Intentionally left blank.]

16.5 Insurance. Section 16.5 of the Astellas License Agreement is hereby incorporated by reference as if set forth herein in full, except that for purposes of this Agreement the terms “Party” or “Parties” shall mean (i) NGX, and (ii) the event the Astellas License Agreement is terminated, CHRP (and its Affiliates), if it elects to directly sell and distribute Products in the Territory, or any Sublicensee of CHRP.

17.

TERM AND TERMINATION

17.1 Term. This Agreement shall become effective as of the Effective Date and, unless earlier terminated pursuant to the other provisions of this Section 17, shall continue until the earlier of (1) the occurrence of the Second Stepdown (as defined in the Financing Agreement), (2) termination of the Financing Agreement in accordance with Section 7.02(a) thereof, (3) full payment has been made to CHRP pursuant to Section 2.02(e) or 7.02(c) or (4) on a country-by-country and Product-by-Product basis, until the later of (a) ten (10) years after the First Commercial Sale thereof in the respective country, (b) the expiration or abandonment of the last Valid Patent Claim covering the respective Product in the respective country and (c) the expiration of all applicable periods of regulatory exclusivity (e.g., regulatory data exclusivity) covering the respective Product in the respective country.

17.2 Termination By CHRP. CHRP may terminate this Agreement for any reason under this Section 17.2 without any penalty, consequence, termination compensation, loss of profits, goodwill indemnity or otherwise solely by reason of such termination (i.e., without prejudice to any remedies NGX may have for a breach of this Agreement by CHRP prior to such termination), as a whole, or with respect to the European Region, or on a country-by-country

basis with respect to countries in the Territory (other than those countries comprising the European Region) and a Product-by-Product basis, in each case upon written notice to NGX.

17.3 Termination for Material Breach. Without limiting either Party’s ability to terminate in accordance with the other provisions of this Agreement, in the event of a Party’s material breach of this Agreement, the non-breaching Party shall have the right to provide notice of its intention to terminate this Agreement. Such notice shall specify in reasonable detail the facts and circumstances constituting the material breach of this Agreement. Upon the expiration of ninety (90) days after receipt by the breaching Party of such notice, if the breaching Party has not cured such material breach, the non-breaching Party shall have the right to terminate this Agreement in whole by giving a notice of termination, which shall be effective on the date such notice is given.

18.

EFFECT OF EXPIRATION OR TERMINATION

18.1 General. Termination of this Agreement for any reason shall not release NGX from any then-outstanding Financing Agreement Obligations then owing to CHRP or any Party hereto from any liability which, at the time of such termination, has already accrued to the other Party or which is attributable to a period prior to such termination nor preclude either Party from pursuing all rights and remedies it may have hereunder or at law or in equity with respect to any breach of this Agreement.

18.2 Sections 18.3-18.7 of the Astellas License Agreement are hereby incorporated by reference as if set forth herein in full except that all references to Astellas in such Sections shall be deemed to be references to CHRP.

18.3 Survival. The provisions of Sections 1, 7.2.1(b), 13, 15.1, 15.2, 16, 18, 19, 20.4 and 20.5 (and any provision of the Astellas License Agreement incorporated herein by reference that survives the expiration or termination thereof) shall survive the expiration or termination of this Agreement for any reason.

18.4 Rights in Bankruptcy. All rights and licenses granted under or pursuant to this Agreement by NGX are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of right to “intellectual property” as defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that CHRP, as licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the U.S. Bankruptcy Code. The Parties further agree that, in the event of the commencement of a bankruptcy proceeding by or against NGX under the U.S. Bankruptcy Code, which results in NGX’s rejection of this Agreement, CHRP shall be entitled to (a) retain ownership of all MAA Approvals and (b) a complete duplicate of (or complete access to, as appropriate) any such intellectual property and all embodiments of such intellectual property, which, if not already in CHRP’ possession, shall be promptly delivered upon written request therefor by CHRP.

19.

DISPUTE RESOLUTION

This Agreement shall be governed and construed in accordance with the laws of the State of New York, USA, without giving effect to any choice of law provisions thereof. Each Party hereby submits itself for the purpose of this Agreement and any controversy arising hereunder to the exclusive jurisdiction of the state and federal courts located in the County of New York, State of New York, USA, and any courts of appeal therefrom, and waives any objection on the grounds of lack of jurisdiction (including, without limitation, venue) to the exercise of such jurisdiction over it by any such courts. In the event of any dispute between the parties, such dispute shall be resolved in accordance with the provisions set forth in Section 8.15 of the Financing Agreement, the provisions of which are incorporated by reference as it set forth herein in full.

20.

MISCELLANEOUS

20.1 Force Majeure. Nonperformance of any Party shall be excused to the extent that performance is rendered impossible by fire, strike (other than of their own workforce), earthquake, flood, acts of terrorism, governmental acts or orders or restrictions, failure of suppliers, or any other reason where failure to perform is beyond the reasonable control of the nonperforming Party. In such event CHRP or NGX, as the case may be, shall promptly notify the other Party of such inability and of the period for which such inability is anticipated to continue. Without limiting the foregoing, the Party subject to such inability shall use reasonable efforts to minimize the duration of the impact of any force majeure event on its performance hereunder.

20.2 No Implied Waivers; Rights Cumulative. No failure on the part of NGX or CHRP to exercise and no delay in exercising any right under this Agreement, or provided by statute or at law or in equity or otherwise, shall impair, prejudice or constitute a waiver of any such right, nor shall any partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.

20.3 Independent Contractors. Nothing contained in this Agreement is intended implicitly, or is to be construed, to constitute NGX or CHRP as partners in the legal sense. No Party hereto shall have any express or implied right or authority to assume or create any obligations on behalf of or in the name of any other Party or to bind any other Party to any contract, agreement or undertaking with any Third Party. This Agreement does not create a partnership for USA federal income tax purposes (as defined in Section 761 of the USA Internal Revenue Code), for any USA state or local jurisdiction, or in any country other than the USA. Therefore there is no requirement to file Form 1065, USA Partnership Return of Income, any similar USA state or local income tax return, or any similar document with tax authorities in any country other than the USA.

20.4 Notices. Any notice required or permitted to be given hereunder shall be in writing and shall be delivered in person, by a nationally recognized overnight courier, or by facsimile (receipt confirmed), to the addresses given below or such other addresses as may be designated in writing by the Parties from time to time during the Term in accordance with the

provisions of Section 8.03 of the Financing Agreement, the provisions of which are incorporated herein by reference.

20.5 Assignment. This Agreement shall not be assignable by either Party to any Third Party without the written consent of the other Party; except CHRP may assign this Agreement without the consent of NGX to a Third Party to whom it assigns all of the other Transaction Documents and NGX may assign this Agreement without the consent of CHRP to a Third Party to whom it assigns all of the other Transaction Documents and which acquires all or substantially all of the assets of NGX; provided, however, that such assignment shall not relieve NGX of its obligations hereunder.

20.6 Modification. No amendment or modification of any provision of this Agreement shall be effective unless in writing signed by all Parties hereto. No provision of this Agreement shall be varied, contradicted or explained by any oral agreement, course of dealing or performance or any other matter not set forth in an agreement in writing and signed by all Parties.

20.7 Severability. If any provision hereof should be held invalid, illegal or unenforceable in any jurisdiction, the Parties shall negotiate in good faith a valid, legal and enforceable substitute provision that most nearly reflects the original intent of the Parties and all other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in order to carry out the intentions of the Parties hereto as nearly as may be possible. Such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of such provision in any other jurisdiction.

20.8 Publicity Review. Any announcements regarding this Agreement or the activities of the Parties hereunder shall be governed by Section 5.04 of the Financing Agreement, the terms of which are incorporated by reference.

20.9 Counterparts. This Agreement may be executed in two counterparts, each of which shall be deemed an original, and all of which together, shall constitute one and the same instrument.

20.10 Headings. Headings used herein are for convenience only and shall not in any way affect the construction of or be taken into consideration in interpreting this Agreement.

20.11 Export Laws. Notwithstanding anything to the contrary contained herein, all obligations of NGX and CHRP are subject to prior compliance with United States and foreign export regulations and such other United States and foreign laws and regulations as may be applicable, and to obtaining all necessary approvals required by the applicable agencies of the governments of the United States and foreign jurisdictions. NGX and CHRP shall cooperate with each other and shall provide assistance to the other as reasonably necessary to obtain any required approvals.

20.12 Entire Agreement. This Agreement, together with all the Exhibits thereto, the Financing Agreement, and the other Transaction Documents constitute the entire agreement, both written or oral, with respect to the subject matter hereof, and supersede all prior or

contemporaneous understandings or agreements, whether written or oral, between NGX and CHRP with respect to such subject matter.

[The remainder of this page left intentionally blank; signature page follows.]

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed and delivered in duplicate originals as of the Effective Date.


NEUROGESX, INC.		XXXXX HEALTHCARE ROYALTY PARTNERS, L.P.

By:	/s/ Xxxxxxx Xxxxxxxxx	By:	/s/ Xxxxxxx X. Browns

Name:	Xxxxxxx Xxxxxxxxx	Name:	Xxxxxxx X. Browns, M.D.

Title:	EVP, COO, CFO	Title:	Managing Director

[SIGNATURE PAGE TO DISTRIBUTION, MARKETING AND LICENSE AGREEMENT]

EXHIBIT C

COPY OF EXISTING LICENSE AGREEMENT

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DATED 19^th June 2009

NEUROGESX INC.

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ASTELLAS PHARMA EUROPE LIMITED

DISTRIBUTION, MARKETING AND LICENSE AGREEMENT

Confidential

TABLE OF CONTENTS


			Page
1.	DEFINITIONS		1

2.	GRANT OF DISTRIBUTION RIGHTS		12
	2.1	Appointment	12
	2.2	License	12
	2.3	Liquid Formulation Product Option	13
	2.4	Subdistributors and Sublicensees	16
	2.5	NGX IP Acquired after the Effective Date	17
	2.6	No Modifications to the Product	18
	2.7	No Conflict	18

3.	INITIAL PAYMENTS AND MILESTONES		19
	3.1	Initial Payment	19
	3.2	Sales Milestones	20
	3.3	Option Fee/Option Exercise Fee	20

4.	ROYALTIES		21
	4.1	Royalty	21
	4.2	Certain Reductions to Royalties	21
	4.3	[***]	22
	4.4	Existing NGX Third Party Royalties	23
	4.5	Discounting	23
	4.6	Royalty Reports	24

5.	COOPERATION		25
	5.1	Commercialization Plan	25
	5.2	Joint Steering Committee	25
	5.3	Joint Development Committee	26
	5.4	Joint Commercialisation Committee	26
	5.5	Joint Regulatory Committee	27
	5.6	General Provisions relating to Committees	27
	5.7	Alliance Managers	29
	5.8	Kick-off Meeting	29
	5.9	Documents	29
	5.10	Co-operation	30

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TABLE OF CONTENTS

(Continued)


6.	TRANSFER OF THE MARKETING AUTHORISATION		30
	6.1	MAA Approval Transfer	30
	6.2	[***]	30
	6.3	NGX’s Obligations	30
	6.4	Prior to MAA Approval Transfer	31
	6.5	After MAA Approval Transfer	31
	6.6	Communications with Regulatory Authorities	31

7.	DEVELOPMENT		32
	7.1	Development of Existing Product	32
	7.2	Exchange of Data	34
	7.3	Development of Liquid Formulation Product	35
	7.4	Coordination	35

8.	COMMERCIALIZATION		36
	8.1	Commercialization	36
	8.2	Pricing and Reimbursement	36
	8.3	Sales Materials	36
	8.4	Reporting Adverse Drug Reactions/Experiences	37
	8.5	Assistance for the Product	37
	8.6	Medical Inquiries for the Product	38
	8.7	Material Failure to Exploit	38
	8.8	Commercialization of Liquid Formulation Product	39

9.	SUPPLY OF EXISTING PRODUCT		39
	9.1	General	39
	9.2	Inventory	39
	9.3	General Supply Terms	39
	9.4	Tripartite Agreements	40
	9.5	Quality Agreement	40

10.	PAYMENTS; BOOKS AND RECORDS		40
	10.1	Payment Method	40
	10.2	Taxes	40
	10.3	United States Dollars	41
	10.4	Records; Inspection	41

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TABLE OF CONTENTS

(Continued)


11.	INTELLECTUAL PROPERTY		42
	11.1	Ownership of Inventions	42
	11.2	NGX Improvements	43
	11.3	Maintenance of Patents	44
	11.4	Third Party Patents and Trademarks	45
	11.5	Enforcement of Patent Rights and Trademarks	47
	11.6	Third Party Patent Rights	48
	11.7	Patent Marking	48

12.	TRADEMARKS		49
	12.1	Product Trademark	49
	12.2	Trade Dress	49
	12.3	License	49
	12.4	Quality Standards	49
	12.5	Alternative Trademark	50
	12.6	Registration & Ownership	50
	12.7	Recordation	50
	12.8	Domain Names	50
	12.9	Trademark for Liquid Formulation Product	51
	12.10	Promotional Materials	51
	12.11	Termination	51

13.	CONFIDENTIALITY		51
	13.1	Confidential Information	51
	13.2	Permitted Use and Disclosures	52
	13.3	Terms of this Agreement	52
	13.4	Prior Non-Disclosure Agreements	53
	13.5	Publication of Product Information	53

14.	REPRESENTATIONS AND WARRANTIES		53
	14.1	Mutual Warranties	53
	14.2	NGX Warranties	53
	14.3	NGX Covenants	58
	14.4	Astellas Warranties	58

15.	LIABILITY		58
	15.1	DISCLAIMER	58
	15.2	LIMITATION OF LIABILITY	58

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TABLE OF CONTENTS

(Continued)


	15.3	Exceptions	59

16.	INDEMNIFICATION		59
	16.1	Indemnification of NGX	59
	16.2	Indemnification of Astellas	59
	16.3	Procedure	59
	16.4	Consequences of Failure to Transfer MA	60
	16.5	Insurance	60

17.	TERM AND TERMINATION		61
	17.1	Term	61
	17.2	Termination By Astellas	61
	17.3	Termination for Material Breach	61
	17.4	Termination for Insolvency	61
	17.5	[***]	61
	17.6	[***]	62

18.	EFFECT OF EXPIRATION OR TERMINATION		62
	18.1	General	62
	18.2	Rights on Expiration	62
	18.3	Rights on Termination of a Product	63
	18.4	Sublicenses	65
	18.5	Rights on Termination of a non-European Union country (under Section 7.1.1) or Region	65
	18.6	Rights on Termination of this Agreement	67
	18.7	No Renewal, Extension or Waiver	67
	18.8	Survival	67
	18.9	Rights in Bankruptcy	68

19.	DISPUTE RESOLUTION		68
	19.1	Disputes	68
	19.2	Arbitration	69

20.	MISCELLANEOUS		70
	20.1	Governing Law	70
	20.2	Force Majeure	70
	20.3	No Implied Waivers; Rights Cumulative	70
	20.4	Independent Contractors	70

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TABLE OF CONTENTS

(Continued)


20.5	Notices	71
20.6	Assignment	71
20.7	Modification	71
20.8	Severability	71
20.9	Publicity Review	72
20.10	Counterparts	72
20.11	Headings	72
20.12	Export Laws	73
20.13	Entire Agreement	73

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DISTRIBUTION, MARKETING AND LICENSE AGREEMENT

This DISTRIBUTION, MARKETING AND LICENSE Agreement (hereinafter “Agreement”), made as of the 19th day of June, 2009 (“Effective Date”), between NeurogesX Inc., a Delaware corporation having a place of business at 0000 Xxxxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxxxxxx 00000, Xxxxxx Xxxxxx of America (“NGX”) and Astellas Pharma Europe Ltd, a corporation established under the laws of England and Wales having a place of business at Xxxxxx Xxxxx, Xxxxxx Xxxx, Xxxxxxx, Xxxxxxxxx, XX00 0XX, Xxxxxx Xxxxxxx (“Astellas”). Each of NGX and Astellas shall be a “Party,” and together the “Parties.”

RECITALS

A. NGX has developed a patch product for the cutaneous delivery of capsaicin (as described below, the “Existing Product”).

B. NGX has obtained MAA Approval (as defined below) for the Existing Product in the European Union using the centralized procedure for treatment of PNP (as defined below) in non-diabetic adults.

C. Astellas desires to obtain (i) an exclusive right to commercialize and distribute the Existing Product, and (ii) an option to obtain the exclusive right to co-develop, commercialize and distribute the Liquid Formulation Product (as defined below), in each case in Europe and certain other countries (as described below, the “Territory”), and NGX desires to have the Existing Product and the Liquid Formulation Product commercialized in the Territory, in accordance with this Agreement.

AGREEMENT

1. DEFINITIONS

1.1 “Affiliate” shall mean, in the case of a subject entity, another entity that controls, is controlled by or is under common control with the subject entity, but only for so long as such control exists. For purposes of this definition only, “control” shall mean beneficial ownership (direct or indirect) of at least fifty percent (50%) of the shares of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, in the election of the corresponding managing authority); provided that where the local law does not permit foreign equity ownership of at least fifty percent (50%), then “control” shall mean the beneficial ownership (direct or indirect) of the maximum percentage of outstanding stock or voting rights permitted by local law.

1.2 “Alternative Trademark” shall mean the [***] trademarks for the Existing Product, which shall be owned by NGX worldwide, including the applications and registrations for which are set out in Exhibit 1.44.

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

1.3 “Brand Guiding Principles” shall mean the general framework for a common understanding of the Existing Product and the commercial focus it should have worldwide, such general framework to include at minimum the items set forth in Exhibit 1.3.

1.4 “cGCP” or “current Good Clinical Practices” means a set of internationally recognized ethical and scientific quality requirements which must be observed for designing, conducting, recording and reporting clinical trials that involve the participation of human subjects as set forth in European Union Commission Directive 2001/20/EC relating to the implementation of good clinical practice in the conduct of clinical trials on medicinal products for human use, and brought into law by European Union Commission Directive 2005/28/EC laying down the principles and detailed guidelines for good clinical practice as regards investigational medicinal products, as well as the requirements for authorization of the manufacturing and importation of such products and any subsequent modifications or amendments thereto and any laws that apply in the location of performance of the clinical trial.

1.5 “cGLP” or “current Good Laboratory Practices” means the quality system concerned with the organizational process and the conditions under which laboratory studies are planned, performed, monitored, recorded and reported, as defined in European Commission Directive 87/18/EEC as amended and any subsequent modifications or amendments thereto and any laws that apply in the location of performance of the laboratory studies.

1.6 “cGMP” or “current Good Manufacturing Practices” means all applicable standards relating to manufacturing practices for fine chemicals, active pharmaceutical ingredients, intermediates, bulk products or finished pharmaceutical products, including current good manufacturing practices and standards as provided for (and as amended or superseded from time to time) in:

1.6.1 European Community Directive 2003/94/EC (Principles and guidelines of good manufacturing practice for medicinal products);

1.6.2 21 C.F.R. §§ 210, 211 and 600;

1.6.3 ICH Guidance for Industry Q7 Good Manufacturing Practice Guidance for Active Pharmaceutical Ingredients; and

1.6.4 Part II of Volume IV of the EU Guide to Good Manufacturing Practice.

1.7 “Commercially Reasonable Efforts” shall mean [***].

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1.8 “Committee” shall mean the JSC, JDC, JRC and JCC or any other committee set up by the JSC, as the case may be.

1.9 “Competitive Product” shall mean [***].

1.10 “Component(s)” shall mean, individually or collectively, Patch and/or Gel.

1.11 “Consultation” shall mean, with respect to the representations, warranties and covenant of NGX, the diligent and informed consultation between any of the individuals identified in Section 1.28 and NGX’s external patent counsel who has meaningful responsibilities related to the prosecution, management and defense of NGX’s intellectual property rights, including the Patent Rights and the NGX Know-How, in each case, which consultation shall specifically concern the subject matter of the applicable representation, warranty or covenant, including any exceptions to the accuracy thereof.

1.12 “Control” shall mean possession of the ability to grant a license or sublicense, within the scope set forth in this Agreement, without violating the terms of any agreement or other arrangement with any Third Party.

1.13 “CPL” shall mean Contract Pharmaceuticals Limited Canada, 0000 Xxxxxx Xxxxxxxx, Xxxxxxxxxxx, Xxxxxxx, X0X 0X0, Xxxxxx, and its successors.

1.14 “Data” shall mean any and all scientific, technical or test data pertaining to Product(s) that is generated by or under authority of either Party, including research data, clinical pharmacology data, CMC data (including analytical and quality control data and stability data), preclinical data, clinical data and/or all submissions made in association with an IND or NDA or other MAA filed in or outside the Territory with respect to such Product(s), in each case to the extent such data either (a) is Controlled by a Party on the Effective Date or (b) comes within a Party’s Control during the term of this Agreement.

1.15 “Development Expenses” means the Direct Costs incurred by a Party in accordance with the approved budget included in the applicable development plan for the [***] (in accordance with Section 2.3.14) or the [***] (in accordance with Section 7.1.1). Development Expenses shall include the cost of any studies detailed in an agreed development plan as well as, in relation to the [***], the costs related to the development and testing of [***].

1.16 “Direct Costs” means the incurred variable costs and fixed costs including, without limitation (a) costs of services provided by contract research organizations and individuals , consultants and contractors, (b) the efforts of the employees of a Party or its Affiliates in performing

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its activities under [***], and (iii) may be different for each Party, and (c) any other direct costs including out of pocket external costs. In determining “Direct Costs” chargeable under this Agreement, each Party will use its respective project accounting systems consistent with GAAP, and will review its respective project accounting methodologies with the other Party upon the other Party’s reasonable request.

For the purpose of this definition:

(a) “variable costs” shall be deemed to be [***], including, but not limited to, the [***];

(b) “fixed costs” shall be deemed to be the costs of [***] and other fixed costs allocable on a reasonable basis to the development of the Product. All cost determinations shall be made in accordance with GAAP.

1.17 “Existing Product” shall mean a product containing a Patch and/or Gel, whether alone or in combination, together with any ancillary non-pharmacologically active components (e.g. gloves), if MAA Approval has been obtained for such a combination.

1.18 “First Commercial Sale” shall mean the first bona fide, arm’s length sale of a Product in a country following receipt of MAA Approval of such Product in such country; provided that where such a first sale has occurred in a country for which [***].

1.19 “Field” shall mean the [***].

1.20 “Fiscal Year” shall mean the twelve (12) month period beginning on 1 April and ending on 31 March each year.

1.21 “Formosa” shall mean Formosa Laboratories, Inc., Xx. 00-0 Xxxxxx Xxxxxx, Xxxxxx Xxxxxx, Xxxxxx, Xxxxxx 338, Republic of China, and its successors.

1.22 “GAAP” shall mean generally accepted accounting principles in the United States or International Financial Reporting Standards (IFRS) consistently applied.

1.23 “Gel” shall mean the packaged cleansing gel product, as further described in NGX’s EMEA MAA Approval No. EMEA/H/C/000909 and any supplements and amendments to such MAA Approval existing as of the Effective Date, together with any improvements or modifications (including but not limited to line extensions, enhanced or modified presentations and formulations) to such cleansing gel or any other cleansing gel [***], in each case developed by or on behalf of NGX during the term of this Agreement.

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1.24 “Gross Sales” shall mean (i) the gross amounts invoiced for sales of Product by Astellas and its Affiliates and Sublicensees (but not Subdistributors) to Third Parties (including Subdistributors), and (ii) any royalties received by Astellas, its Affiliates or Sublicensees based on sales of Product by a Subdistributor, and (iii) any lump sums received by Astellas, its Affiliates or Sublicensees for the grant of subdistribution rights.

1.25 “IND” shall mean the approval granted by the FDA to conduct the first clinical trial of any Product in man in the United States or the equivalent approval in any other country.

1.26 “Key Metrics” shall mean those criteria set forth in Exhibit 1.26.

1.27 “Know-How” shall mean any information, results and data of any type whatsoever, in any tangible or intangible form whatsoever, including without limitation, databases, ideas, discoveries, inventions, trade secrets, practices, methods, tests, assays, techniques, specifications, processes, formulations, formulae, knowledge, know-how, skill, experience, materials, including pharmaceutical, chemical and biological materials, products and compositions, Data, studies and procedures, drawings, plans, designs, diagrams, sketches, technology, documentation or descriptions.

1.28 “Knowledge of NGX” or “Knowledge” shall mean, with respect to the existence or absence of a fact, the actual knowledge of:

(a) [***];

(b) [***];

(d) [***];

(e) [***];

(f) [***];

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(g) [***];

(h) [***]; and

(i) [***].

1.29 “Launch” shall mean First Commercial Sale.

1.30 “Liquid Formulation Product” shall mean NGX-1998, the high concentration liquid formulation of capsaicin currently under development by NGX, together with [***] provided that [***] together with [***].

1.31 “LTS” shall mean LTS Therapie-Systeme AG with its head office at Xxxxxxxxxxxxx 0, 00000 Xxxxxxxxx, Xxxxxxx, and its successors.

1.32 “LTS Agreement” shall mean the Commercial Supply and License Agreement between NGX and LTS entered into on 28 January 2007 and attached as Exhibit 1.32.

1.33 “MAA” shall mean an application requesting regulatory approval, whether as a drug, device, or a combination thereof, for the commercialization of a Product for a particular indication in a country in or outside the Territory, including without limitation a New Drug Application (“NDA”) filed with the U.S. Food and Drug Administration (“FDA”) or a marketing authorization application filed with the FDA’s counterpart in a country or a Region in the Territory. It is understood that MAA does not include applications for pricing or reimbursement approval.

1.34 “MAA Approval” shall mean, with respect to each country in or outside the Territory for a particular Product, approval by the health regulatory authority in such country that is the counterpart of the FDA of the MAA for such Product filed in such country. It is understood that, as used herein, MAA Approval does not include pricing or reimbursement approval.

1.35 “Major Country” shall mean any of United Kingdom, Germany, France, Italy or Spain.

1.36 “Manufacture” shall mean:

(a) the purchase of Patches from (i) LTS under the LTS Tri-Partite Agreement (as defined in the Supply Agreement), (ii) an Alternative Patch Supplier (as defined in the Supply Agreement) in accordance with Section 13.4.4 of the Supply Agreement, or (iii) any other supplier of Patches under the back up manufacturing provisions in Section 13.7.1 of the Supply Agreement or the corresponding provision of the LTS Tri-Partite Agreement;

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(b) the purchase of Gel from (i) CPL under the CPL Tri-Partite Agreement (as defined in the Supply Agreement), (ii) an Alternative Gel Supplier (as defined in the Supply Agreement) in accordance with Section 2.4(b) of the Supply Agreement, or (iii) any other supplier of Gel under the back up manufacturing provisions in Section 13.7.2 of the Supply Agreement or the corresponding provision of the CPL Tri-Partite Agreement;

(c) the right to manufacture Gel (i) in accordance with Section 2.4(b) of the Supply Agreement, or (ii) under the back up manufacturing provisions in Section 13.7.2 of the Supply Agreement or the corresponding provision of the CPL Tri-Partite Agreement;

(d) the purchase of capsaicin from (i) Formosa under the Formosa Tri-Partite Agreement (as defined in the Supply Agreement), (ii) an Alternative API Supplier (as defined in the Supply Agreement) in accordance with Section 2.4(a) of the Supply Agreement; and

(e) the right to manufacture capsaicin (i) in accordance with Section 2.4(a) of the Supply Agreement, or (ii) under the back up manufacturing provisions of the Formosa Tri-Partite Agreement;

in each of (a)-(e) above, either inside or outside the Territory but solely for the purpose of importing, keeping, packaging and having packaged, promoting, marketing, offering for sale, selling, having sold, importing and otherwise distributing and using the Existing Product in the Territory.

1.37 “Net Sales” shall mean Gross Sales less deductions for (a) customary trade, quantity and cash discounts allowed and actually taken; (b) credits to customers on account of rejection of Product; (c) sales and excise taxes and duties and any other similar governmental charges imposed upon the sale of Product (including VAT, but only to the extent such VAT taxes are not reimbursable or refundable; and (d) outbound transportation including freight shipping and insurance costs prepaid or allowed. Notwithstanding the foregoing, the amounts described in clauses (c) and (d) above shall be deducted only to the extent they are stated separately on the invoice and included within gross amounts received from sales of Product. If a Product is sold for consideration other than solely cash, the value of such other consideration shall be included in the calculation of Net Sales. In the case of any sale or disposal of Products among Astellas and its Affiliates and Sublicensees (but not Subdistributors) for resale, Net Sales shall include only Astellas’ or its Affiliates’ or Sublicensees’ (but not Subdistributors’) Gross Sales with respect to the resale of such Product to Third Parties (including Subdistributors), but not the amount invoiced among Astellas and its Affiliates and Sublicensees.

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1.38 “NGX Know-How” shall mean any Know-How that is necessary for the development or commercialization of the Products in the Field in the Territory that either (a) is Controlled by NGX on the Effective Date or (b) comes within NGX’s Control during the term of this Agreement.

1.39 “Patch” shall mean the capsaicin-containing cutaneous patch described in NGX’s EMEA MA Approval No. EMEA/H/C/000909 and any supplements or amendments to such MAA Approval, together with any changes to formulation or other aspects of such patch (including but not limited to line extensions, enhanced or modified presentations and formulations) developed by or on behalf of NGX during the term of this Agreement, [***]. As used in this Agreement, a [***] means [***] such product comprising [***].

1.40 “Patent Rights” shall mean all issued, unexpired patents and all reissues, renewals, re examinations and extensions thereof, and patent applications therefor, and any divisions or continuations, in whole or in part, thereof, including those patents and applications set forth in Exhibit 1.40 which shall be updated from time to time, in each case which would, but for the license granted hereunder, be infringed by the Manufacture, packaging, importation, keeping, promoting, offering for sale, sale, marketing, distributing or use of a Product by Astellas, any of its Affiliates, Sublicensees or Subdistributors within the Field in the Territory, in each case to the extent Controlled by NGX during the term of this Agreement. Patent Rights also includes a Supplementary Certificate of Protection of a member state of the European Union or any similar protective rights in any country in the Territory.

1.41 “PDN” shall mean indication(s) for the Product relating to pain in connection with neuropathy or neuralgia associated with diabetes.

1.42 “PNP” shall mean indication(s) for the Product relating to the general treatment or mitigation of peripheral neuropathic pain.

1.43 “Product” shall mean (i) the Existing Product, and (ii) the Liquid Formulation Product to the extent Astellas has executed its Option under Section 2.3 below.

1.44 “Product Trademark” shall mean the QUTENZA trademark including those registered trademarks and applications for QUTENZA set forth in Exhibit 1.44, or another mutually agreed trademark for the Existing Product (including the Alternative Trademark), in either case which shall be owned by NGX worldwide.

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1.45 “Region” shall mean a set of countries in the Territory, specified in Exhibit 1.48 as a single “region” for commercialization of the Products hereunder. It is understood and agreed that [***] constitute a single Region (“European Region”).

1.46 “Subdistributor” shall mean a Third Party appointed by Astellas or one of its Affiliates or Sublicensees as a distributor of a Product, in accordance with Section 2.4.1 and 2.4.3, which Third Party purchases Product in [***]. For the avoidance of doubt, “Subdistributor” shall specifically exclude Sublicensees.

1.47 “Sublicensee” shall mean a Third Party to whom Astellas has granted, in accordance with Section 2.4.2 and 2.4.3, a sublicense under the Patent Rights and/or NGX Know-How to Manufacture, package and have packaged, develop, register, keep, import, offer for sale, sell, have sold, use market, distribute and/or promote a Product in any country or countries in the Territory other than [***] and the countries comprising [***].

1.48 “Territory” shall mean the European Region (as defined in Exhibit 1.48), the countries of the SATR Region and the Rest of the Territory Region (as defined in Exhibit 1.48), and such other countries as may be added by written agreement between the Parties.

1.49 “Third Party” shall mean any party other than Astellas, NGX and their Affiliates.

1.50 “UC” shall mean The Regents of the University of California, 0000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx 00000.

1.51 “UC License Agreement” shall mean the Exclusive License Agreement between NGX and UC, effective as of November 1, 2000, together with any amendments in effect as of the Effective Date, as attached hereto as Exhibit 1.51.

1.52 “Valid Patent Claim” shall mean a claim of an issued and unexpired patent included within the Patent Rights which has not been abandoned, cancelled or held permanently revoked, unenforceable or invalid by a decision of a court or other governmental agency of competent jurisdiction unappealed within the time allowed for appeal, or which has not been admitted to be invalid or unenforceable through reissue or disclaimer or otherwise.

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In addition, the following terms shall have the meaning described in the corresponding section of this Agreement. Other terms may be defined throughout the Agreement and its Exhibits.


Term		Section Defined
“Adverse Proceedings”		11.4.2
“Agreement”		Preamble
“Alliance Manager”		5.7
“Annual Net Sales”		4.1.1
“Applicator”		2.5.7
“Assumed Patent”		11.3.5
“Astellas”		Preamble
“Astellas Improvements”		11.1.4
“Astellas Indemnitees”		16.2
“Clinical Supplies”		4.2.1
“Commercialization Plan”		5.1
“Confidential Information”		13.1
“Costs”		11.4.2
“Damages”		11.4.1
“Developing Party”		7.1.1(a)(ii)(2)
“Document”		6.3.1
“Dominating Patent Rights”		4.2.3
“Earned Royalty”		4.1
“Effective Date”		Preamble
“EMEA Requirements”		7.1.1(a)(ii)
“Enforcement Actions”		11.5
“Exclusivity Period”		2.7.1
“Existing Product MAA Approval”		6.1
“Extraterritorial DPR”		4.3
“Floor”		4.2.3
“Generic Competition”		4.2.2(a)
“Generic Product”		4.2.2(a)
“Generic Sales”		4.2.2(b)(i)
“Indemnitee,” “Indemnitor”		16.3
“Infringement Actions”		11.4.1
“Infringing Product”		11.5
“Initiating Party”		11.5.2
“Joint IP”		11.1.2
“Joint Commercialisation Committee”, “JCC”		5.4
“Joint Development Committee”, “JDC”		5.3
“Joint Patents”		11.1.2
“Joint Steering Committee,” “JSC”		5.2
“Joint Regulatory Committee”, “JRC”		5.5

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Term		Section Defined
“LF Development Plan”		2.3.4
“LF Trademark”		12.9
“Liabilities”		16.1
“Licensing Option”		2.7.7
“Licensing Option Product”		2.7.7
“Licensing Option Term”		2.7.7(b)
“LTS Royalties”		4.4.2
“Maintenance”		6.5
“Marketing”		Exhibit 1.26
“Material Failure to Exploit”		Exhibit 1.26
“NGX”		Preamble
“NGX Improvements”		11.2.5
“NGX Indemnitees”		16.1
“Non-Generic Sales”		4.2.2(b)(i)
“Option Fee”		3.3.1
“Option Retention Fee”		3.3.2
“Option Exercise Fee”		3.3.3
“Option Period [***]”		2.3.2
“Option Period [***] Deliverables”		Exhibit 2.3.4
“Option Period [***]”		2.3.2
“Option Period [***] Deliverables”		Exhibit 2.3.7
“Party,” “Parties”		Preamble
“PDN Trial”		7.1.1(a)(ii)
“Post-Marketing Studies”		7.1.1(a)(iii)
“Product Liability Claim”		16.1
“Promotional Samples”		4.2.1
“Product Materials”		18.3.4
“QA Samples”		4.2.1
“QPPV”		8.4
“Reference Product”		4.2.2(a)(iii)
“Regulatory Request”		6.4
“Reimbursement Date”		2.5.5; 4.3.4
“Royalty Adjustment”		4.6.2(a)
“Rejected IP”		4.3.5
“Safety Study”		7.1.1(a)(i)
“Sales Materials”		8.3.2
“Supply Agreement”		9.1
“Terminated Product”		18.3
“Terminated Region”		18.4
“Third Party Claim”		16.1
“Third Party IP”		2.5

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Term		Section Defined
“Third Party Right”		11.4.1
“Total UC Royalties”		4.4.1
“UC Royalties”		4.4.1
“UC Royalty Cap”		4.4.1
“Wind-down Period”		18.3, 18.4
“Withdrawal Notice”		5.6.6

2.1 Appointment During the term of this Agreement, NGX appoints Astellas, and Astellas hereby accepts such appointment, as the exclusive (even as to NGX and its Affiliates) distributor and marketer of the Existing Product in the Field in the Territory.

2.2 License

2.2.1 Subject to the terms and conditions of this Agreement, NGX grants to Astellas:

(a) an exclusive (even as to NGX and its Affiliates) license during the term of this Agreement under the Patent Rights and NGX Know-How to: (i) register (including conducting such clinical trials as may be required to support such registrations) the Existing Product (ii) import, keep, package and have packaged the Components supplied by NGX, and (iii) promote, market, offer for sale, sell, have sold, import and otherwise distribute and use the Existing Product in the Territory for any and all indications in the Field; and

(b) a license (co-exclusive with NGX) during the term of this Agreement under the Patent Rights and NGX Know-How to Manufacture Components for the exclusive use by Astellas in the Territory and Field.

Notwithstanding the foregoing, it is understood that the licenses granted above shall exclude [***].

NGX reserves all rights not expressly granted herein. Additionally it is understood and agreed that Astellas shall have the right to: (x) carry out marketing activities outside the Territory, in co-operation with NGX, for the promotion of sales of Existing Product (by Astellas, any Astellas Affiliate, Sublicensee or Subdistributor) in the Territory strictly in accordance with the license and terms set forth in Section 1.2 of Exhibit 2.2.1; and (y) carry out clinical trials outside the Territory, in co-operation with NGX, for the development (by Astellas or any Astellas Affiliate) of Existing Product which is to be promoted, marketed and sold in the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1.

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2.2.2 During the term of this Agreement, NGX shall not, and shall not license or authorise any Affiliate or Third Party to develop (save in accordance with this Agreement), register, promote, market, offer for sale, sell, have sold, import and otherwise distribute and use and sell

(a) Components and/or Existing Products within the Field and Territory; or

(b) [***], save that it may carry out pre-clinical development activities provided that notwithstanding the foregoing, NGX shall have the right to (x) carry out marketing activities in the Territory, in co-operation with Astellas, for the promotion of sales of Existing Product and Liquid Formulation Product (by NGX, any NGX Affiliate or their licensees) outside of the Territory strictly in accordance with the license and terms set forth in Section 1.3 of Exhibit 2.2.1. and (y) carry out clinical trials inside the Territory, in co-operation with Astellas, for the development by NGX of Existing Product which is to be promoted, marketed and sold outside the Territory, strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1.

2.2.3 Extension of License to Affiliates. Astellas shall have the right to exercise the licenses granted in Section 2.2 through one or more of its Affiliates, for as long as such entity remains an Affiliate of Astellas, provided that (a) Astellas hereby warrants and guarantees the performance of, and compliance with, the obligations set forth in this Agreement by its Affiliates, and (b) Astellas shall remain responsible for all other payments and other obligations under this Agreement arising from activities of its Affiliates.

2.3 Liquid Formulation Product Option

2.3.1 Subject to the receipt by NGX of the Option Fee specified in Section 3.3.1, NGX shall grant and does hereby grant to Astellas an exclusive option to include the Liquid Formulation Product as a Product under this Agreement (“Option”).

2.3.2 The Option shall commence upon receipt by NGX of the Option Fee and shall continue until the expiry of the [***] in Section 2.3.12 (“Option Period”). The Option Period shall be [***] (as defined below). Following the exercise of the Option by Astellas in accordance with Section 2.3.12 the Parties shall carry out Phase III trials of the Liquid Formulation Product in accordance with Section 2.3.14.

2.3.3 During the Option Period, NGX and its Affiliates shall not offer to or grant to any Third Party any right in or to the Liquid Formulation Product in the Field and Territory.

2.3.4 Within [***] of the payment of the Option Fee, NGX shall draw up a draft development plan for the Liquid Formulation Product (“LF Development Plan [***]”) which shall include [***] of the LF Development Plan [***] being described in Exhibit 2.3.4.

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2.3.5 NGX shall present the LF Development Plan [***] to the JDC within the [***] period described in Section 2.3.4, following which the JDC will finalise the LF Development Plan [***], which shall be agreed by the JSC within a further [***] period, such that the LF Development Plan [***] shall be agreed by the JSC within [***]from the Effective Date.

2.3.6 Following the agreement of the LF Development Plan [***], NGX shall be responsible for performing the tasks allocated to it under the LF Development Plan [***] in respect of Option Period [***], subject to the oversight of the JDC and ultimately the JSC. NGX shall carry out such tasks in a [***]. [***].

2.3.7 Following completion of the activities set out in the LF Development Plan [***] that are to be carried out in [***], NGX shall provide Astellas with the [***] and a draft “LF Development Plan [***]” setting out the activities to be carried out in [***] which shall include at least [***] and the [***].

2.3.8 At any time up to [***] after the date of delivery to Astellas of the complete [***] and the draft LF Development Plan [***], Astellas may provide NGX with written notice of its intent to retain the Option. If it wishes to retain the Option then it shall pay the Option Retention Fee in accordance with Section 3.3.2.

2.3.9 If Astellas notifies NGX in accordance with Section 2.3.8 that it wishes to retain the Option and has paid the Option Retention Fee in accordance with Section 3.3.2, then within [***] of the payment of the Option Retention Fee the JDC shall finalise the LF Development Plan [***], which shall be agreed by the JSC within the same [***] period. For clarity, if Astellas does not provide NGX with written notice of its intent to retain the Option within the period set forth in Section 2.3.8 above, or fails to pay the Option Retention Fee in accordance with Section 3.3.2, then Astellas will be deemed to have declined to retain the Option, in which case the Option shall terminate and Sections 2.3.10 – 2.3.15 shall not apply.

2.3.10 Following the agreement of the LF Development Plan [***], NGX shall be responsible for performing the tasks allocated to it under the LF Development Plan [***] in respect of [***], subject to the oversight of the JDC and ultimately the JSC. NGX shall carry out such tasks in a diligent and sustained manner. All Development Expenses connected therewith shall be the responsibility of NGX.

2.3.11 Following completion of the activities set out in the LF Development Plan [***] that are to be carried out in [***], NGX shall provide Astellas with the [***] and a draft LF Development Plan [***] setting out the Phase III clinical trial activities that are to be carried out if Astellas exercises the Option.

2.3.12 At any time up to [***] after the date of delivery to Astellas of the complete [***] and the draft LF Development Plan [***], Astellas may provide NGX with written notice of its intent to exercise the Option. If it wishes to exercise the Option then it shall pay the Option Exercise Fee in accordance with Section 3.3.3.

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2.3.13 If Astellas notifies NGX in accordance with Section 2.3.12 that it wishes to exercise the Option and has paid the Option Exercise Fee in accordance with Section 3.3.3, then within two months of the payment of the Option Exercise Fee the JDC shall finalise the LF Development Plan [***], which shall be agreed by the JSC within the same [***] period. If:

(a) Astellas does not provide NGX with written notice of its intent to exercise the Option within the period set forth in Section 2.3.12 above;

(b) Astellas fails to pay the Option Exercise Fee in accordance with Section 3.3.3; or

(c) the JSC (acting through the JDC) is unable to agree upon a final LF Development Plan [***] within the [***] period described above (or any extension of such period mutually agreed upon in writing by the Parties) due to deadlock;

then Astellas will be deemed to have declined to have exercised the Option, in which case the Option shall terminate and Sections 2.3.14 and 2.3.15 shall not apply. In the event of deadlock as described in Section 2.3.13(c), NGX shall refund Astellas the Option Exercise Fee within [***] of the end of the [***] period described above (or any extension of such period mutually agreed upon in writing by the Parties).

2.3.14 Following the agreement of the LF Development Plan [***], the JDC shall oversee the performance of the Phase III clinical trial activities and shall allocate responsibility for the performance of the various tasks required in connection with such activities based upon which Party is better situated to perform such tasks, taking into account among other things, the estimated costs associated with having each Party perform such task. The aim of the LF Development Plan [***] will be to generate clinical data which is intended for, and in the correct format for, submission to satisfy the requirements of both the EMEA and the FDA. The Development Expenses for such activities will be borne [***].

2.3.15 If Astellas has exercised its Option in accordance with Section 2.3.12 and upon NGX’s receipt of the appropriate fee in accordance with Section 3.3.3, the Liquid Formulation Product shall thereafter be considered a “Product” for the purposes of this Agreement and NGX shall:

(a) appoint Astellas as the exclusive (even as to NGX and its Affiliates) distributor and marketer of the Liquid Formulation Product in the Field in the Territory;

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(b) grant to Astellas an exclusive (even as to NGX and its Affiliates) license under the Patent Rights and Know-How to co-develop, register, promote, market, sell, have sold, keep, import and otherwise distribute and use the Liquid Formulation Product in the Territory for any and all indications in the Field, and to appoint Subdistributors to do the same, in each case as further described in Section 2.4;

(c) grant to Astellas a license under the Patent Rights and Know-How to make, have made, package, and have packaged the Liquid Formulation Product for the exclusive use by Astellas in the Territory and Field providing that the Parties shall use [***] to supply the Liquid Formulation Product to each Party; and

(d) grant to Astellas the right to: (x) carry out marketing activities outside the Territory, in co-operation with NGX, for the promotion of sales of Liquid Formulation Product (by Astellas, any Astellas Affiliate, Sublicensee or their Subdistributor) in the Territory strictly in accordance with the license and terms of Section 1.2 of Exhibit 2.2.1 and (y) carry out [***], strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1, provided that Astellas shall grant to NGX the right to (x) carry out [***] strictly in accordance with the license and terms set forth in Section 1.3 of Exhibit 2.2.1. and (y) carry out [***], strictly in accordance with the license and terms set forth in Section 3 of Exhibit 2.2.1.

2.3.16 If Astellas does not retain the Option in accordance with Section 2.3.9 or does not exercise the Option in accordance with Section 2.3.13, for the term of the Exclusivity Period [***]. For clarity, it is acknowledged and agreed that the only rights and obligations of Astellas and NGX under this Section 2.3 are as expressly stated herein, and that there are no further implied obligations relating to the matters contemplated herein. As used herein, Regulatory Filing shall mean a marketing authorisation application in accordance with Title III, Chapter 1 of Directive 2001/83/EC, as amended (i.e., either a full marketing authorisation application or an abbreviated marketing authorisation application), or any equivalent filing made with a regulatory authority in the Territory.

2.4 Subdistributors and Sublicensees

2.4.1 Subdistributors. Astellas shall have the right, upon the approval of NGX, not to be unreasonably withheld or delayed, to appoint Third Parties as Subdistributors to distribute, sell, market and promote the Product in the Territory. For clarity, it is understood that the decision to treat sales to Subdistributors as Net Sales for royalty purposes under this Agreement (as opposed to basing Net Sales on such Subdistributors’ subsequent sale to Third Parties as is the case for sales by Affiliates and Sublicensees) was predicated on the understanding that Astellas’ use of Subdistributors would be limited to countries [***]. Consequently, it is understood and agreed that it shall not be unreasonable for NGX to withhold its approval with respect to the appointment of Subdistributors in [***] if such appointments would materially alter the economics for NGX under this Agreement with respect to the European Region.

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2.4.2 Sublicensees. Astellas shall have the right, upon the approval of NGX, not to be unreasonably withheld or delayed, to grant sublicenses to Third Parties under the Patent Rights and/or NGX Know-How to Manufacture, package and have packaged, develop, register, keep, import, offer for sale, sell, have sold, use, market, distribute and/or promote a Product in any country or countries in the Territory other than [***].

2.4.3 Astellas shall ensure that all Subdistributors and Sublicensees are bound by written agreements which (a) shall not conflict with, and shall be subordinate to, the terms and conditions of this Agreement, and (b) shall contain provisions which are as protective of NGX and the Product(s) as those contained in this Agreement, including without limitation Sections 2.7.8, 7.2, 8.3 and 13. Astellas hereby warrants and guarantees the performance of, and compliance with, the obligations set forth in this Agreement by its Sublicensees and Subdistributors and shall remain responsible for all payments and other obligations under this Agreement arising from activities of its Sublicensees and Subdistributors. Without limiting the foregoing, in the event that Products supplied by Astellas, its Affiliates or Sublicensees to a Subdistributor are being directly or indirectly [***], Astellas agrees that, upon becoming aware of such sale or use or otherwise upon the request of NGX, it shall: [***].

2.5 NGX IP Acquired after the Effective Date

If, after the Effective Date, NGX acquires from a Third Party subject matter that would fall within the definition of Patent Rights and/or NGX Know-How in each case only to the extent that the Patent Rights or NGX Know How covers the Existing Product (“Third Party IP”), then the following shall apply:

2.5.1 Astellas at its sole discretion can decide that it wishes to obtain a license to such Third Party IP.

2.5.2 If Astellas decides that it wishes to obtain a license to the Third Party IP, the licenses granted under Section 2.2 above with respect to such Third Party IP shall be subject to [***] for the applicable Product outside the Territory to whom NGX has granted a license under such Third Party IP.

2.5.3 To the extent such Third Party IP constitutes [***] below.

2.5.4 Upon request by Astellas, NGX shall disclose to Astellas a true, complete and correct written description of such payment obligations including a copy of the license agreement between NGX and such Third Party, and Astellas’ obligation to reimburse such amounts following such request shall be limited to those payment obligations so disclosed by NGX.

2.5.5 If Astellas decides not to obtain a license to the Third Party IP or in the event [***], having notified NGX that it wishes to obtain a license to the Third Party IP, then such Third Party IP shall [***].

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2.5.6 Should Astellas have declined to accept a license to such Third Party IP, then in the event that [***] then Astellas shall [***]. In the event of an [***] this Section 2.5, Section [***] shall apply to the defense and settlement of [***].

2.5.7 For clarity, any Third Party intellectual property that NGX may elect to in-license with respect to the [***] shall not constitute Third Party IP for purposes of this Section 2.5, and shall instead be subject to the following: [***] and (b) in the event Astellas exercises its Option under Section 2.3.12, [***] of the Liquid Formulation Product.

2.6 No Modifications to the Product

Except upon mutual agreement of the Parties in writing, Astellas covenants and warrants that neither Astellas nor its Affiliates or Sublicensee shall:

2.6.1 save for any modifications that [***], make any modifications to the Existing Product save to [***] and add [***] provided this is in accordance with the relevant MAA Approval and applicable laws and regulations; nor

2.6.2 use any Confidential Information of NGX for any purpose other than in connection with this Agreement.

2.7 No Conflict

2.7.1 [***]. Subject to Sections 2.7.2 and 2.7.3, Astellas and its Affiliates shall not, by themselves or through any Third Party(ies) [***] for a period starting on the Effective Date and ending [***] after the first First Commercial Sale of the Existing Product in a [***] unless NGX and Astellas have agreed in writing that such [***] are [***].

2.7.2 Astellas shall not be in breach of Section 2.7.1 of this Agreement if, during the Exclusivity Period, [***]. For the avoidance of doubt, [***].

2.7.3 Astellas shall not be in breach of Section 2.7.1 of this Agreement if Astellas [***] following the date that such [***] provides that Astellas (or its Affiliates) no longer [***] based on [***].

2.7.4 [***]. Subject to Sections 2.7.5 and 2.7.6, NGX and its Affiliates shall not, by themselves or through any Third Party(ies) [***].

2.7.5 NGX shall not be in breach of Section 2.7.4 of this Agreement if, [***]. For the avoidance of doubt, [***].

2.7.6 NGX shall not be in breach of Section 2.7.4 of this Agreement if NGX [***] provided that NGX [***].

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2.7.7 [***]. If, at any time prior to the end of the Exclusivity Period, NGX wishes to [***] for the Territory (a “Licensing Option Product”), NGX grants Astellas [***] in respect of such Licensing Option Product. The [***] as follows:

(a) when NGX decides that it wishes to [***] for the Territory, it will [***] of the general type and quantity that NGX would typically [***]; and

(b) within [***] (or such other longer period as the Parties may agree) of receipt of the notice and [***] in Section 2.7.7(a) above (the “[***]”), Astellas will inform NGX in writing whether [***];

(c) If Astellas notifies NGX that it [***] in relation to the [***] that is the subject of the notice in Section 2.7.7(a), then the Parties will enter into negotiations to agree a licensing agreement between them. In such [***]. Such [***] shall be consistent with the [***] within [***], and shall include, but not be limited to, [***].

(d) If Astellas notifies NGX pursuant to Section 2.7.7(b) that it [***] that is the subject of the notice in Section 2.7.7(a), or Astellas [***] then NGX will have [***].

2.7.8 Ex-Territory; No Exploitation except as Licensed. Except as otherwise permitted under Sections 1.2 and 3 of Exhibit 2.2.1 or required by applicable law, neither Astellas nor its Affiliates or Sublicensees or their respective Subdistributors will [***], only in accordance with and under this Agreement. Astellas agrees that it and its Affiliates and Sublicensees shall not use nor otherwise exploit Patent Rights, Data and the Product Trademark, except as licensed in this Agreement.

3. INITIAL PAYMENTS AND MILESTONES

3.1 Initial Payment

In partial consideration of the costs incurred by NGX in connection with the research and development of the Existing Product and in exchange for the exclusive rights granted herein, and provided that NGX has provided to Astellas an invoice for the total sum (which may be sent by e-mail or facsimile), Astellas shall pay NGX Thirty Million Euros (€30,000,000) within [***] of the execution of this Agreement. For purposes of clarity, it is understood and agreed that this payment shall be non-refundable and non-creditable save as set out in Section 16.4. For further clarity, the term “non-refundable and non-creditable” as used in this Agreement shall not act as any limitation on any amounts obtainable by Astellas by way of damages resulting from NGX’s breach of this Agreement or any obligation under it.

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3.2 Sales Milestones

In further consideration of the exclusive rights granted herein, Astellas shall pay NGX in accordance with the procedure set out in Section 4.6.1(a) and (b), the following milestone payments upon achievement of the corresponding sales milestones, which milestone payments shall be non-refundable and non-creditable:

3.2.1 Upon first achieving Annual Net Sales equal to or exceeding [***] in any Fiscal Year, Astellas shall pay NGX [***].

3.2.2 Upon first achieving Annual Net Sales equal to or exceeding [***] in any Fiscal Year, Astellas shall pay NGX [***].

3.2.3 Upon first achieving Annual Net Sales equal to or exceeding [***] in any Fiscal Year, Astellas shall pay NGX [***].

3.2.4 Upon first achieving Annual Net Sales equal to or exceeding [***] in any Fiscal Year, Astellas shall pay NGX [***].

The sales milestones are payable only once and are not on a Product-by-Product basis.

3.3 Option Fee/Option Exercise Fee

3.3.1 Option Fee. In consideration for the Option granted to Astellas with respect to the Liquid Formulation Product, and provided that NGX has provided to Astellas an invoice for the total sum (which may be sent by e-mail or facsimile), Astellas shall pay NGX Five Million Euros (€5,000,000) ) within [***] of the execution of this Agreement (“Option Fee”). For purposes of clarity, it is understood and agreed that this payment shall be non-refundable and non-creditable [***].

3.3.2 Option Retention Fee. In the event that Astellas elects to retain its Option with respect to the Liquid Formulation Product pursuant to Section 2.3.8 above, Astellas shall pay NGX [***] within [***] of such notice of retention provided that NGX has provided to Astellas an invoice for the total sum (which may be sent by e-mail or facsimile) (“Option Retention Fee”). For purposes of clarity, it is understood and agreed that this payment shall be non-refundable and non-creditable

3.3.3 Option Exercise Fee. In the event that Astellas elects to exercise its Option with respect to the Liquid Formulation Product pursuant to Section 2.3.12 above, Astellas shall pay NGX [***] within [***] of such exercise provided that NGX has provided to Astellas an invoice for the total sum (which may be sent by e-mail or facsimile) (“Option Exercise Fee”). For purposes of clarity, it is understood and agreed that this payment shall be non-refundable and non-creditable save as set out in Section 2.3.13.

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4. ROYALTIES

4.1 Royalty In further consideration of the exclusive rights granted herein, Astellas shall, subject to the reduction of royalty rate pursuant to Section 4.2 below, pay to NGX the following running royalties on the Net Sales of the Product in the Territory (“Earned Royalty”):


Annual Net Sales		Percentage of Net Sales
That portion of Annual Net Sales up to and including [***]		[***] of such Net Sales

That portion of Annual Net Sales above [*] and up to and including [*]		[***] of such Net Sales

That portion of Annual Net Sales above [*] and up to and including [*]		[***] of such Net Sales

That portion of Annual Net Sales above [***]		[***] of such Net Sales

4.1.1 For purposes of this Agreement, “Annual Net Sales” shall mean total Net Sales of Products in each Fiscal Year occurring in those countries in the Territory in which Astellas’ royalty obligations have not yet expired. For clarity, it is understood that in the event that Astellas exercises its Option with respect to the Liquid Formulation Product, Annual Net Sales shall mean [***] in the Territory by or under authority of Astellas in each Fiscal Year. Units of Product shall be considered sold upon [***]. Notwithstanding the foregoing, to the extent that this Agreement would have expired with respect to a particular Product in a particular country but for the fact that [***], then it is understood that no Earned Royalties shall be payable in respect of such Joint Patents or Assumed Patents in accordance with Sections 11.1.3 and 11.3.5.

4.2 Certain Reductions to Royalties

4.2.1 Non-Commercial Sales. No Earned Royalty shall be due hereunder with respect to (a) [***] of Product used as samples for training programs, educational programs or customer demonstration (“Promotional Samples”) and (b) [***] of Product used for destructive testing, such as QA/QC or stability testing (“QA Samples”), and (c) [***] of Product used in clinical trials of Product (“Clinical Supplies”) conducted in accordance with Section 7.

4.2.2 Loss of Exclusivity. In the event of Generic Competition with respect to a Product in a country in the Territory, the Earned Royalty applicable to units of the Product in such country shall be reduced to [***] of the Net Sales from the Product from the beginning of the [***] after (a) [***] (b) [***].

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(a) Certain Definitions

(i) “Generic Competition” in a country shall mean that one or more Generic Product(s) and/or Reference Product(s) is/are sold by an entity (including but not limited to NGX) who is not acting under the authority of Astellas, its Affiliates, Sublicensees or Subdistributors without infringing any Patent Rights and/or regulatory exclusivity in such country.

(ii) “Generic Product” shall mean:

(1) a product for [***], and

(2) which has been [***]; or

(3) [***].

(iii) “Reference Product” shall mean [***].

(b) Application of the Generic Royalty to the Tiered Earned Royalty Structure

(i) The Parties agree that the Net Sales of Product subject to a reduction of the Earned Royalties in accordance with this Section 4.2.2 (the “Generic Sales”) will be included in the Annual Net Sales for the relevant calendar year, for purposes of calculating the Earned Royalty for the rest of the Product sold in such calendar year (the “Non-Generic Sales”) as follows: the [***].

(ii) [***].

4.2.3 [***]. In the event Astellas or its Affiliates is required to pay to a Third Party [***] in order to obtain [***], Astellas may [***] to NGX under this Agreement, provided that in no event shall the [***] under Section 4.1 (the “[***]”). If the existence of the [***] results in Astellas not being able to [***] then Astellas can [***]. As used herein, “[***]” shall mean Third Party [***], including without limitation Third Party [***] under Section 11.4.1, without [***]. Notwithstanding the foregoing, it is agreed by the Parties that [***].

4.3 [***]

If Astellas’ license to [***] extends to the equivalent [***], then the following shall apply:

4.3.1 NGX at its sole discretion can decide that it wishes to [***].

4.3.2 If NGX decides that it wishes to obtain [***], then the grant of such [***] shall be subject to NGX [***] by reason of NGX’s [***] together with NGX’s [***].

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4.3.3 Upon request by NGX, Astellas shall disclose to NGX a true, complete and correct written description of such [***], and NGX’s obligation to [***].

4.3.4 If NGX decides not to obtain a [***] or in the event NGX does not promptly [***] upon request, having notified Astellas that it wishes to obtain a [***], then such [***] to NGX, until NGX notifies Astellas that it wishes to obtain a [***].

4.3.5 Should NGX have declined to accept [***], then in the event that Astellas is subsequently subject to [***] as a result of NGX’s acts of [***], then NGX shall [***]. In the event of [***].

4.4 Existing NGX Third Party Royalties

4.4.1 UC License Agreement. [***] the royalties accruing on sales of Product by Astellas, its Affiliates, Sublicensees and Subdistributors in the Territory under Section 7.1 of the UC License Agreement, at the royalty rate of zero point five percent (0.5%) [***] until such time as the total amount of royalties that have been paid to UC in a given calendar year on world-wide sales of Products that would be considered “Licensed Product(s)” under the UC License Agreement (including amounts paid by NGX attributable to sales outside the Territory) (collectively, “Total UC Royalties”) equals One Million Dollars (US $1,000,000) (“UC Royalty Cap”). At such time as the total amount of Total UC Royalties that has been paid to UC in a given calendar year reaches the UC Royalty Cap, [***] under this Section 4.4.1 during the remainder of such calendar year. For the avoidance of doubt, the UC Royalties shall [***] such that they are [***] to the extent that NGX has an obligation to account to UC for such royalties under the UC Agreement.

4.4.2 LTS Agreement. [***] the royalties at the rate of one point sixty-seven percent (1.67 %) accruing on sales of the Existing Product by Astellas and its Affiliates and Sublicensees under Section 5.2(a) of the LTS Agreement, as of the Effective Date [***] after the end of each calendar half-year (i.e. after 30 June and 31 December of each calendar year). For the avoidance of doubt, the LTS Royalties shall [***] such that they are [***] to the extent that NGX has an obligation to account to LTS for such royalties under the LTS Agreement.

4.5 Discounting Astellas and its Affiliates shall set prices for the Product in the Territory in the best interest of the commercial success of the Product in the Territory. Without limiting the foregoing, if Astellas or its Affiliate, Sublicensee or Subdistributor sells any Product to a customer who also purchases other products or services from Astellas, its Affiliates, Sublicensees or Subdistributors and receives a specific discount for such “bundling” of products, Astellas shall ensure that for purposes of calculating the Earned Royalty due to NGX, [***]. Without limiting the foregoing obligations, it is understood and agreed that nothing in this Agreement is intended to dictate to Astellas, its Affiliates, Sublicensees and Subdistributors the resale prices for the Products in the Territory.

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4.6 Royalty Reports

4.6.1 Quarterly Report

(a) Following the First Commercial Sale of a Product in the Territory, Astellas shall furnish to NGX a quarterly written report detailing on a country-by-country and product-by-product basis: (i) the Gross Sales of all Product(s) sold during such calendar quarter on a country-by-country and product-by-product basis, the calculation of Net Sales of such Product(s) from such Gross Sales (with all the Net Sales of Product subject to a reduction of the Earned Royalties in accordance with Section 4.2.2 (the “Generic Sales”) being clearly identified as such); (ii) the Earned Royalties, [***] (if applicable), payable in United States Dollars, which shall have accrued hereunder based upon such Net Sales of such Product(s) by Astellas and its Affiliates and/or Sublicensees; (iii) any adjustments to the Earned Royalties in accordance with Section 4.2; (iv) the date of the First Commercial Sale of each Product in each country in the Territory; (v) the exchange rates used in determining the amount of United States Dollars, as more specifically provided in Section 10.3 below, (vi) a statement as to whether any Sales Milestones in accordance with Section 3.2 have been reached in such quarter and (vii) any additional information reasonably required to support NGX’s reporting requirements as a public company. Reports shall be due [***] following the end of each calendar quarter.

(b) Following the delivery of each such report, within [***] following receipt of NGX’s invoice (which may be sent by e-mail or facsimile) Astellas shall, pay to NGX the total Earned Royalties, Sales Milestones, [***], if any, due to NGX for the period of such report. If no Earned Royalties, [***] are due, Astellas shall so report.

(c) Additionally, in any calendar year in which the [***], then upon NGX’s receipt of the final quarterly report for such calendar year from Astellas, NGX shall calculate each Party’s allocable share of the [***] based on each Party’s contribution to the total global annual sales of the Existing Product in such calendar year. NGX will provide Astellas with a report informing Astellas of the difference, if any, between each Party’s allocable share of such [***] in royalties (as calculated above) and the royalty amounts actually paid by the Parties in connection with [***] in such calendar year. The Party having paid higher royalties in connection with [***] than its calculated share shall provide the other Party with an invoice with respect to any amounts due. Payment of any such amounts owed to by either Party to the other shall be made within twenty (20) days after receipt of the other Party’s invoice.

4.6.2 Year End Report

(a) In any Fiscal Year in which (i) Astellas, its Affiliates and/or Sublicensees have incurred payment obligations under Section 4.1 above, and (ii) there are Generic Sales, Astellas shall provide to NGX a year end report detailing: (a) the total Generic Sales and Non-Generic Sales on a [***] for the just concluded calendar year; (b) the calculation of the

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total Earned Royalties due for such calendar year based on the application of Section 4.2.2(b) above; and (c) the difference, if any, between the amount calculated pursuant to subsection (b) of this Section 4.6.2 and the total Earned Royalties actually paid to NGX under Section 4.6.1 for such Fiscal Year (such difference, the “Royalty Adjustment”). Year end reports shall be due [***] following the end of the Fiscal Year to which they relate.

(b) Following the delivery of each such report, Astellas shall, within [***] following receipt of NGX’s invoice, pay to NGX any Royalty Adjustment owed to NGX. If a Royalty Adjustment is owed to Astellas by NGX, such Royalty Adjustments shall be [***].

(c) The year end report and the final quarterly report for a given Fiscal Year may be combined into a single document provided all required information are combined therein.

5. COOPERATION

JSC and Commercialization Plan for Existing Product

5.1 Commercialization Plan

The initial plan for Astellas’ development and commercialization of the Existing Product in the Territory (“Commercialization Plan”) will be provided by Astellas to the JSC [***] months, of the Effective Date. Astellas agrees to provide to NGX [***] updated versions of the Commercialization Plan at least [***] at the next JSC meeting [***], and any material modification or addition to the Commercialization Plan within a reasonable period of time prior to adoption and implementation thereof. It is understood and agreed that the Commercialization Plan shall be reasonably detailed including without limitation, [***]. The Parties agree that [***] shall be subject to NGX’s (and not the JSC’s) approval not to be unreasonably withheld, delayed or conditioned.

5.2 Joint Steering Committee

The Parties shall establish a committee (the “Joint Steering Committee” or “JSC”) to (a) oversee the development and commercialization activities relating to Products in the Territory during the term of this Agreement; (b) oversee the JDC, JRC and JCC (and any other committees set up under the control of the JSC) and [***] and (c) resolve matters on [***]. Each of such Committees shall have the responsibilities and authority allocated to it in this Section 5.2.

5.2.1 In addition to its overall responsibilities described in Section 5.2, subject to Section 5.6.2 and its subsections, the JSC shall, among other things:

(a) review the [***];

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(b) discuss [***];

(d) discuss [***];

(e) facilitate [***];

(f) coordinate [***];

(g) monitor and coordinate the [***]; and

(h) discuss, undertake and/or approve [***].

5.3 Joint Development Committee

The Parties shall establish a committee (the “Joint Development Committee” or “JDC”) to oversee the development activities relating to Products in the Territory during the term of this Agreement which shall, among other things:

(a) review and comment on [***];

(b) discuss [***] for Products in the Territory and outside the Territory;

(d) monitor [***];

(e) manage [***]; and

(f) coordinate [***].

5.4 Joint Commercialisation Committee

The Parties shall establish a committee (the “Joint Commercialisation Committee” or “JCC”) to oversee the commercialisation activities relating to Products in the Territory during the term of this Agreement which shall, among other things:

(a) review [***];

(b) discuss [***];

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(d) cooperate [***];

(e) monitor [***]; and

(f) [***].

5.5 Joint Regulatory Committee

NGX and Astellas shall establish [***] a committee (the “Joint Regulatory Committee” or “JRC”) which shall co-ordinate [***].

5.6 General Provisions relating to Committees

For each Committee the Parties shall each designate [***] to serve as members of such Committee. The JSC will consist of [***] from each Party, [***] shall be a senior executive of each Party and the JSC shall determine the number of representatives of each Party for each other Committee; provided, however, that the JDC shall be composed of no less than [***] making representatives of each Party, [***]. Each representative may serve on more than one Committee as appropriate in view of the individual’s expertise. Each Party may replace its Committee representatives at any time upon written notice to the other Party, provided that the Parties will use reasonable endeavors to keep such replacements to a minimum. The chairperson of each Committee shall [***] from one of its representatives on such Committee and thereafter, the Parties shall rotate annually as to which Party selects such chairperson. The chairperson shall be responsible for calling meetings, preparing and circulating an agenda in advance of each meeting of such Committee, and preparing and issuing minutes of each meeting within [***] thereafter; [***]. Such minutes will not be finalized until a representative of the other Party on such Committee has reviewed and confirmed the accuracy of such minutes in writing.

5.6.1 Meetings. The JSC shall meet [***] until the [***], and thereafter [***] during the term of this Agreement, unless otherwise agreed by the Parties. The frequency of meetings of other Committees shall be decided by the JSC. All Committee meetings shall be in person at least [***] unless otherwise mutually agreed, and the other meetings may be through telephone or video conference or other mutually agreeable means. With the consent of the Committee members, other representatives of NGX or Astellas may attend Committee meetings as non-voting observers. [***].

5.6.2 Decisions.

(a) Decisions of the Committees shall be made [***]. If a Committee other than the JSC is unable to reach unanimous consent on a particular matter within [***] of its initial consideration of such matter, then such matter shall be referred to the JSC. In the event the JSC cannot reach agreement on a matter within [***] after it has met (whether in person or by telephone or video conference) and attempted to reach such agreement, the dispute [***]:

(i) by the [***] in good faith, giving appropriate consideration to the reasonable business and scientific concerns of [***], for all matters relating to [***]; and

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(ii) by the [***] in good faith, giving appropriate consideration to the reasonable business and scientific concerns of [***], for all matters relating to [***].

(b) Notwithstanding anything to the contrary in Section 5.6.2(a) above:

(i) With respect to disputes relating to [***] to the extent [***].

(ii) To the extent additional responsibilities are delegated to the JSC pursuant to Section 5.2(h)(ii), the Parties shall mutually agree at the time of such delegation [***] to decide any matter encompassed by that responsibility in the event that [***] an agreement regarding that dispute.

(iii) [***] over any dispute explicitly reserved for arbitration pursuant to Section 19.2.

(iv) Neither Party shall [***].

5.6.3 Authority. Notwithstanding the creation of the JSC or any other Committee, each Party shall [***] hereunder, and the JSC or any other Committee shall not [***]. No Committee shall have the power to amend or modify this Agreement, and its decisions shall not be in contravention of any terms and conditions of this Agreement. It is understood and agreed that issues to be formally decided by a Committee are only those specific issues that are expressly provided in this Agreement to be decided by such Committee.

5.6.4 From time to time, the JSC may establish further committees as it deems appropriate to oversee specific matters, activities and obligations of the Parties under this Agreement or the Supply Agreement as set forth herein, and ensure an optimal coordination between the Parties with respect to such matters, activities and obligations.

5.6.5 It is understood between the Parties that under no circumstances, the activities to be performed by the JSC (or any subcommittee) are intended or allowed to violate any applicable law (including but not limited to any competition and/or antitrust law).

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5.6.6 Upon the [***] the Effective Date the JSC and any other Committees then in existence shall be disbanded, provided that at any time following the [***] of the Effective Date, NGX shall have the right to withdrawal from participation in the JSC and all other Committees upon written notice to Astellas, which notice shall be effective [***] (“Withdrawal Notice”). Following the disbanding of the Committees (or if applicable, the issuance of a Withdrawal Notice), NGX shall no longer participate in any meetings of any Committees, nor shall NGX have any right to vote on decisions within the authority of the JSC or any other Committees. Following the disbanding of the Committees (or if applicable, NGX’s earlier withdrawal from the Committees), Astellas will have the sole decision with regard to matters that affect the commercialization and development of the Existing Product within the Territory and [***].

5.7 Alliance Managers

Promptly after the Effective Date, each Party shall appoint an individual to act as the alliance manager for such Party (the “Alliance Manager”). Each Alliance Manager who is not otherwise a member of the JSC shall thereafter be permitted to attend meetings of the JSC. The Alliance Managers shall be the primary contact for the Parties regarding the activities contemplated by this Agreement and shall facilitate all such activities hereunder. Each Party may replace its Alliance Manager with an alternative representative at any time with prior written notice to the other Party. The Alliance Managers shall not, in any manner, take over the role of the JSC and shall not have any rights, powers or discretion except as expressly granted to the Alliance Managers hereunder. In no event shall the Alliance Managers have any power to modify or amend this Agreement.

5.8 Kick-off Meeting

The Parties agree to hold a face to face meeting, within [***] after the Effective Date, with the aim of NGX sharing with Astellas (at no cost to Astellas) the existing NGX Know-How reasonably necessary for [***]. The Alliance Managers shall be responsible for co-ordinating and setting up the meeting. The agenda for the meeting will be mutually agreed by both Parties but will serve to exchange [***]. The Parties will also agree upon the subsequent transfer of the documents and files encompassing copies of NGX Know-How in existence prior to the Effective Date, which shall include establishing a key contact list to facilitate the transfer of such NGX Know-How and enable clear and effective communication thereafter.

5.9 Documents

Notwithstanding the above, NGX shall provide Astellas with all the documents set out in Exhibit 5.9 upon the later of (a) [***], or (b) [***] after the Effective Date although NGX shall use reasonable efforts to provide the documents within [***].

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5.10 Co-operation

The Parties agree to the cooperation terms set out in Exhibit 2.2.1.

6. TRANSFER OF THE MARKETING AUTHORISATION

6.1 MAA Approval Transfer

At the Effective Date, NGX shall transfer the benefit of and interest in the NGX EMEA MAA Approval number EMEA/H/C/000909 (the “Existing Product MAA Approval”) to Astellas or its designated Affiliate free from all encumbrances on the terms of and in accordance with this Section 6.

6.2 [***]

[***] for preparing and submitting all notices, applications, submissions, reports and other instruments, documents, correspondence or filings necessary to obtain a transfer to Astellas or its designated Affiliate of the Existing Product MAA Approval [***].

6.3 NGX’s Obligations

NGX shall or shall procure that any of its Affiliates will:

6.3.1 [***] after the Effective Date sign any notices, applications, submissions, reports and other instruments, documents, correspondence or filings presented to it by Astellas or its designated Affiliate (any of these a “Document”) that are necessary for: (i) the transfer to Astellas or its designated Affiliate of the Existing Product MAA Approval; or (ii) maintaining, renewing or varying the Existing Product MAA Approval in the period from the Effective Date until the transfer of the Existing Product MAA Approval in accordance with Section 6.1;

6.3.2 [***] provide notice of its consent to the transfer of Existing Product MAA Approval to Astellas or its designated Affiliate if required by any applicable governmental or regulatory authority after the Effective Date;

6.3.3 [***] after the Effective Date where permitted and reasonably practicable conduct all communications with the EMEA relating to the transfer of the Existing Product MAA Approval at the direction of Astellas;

6.3.4 subject to Astellas’ or its designated Affiliate’s right in each case to review and approve all written material prepared by NGX prior to submission to the EMEA, NGX shall [***], and use [***]; and

6.3.5 [***] after the Effective Date provide such reasonable assistance as Astellas (or its designated Affiliate) may reasonably request, [***], that is necessary to facilitate the transfer of the Existing Product MAA Approval to Astellas (or its designated Affiliate).

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6.4 Prior to MAA Approval Transfer

After the Effective Date, and before the Existing Product MAA Approval is transferred to Astellas or its designated Affiliate, NGX shall hold the Existing Product MAA on trust for Astellas, and shall without prejudice to Sections 6.3.4 and 6.5 maintain in force the Existing Product MAA Approval ([***]), and shall not encumber, amend, cancel or surrender the Existing Product MAA Approval or take any step in relation thereto unless requested to do so by Astellas or any applicable governmental or regulatory authority (any such request of a governmental or regulatory authority a “Regulatory Request”). Before taking any such step pursuant to a Regulatory Request, NGX shall act in accordance with any reasonable instruction given by Astellas in relation to such Regulatory Request unless action is required to be taken urgently by the relevant governmental or regulatory authority, in which case NGX shall inform Astellas of such action as soon as possible thereafter.

6.5 After MAA Approval Transfer

Following transfer to Astellas of the Existing Product MAA Approval, Astellas shall be responsible for the Maintenance of the Existing Product MAA Approval, as well as for the filing and Maintenance of all additional XXXx filed and MAA Approvals obtained in its, its Affiliates’, Sublicensees’ or Subdistributors’ name in the Territory, [***], provided that NGX shall, upon Astellas ‘ request, provide to Astellas reasonable assistance in relation with such Maintenance, as well as all electronic documents in its possession or under its Control that are reasonably necessary to perform such Maintenance, including without limitation the relevant dossier for the Existing Product MAA Approval in the format of an electronic common technical document (eCTD). NGX shall also within [***] of the Effective Date provide Astellas with all original documents comprising the Existing Product MAA Approval and to the extent that such original documents are required by NGX for regulatory filings outside the Territory, NGX shall allow Astellas to have access and to copy such original documents at all reasonable times on reasonable notice for the purpose of the Maintenance of the MAA Approvals and filing of XXXx in relation to developments of the Products in the Territory. As used in this Section 6, “Maintenance” with respect to MAA Approvals and/or MAA shall include, without limitation, payment of the annual fees, renewal of the MAA Approval, implementation of any variations with respect to such MAA Approval and/or MAA and responding to requests by the relevant Regulatory Authorities.

6.6 Communications with Regulatory Authorities

Subject to applicable laws, following transfer of the Existing Product MAA Approval to Astellas, Astellas shall be the Party responsible for communicating directly with and appearing before the EMEA or any other regulatory authority, provided that Astellas shall [***]. NGX agrees, upon Astellas’ request, to provide Astellas with reasonable assistance in connection with any such communications and meetings.

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7. DEVELOPMENT

7.1 Development of Existing Product

7.1.1 European Union.

(a) Additional Studies.

(i) Safety Study. Initial MAA Approval for the Existing Product in the European Union is accompanied by a post approval commitment requiring that an open label safety study in on label patient populations be carried out on the committed timelines with respect to the Existing Product (“Safety Study”), as further specified in Exhibit 7.1.1. Astellas shall be solely responsible for planning and overseeing the performance of the Safety Study and liaising with the regulatory authorities, provided that Astellas shall keep the JDC informed about all study activities and provided that Astellas shall give reasonable consideration to any comments of the JDC. [***].

(ii) [***] Trial. [***]. The [***] Trial shall be designed and carried out as follows:

(1) Astellas shall be responsible for drawing up a protocol that satisfies the EMEA’s conditions and requirements (“EMEA Requirements”) which may involve requesting scientific advice from the EMEA (the “Initial Protocol”);

(2) Astellas shall provide a copy of the Initial Protocol for the [***] Trial, to NGX, through the JDC, for NGX’s review and comment at which time NGX may request Astellas to add activities to the protocol to satisfy any requirements of the FDA. Astellas will reasonably consider any such request(s) and agrees to implement such request(s) to the extent they are commercially reasonable, it being understood that in no event shall Astellas be required to include any activities in the protocol which would conflict with EMEA Requirements for the [***] Trial, [***] and in all cases the final decision rests with Astellas;

(3) Astellas shall negotiate with the EMEA to obtain approval for the protocol for the [***] Trial and shall be responsible for the execution and delivery of the [***] Trial; and

(4) Astellas shall be responsible for [***] of the [***] Trial, provided that NGX shall be responsible for [***] relating to activities that have been added to the Initial Protocol at NGX’s request and to the extent that any communication or filings with the FDA are required in connection with such added activities, NGX shall be responsible for conducting such communications and making such filings [***].

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(iii) Other Post-Marketing Studies. The Parties anticipate that it will be desirable to conduct certain additional post-marketing studies of the Existing Product in order to maximize the potential market for the Existing Product in or outside the Territory (“Post-Marketing Studies”). The Parties shall discuss all proposed Post-Marketing Studies at the JDC. In relation to the Territory, Astellas shall [***] for any Post-Marketing Study and shall present it to the JDC [***]. Astellas shall [***] any such Post-Marketing Studies in the Territory, [***], and shall update the JDC on the progress of such studies. Astellas shall [***] performing Post-Marketing Studies in the Territory and shall [***] on such studies within the ten (10) year period commencing upon the first First Commercial Sale of the Existing Product in the Territory, provided that in no event shall Astellas [***]. NGX shall be responsible for planning and overseeing the performance of any Post-Marketing Studies outside the Territory, subject to the oversight of the JDC, and shall update the JDC on the progress of such studies. NGX shall be responsible for [***] of performing Post-Marketing Studies outside the Territory.

(iv) Further Development of the Existing Product. If a Party wishes to develop the Existing Product for [***], then it shall raise the issue at the JSC. If the JSC agrees to such further development then the JDC shall be responsible for drawing up a development plan which it shall present to the JSC for approval.

(1) If both Parties wish to participate in the development then the JDC shall oversee the performance of such development and shall allocate responsibility for the performance of the various tasks required in connection with such studies based upon which Party is better situated to perform such tasks, taking into account among other things, the estimated costs associated with having each Party perform such task. The aim of the development plan will be to generate clinical data which is intended for, and in the correct format for, submission to [***]. To the extent that any activities under the development plan are necessary to satisfy the requirements of [***]. To the extent that any activity is necessary to satisfy the requirements [***].

(2) If only one Party wishes to carry out any development under this Section 7.1.1(iv) (the “Developing Party”), and the JSC has approved the development plan then the Developing Party shall carry out the activities under such development plan and shall be solely responsible for all Development Expenses related to such activities. If the other Party subsequently wishes to include any of the Data that has been created as a result of such development in its regulatory filings for Product in its territory, then it can only do so if it reimburses the Developing Party [***] of all the Developing Party’s Development Expenses incurred in relation to all the activities under the development plan.

7.1.2 Non-European Union Countries. Astellas shall be responsible, [***], for conducting such clinical trials as may be necessary to file and obtain MAA Approval for the Existing Product in each non-European Union country in the Territory as may be required to meet its obligations under the Commercialization Plan. Additionally, to the extent that compliance

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with the regulatory requirements for obtaining MAA Approval in one or more non-European Union countries in the Territory would result [***]. If a regulatory authority in a non-European Union country requires [***], then Astellas shall have the right to terminate this Agreement in respect of such non-European Union country by providing NGX at least ninety (90) days prior written notice.

7.1.3 Compliance with Laws. Each Party or its permitted Third Party contractors shall perform its responsibilities under this Section 7 in accordance with all applicable laws, including, without limitation, cGLPs, cGCPs and cGMPs to the extent applicable.

7.1.4 Diligence. Each Party shall use [***] to carry out its development obligations under Section 7.1 and such obligations are subject to the other Party providing all relevant support and Data reasonably necessary to perform such obligations.

7.2 Exchange of Data

NGX and Astellas, respectively, shall provide to each other [***] for use of each of Astellas and NGX for the purposes set forth in Section 7.2.1 in a timely fashion and as promptly as possible upon request of each of Astellas or NGX. In addition, (a) NGX shall provide Astellas with [***] within [***] of such submission, and (b) Astellas shall provide NGX with [***] within [***] of such submission. Astellas shall have the right to withhold Data for a reasonable period to allow it to file for patent protection relating to such [***].

7.2.1 Use; Disclosure.

(a) Astellas will only use and disclose Data to Third Parties as required to [***] including without limitation [***] in each case for commercialization of Products inside the Territory and NGX gives Astellas the right to [***], and as may be necessary in performing its obligations and exercising its rights under this Agreement, i.e. [***] in each case solely to the extent necessary for development and commercialization of Products in Territory; or as may otherwise be agreed by NGX and Astellas. Astellas may not use any Data (or permit any Third Party to use Data) outside the Territory, or outside the Field or for any products other than the Products, except for the assessment and validation of the Data by Affiliates or Third Party consultants outside the Territory but solely for purposes of [***]. NGX may not use any Data (or permit any Third Party to use Data) inside the Territory (except as required to fulfill any development obligations it may have under a development plan agreed with Astellas pursuant to Sections 7.1.1, 2.3.6, 2.3.10 or 2.3.14), or outside the Field or for any products other than the Products, except for the [***] but solely for purposes of developing or commercializing Products outside the Territory. Notwithstanding anything to the contrary in this Section 7.2.1(a) or Section 7.2.1(b) below, [***] shall be subject to the requirements set forth therein.

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(b) Astellas hereby grants NGX a non-exclusive sublicensable right and license to use the Data provided by Astellas, and to disclose such Data to Third Parties, in each case as is reasonably necessary or useful for commercialization of Products outside the Territory including without limitation for use by NGX’s licensees of the Products and for [***] (and Astellas hereby gives NGX the right to so [***]), in each case for commercialization outside the Territory, provided that any disclosure of such Data to a non-governmental Third Party is made under reasonable and customary confidentiality restrictions. Notwithstanding the foregoing, upon termination of this Agreement by Astellas pursuant to Section 17.2 or by NGX pursuant to Sections 17.3-17.5, the scope of NGX’s license to Data provided by Astellas shall thereafter be worldwide.

7.2.2 Third Parties.

(a) In all agreements after the Effective Date with Third Parties or Affiliates involving the development of Data, Astellas and NGX, respectively, shall require that such Third Parties and Affiliates provide the other Party access to all such Data, to the extent that such Data is required for [***] in accordance with this Agreement.

(b) Notwithstanding Section 7.2.2(a) above, Astellas acknowledges that under NGX’s agreement(s) with LTS prior to and after the Effective Date, [***]. If any regulatory authority does not accept such a direct filing by LTS then the Parties and LTS shall cooperate to find an alternative route by which such LTS Data shall be filed with such regulatory authority. Such arrangement with LTS shall not be deemed a breach by NGX of this Section 7.2.2. It is understood that NGX shall ensure that it obtains [***] for the use by each of NGX and Astellas as set forth in this Section 7.2.

7.2.3 All XXXx and MAA Approvals and any other regulatory filings relating to developments of the Existing Product in the Territory including all variations and line extensions shall be owned by Astellas or its nominated Affiliate.

7.3 Development of Liquid Formulation Product

7.3.1 In the event that Astellas exercises the Option under Section 2.3.12 Astellas shall be responsible for [***] with respect to the Liquid Formulation Product in the Territory, in each case [***], provided that NGX shall, upon Astellas’ request, provide to Astellas reasonable assistance in relation to such activities.

7.4 Coordination Each Party agrees to keep the other [***] informed as to the progress of its clinical development and regulatory activities relating to the Liquid Formulation Product in and outside the Territory, including its correspondence and meetings with regulatory agencies, by way of updates to the JSC and JDC at its meetings and as otherwise [***] requested by the other Party. The Party responsible for conducting the clinical development of the Liquid Formulation Product shall reasonably consider and [***] respond to any comments provided by the other Party with respect to such clinical development and regulatory activities. Subject to

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Sections 18.3.2 and 18.5.2 below, all MAA filings and MAA Approvals in the Territory for the Liquid Formulation Product (including all variations and line extensions) shall be in the name of, and owned by, Astellas or its Affiliates.

8. COMMERCIALIZATION

8.1 Commercialization

Subject to oversight by the JCC and ultimately the JSC, Astellas shall [***] to launch and commercialize the Existing Product in the Territory, in accordance with the Commercialization Plan in order to maximize the Net Sales of such Product in the Territory. Astellas agrees to keep NGX [***] informed as to the progress of its launch and commercialization activities relating to Products in the Territory, by way of [***] at its meetings and as otherwise reasonably requested by NGX. Astellas shall [***] consider and [***] respond to any comments provided by NGX with respect to such launch and commercialization activities, provided that any final decision is in the discretion of Astellas to the extent that it is consistent with the Key Metrics. It is understood and agreed that all commercialization efforts for Products in the Territory shall, as between the Parties, [***]. Any failure of Astellas to comply with its obligations under the Commercialization Plan and the Key Metrics shall not be considered a breach of this Agreement to the extent [***].

8.2 Pricing and Reimbursement

[***].

8.2.1 Subject to [***] the Existing Product pursuant to Section 8.2.2, Astellas shall [***] to (i) obtain pricing and/or reimbursement approvals for the Existing Product [***] and make such regulatory filings as are necessary to [***] that are [***] to market the Existing Product in each country in the European Union, in each case in accordance with the Commercialization Plan and any development plans in accordance with Section 7.1, and (ii) subject to Section 7.1.2, obtain such regulatory approvals, including MAA Approvals and [***], as may be necessary to market the Existing Product in [***], in accordance with the Commercialization Plan.

8.2.2 Notwithstanding Astellas’ obligations under Section 8.2.1, Astellas shall always have the [***] the Existing Product in a country in the Territory if [***], provided that this Section 8.2.2 shall in no event excuse any [***].

8.3 Sales Materials

8.3.1 Brand Guiding Principles. Within [***] after the Effective Date, the Parties shall agree on Brand Guiding Principles, to be updated from time to time. Astellas agrees to adhere, and to cause its Affiliates, Sublicensees and Subdistributors to adhere, to the Brand Guiding Principles in connection with the commercialization of the Existing Product in the Territory. NGX agrees to adhere, and to cause its Affiliates and distributors and licensees to adhere, to the Brand Guiding Principles in connection with the commercialization of the Existing Product outside the Territory.

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8.3.2 Sales Materials. Any marketing and promotional materials and packaging created or used by Astellas, its Affiliates, Sublicensees and Subdistributors for the Product shall be appropriate to the MAA Approval for the Product in the respective country, and, in the case of the Existing Product, consistent with the Brand Guiding Principles. Upon each Party’s reasonable request, the other Party shall [***]. It is understood and agreed that each Party shall have the right to [***] for purposes of commercializing Products in their respective territory provided that each Party shall be solely responsible for the compliance of such Sales Materials with laws and regulations in its own territory. Any claim, message or other material item in the Sales Materials, which is not consistent with the Brand Guiding Principles and [***], shall be subject to [***] provided that in the event of a dispute as to whether a claim complies with the laws and regulations in the Territory, Astellas’ view shall prevail. NGX shall use all reasonable efforts to complete any such review and provide Astellas with an answer within [***] from notification by Astellas to NGX of the relevant matter and in the absence of an answer within such [***] period such claim, message or other material item shall be deemed [***].

8.4 Reporting Adverse Drug Reactions/Experiences

Each Party shall observe and comply with its respective obligations regarding the exchange of data concerning adverse drug events, as set out in a safety agreement which the Parties shall enter into [***] after the Effective Date but in any event not later than [***] delivery of Product by NGX to Astellas and which will be attached to this Agreement as Exhibit 8.4 (hereinafter referred to as “Safety Agreement”). NGX will be responsible for managing and maintaining (itself or through its designee) the worldwide drug safety database, provided that Astellas [***] and receive appropriate information in order to fulfill the requirements specified in the EU Rules Governing Medicinal Products in the European Union, Volume 9A. The Parties agree that the management and maintenance of the worldwide drug safety database [***]. The costs associated with setting up the worldwide drug safety database shall be the sole responsibility of NGX. Any fees charged by such Third Party contractor to NGX for specific activities relating to the use of the worldwide drug safety database which exclusively relate to [***] shall [***].

8.5 Assistance for the Product

Each Party shall promptly inform the other Party of any notification of any action by, or notification or other information which it receives (directly or indirectly) from any governmental or regulatory authority (together with copies of correspondence related thereto), which (a) raises any material concerns regarding the safety or efficacy of a Product, (b) indicates or suggests a potential material liability for either Party to Third Parties arising in connection with a Product or (c) which indicates a reasonable potential for a recall or market withdrawal of a Product.

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8.6 Medical Inquiries for the Product

Following the completion of the transfer of the Existing Product MAA Approval to Astellas in accordance with Section 6 above, Astellas shall be responsible for handling all medical questions or inquiries for the Field in the Territory with regard to the Product ([***]), but shall consider in good faith input from NGX in connection therewith. NGX shall immediately forward any and all medical questions or inquiries which it receives in relation to the Product for the Field in the Territory to Astellas in accordance with all applicable laws.

8.7 Material Failure to Exploit

This Section 8.7 shall not limit any other remedies in damages that NGX may have under this Agreement or applicable law but shall be NGX’s sole remedy in relation to Astellas’ obligations to commercialise the Products.

8.7.1 European Region. In the event Astellas commits a Material Failure to Exploit in the European Region [***]. Such notice shall specify in reasonable detail the facts and circumstances constituting the Material Failure to Exploit. Upon the expiration of [***].

8.7.2 Other Regions. In the event there is a Material Failure to Exploit with respect to Products in a Region (other than the European Region), then NGX shall have the right to [***].

8.7.3 In the event there are no Regions then in effect after such exclusion, then this Agreement shall be deemed terminated in whole.

8.7.4 In the event of such termination by NGX of a Region or in the event of non-exclusivity imposed by NGX for such Region, the Parties would adjust [***] set forth above in Section 4.1 as follows:

(a) For each Region (other than the European Region) excluded from the Territory (or in which Astellas’ rights are reduced to non-exclusive status) pursuant to Section 8.7.2, the [***] shall be reduced by [***].

(b) If the European Region is excluded from the Territory (Astellas’ rights in the European Region are reduced to non-exclusive status) pursuant to Section 8.7.1, the [***] shall be reduced by [***].

8.7.5 In the event Astellas commits a Material Failure to Exploit with respect to the required minimum Marketing spending, NGX shall have the right to provide notice of its intention to terminate this Agreement or make Astellas’ rights for the Territory non-exclusive. Such notice shall specify in [***] detail the facts and circumstances constituting the Material Failure to Exploit. Upon the expiration of [***] after receipt by Astellas of such notice, if Astellas (a) has not cured such Material Failure to Exploit, or (b) in the event that such Material Failure to Exploit is not capable of being cured in [***], is not [***] to cure such Material Failure to Exploit, NGX shall have the right to terminate this Agreement or make Astellas’ rights in the Territory non-exclusive by giving a notice, which shall be effective on the date such notice is given.

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8.8 Commercialization of Liquid Formulation Product

In the event that Astellas elects to exercise its Option under Section 2.3.12 with respect to the Liquid Formulation Product, Astellas shall [***] to launch the Liquid Formulation Product in the Territory, and thereafter to market, promote and sell the Liquid Formulation Product so as to maximize the Net Sales of both the Existing Product and Liquid Formulation Product as a portfolio of products.

9. SUPPLY OF EXISTING PRODUCT

9.1 General

It is understood that NGX procures supplies of Components from Third Party contractors. However, the Parties anticipate that Astellas shall eventually enter into direct contractual relationships with such Third Party contractors for the supply of Components. Pending such direct agreements, on the Effective Date NGX enters into a separate written agreement with Astellas (“Supply Agreement”) pursuant to which NGX shall obtain from its Third Party contractors quantities of Components sufficient to supply Astellas’ reasonable requirements for Components in the Territory.

9.2 Inventory

In addition, Astellas shall purchase the Patch Inventory and Gel Inventory (both as defined in the Supply Agreement) in accordance with the Supply Agreement.

9.3 General Supply Terms

Until Astellas enters into direct contractual relationships with Third Party contractors for the supply of Components:

9.3.1 Astellas and its Affiliates shall exclusively purchase all of their requirements of Components from NGX;

9.3.2 NGX shall procure Components on behalf of and as reasonably requested in writing by Astellas, consistent with NGX’s arrangements with its suppliers;

9.3.3 Components ordered by NGX from such supplier on behalf of Astellas, shall be charged to Astellas at NGX’s cost of goods as defined in the Supply Agreement;

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9.3.4 the Components supplied to Astellas under the Supply Agreement shall be supplied in the same form as like Components are supplied to NGX (save as to artwork and text), or as otherwise established by the JSC or by agreement of the Parties, it being understood that any differences in such form requested by Astellas shall be at Astellas’ expense; and

9.3.5 in the event that NGX would be required to pay to LTS any fees under Section 3.4(c) of the LTS Agreement in order to expand the “Territory” as defined in the LTS Agreement to be commensurate in scope with the “Territory” as defined in this Agreement, Astellas shall be responsible for such fees.

9.4 Tripartite Agreements

It is anticipated that NGX will also be a party to any direct agreements between Astellas and the Third Party suppliers so as to, among other things (a) [***]; (b) [***]; and (c) [***]. Irrespective of whether or not NGX is a party to any direct supply agreement that Astellas may enter into with NGX’s Third Party suppliers, it is understood that Astellas [***].

9.5 Quality Agreement

NGX and Astellas shall execute a quality agreement which allocates roles and responsibilities to each Party with respect to quality control and regulatory compliance with respect to Components and the Existing Product.

10. PAYMENTS; BOOKS AND RECORDS

10.1 Payment Method

All payments under this Agreement shall be made by bank wire transfer in immediately available funds to an account designated by the Party to which such payments are due. Any payments due under this Agreement which are not paid by the date such payments are due under this Agreement shall bear interest to the extent permitted by applicable law at the interest rate applied by the [***] to its most recent refinancing operations ([***] bid rate or fixed rate as published on [***]), plus [***], computed on the basis of the [***]. The applicable interest rate shall be adjusted each time there shall be a change in the aforementioned rate of the [***]. This Section 10.1 shall in no way limit any other remedies available to the Parties.

10.2 Taxes

Any tax (other than VAT) which Astellas is required to pay or withhold in respect of the payments to be made to NGX hereunder shall be deducted from the amount otherwise due provided that, in regard to any such deduction, Astellas shall give NGX reasonable assistance, which shall

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include the provision of such documentation as may be required by any revenue authority and other revenue services, as may be necessary to enable NGX to claim exemption therefrom or obtain a repayment thereof or a reduction thereof and shall upon request provide such additional documentation from time to time as is needed to confirm the payment of tax.

10.3 United States Dollars

All dollar amounts specified in this Agreement, and all payments made hereunder, are and shall be in U.S. dollars. For all payments other than the initial payment due under Section 3.1, the sales milestones due under Section 3.2, the Option Fee due under Section 3.3.1, the Option Retention Fee due under Section 3.3.2 and the Option Exercise Fee due under Section 3.3.3, monetary conversion from the currency of a foreign country, in which Product is sold, into United States currency shall be calculated for a calendar quarter in which such sales were made using an exchange rate equal to [***] prior to the date that the report detailed in Section 4.6.1(a) is delivered to NGX. With respect to the initial payment due under Section 3.1 and the Option Fee due under Section 3.3.1, monetary conversion from Euros into United States currency shall be calculated using an exchange rate equal to [***] days prior to the execution of this Agreement. With respect to the payments of the sales milestones due under Section 3.2, the Option Retention Fee due under Section 3.3.2 and the Option Exercise Fee due under Section 3.3.3, monetary conversion from Euros into United States currency shall be calculated using an exchange rate equal to [***] prior to achieving the relevant milestone, the election by Astellas to retain the Option or the election by Astellas to exercise the Option, as the case may be.

10.4 Records; Inspection

10.4.1 Astellas. Astellas shall keep, and require its Affiliates and Sublicensees to keep, complete, true and accurate books of accounts and records for the purpose of determining the amounts payable (or reimbursable) under this Agreement, including without limitation true and accurate records of Gross Sales, Net Sales and the costs incurred by Astellas in connection with the conduct of the clinical studies contemplated in Article 7. Such books and records shall be kept at the principal place of business of Astellas (or the place of business of its Affiliates or Sublicensees, as applicable) for at least [***] following the end of the calendar quarter to which they pertain. Such records will be open for inspection during such [***] period by an independent auditor chosen by NGX and reasonably acceptable to Astellas for the purpose of verifying the amounts payable by Astellas hereunder. Such inspections may be made no more than once each calendar year (it being understood that a single audit may require multiple visits) and no more than once in respect of any audited period, at reasonable times and on reasonable notice. The independent auditor shall be obligated to execute a reasonable confidentiality agreement prior to commencing any such inspection. Inspections conducted under this Section 10.4.1 shall be at the expense of NGX, unless a variation or error producing an underpayment in amounts payable exceeding [***] of the amount paid for any period covered by the inspection is established in the course of any such inspection, whereupon all costs relating to the inspection for such period and any

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unpaid amounts that are discovered shall be paid by Astellas, together with interest on such unpaid amounts at the rate set forth in Section 10.1 above. The Parties will endeavor to minimize disruption of Astellas’ normal business activities to the extent reasonably practicable. To the extent that Astellas does not have the right to grant NGX the right to audit its Sublicensees’ books and records hereunder, Astellas shall obtain for itself such right and, at the request of NGX, Astellas shall exercise such audit right with respect to Sublicensees and provide the results of such audit for inspection by NGX pursuant to this Section 10.4.1.

10.4.2 NGX. NGX shall keep complete, true and accurate books of accounts and records for the purpose of determining the amounts payable (or reimbursable) under this Agreement, including without limitation true and accurate records of the costs incurred by NGX in connection with the conduct of those development studies contemplated in Article 7 for which it is entitled to reimbursement from Astellas. Such books and records shall be kept open at the principal place of business of NGX and be for at least [***] following the end of the calendar quarter to which they pertain. Such records will be open for inspection during such [***] period by an independent auditor chosen by Astellas and reasonably acceptable to NGX for the purpose of verifying the amounts payable by NGX hereunder. Such inspections may be made no more than once each calendar year (it being understood that a single audit may require multiple visits) and no more than once in respect of any audited period, at reasonable times and on reasonable notice. Astellas’ independent auditor shall be obligated to execute a reasonable confidentiality agreement prior to commencing any such inspection. Inspections conducted under this Section 10.4.2 shall be at the expense of Astellas, unless a variation or error producing an overpayment in amounts payable exceeding [***] of the amount paid for any period covered by the inspection is established in the course of any such inspection, whereupon all costs relating to the inspection for such period shall be paid by NGX and Astellas shall receive a credit for any overpaid amounts that are discovered together with interest on such overpaid amounts at the rate set forth in Section 10.1 above. The Parties will endeavor to minimize disruption of NGX’s normal business activities to the extent reasonably practicable.

11. INTELLECTUAL PROPERTY

11.1 Ownership of Inventions

11.1.1 Title to all inventions and other intellectual property made solely by Astellas personnel in connection with this Agreement shall be owned by Astellas. Title to all inventions and other intellectual property made solely by NGX personnel in connection with this Agreement shall be owned by NGX.

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11.1.2 Title to all inventions and other intellectual property made jointly by personnel of NGX and Astellas in connection with the performance of this Agreement (“Joint IP”) shall be jointly owned by Astellas and NGX. Prosecution of any patent applications and patents with respect to such jointly owned inventions and intellectual property (“Joint Patents”) shall be as mutually agreed.

11.1.3 It is understood that neither Party shall have any obligation to account to the other for profits, nor to obtain any approval of the other Party to exploit, license or assign any such Joint IP, by reason of joint ownership thereof, provided that to the extent that such Joint IP covers or directly relates to Products neither Party shall until expiry of this Agreement, without obtaining the approval of the other Party, (a) license such Joint IP to a Third Party, other than to a Sublicensee in the case of Astellas or a licensee of the Existing Product and/or the Liquid Formulation Product in the case of NGX, or (b) assign such Joint IP to a Third Party, other than to an assignee of all or substantially all of its assets or business in any country pertaining to the Components and/or the Products. Such Joint Patents shall be considered a Patent Right for the purposes of extending the term of this Agreement but no Earned Royalties shall be payable to NGX in respect of any Joint Patent.

11.1.4 Astellas Improvements. Astellas shall notify NGX of any Astellas Improvements in a [***]. Astellas shall have the right to file and maintain patents for Astellas Improvements as it, in its sole discretion, decides, provided that if Astellas elects not to maintain patent application(s) and patent(s) for an Astellas Improvement that Astellas has filed, Astellas shall notify NGX of such intention at least [***] prior to the date upon which such patent or patent application shall expire or be abandoned, and NGX shall thereupon have the right, but not the obligation, to assume responsibility for the prosecution and maintenance thereof at its own expense, provided that it is understood that ownership of such Patent Right shall remain with Astellas. Astellas hereby grants to NGX an [***] outside the Territory, with the right to sublicense, under any Astellas Improvements to make, have made, use, sell, offer for sale, import, practice and otherwise exploit the same for the Components and/or the Product outside the Territory (the “NGX License”). Upon the expiration of this Agreement the NGX License shall thereafter be non-exclusive but in all other respects shall remain unchanged. Upon the termination of this Agreement by Astellas pursuant to Section 17.2 or by NGX pursuant to Sections 17.3-17.5, the scope of the NGX License shall thereafter be worldwide but in all other respects shall remain unchanged. As used herein, “Astellas Improvements” means any patent rights or other intellectual property made by or under authority of Astellas or its Affiliates in connection with development and/or commercialization of a Product under this Agreement that is applicable to the Components or Product or the manufacture, use or formulation thereof and solely to the extent that such patent rights or other intellectual property cover a Product.

11.2 NGX Improvements

NGX shall notify Astellas of any NGX Improvements [***].

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11.2.1 NGX shall license any Know-How comprised in NGX Improvements to Astellas under the terms of Section 2.2.

11.2.2 NGX shall notify Astellas of the grant of any patent for NGX Improvements within [***] of such grant and provide Astellas with a copy of the granted patent.

11.2.3 Within [***] of the date of the notice in Section 11.2.2, Astellas shall notify NGX whether it wishes such patent for NGX Improvements to be added to the Patent Rights and thereby be licensed to Astellas under Section 2.2 and extend the term of this Agreement.

11.2.4 If Astellas does not notify NGX within the [***] period in Section 11.2.3 or notifies NGX that it does not wish such patent for NGX Improvements to be added to the Patent Rights then Astellas shall not be licensed under such patent and the term of this Agreement shall not be extended. To the extent that such patent for an NGX Improvement is solely applicable to Products, NGX and its Affiliates shall not exploit or license it to a Third Party in the Territory until the expiry or earlier termination of this Agreement.

11.2.5 As used herein, “NGX Improvements” means any patent rights or other intellectual property made by or under authority of NGX or its Affiliates in connection with development and/or commercialization of a Product under this Agreement that is applicable to the Components or a Product or the manufacture, use or formulation thereof and solely to the extent that such patent rights or other intellectual property cover a Product.

11.3 Maintenance of Patents

11.3.1 Filings. As between Astellas and NGX, NGX shall have responsibility for and shall control the filing, prosecution and maintenance of all Patent Rights in the Territory. NGX agrees to keep Astellas informed of the course of patent prosecution or other proceedings with respect to the Patent Rights within the Territory (including those licensed under the UC Agreement and LTS Agreement), and Astellas shall have the right to review pending patent applications and make recommendations to NGX concerning the foregoing. NGX will consider in good faith all reasonable suggestions of Astellas with respect thereto. Astellas shall hold all information disclosed to it under this Section 11.3.1 as confidential.

11.3.2 Patent Costs. The costs of prosecuting and maintaining the Patent Rights ([***]) in the Territory will [***].

11.3.3 Maintenance of Existing Product Patent Portfolio. In respect of the Existing Product NGX [***].

11.3.4 Maintenance of Liquid Formulation Product Patent Portfolio. Following Astellas’ exercise of its Option under Section 2.3.12 with respect to the Liquid Formulation Product, the Parties shall agree upon those Patent Rights with respect to the Liquid Formulation Product that constitute “Core Patent Rights”. Such patents shall thereafter be added to Exhibit 1.40 and [***].

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11.3.5 If, during the term of this Agreement, NGX intends to allow any [***] (as indicated in Exhibit 1.40) owned by NGX in the Territory to expire or otherwise be abandoned, NGX shall notify Astellas of such intention at least [***] prior to the date upon which such Patent Right shall expire or be abandoned, and Astellas shall thereupon have the right, but not the obligation, to assume responsibility for the prosecution and maintenance thereof at its own expense, such Patent Right being an “Assumed Patent”, provided that it is understood that ownership of such Patent Right shall remain with NGX. Although such Assumed Patent shall be licensed to Astellas under this Agreement and shall be considered a Patent Right for the purposes of extending the term of this Agreement no Earned Royalties shall be payable to NGX in respect of any Assumed Patent.

11.3.6 NGX shall not during the term of the Agreement assign or otherwise transfer any Patent Rights (owned by it) in the Territory for which it is the registered proprietor to any Third Party.

11.3.7 Extensions/Supplementary Protection Certificates. The Parties shall discuss and mutually agree upon the patent or patents within the Patent Rights to be extended in each country of the Territory and each Party shall cooperate with the other in seeking any such agreed upon extensions of the terms of Patent Rights in the Territory. Without limiting the foregoing, NGX shall, at Astellas’ request, either authorize Astellas to act as NGX’s agent for the purpose of making any application for any such agreed upon extensions or shall diligently seek to obtain such extensions, in either event, [***].

11.4 Third Party Patents and Trademarks

11.4.1 Third Party Infringement Claims. If the production, importation, keeping, sale, offering for sale, or use of any Product in the Territory pursuant to this Agreement results in a claim, suit or proceeding in the Territory by a Third Party alleging patent or trademark infringement against NGX or Astellas (or their respective Affiliates, licensees or Subdistributors) (collectively, “Infringement Actions”), such Party shall promptly notify the other Party hereto in writing. The Party [***]. The Party controlling the defense of such Infringement Action shall defend such Infringement Action using counsel of its own choice, and the Infringement Action shall be at such Party’s [***]; provided, however, that the other Party may participate in the defense and/or settlement thereof [***] with counsel of its choice. The Party controlling the Infringement Action agrees to keep the other Party hereto reasonably informed of all material developments in connection with any such Infringement Action. Astellas agrees not to (i) make admissions regarding infringement by the Product of any patents outside of the Patent Rights, or (ii) settle such Infringement Action, or make any admissions or assert any position in such Infringement Action, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent

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Rights in or outside the Territory, in each case without obtaining the prior written consent of NGX which shall not be unreasonably withheld, conditioned or delayed. Subject to any right of Astellas to be indemnified by NGX under the Supply Agreement, [***]. As used herein, “Damages” shall mean out-of-pocket costs incurred by a Party, including reasonable attorneys’ fees and other legal costs, damages and other liabilities that are part of any final judgment awarded against such Party, and any amounts paid by such Party in a settlement of the action that is approved by the other Party, such approval not to be unreasonably withheld, delayed or conditioned. In respect of any infringement actions outside the Territory, NGX agrees not to settle such infringement action, or make any admissions or assert any position in such infringement action, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent Rights inside the Territory, without obtaining the prior written consent of Astellas which shall not be unreasonably withheld, conditioned or delayed.

11.4.2 Oppositions to Third Party Patents and Trademarks. If NGX or Astellas becomes aware of a Third Party patent and/or trademark filed and/or registered in the Territory, which the production, sale or use of any Product in the Territory pursuant to this Agreement may infringe (a “Third Party Right”), such Party shall promptly notify the other Party hereto in writing. [***]. In the event that the Parties agree that it would be advisable to bring such revocation or opposition proceedings (“Adverse Proceedings”), Astellas shall have the right, [***], to bring and control the Adverse Proceedings using counsel of its own choice. Astellas agrees to keep NGX reasonably informed of all material developments in connection with any such Adverse Proceedings and shall reasonably consider NGX’s advice and requests with respect to such Adverse Proceeding. Astellas may treat its Costs from such Adverse Proceedings [***]. As used herein, “Costs” shall mean out-of-pocket costs incurred by Astellas, including reasonable attorneys’ fees and other legal costs, damages and other liabilities that are part of any final judgment awarded against Astellas, and any amounts paid by Astellas in a settlement of the action that is approved by the NGX, such approval not to be unreasonably withheld, delayed or conditioned. In the event that the Parties cannot agree on whether an Adverse Proceeding should be initiated, the Party wishing to bring the Adverse Proceeding shall have the right to do so using counsel of its own choice, provided that it agrees to [***] associated with such Adverse Proceeding and to keep the other Party reasonably informed of all material developments in connection with any such Adverse Proceedings. Notwithstanding the foregoing, in the event that the Parties cannot agree on whether an Adverse Proceeding should be initiated but the Party wishing to bring the Adverse Proceeding can reasonably demonstrate that (a) failure to bring an Adverse Proceeding with respect to a particular Third Party Right would have a material adverse effect on the commercialization of Product in the Territory, and (b) that the contemplated Adverse Proceeding has a reasonable chance of success, in each case through the reasoned legal opinion of such Party’s outside patent counsel, then the Party bringing such Adverse Proceeding [***] from such Adverse Proceedings [***], as applicable.

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11.5 Enforcement of Patent Rights and Trademarks

Subject to the provisions of this Section 11.5, in the event that Astellas reasonably believes that the Product Trademark or any Patent Rights in the Territory are infringed or misappropriated by a Third Party or are subject to a declaratory judgment action in the Territory arising from such infringement, in each case with respect to the sale or use within the Field in the Territory of a [***] product comprising a [***] (each such product, an “Infringing Product”), Astellas shall promptly notify NGX. In such event, as between the Parties, NGX shall have the initial right (but not the obligation), to enforce the Product Trademark or Patent Rights (save in respect of any Assumed Patent), as appropriate, with respect to such infringement, or defend any declaratory judgment action with respect thereto (for purposes of this Section 11.5, an “Enforcement Action”). Astellas (or NGX in respect of any Assumed Patent) shall, [***], have the right to participate with counsel of its own choice, provided that it is understood that Astellas’ right to participate in any Enforcement Action with respect to the patents within the Patent Rights in-licensed to NGX under the LTS Agreement shall be subject to LTS’ consent. NGX shall keep Astellas reasonably informed of the progress of any such Enforcement Action.

11.5.1 Initiating Enforcement Actions. In the event that NGX, or the owner of the Patent Rights, as applicable, fails to initiate an Enforcement Action to enforce the Patent Rights or Product Trademark, as applicable, against an infringement by a Third Party in a country in the Territory, which infringement consists of the sale or use of an Infringing Product in the Field in such country, within [***] of a request by Astellas to initiate such Enforcement Action (or such shorter period required to allow obtaining an interim injunction in the relevant country), Astellas may initiate an Enforcement Action against such infringement. NGX shall cooperate in such Enforcement Action including by being joined as a party to such Enforcement Action. Astellas shall keep NGX reasonably informed of the progress of any such Enforcement Action. NGX shall, at its expense, have the right to join in as a party plaintiff and to give reasonable assistance to such Enforcement Action. Astellas agrees not to settle any Enforcement Action, or make any admissions or assert any position in such Enforcement Action, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent Rights in or outside the Territory, without the prior written consent of NGX, which shall not be unreasonably withheld, delayed or conditioned. In respect of any proceedings to enforce any patents outside the Territory that are equivalent to the Patent Rights, NGX agrees not to settle any such proceedings, or make any admissions or assert any position in such proceedings, in a manner that would materially adversely affect the validity, enforceability or scope of the Patent Rights inside the Territory, without the prior written consent of Astellas, which shall not be unreasonably withheld, delayed or conditioned.

11.5.2 Recoveries. With respect to Enforcement Actions initiated by a Party (the “Initiating Party”) in a country, with the other Party’s prior written consent and upon mutual agreement not to be unreasonably withheld, delayed or conditioned, the other Party shall pay [***] of the costs and expenses (including attorneys’ and professional fees) incurred by the Initiating Party in such Enforcement Action. Any recovery received as a result of any Enforcement Action to enforce the Product Trademark or Patent Rights pursuant to this Section 11.5 by either Party shall, [***] incurred in connection with such Enforcement Action, and the [***] (to the extent the same

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represents damages from sales of products within the Field in the Territory) equally between the Parties; provided, however, that if the Initiating Party initiates the Enforcement Action and the other Party does not agree to pay [***] of the costs and expenses incurred by the Initiating Party therein, the other Party shall be entitled to any amount recovered in such Enforcement Action in a pro rata amount to its contribution to the costs and expenses incurred by the Initiating Party.

11.6 Third Party Patent Rights

11.6.1 Subject to Section 11.6.2, the obligations of NGX and the rights of Astellas under Sections 11.3 and 11.5 shall be subject to, and limited by, any agreements pursuant to which NGX acquired or licensed any particular Patent Rights or Data, including without limitation the UC License Agreement and LTS Agreement. Without limiting the foregoing, with respect to the prosecution or enforcement of Patent Rights licensed by NGX from a Third Party, to the extent NGX has the right to do so, NGX shall cooperate with Astellas to prosecute and enforce such Patent Rights in the Territory in the same manner as set forth in Sections 11.3 and 11.5 above. As between NGX and Astellas, any recoveries from enforcement of such Patent Rights licensed from a Third Party (including any amounts that NGX receives from the Third Party licensor as a result of such enforcement) [***], after deducting from such recoveries any amounts owed to the Third Party licensor for such enforcement; provided that any Enforcement Actions initiated by the [***].

11.6.2 NGX shall not [***].

11.6.3 If NGX receives notification from LTS under Section 7.2(d) of the LTS Agreement that LTS has elected not to file, prosecute or maintain any patent or patent application licensed by NGX from LTS, then NGX shall so notify Astellas within [***] of NGX’s receipt of such notification. If Astellas wishes NGX to file, prosecute or maintain such patent or patent application it shall inform NGX within [***] of receipt of the notice from NGX and NGX shall immediately (and in any event within the [***] period in Section 7.2(d) of the LTS Agreement) so inform LTS such that the provisions of Sections 7.2(d) and (e) of the LTS Agreement take effect.

11.7 Patent Marking

Astellas agrees to xxxx and have its Affiliates, Sublicensees and Subdistributors xxxx all patented Products they sell or distribute pursuant to this Agreement in accordance with the applicable patent statutes or regulations in the country or countries of manufacture and sale thereof.

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12. TRADEMARKS

12.1 Product Trademark

The Existing Product shall be distributed, promoted, marketed and sold in the Territory by Astellas, its Affiliates, Sublicensees and Subdistributors exclusively under the Product Trademark. All packaging materials, labels and promotional materials for the Existing Product in the Territory shall display the Product Trademark to the extent such packaging materials, labels and promotional materials have enough space for such display. In addition, to the extent reasonably desired by NGX, all product information leaflets and promotional materials for the Product in the Territory shall include a statement acknowledging that the Product is sold under license from NGX.

12.2 Trade Dress

The Astellas trade dress and style of packaging with respect to the Existing Product may be determined by Astellas so as to be consistent with Astellas’ standard trade dress and style, provided that they conform to the Brand Guiding Principles. Any trade dress and style of packaging not consistent with the Brand Guiding Principles shall be subject to the prior written approval by NGX not to be unreasonably withheld, delayed or conditioned. Astellas shall own rights to any trade dress which is created by Astellas or on its behalf and used in the commercialization of the Existing Product in the Territory.

12.3 License

NGX hereby grants to Astellas an exclusive, royalty-free license, to use the Product Trademark solely in connection with marketing, promoting, distributing and selling the Existing Product in the Field and Territory in accordance with this Agreement. This license is sublicensable in accordance with Section 2.4.2 above. The ownership and all goodwill from the use of the Product Trademark shall vest in and inure to the benefit of NGX and will not create any right, title or interest for Astellas in the Product Trademark.

12.4 Quality Standards

12.4.1 The use of the Product Trademark by Astellas shall be in accordance with the Brand Guiding Principles. Astellas shall not take any action that impairs the validity or enforceability of the Product Trademark.

12.4.2 The quality of the Product associated with the Product Trademark, as well as the quality of all marketing and promotional materials and packaging that include the Product Trademark, shall be in accordance with the MAA Approval for the Product in the respective country or jurisdiction. Upon NGX’s reasonable and periodic request, Astellas shall provide NGX with a sample of the Product associated with the Product Trademark.

12.4.3 NGX shall have the right to [***], and the [***] that include the Product Trademark provided by Astellas, and Astellas shall assist NGX [***] in accordance with Section 8.3.2.

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12.5 Alternative Trademark

If the Product Trademark cannot be used for legal, regulatory or other material reasons outside the Parties’ reasonable control, in one or more countries of the Territory, the Parties shall mutually select one of the then available Alternative Trademarks and NGX shall license such Alternative Trademark to Astellas during the term of this Agreement, at no additional cost to Astellas in accordance with Section 12.3 above. In such an event, the Alternative Trademark in such country or countries of the Territory shall become the Product Trademark.

12.6 Registration & Ownership

NGX agrees to use commercially reasonable efforts to file, register and maintain a registration for the Product Trademark (including, if appropriate pursuant to Section 12.5, the Alternative Trademark) in all countries of the European Union (and in countries of the Territory outside the European Union, upon notice from Astellas that an MAA for the Product is being filed in such country), in each case for use with the Existing Product during the term of this Agreement. The costs of filing and maintaining such registrations in the Territory shall [***]. Astellas hereby acknowledges NGX’s exclusive ownership rights in the Product Trademark, and accordingly agrees that at no time during or after the term of this Agreement to challenge or assist others to challenge the Product Trademark or the registration thereof or attempt to register any trademarks, marks or trade names confusingly similar to such Product Trademark. NGX shall not during the term of the Agreement assign or otherwise transfer any Product Trademark in the Territory for which it is the registered proprietor to any Third Party.

12.7 Recordation

In those countries where a trademark license must be recorded, NGX will provide and record a separate trademark license for the Product Trademark, at NGX’s sole expense. Astellas shall cooperate in the preparation and execution of such documents.

12.8 Domain Names

NGX shall own rights to any Internet domain names incorporating the Product Trademark or any variation or part of such Product Trademark as its URL address or any part of such address where the relevant Product Trademarks are owned by it. NGX agrees to grant, and hereby grants to Astellas a royalty-free, fully paid-up exclusive license to use the domain names listed on Exhibit 12.8 (“Domain Names”) in connection with Astellas’ commercialization of the Existing Product in the Territory in accordance with this Agreement, provided that [***]. If there is a requirement in any country in the Territory for the domain name holder to have a presence in that country and NGX does not have a presence in that country then NGX shall transfer the relevant Domain Name to Astellas provided that upon termination of this Agreement (but not expiration) Astellas shall promptly transfer such Domain Name back to NGX. The use rights granted to the Domain Names

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under this Section 12.8 are limited to the Territory, and Astellas shall not make or authorize any use, direct or otherwise, of the Domain Names outside the Territory. Astellas shall not sublicense the Domain Names without NGX’s prior written consent. For clarity, Astellas acknowledges and agrees that the Domain Names and the goodwill pertaining to such Domain Names shall belong to NGX. NGX agrees to take such additional actions as may be reasonably required to extend to Astellas the benefits of this license. The Parties agree that any use of the Product Trademark in any content describing or referring to the Existing Product in the Territory on any internet page or web site shall, subject to the terms of this Agreement, be in the sole control of Astellas.

12.9 Trademark for Liquid Formulation Product

If Astellas exercises the Option pursuant to Section 2.3.12 then the parties shall agree a trademark for use in relation to such Product (the “LF Trademark”). The terms of Sections 12.1 to 12.8 shall apply mutatis mutandis in relation to any such trademark such that references to Existing Product shall be read as references to the Liquid Formulation Product, references to Product Trademark shall be read as references to the LF Trademark and references to the Alternative Trademark shall be read as references to a mutually agreed alternative trademark for the Liquid Formulation Product.

12.10 Promotional Materials

All promotional materials and packaging for Product (whether of NGX, its Affiliates and licensees outside the Territory or Astellas, its Affiliates, Sublicensees and Subdistributors inside the Territory) using the Product Trademark shall conform to the Brand Guiding Principles.

12.11 Termination

Astellas’ right to use the Product Trademark shall terminate in each country of the Territory in which Astellas’ rights to distribute the Product are terminated in accordance with this Agreement. Astellas shall cooperate in the cancellation of any trademark licenses recorded or entered into in such countries. In the event that the Agreement expires then Astellas’ rights to the Product Trademark shall continue pursuant to Section 18.2(b).

13. CONFIDENTIALITY

13.1 Confidential Information Except as expressly provided herein, the Parties agree that the receiving Party shall not publish nor otherwise disclose, and shall not use for any purpose, any information furnished to it by the other Party hereto pursuant to this Agreement (collectively, “Confidential Information”). Notwithstanding the foregoing, Confidential Information shall not include information which, in each case as demonstrated by written documentation:

13.1.1 was already known to the receiving Party, other than under an obligation of confidentiality, at the time of disclosure;

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13.1.2 was generally available to the public or otherwise part of the public domain at the time of its disclosure to the receiving Party;

13.1.3 became generally available to the public or otherwise part of the public domain after its disclosure and other than through any act or omission of the receiving Party in breach of this Agreement;

13.1.4 was subsequently lawfully disclosed to the receiving Party by a person other than a Party, and who did not directly or indirectly receive such information from disclosing Party; or

13.1.5 was independently developed by the receiving Party without use of or reference to any information or materials disclosed by the disclosing Party.

13.2 Permitted Use and Disclosures

Notwithstanding the provisions of Section 13.1 above, each Party hereto may use and disclose the other Party’s Confidential Information to the extent such disclosure is reasonably necessary to exercise the rights granted to it, or reserved by it, under this Agreement (including the right to grant sublicenses, as applicable), prosecuting or defending litigation, complying with applicable governmental regulations, submitting information to tax or other governmental authorities (including without limitation the European Commission), or conducting clinical trials hereunder with respect to Products, provided that if a Party is required to make any such disclosure of the other Party’s Confidential Information, to the extent it may legally do so, it will give reasonable advance notice to the latter Party of such disclosure and, save to the extent inappropriate in the case of patent applications or otherwise, will use its reasonable efforts to secure confidential treatment of such information prior to its disclosure (whether through protective orders or otherwise). For any other disclosures of the other Party’s Confidential Information, including to Affiliates, licensees, Subdistributors and other Third Parties, a Party shall ensure that the recipient thereof is bound by a written confidentiality agreement as materially protective of such Confidential Information as this Section 13. If the Party whose Confidential Information is to be disclosed has not filed a patent application with respect to such Confidential Information, it may require the other Party to delay the proposed disclosure (to the extent the disclosing Party may legally do so), for up to [***], to allow for the filing of such an application. This Section 13 shall not limit either Party’s right under Section 7.2.1 to use and disclose Data.

13.3 Terms of this Agreement

Each Party agrees not to disclose to any Third Party the terms of this Agreement without the prior written consent of the other Party hereto, except each Party may disclose the terms of this Agreement (a) as required by law (as determined by the disclosing Party’s legal counsel) or in filings with governmental entities, e.g. the SEC, IRS or with national stock exchanges, or (b) under reasonable conditions of confidentiality, to advisors, auditors and actual or potential acquisition partners or private investors on a need to know basis.

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13.4 Prior Non-Disclosure Agreements

Upon execution of this Agreement, the terms of this Section 13 shall supercede any prior non-disclosure, secrecy, or confidentiality agreement between the Parties. Any information disclosed under such prior agreements shall be deemed disclosed under this Agreement.

13.5 Publication of Product Information

Prior to publishing, publicly presenting and/or submitting for written or oral publication a manuscript, abstract or the like that includes Data or other information relating to Product that has not previously been published pursuant to this Section 13.5, a Party shall provide the other Party a copy thereof in English for its review for at least [***] (unless such Party is required by law to publish such information sooner). Such Party shall consider in good faith any comments provided by the other Party during such [***] period. In addition, such Party shall, at the request of the other Party: (a) remove any Confidential Information of the other Party therefrom, except each Party shall have the right to publicly disclose any information, including Confidential Information, pertaining to safety or efficacy of the Product that such Party believes in good faith it is obligated or appropriate to disclose; and (b) delay publication for a period not to exceed [***] in order to allow the other Party to file for patent protection in relation to its Data and Confidential Information. The contribution of each Party shall be noted in all publications or presentations by acknowledgment or coauthorship, whichever is appropriate.

14. REPRESENTATIONS AND WARRANTIES

14.1 Mutual Warranties

Each Party warrants and represents to the other that the Agreement is a legal and valid obligation binding upon such Party and enforceable in accordance with its terms. The execution, delivery and performance of the Agreement by such Party does not conflict with any agreement, instrument or understanding, oral or written, to which it is a party or by which it is bound, nor to such Party’s knowledge, violate any law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it.

14.2 NGX Warranties

NGX warrants and represents to Astellas that as of the Effective Date:

14.2.1 it has the full right and authority to enter into this Agreement and grant the rights and licenses granted herein;

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Intellectual Property

14.2.2 it has not previously granted any right, license or interest in or to the Patent Rights, or any portion thereof, that is in conflict with the rights or licenses granted to Astellas under this Agreement;

14.2.3 [***];

14.2.4 there are no pending proceedings in any court, arbitration, patent office, administrative or other tribunal which are concerned with the validity or ownership of any of the Patent Rights, NGX Know-How or the Product Trademark or the Alternative Trademark, [***] those that have been published in the following NGX SEC filings: (a) the Business and Risk Factors sections of (i) the Form S-1A dated 16 March 2007, (ii) the Form 10-K for the year ended 31 December 2007 and (iii) the Form 10-K for the year ended 31 December 2008 and (b) the Risk Factors Section of the Form 10Q for the quarter ended 31 March 2009 provided that in relation to Patent Rights which have been licensed to it and are not owned by it, the foregoing is given to the Knowledge of NGX having made reasonable enquiry of UC and LTS;

14.2.5 to the Knowledge of NGX, upon Consultation, [***];

14.2.6 the details of the Patent Rights, the Product Trademark and the Alternative Trademark that are set out in Exhibit 1.40 and Exhibit 1.44 are [***]. Without derogation from the generality of the foregoing, the Patents Rights, the Product Trademark and the Alternative Trademark (to the extent they are granted) are subsisting and all applications for Patents Rights, the Product Trademark or the Alternative Trademark indicated in Exhibit 1.40 and Exhibit 1.44 as pending are pending. The legal and beneficial owner or applicant for registration of each of the Patents Rights, the Product Trademark or the Alternative Trademark specified in Exhibit 1.40 and Exhibit 1.44 is [***];

14.2.7 [***] the Patent Rights and Product Trademarks set forth in Exhibit 1.40 and Exhibit 1.44;

14.2.8 the Patent Rights, the Product Trademark, the Alternative Trademark and the NGX Know-How are [***];

14.2.9 all actions required to be taken [***] in good faith ([***]) have been taken [***];

14.2.10 the Patent Rights owned by NGX are not and, during the term of this Agreement, will not become subject to any rights granted in favor of a Third Party, including a lien or other encumbrance, which would conflict with the rights or licenses of Astellas hereunder;

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14.2.11 as of the Effective Date, [***] save for those that have been published in the following NGX SEC filings: (a) the Business and Risk Factors sections of (i) the Form S-1A dated 16 March 2007, (ii) the Form 10-K for the year ended 31 December 2007 and (iii) the Form 10-K for the year ended 31 December 2008 and (b) the Risk Factors Section of the Form 10Q for the quarter ended 31 March 2009.

Licenses

14.2.12 NGX has disclosed to Astellas true and complete copies of the UC Agreement and the LTS Agreement and all actual amendments to these agreements and all contemplated amendments that have been discussed with, respectively, UC and LTS;

14.2.13 the UC Agreement and LTS Agreement are in full force and effect, each such agreement is binding on the parties and to the Knowledge of NGX no party is in material breach of any of its obligations under such agreements;

14.2.14 NGX (a) is not in breach and shall not breach its obligations under the UC Agreement or LTS Agreement or take any other actions, in each case which would result in the termination of such agreement(s) and the subsequent loss by Astellas of its rights with respect to the Patent Rights in-licensed under such agreement(s), provided that NGX will not be deemed to be in breach of this Section 14.2.14(a) in the event that Astellas’ rights under such agreement(s) would have survived the termination of such agreement(s) but for Astellas’ having failed to take the necessary steps to ensure the survival of its rights, (b) shall promptly inform Astellas in the event that it receives written notice from UC or LTS purporting to unilaterally terminate the UC Agreement and LTS Agreement and will use commercially reasonable efforts to dispute any allegation of material breach asserted by UC or LTS with respect to the UC Agreement and/or LTS Agreement as may be required to prevent termination of such licenses, and (c) shall not amend such agreements in a manner that would be to the detriment of the rights and obligations of Astellas under this Agreement without Astellas’ prior written consent;

14.2.15 NGX has provided UC with a copy of [***];

14.2.16 NGX has not been notified by [***] that [***] has commenced development [***];

Marketing Authorizations/Regulatory

14.2.17 EMEA MA Approval Number EMEA/H/C/000909 is the only MAA and MAA Approval held by NGX or its Affiliates in relation to the marketing and sale of the Existing Product in the Territory;

14.2.18 Astellas has been granted access to true and complete copies of all of NGX’s regulatory filings relating to the Product;

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14.2.19 all clinical trials for the Existing Product conducted by or on behalf of NGX and included in NGX’s regulatory filings with the EMEA [***];

14.2.20 [***] with respect to the Data used to support EMEA MA Approval Number EMEA/H/C/000909;

14.2.21 that as of the Effective Date, NGX has disclosed to Astellas all clinical data relating to SAEs relating to Products, such SAEs being set out in Exhibit 14.2.21;

14.2.22 NGX has not knowingly withheld from any regulatory authority any material information in the possession of NGX or its Affiliates related to the safety, toxicity, quality or efficacy of the Components and/or the Existing Product (a) that has been requested by a regulatory authority, or (b) that a biopharmaceutical company would reasonably consider to be material for the EMEA’s evaluation of the safety, toxicity, quality and/or efficacy of the Components and/or the Existing Product;

14.2.23 neither NGX nor its Affiliates or any of its or their officers, agents or employees (during the course of their duties) in relation to researching, and developing the Existing Product in the Territory has done or omitted to [***] adversely affect Astellas’ ability to commercialize the Existing Product as contemplated herein;

14.2.24 there has been no failure to [***] that would materially adversely affect Astellas’ ability to commercialize the Existing Product as contemplated herein;

14.2.25 NGX and its Affiliates have developed the Existing Product and the Liquid Formulation Product [***];

14.2.26 EMEA MA Approval Number EMEA/H/C/000909 was granted by the European Commission upon the submission by the NGX of a full dossier presented in accordance with Article 8.3 of EC Directive 2001/83 and does not refer to any other marketing approval;

14.2.27 the application for EMEA MA Approval Number EMEA/H/C/000909 includes the results of all clinical trials that have been started (i.e., in which patients have been enrolled) by or on behalf of NGX relating to the Existing Product whether discontinued or completed with the exception of [***] for which only a synopsis has been provided to the EMEA;

14.2.28 Astellas has the right to [***];

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General

14.2.29 neither NGX nor any NGX Affiliate is engaged in any litigation, opposition or arbitration proceedings affecting or relating to the Products anywhere in the world (including but not limited to claims relating to product liability) as plaintiff or defendant and [***] sections of (i) the Form S-1A dated 16 March 2007, (ii) the Form 10-K for the year ended 31 December 2007 and (iii) the Form 10-K for the year ended 31 December 2008 and (b) the Risk Factors Section of the Form 10Q for the quarter ended 31 March 2009;

14.2.30 NGX has not knowingly withheld from Astellas any material information in the possession of NGX related to the safety, toxicity, quality or efficacy of the Components and/or the Existing Product (a) that has been requested by Astellas, or (b) that a biopharmaceutical company would reasonably consider to be material to Astellas’ evaluation of the safety, toxicity, quality and/or efficacy of the Components and/or the Existing Product;

14.2.31 NGX has not knowingly withheld from Astellas any material CMC Information in the possession of NGX regarding the Existing Product (a) that has been requested by Astellas, or (b) that a biopharmaceutical company would reasonably consider to be material to Astellas’ evaluation of the quality of the Components and/or the Existing Product. As used herein, “CMC Information” means information of the type required to appear in Module 3 of EMEA MAA Approval No. EMEA/H/C/000909;

14.2.32 NGX has not knowingly withheld from Astellas any material information in the possession of NGX related to the market and sales potential of the Components and/or the Existing Product (a) that has been requested by Astellas, or (b) that a biopharmaceutical company would reasonably consider to be material to Astellas’ evaluation of the market and sales potential of the Components and/or the Existing Product in the Territory;

14.2.33 NGX and its Affiliates have no employees in the Territory;

14.2.34 all necessary consents, approvals and authorizations of all governmental authorities and other persons or entities required to be obtained by NGX in order to enter into this Agreement have been obtained;

14.2.35 other than with respect to [***], no US export control license is required (a) in order to enter into this Agreement, (b) transfer NGX Know-How and Data to Astellas, (c) for Astellas to purchase any Components or Existing Products, or (d) in order to enable Astellas to exercise its rights under this Agreement;

14.2.36 except as otherwise noted in Section 14.2.35, no approval from U.S. federal government or any U.S. state government (including any agency or division thereof) or to its Knowledge under any applicable law, is required (a) in order to enter into this Agreement, (b) transfer NGX Know-How and Data to Astellas, (c) for Components, Existing Products or the

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Liquid Formulation Product to be manufactured either inside or outside the US or (d) in order to enable Astellas to exercise its rights under this Agreement, in each case which lack of approval would materially adversely affect Astellas’ ability to commercialize the Existing Product as contemplated herein;

14.2.37 as of the Effective Date, [***]; and

14.2.38 except for the documents identified on Exhibit 14.2.38, all material information referred to in Sections 14.2.30, 14.2.31 and 14.2.32 has been made available to Astellas at least [***] prior to the Effective Date.

14.3 NGX Covenants

NGX covenants to Astellas that, during the term of this Agreement (a) it shall not grant any right, license or interest in or to the Patent Rights and NGX Know-How, or any portion thereof, that is in conflict with the rights or licenses granted under this Agreement, and (b) it shall not xxxxx x xxxx or other encumbrances on any of the subject matter of this Agreement or on any of NGX’s rights, benefits or obligations hereunder or on any of the Patent Rights, which would conflict with the rights or licenses of Astellas hereunder, provided that the Parties agree that this subsection (b) is not intended to, and shall not, restrict NGX from engaging in customary equity and debt financings.

14.4 Astellas Warranties

Astellas warrants and represents to NGX that, as of the Effective Date: (a) it has the full right and authority to enter into this Agreement and grant the rights and perform the obligations set forth herein; (b) [***] (c) all necessary consents, approvals and authorizations of all governmental authorities and other persons or entities required to be obtained by Astellas in order to enter into this Agreement have been obtained save in respect of any export control licenses.

15. LIABILITY

15.1 DISCLAIMER EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT TO THE CONTRARY, NEITHER PARTY MAKES ANY REPRESENTATION OR EXTENDS ANY WARRANTIES OF ANY KIND EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NONINFRINGEMENT, OR VALIDITY OF ANY PATENTS ISSUED OR PENDING.

15.2 LIMITATION OF LIABILITY NOTWITHSTANDING ANYTHING IN THIS AGREEMENT OR OTHERWISE, NEITHER PARTY SHALL BE LIABLE TO THE OTHER WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT, WHETHER UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE THEORY, FOR ANY INCIDENTAL, INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE, MULTIPLE, OR CONSEQUENTIAL DAMAGES, LOST PROFITS, LOSS OF ROYALTIES AND MILESTONE PAYMENTS, LOSS OF USE, DAMAGE TO GOODWILL, OR LOSS OF BUSINESS.

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15.3 Exceptions

Nothing in this Agreement shall limit any Party’s liability (a) caused by that Party’s willful misconduct, (b) for death or personal injury caused by that Party’s negligence, or (c) for fraudulent misrepresentation by that Party.

16. INDEMNIFICATION

16.1 Indemnification of NGX

Subject to Section 15.2, Astellas hereby agrees to indemnify, defend and hold harmless NGX, its Affiliates, and their respective directors, officers, employees, agents and their respective successors, heirs and assigns (the “NGX Indemnitees”) from and against any losses, costs, claims, damages, liabilities or expenses (including, without limitation, reasonable attorneys’ and professional fees and other expenses of litigation) (collectively, “Liabilities”) from any claims, suits, actions or proceedings brought by a Third Party (a “Third Party Claim”) incurred by any NGX Indemnitee as a result of: [***].

16.2 Indemnification of Astellas

Subject to Section 15.2, NGX hereby agrees to indemnify, defend and hold harmless Astellas, its Affiliates, and their respective directors, officers, employees, agents and their respective successors, heirs and assigns (the “Astellas Indemnitees”) from and against any Liabilities from any Third Party Claims incurred by any Astellas Indemnitee as a result of: [***].

16.3 Procedure

Except with respect to Third Party infringement claims subject to Section 11.4 above, a Party that intends to claim indemnification under this Section 16 (the “Indemnitee”) shall promptly notify the other Party (the “Indemnitor”) in writing of any Third Party Claim, in respect of which the Indemnitee intends to claim such indemnification, and the Indemnitor shall have sole control of the defense and/or settlement thereof; provided, that the Indemnitee shall have the right to participate in the defense or settlement of such Third Party Claim with counsel of its own choosing at its expense. The Indemnitor shall keep the Indemnitee fully informed of the progress of any such Third Party Claim. The indemnity arrangement in this Section 16 shall not apply to amounts paid in settlement of any action with respect to a Third Party Claim, if such settlement is effected without the consent of the Indemnitor, which consent shall not be withheld, delayed or conditioned unreasonably. The failure to deliver written notice to the Indemnitor within a reasonable time after the commencement of any action with respect to a Third Party Claim, if prejudicial to its ability to defend such action,

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shall relieve such Indemnitor of any liability to the Indemnitee under this Section 16 to the extent it is so prejudiced, but the omission to so deliver written notice to the Indemnitor shall not relieve the Indemnitor of any liability that it may have to any Indemnitee otherwise than under this Section 16. The Indemnitee under this Section 16 shall cooperate fully with the Indemnitor and its legal representatives in the investigation of any action with respect to a Third Party Claim covered by this indemnification.

16.4 Consequences of Failure to Transfer MA

The Parties acknowledge and agree that the transfer of the Existing Product MAA Approval is fundamental to Astellas’ ability to commercialize the Existing Product, and accordingly it is agreed that in the event that NGX materially breaches its obligations under Sections 6.1, 6.3.1, 6.3.2 or 6.4, and as a result, the Existing Product MAA Approval is not transferred to Astellas or Astellas’ designated Affiliate within [***] of Astellas’ request for transfer, or is cancelled, withdrawn or substantially amended in a manner that is prevents the commercialisation of the Existing Product in the Territory (each of the foregoing a “Default”), then Astellas shall have the right under this Section 16.4 to terminate this Agreement upon written notice to NGX within thirty (30) days of the occurrence of a Default, in which case NGX shall refund to Astellas within thirty (30) days of the date of such notice, the Initial Payment of Thirty Million Euros (€30,000,000) together with the Option Fee of Five Million Euros (€5,000,000) and the terms of Section 18.6 shall apply. Save for willful misconduct by NGX, and its employees, the foregoing shall be Astellas’ sole remedy for a failure to transfer the Existing Product MAA Approval or the cancellation, withdrawal or amendment of the Existing Product MAA Approval, in each case which is the result of NGX’s breach of its obligations under Sections 6.1, 6.3.1, 6.3.2 or 6.4

16.5 Insurance

Each Party shall secure and maintain in effect during the term of this Agreement and for a period of [***] thereafter (a) commercial general liability insurance with a minimum coverage of [***] per occurrence and annual aggregate, (b) product liability insurance with a minimum coverage of [***] per occurrence and annual aggregate, and (c) clinical trial insurance with limits as required by local laws and regulations or, in the absence of such requirements, standard and customary in the relevant country, underwritten by a reputable insurance company in a form standard and customary for entities in the pharmaceutical industry for exposures related to this Agreement. Upon request by the other Party hereto, certificates of insurance evidencing the coverage required above shall be provided to the other Party.

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17. TERM AND TERMINATION

17.1 Term

This Agreement shall become effective as of the Effective Date and, unless earlier terminated pursuant to the other provisions of this Section 17 or Section 8.7 above, shall continue on a country-by-country and Product-by-Product basis, until the later of (a) ten (10) years after the First Commercial Sale thereof in the respective country, (b) the expiration or abandonment of the last Valid Patent Claim covering the respective Product in the respective country and (c) the expiration of all applicable periods of regulatory exclusivity (e.g., regulatory data exclusivity) covering the respective Product in the respective country.

17.2 Termination By Astellas

Astellas may terminate this Agreement for any reason under this Section 17.2 without any penalty, consequence, termination compensation, loss of profits, goodwill indemnity or otherwise solely by reason of such termination (i.e., without prejudice to any remedies NGX may have for a breach of this Agreement by Astellas prior to such termination), as a whole, or with respect to the European Region, or on a country-by-country basis with respect to countries in the Territory (other than those countries comprising the European Region) and a Product-by-Product basis, in each case upon written notice to NGX.

17.3 Termination for Material Breach

Without limiting either Party’s ability to terminate in accordance with the other provisions of this Agreement, in the event of a Party’s material breach of this Agreement, the non-breaching Party shall have the right to provide notice of its intention to terminate this Agreement. Such notice shall specify in reasonable detail the facts and circumstances constituting the material breach of this Agreement. Upon the expiration of [***] after receipt by the breaching Party of such notice, if the breaching Party has not cured such material breach, the non-breaching Party shall have the right to terminate this Agreement in whole by giving a notice of termination, which shall be effective on the date such notice is given.

17.4 Termination for Insolvency

Either Party may terminate this Agreement upon written notice to other Party at any time, to the extent permitted by applicable law, if the other Party shall become insolvent, or shall make or seek to make or arrange an assignment for the benefit of creditors, or if proceedings in voluntary or involuntary bankruptcy shall be initiated by, on behalf of or against such Party (and, in the case of any such involuntary proceeding, not dismissed within [***]), or if a receiver or trustee of such Party’s property shall be appointed and not discharged within [***].

17.5 [***]

NGX may terminate this Agreement in whole or in part (on a country-by-country basis) at any time upon [***] prior written notice to Astellas in the event Astellas breaches Section 2.7.1 of this Agreement. Notwithstanding the foregoing, in the event that upon notice from NGX that Astellas is in breach of Section 2.7.1 (solely for the first such breach), Astellas ceases to [***], NGX’s right to terminate this Agreement shall cease.

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FINANCING AGREEMENT Dated as of April 29, 2010 between NEUROGESX, INC. and COWEN HEALTHCARE ROYALTY PARTNERS, L.P.