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SUBSEQUENT EVENTS

Collaboration, License and Option Agreement with Aurigene Discovery Technologies, Ltd.

In January 2015, the Company entered into an exclusive collaboration agreement focused on immuno-oncology and selected precision oncology targets with Aurigene Discovery Technologies, Ltd., or Aurigene. The collaboration provides for inclusion of multiple programs, with the Company having the option to exclusively license compounds once a development candidate is nominated within each respective program. The partnership draws from each company’s respective areas of expertise, with Aurigene having the responsibility for conducting all discovery and preclinical activities, including IND-enabling studies and providing Phase 1 clinical trial supply, and the Company having responsibility for all clinical development, regulatory and commercialization efforts worldwide, excluding India and Russia, for each program for which it exercises an option to obtain a license.

The first two programs under the collaboration are an orally-available small molecule antagonist of programmed death ligand-1 (PD-L1) in the immuno-oncology field and an orally-available small molecule inhibitor of Interleukin-1 receptor-associated kinase 4 (IRAK4) in the precision oncology field. The agreement provides that the parties will collaborate exclusively in immuno-oncology for an initial period of approximately two years, with the option for the Company to extend the broad immuno-oncology exclusivity.

In connection with the transaction, the Company issued to Aurigene approximately 17,120,131 shares of its common stock, or 19.9% of its outstanding common stock immediately prior to the transaction, in partial consideration for the rights granted to Curis under the collaboration agreement. The shares issued to Aurigene are subject to a lock-up agreement until January 18, 2017, with a portion of the shares being released from the lock-up in four equal bi-annual installments between now and that date.

In addition, the Company has agreed to make payments to Aurigene as follows:

•

for the first two programs: up to $52.5 million per program, including $42.5 million per program for approval and commercial milestones, plus specified approval milestone payments for additional indications, if any;

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for the third and fourth programs: up to $50 million per program, including $42.5 million per program for approval and commercial milestones, plus specified approval milestone payments for additional indications, if any; and

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for any program thereafter: up to $140.5 million per program, including $87.5 million per program in approval and commercial milestones, plus specified approval milestone payments for additional indications, if any.

The Company has agreed to pay Aurigene royalties on any net sales ranging from high single digits to 10% in territories where it successfully commercializes products and will also share in amounts that it receives from sublicensees depending upon the stage of development of the respective molecule.

Termination and Transition Agreement with Debiopharm

On February 6, 2015, the Company entered into a termination and transition agreement with Debiopharm International S.A., or Debiopharm to terminate the August 5, 2009 license agreement between the Company and Debiopharm, under which the Company granted Debiopharm an exclusive, worldwide license to Debio 0932, a small molecule inhibitor of heat shock protein 90, or HSP90, as amended. The transition agreement is effective as of February 5, 2015.

Under the terms of the termination and transition agreement, the licenses and all other rights granted by the Company related to Debio 0932 have been terminated and reverted to the Company effective as of the termination date. Debiopharm ceased enrollment in all clinical trials as of the termination date. In addition, the Company exercised its right, pursuant to the license agreement, to obtain a non-exclusive, worldwide, royalty-bearing license, with the right to sublicense, under intellectual property rights of Debiopharm to develop, make, have made, use, sell, offer for sale, have sold and import Debio 0932 and any product containing Debio 0932, and Debiopharm will transfer to the Company the U.S. investigational new drug application related to Debio 0932. Debiopharm also assigned its sole patent application related to Debio 0932 to the Company.

Under the terms of the transition agreement, Debiopharm will transition ongoing Debio 0932 development and manufacturing activities to the Company and will transfer the manufacturing technology necessary for the manufacture of Debio 0932 and all data generated by or on behalf of Debiopharm relating to Debio 0932 to the Company.

The Company has agreed to make the following payments to Debiopharm under the terms of the termination and transition agreement:

Up-front drug product payment. The Company has agreed to pay $750,000 within fifteen (15) days of the termination date, primarily in consideration for Debiopharm providing Debio 0932 drug product for use in the Company’s future clinical studies.

Milestone payments. The Company has agreed to make each of the following one-time payments to Debiopharm:

(i)

$3,000,000 within 30 days after the first dosing of the first patient in the first Phase 3 clinical trial of Debio 0932; and

(ii)

$10,000,000 within 30 days after receipt of the first marketing approval for Debio 0932 in the United States of America or any specified major European market (whichever occurs first);

Royalties on the Company’s net sales. The Company has agreed to pay to Debiopharm royalties at a rate of 3% of net sales by the Company (excluding sales by the Company’s third party sublicensees) of products containing Debio 0932.

Amounts that the Company receives from sublicensees. The Company has agreed to pay to Debiopharm the following percentages of amounts that the Company receives from third party sublicensees;

(i)

10% of any royalties that the Company receives from third party sublicensees based on such sublicensees’ net sales of products containing Debio 0932; and

(ii)

15% of any non-royalty sublicense payments that the Company receives from third party sublicensees, provided that the maximum aggregate amount payable by the Company to Debiopharm with respect to non-royalty sublicense payments is $20,000,000, unless such sublicense payments are attributable to the Company’s grant to a third party sublicensee of a license or sublicense to develop or commercialize a topical formulation of Debio 0932 for local, non-systemic delivery for the treatment of psoriasis, in which case there is no such maximum aggregate.