EXECUTION VERSION

Exhibit 10.1

Certain portions of this exhibit, marked by [***], have been excluded because they are both not material and are the type that the registrant treats as private or confidential.

Collaboration and License Agreement

between

Ionis Pharmaceuticals, Inc.

and

Novartis Pharma AG

COLLABORATION AND LICENSE AGREEMENT

This COLLABORATION AND LICENSE AGREEMENT (the “Agreement”) is entered into as of August 2, 2023 (the “Execution Date”) by and between Ionis Pharmaceuticals, Inc., a Delaware corporation, having its principal place of business at 2855 Gazelle Court, Carlsbad CA 92010 USA (“Ionis”), and Novartis Pharma AG, a company organized under the laws of Switzerland, having its principal place of business at Lichtstrasse 35, CH-4056 Basel, Switzerland (“Novartis”). Novartis and Ionis each may be referred to herein individually as a “Party” or collectively as the “Parties.” Capitalized terms used in this Agreement, whether used in the singular or the plural, have the meaning set forth in Appendix 1. All attached appendices, schedules, and exhibits are a part of this Agreement.

RECITALS

WHEREAS, Ionis possesses certain Patent Rights, Know-How, technology and expertise with respect to RNA-targeted antisense drugs, and has novel and valuable capabilities for the research, discovery, identification, development and synthesis of antisense drugs;

WHEREAS, Novartis has expertise in globally researching, developing and commercializing human therapeutics and, in particular, cardio-metabolic lipid drugs;

WHEREAS, the Parties are interested in entering into a collaboration to discover and develop [***] products targeting the RNA encoding APO(a); and

WHEREAS, Novartis desires to receive from Ionis, and Ionis desires to grant to Novartis, an exclusive worldwide license under this Agreement to research, develop, manufacture, and commercialize the Licensed Products under the terms and conditions set forth herein.

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

ARTICLE 1

OVERVIEW

The Parties intend that under this Agreement: the Parties will (a) conduct a research collaboration pursuant to the Research Plan and, under the Research Plan, conduct Research to identify one or more Compounds using Oligonucleotide technology, which may include [***] chemistry, in each case, with the goal of achieving [***] and (b) designate one or more Development Candidates through the JRC and JSC. Following designation of a Development Candidate, as between the Parties, Novartis will be responsible for conducting IND-Enabling Toxicology Studies and all further Development activities for such Development Candidate, at Novartis’ cost. Furthermore, following designation of the applicable Development Candidate, Novartis will have the right to Develop Licensed Products containing such Development Candidate under this Agreement and will be responsible for all Development and Commercialization activities for such Licensed Product, at Novartis’ cost. The purpose of this Article 1 (Overview) is to provide a high-level overview of the roles and responsibilities and rights and obligations of each Party under this Agreement, and therefore this Article 1 (Overview) is not binding on either Party and is qualified in its entirety by the more detailed provisions of this Agreement set forth below.

ARTICLE 2

RESEARCH PROGRAM

2.1. Research Responsibilities and Research Plan.

2.1.1. Research Plan. Prior to the Execution Date, the Parties have agreed upon an initial research plan to identify one or more Development Candidates and to complete IND-Enabling Toxicology Studies for such Development Candidate(s), which initial research plan is attached hereto as Schedule 2.1.1 (Research Plan) (such research plan, as it may be updated in accordance with the terms and conditions of this Agreement, the “Research Plan” and the activities to be performed by the Parties thereunder, the “Research Activities”). The initial Research Plan includes: (a) all Research and Development activities to be performed by each Party through Completion of IND-Enabling Toxicology Studies for the Development Candidates, (b) the criteria for considering one or more Compounds as Development Candidates set forth in Table 4 thereof (such criteria, the “Development Candidate Criteria”), (c) the allocation of responsibilities between the Parties (which allocation will be consistent with Section 2.1.2 (Allocation of Research Activities)) for all Research Activities, (d) the estimated timelines for all Research Activities, and (e) the initial toxicology and study designs for the Licensed Product.

2.1.2. Allocation of Research Activities. The Research Plan will include the allocation of responsibilities between the Parties for all Research Activities. Unless otherwise mutually agreed by the Parties and set forth in the Research Plan, the Research Plan will provide that: (a) Ionis will be primarily responsible for all Research Activities to identify the Compounds for the Development Candidate selection process pursuant to Section 2.2 (Development Candidate Selection Process) and (b) Novartis will be responsible for any IND-Enabling Toxicology Studies under the Research Plan.

2.1.3. Updates to the Research Plan. At least [***] during the Research Term, or upon either Party’s request, the JRC will develop, discuss and determine whether to recommend to the JSC any updates to the Research Plan and the JSC will review, discuss, and determine whether to approve any such recommended updates to the Research Plan. Each such update to the Research Plan will become effective and will supersede the previous Research Plan upon approval thereof by the JSC.

2.2. Development Candidate Selection Process.

2.2.1. Licensed Compounds; Proposed Development Candidates. During the Research Term, as part of each Research Report to be submitted to the JRC, each Party will [***] by it as part of the Research Activities conducted by or on behalf of such Party during the most recently completed Calendar Quarter ([***] Compounds identified or evaluated under the Research Activities, collectively, the “Compound Pool” and each Compound in the Compound Pool, a “Licensed Compound”). In addition, at either Party’s request no more than [***], the other Party will provide a reasonably detailed summary of available data with respect to all Licensed Compounds that have been identified or evaluated in [***] as part of the Research Activities conducted by such Party since the last such summary, including, to the extent available, information and data that is sufficiently detailed for the JRC to assess whether such Licensed Compounds satisfy the Development Candidate Criteria. For each Licensed Compound that a Party identifies or evaluates during the Research Term and reasonably believes satisfies the Development Candidate Criteria, such Party will, in addition to any Research Report required pursuant to Section 2.10.2 (Research Reports), submit a Development Candidate Data Package to the JRC for review and discussion in order to determine whether to recommend to the JSC that such Licensed Compound be designated by the JSC as a Development Candidate. If a Party reasonably believes that a Licensed Compound identified or evaluated by the other Party satisfies the Development Candidate Criteria but the evaluating Party did not provide a Development Candidate Data Package for such Licensed Compound, then, at such Party’s request during the Research Term, the Party that identified or evaluated such Licensed Compound will submit a Development Candidate Data Package with the information and data that is already in such identifying or evaluating Party’s possession to the JRC for review and discussion in order to determine whether to recommend to the JSC that such Licensed Compound be designated by the JSC as a Development Candidate. Any Licensed Compound recommended to the JSC by the JRC in accordance with this Section 2.2.1 (Development Candidate Data Packages) will be a “Proposed Development Candidate”.

2.2.2. Carryover Period. If the JSC does not designate at least one Proposed Development Candidate as a Development Candidate during the Research Term, then for the period beginning upon the expiration of the Research Term and ending on the [***] such expiration (such period, the “Carryover Period”), [***] will have the right, but not the obligation, to conduct further Research with respect to the Licensed Compounds or any additional Compounds in order to identify potential Development Candidates pursuant to the terms of this Agreement. During the Carryover Period, if [***] identifies or evaluates a Compound (whether a Licensed Compound or a Compound that is first identified or evaluated after the end of the Research Term) that it reasonably believes satisfies the Development Candidate Criteria (each such Compound, a “Carryover Candidate”), then (a) if not already a Licensed Compound, such Carryover Candidate shall be considered a Licensed Compound and be included in the Compound Pool and (b) [***] shall provide to the JSC a Development Candidate Data Package for such Carryover Candidate for the JSC to review, discuss, and determine whether to designate such Carryover Candidate as a Development Candidate pursuant to Section 2.2.4 (Development Candidate Selection Process).

2.2.3. Novartis Proposed Development Candidate. At any time after [***] until [***], if Novartis reasonably believes that any Licensed Compound that was not a Proposed Development Candidate or a Carryover Candidate satisfies the Development Candidate Criteria (such Compound, a “Novartis Proposed Development Candidate”), then Novartis may provide to the JSC a Development Candidate Data Package for such Novartis Proposed Development Candidate for the JSC to review, discuss, and determine whether to designate such Novartis Proposed Development Candidate as a Development Candidate pursuant to Section 2.2.4 (Development Candidate Selection Process).

2.2.4. Development Candidate Selection Process.

(a) Upon the JRC’s receipt of a Development Candidate Data Package for a Licensed Compound, the JRC will review and discuss such Development Candidate Data Package and determine whether to submit such Development Candidate Data Package to the JSC for the JSC to determine whether to designate the applicable Proposed Development Candidate as a Development Candidate.

(b) After the JSC’s receipt of (i) a Development Candidate Data Package for a Proposed Development Candidate from the JRC, (ii) a Development Candidate Data Package for a Carryover Candidate [***] such Carryover Candidate, or (iii) a Development Candidate Data Package for a Novartis Proposed Development Candidate from Novartis, the JSC will review and discuss such Development Candidate Data Package and determine whether to designate such Proposed Development Candidate, Carryover Candidate, or Novartis Proposed Development Candidate as a Development Candidate.

(c) Upon the JSC’s designation of any Proposed Development Candidate, Carryover Candidate, or Novartis Proposed Development Candidate as a Development Candidate pursuant to this Section 2.2.4 (Development Candidate Selection Process) and in accordance with Section 3.3 (Decision Making) (the date of such designation, the “DC Selection Date”), (i) Novartis shall make the payment under Section 7.2 (Payments for Development Activities), if [***] under Section 7.2 (Payments for Development Activities), and (ii) as between the Parties, Novartis will be responsible for further Research and Development, including initiating IND-Enabling Toxicology Studies, on such Development Candidate (in the case of a Proposed Development Candidate, in accordance with the Research Plan).

2.3. Research Term. The Parties’ obligations to perform the Research Activities will commence on the Effective Date and continue until the earlier of (a) Completion of the IND-Enabling Toxicology Studies identified in the then-current Research Plan and (b) [***] (such period, the “Research Term”). At the end of the Research Term, unless otherwise agreed in writing by the Parties, neither Ionis nor Novartis will have an obligation to perform any additional Research Activities.

2.4. Research Costs. Except as otherwise agreed by the Parties, each Party will be responsible for all costs and expenses incurred by such Party in the performance of Research Activities allocated to such Party under the Research Plan, including, with respect to Novartis, any IND-Enabling Toxicology Study; provided that if Novartis requests any changes to the Research Activities allocated to Ionis that would increase Ionis’ FTE Costs or Out-of-Pocket Costs compared with the then-current Research Plan, and the JSC approves an amendment to the Research Plan to reflect such change in accordance with Section 3.3 (Decision Making) (such activities that would increase Ionis’ FTE Costs or Out-of-Pocket Costs compared with the then-current Research Plan, “Additional Ionis Research Activities”), then Novartis will reimburse Ionis for any Material Research Costs incurred by Ionis in conducting such Additional Ionis Research Activities within [***] from the date an Invoice is received by Ionis for such FTE Costs and Out-of-Pocket Costs, except to the extent Novartis disputes such Invoice in good faith (in which case such disputed amount will be paid after resolution of such dispute).

2.5. Clinical Development Plan. Within [***] after the DC Selection Date for a Development Candidate, Novartis will provide the JSC with a [***] clinical development plan for such Development Candidate (or, if there is an existing development plan for a Development Candidate, modify such development plan to incorporate such additional Development Candidate) through [***] for such Development Candidate (such plan the “Clinical Development Plan”) for the JSC to review and discuss. The initial draft of the Clinical Development Plan will include the level of detail that Novartis includes for similarly situated partnered-programs. Thereafter, Novartis will review and update the Clinical Development Plan every [***] and, if requested by Ionis following receipt of any such update, the Parties will meet (in person or virtually) to review such update, which meeting may be held as part of a JSC meeting if the JSC is still in existence. The Parties will mutually determine the location of such meetings. Each Party will be responsible for the costs of its own representatives attending such meetings.

2.6. IND-Enabling Toxicology Studies. For each Development Candidate, at least [***] before an IND is filed by or on behalf of Novartis with respect to such Development Candidate or earlier if available and upon Ionis’ reasonable request, Novartis will provide Ionis with a Draft Report from an IND-Enabling Toxicology Study for such Development Candidate for Ionis to review. Upon Ionis’ reasonable request, the JSC (or, if the JSC has been discontinued, the Parties) will promptly convene a meeting to discuss [***] any comments or concerns raised by Ionis with respect to such Draft Report, which meeting will be convened prior to Novartis filing an IND for such Development Candidate.

2.7. Manufacturing and Supply.

2.7.1. Responsibility During the Research Term. During the Research Term, Ionis will be responsible for Manufacturing and supplying, at [***] expense, any non-GMP API that is reasonably required to conduct any Research Activities; provided that Novartis may assume responsibility for Manufacturing and supplying, at [***] expense, any such non-GMP API by providing written notice to Ionis. If Novartis elects to assume such Manufacturing responsibility, then Ionis will (a) provide any assistance that is reasonably requested by Novartis to facilitate Novartis’ ability to Manufacture such non-GMP API and (b) if such non-GMP API requires a Manufacturing process that Novartis does not at such time possess, then the Parties will establish and approve a plan pursuant to which Ionis will perform a technology transfer to Novartis of all Ionis Manufacturing and Analytical Know-How in Ionis’ possession that is necessary to Manufacture such non-GMP API solely for use by Novartis, its Affiliates, or a Third Party as permitted under Section 5.3 (Sublicense Rights) in accordance with the licenses granted by Ionis to Novartis pursuant to Section 5.1.1 (License for Research Activities). Novartis will compensate Ionis in accordance with Section 7.10 (Reimbursement for Ionis’ Time) for any technology transfer assistance provided by Ionis under this Section 2.7.1 (Responsibility During the Research Term).

2.7.2. Responsibility After the Research Term. In addition, if the Parties mutually agree, then Ionis will be responsible for Manufacturing and supplying additional batches of API for use after the Research Term pursuant to a supply agreement between the Parties that is negotiated in good faith and on commercially reasonable terms, including that Novartis will pay for any such API at a price equal to [***]. Except as set forth in this Section 2.7 (Manufacturing and Supply), as between the Parties, Novartis will be responsible for supplying all API and Finished Drug Product in connection with its Development and Commercialization activities under this Agreement.

2.8. Materials Transfer. To facilitate the activities under the Research Plan, each Party shall provide to the other such materials in such quantities as are specified in the Research Plan and, in addition, either Party may provide to the other Party certain materials for use by the other Party in furtherance of the conduct of the activities under the Research Plan. All such materials will be used by the receiving Party in accordance with the terms and conditions of this Agreement solely for purposes of exercising its rights and performing its obligations under this Agreement, and the receiving Party will not transfer such materials to any Third Party unless expressly contemplated by this Agreement or upon the written consent of the supplying Party. THE MATERIALS ARE PROVIDED “AS IS” AND WITHOUT ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE OR ANY WARRANTY THAT THE USE OF THE MATERIALS WILL NOT INFRINGE OR VIOLATE ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.

2.9. Conduct of Research Activities. Each Party will conduct and use Commercially Reasonable Efforts to complete the Research Activities allocated to it under the Research Plan. Each Party will, and will require its Affiliates and subcontractors to, perform its obligations under the Research Plan in compliance with Applicable Law.

2.10. Research Records and Reports.

2.10.1. Records. Each Party will maintain, and require its Affiliates and subcontractors to maintain, consistent with its internal policies and Applicable Law, for at least seven years, records and laboratory notebooks, inventory, purchase and invoice records and Manufacturing records, in each case, with respect to the Research Activities and the Licensed Products in sufficient detail and in a good scientific manner appropriate for (a) inclusion in filings with Regulatory Authorities for such Licensed Products and (b) obtaining and maintaining intellectual property rights and protections, including Patent Rights for such Licensed Products. Such records and laboratory notebooks will be complete and accurate in all material respects and will fully and properly reflect all work done, data and developments made, and results achieved. Each Party will allow the other Party, to the extent necessary for such regulatory or intellectual property protection purposes, to inspect or copy such records, subject to reasonable redaction of such Party’s Confidential Information to the extent not relevant to the activities under this Agreement.

2.10.2. Research Reports. During the Research Term, in advance of each meeting of the JRC (unless otherwise agreed by the JRC), each Party will submit to the JRC for its review and discussion written materials that include a reasonably detailed summary of the Research Activities performed by or on behalf of such Party during the most recently completed Calendar Quarter and the results of such Research Activities as well as the information and data specified in Section 2.2 (Development Candidate Selection Process) (each, a “Research Report”).

ARTICLE 3

COLLABORATION MANAGEMENT

3.1.

Joint Steering Committee.

3.1.1. Establishment; Meetings. Within [***] after the Effective Date, the Parties will establish a joint steering committee (“JSC”), which JSC will coordinate, oversee and monitor the Parties’ activities hereunder in accordance with this Section 3.1 (Joint Steering Committee). The JSC will consist of [***] representatives appointed by Ionis and [***] representatives appointed by Novartis (which may include representative(s) from each Party’s Affiliates), and each JSC member will be a senior executive of such Party (or its Affiliate). Each Party will designate one of its representatives who is empowered by such Party to make decisions related to the performance of such Party’s obligations under this Agreement to act as the co-chair of the JSC. Unless otherwise agreed by the Parties, the JSC will meet in person, by videoconference, or by teleconference at least [***] each Calendar Quarter during the Research Term, and upon Novartis’ request any time after the Research Term prior to [***] for the first Licensed Product if Novartis provides a Development Candidate Data Package for a Novartis Proposed Development Candidate in accordance with Section 2.2.3 (Novartis Proposed Development Candidate), provided that in case a Carryover Period applies, the JSC will meet during such Carryover Period to the extent required to review, discuss, and determine whether to designate any Carryover Candidate as a Development Candidate, in each case, on such dates and at such times and places as agreed to by the members of the JSC. The JSC will determine the JSC operating procedures at its first meeting, including the JSC’s policies for replacing JSC members, policies for participation by additional representatives or consultants invited to attend JSC meetings, and the location of meetings, which will be codified in the written minutes of the first JSC meeting. Each Party will be responsible for the costs and expenses of its own employees or consultants attending JSC meetings.

3.1.2. Responsibilities. The JSC will perform the following functions during the Research Term:

(a) oversee, review, monitor, and coordinate the Parties’ activities under this Agreement;

(b) review, discuss, and determine whether to approve any updates to the Research Plan as proposed by the JRC, as described in Section 2.1.3 (Updates to the Research Plan)

(c) review, discuss, and determine whether to designate any Proposed Development Candidate as a Development Candidate, as described in Section 2.2.4 (Development Candidate Selection Process);

(d) review and discuss the Clinical Development Plan, as described in Section 2.5 (Clinical Development Plan);

(e) at Ionis’ reasonable request, review and discuss a Draft Report for an IND-Enabling Toxicology Study, as described in Section 2.6 (IND-Enabling Toxicology Studies);

(f) oversee each Technology Transfer Plan, as described in Section 5.9.1 (Licensed Know-How – Generally);

(g) oversee each Manufacturing Technology Transfer Plan, as described in Section 5.9.2 (Ionis Manufacturing and Analytical Know-How) and, as applicable, Section 2.7.1 (Responsibility During the Research Term);

(h) review and discuss any safety concerns regarding the Licensed Compounds or Licensed Products raised by either Party;

(i) establish and oversee joint subcommittees, including the JRC, as it deems necessary or advisable to further the purpose of this Agreement;

(j) perform such other review and advisory responsibilities as may be assigned to the JSC by mutual agreement of the Parties pursuant to this Agreement; and

(k) resolve any disputes at the JRC or any other subcommittee.

Subject to Section 3.1.3 (Obligations to Participate in JSC) and Section 3.1.4 (Discontinuation of JSC), after the end of the Research Term, the JSC will perform the following functions:

(a)

review, discuss, and determine whether to designate any Carryover Candidate or Novartis Proposed Development Candidate as a Development Candidate, as described in Section 2.2.4 (Development Candidate Selection Process);

(b)

oversee each Technology Transfer Plan, as described in Section 5.9.1 (Licensed Know-How – Generally) with respect to any such Development Candidate; and

(c)

oversee each Manufacturing Technology Transfer Plan, as described in Section 5.9.2 (Ionis Manufacturing and Analytical Know-How) with respect to any such Development Candidate.

3.1.3. Obligation to Participate in JSC. Ionis’ obligation to participate in the JSC will terminate upon the JSC’s designation of the first Compound as a Development Candidate in accordance with Section 2.2.4 (Development Candidate Selection Process).

3.1.4. Discontinuation of JSC. The JSC shall continue to exist until the first to occur of (a) the Parties mutually agreeing to disband the JSC or (b) [***] for the first Licensed Product.

3.2. Joint Research Committee.

3.2.1. Establishment. Within [***] after the Effective Date, the Parties will establish a joint research committee (“JRC”), which JRC will coordinate, oversee, and monitor the Parties’ activities hereunder in accordance with this Section 3.2 (Joint Research Committee). The JRC will comprise an equal number of at most [***] members from each Party. The JRC will meet as often as agreed by them (and at least on [***] basis during the Research Term), to discuss matters arising out of the activities set forth in this Section 3.2 (Joint Research Committee). The JRC will determine the JRC operating procedures at its first meeting, including the JRC’s policies for replacement of JRC members, and the location of meetings, which will be codified in the written minutes of the first JRC meeting. The Parties may escalate issues to the JSC for input and resolution. Each Party’s representatives on the JRC will consider comments and suggestions made by the other in good faith. Each Party will bear their own cost of participation on the JRC.

3.2.2. Responsibilities. The JRC will perform the following functions during the Research Term:

(a) review and discuss the Research Reports and any Development Candidate Data Package submitted to it by a Party;

(b) coordinate the Research Activities and facilitate communications between the Parties with respect to the Research Activities;

(c) prepare and submit any updates to the Research Plan to the JSC for the JSC to review, discuss, and determine whether to approve;

(d) discuss each Party’s performance under the Research Plan and the anticipated timeline for initiating and completing the activities set forth therein;

(e) (i) review, discuss, and determine whether any Compounds satisfy the Development Candidate Criteria, (ii) review, discuss, and determine whether to submit a Development Candidate Data Package to the JSC for the JSC to consider designating such Compound as a Development Candidate, and (iii) recommend Proposed Development Candidate(s), if any, for the JSC’s designation as Development Candidate(s); and

(f) perform such other functions as may be appropriate to further the purposes of this Agreement with respect to the research of the Licensed Products, as directed by the JSC.

3.2.3. Discontinuation of JRC. The JRC shall continue to exist until the first to occur of (a) the Parties mutually agreeing to disband the JRC or (b) the end of the Research Term.

3.3. Decision Making.

3.3.1. Committee Decisions. Each Party’s representatives on the JSC and the JRC will, collectively, have one vote (the “Party Vote”) on all matters brought before the JSC or JRC for a decision by consensus. Except as otherwise expressly set forth in this Agreement, the phrase “determine,” “designate,” “confirm,” “approve,” or “determine whether to approve” by the JSC or JRC and similar phrases used in this Agreement will mean approval in accordance with this Section 3.3 (Decision Making). The JSC and JRC will make decisions as to matters within their jurisdiction by unanimous Party Vote, which Party Vote may either be reflected in the minutes of the committee meeting or by an action by written consent signed by a representative of each Party. No vote will be binding on either Party unless each Party has at least one representative in attendance.

3.3.2. Scope of Committee Authority. For the avoidance of doubt, matters that are specified in this Article 3 (Collaboration Management) only to be reviewed and discussed (as opposed to reviewed, discussed, and approved) or where a committee is to oversee certain activities do not require any agreement or decision by either Party and are not subject to the voting and decision-making procedures set forth in this Section 3.3 (Decision Making).

3.3.3. Escalation. If the JRC is unable to reach agreement as to a particular matter within its jurisdiction within [***] (or a later date mutually agreed to by the Parties) after such matter has been brought to the JRC for resolution, then such disagreement will be referred to the JSC for resolution. If the representatives of Novartis and Ionis are unable to agree on or resolve any matter requiring the approval of the JSC (including any disagreements referred from the JRC to the JSC) after the use of good faith efforts, then, at the election of either Party, such Party may refer such matter to the Party’s respective Executives. The Executives will use good faith efforts to resolve any such disagreement so referred to them as soon as practicable, and any final decision that the Executives agree to in writing will be conclusive and binding on the Parties. If the Executives are unable to resolve any disagreement so referred within a period of [***] after such matter is referred to them (or such longer period as the Executives may agree upon), then:

(a) Novartis Final Decision-Making Authority. Except for the matters set out in Section 3.3.3(b) (Ionis Final Decision-Making Authority), Novartis will have the right to make the final decision regarding [***], provided, however, that:

(i)

[***];

(ii)

[***];

(iii)

[***]; and

(iv)

[***].

(b) Ionis Final Decision-Making Authority. Ionis will have the right to make the final decision regarding [***].

3.4. Day-to-Day Responsibilities. Each Party will: (a) be responsible for day-to-day implementation and conduct of the activities hereunder for which it has or is otherwise assigned responsibility under this Agreement, provided that such implementation is consistent with the express terms of this Agreement and the decisions of the JSC that are within the scope of its authority as provided herein; and (b) provide the other Party with information about material events related to the progress of such activities, as may be reasonably requested by the other Party from time to time.

3.5. Limitations on Authority. Each Party shall retain the rights, powers, and discretion granted to it under this Agreement and no such rights, powers, or discretion shall be delegated to or vested in the JSC or JRC unless such delegation or vesting of rights is expressly provided for in this Agreement or the Parties expressly so agree in writing. The JSC and JRC shall not have the power to: (a) amend, modify, or waive compliance with this Agreement or any term or condition of this Agreement; (b) make any determination that any Party is in breach of this Agreement, (c) impose additional material financial obligations on a Party beyond those provided in this Agreement, or (d) make any decisions in a manner that would require a Party to perform any act that would cause such Party to violate any Applicable Law or the requirements of any Regulatory Authority, or otherwise breach any of its obligations hereunder.

3.6. Alliance Managers. Each Party shall appoint a representative to act as its alliance manager under this Agreement (each, an “Alliance Manager”). The Alliance Managers shall be responsible for: (a) facilitating the flow of information and otherwise promoting communication, coordination, and collaboration between the Parties under this Agreement, (b) providing support and guidance to the JSC and the JRC, (c) developing a mutually agreed launch plan covering any activities and systems the Parties need to implement within 100 days after the Effective Date, (d) coordinating proper approval of press releases, publications, and public disclosures prior to submission in accordance with Section 12.4 (Press Release; Publications; Disclosure of Agreement), and (e) organizing JSC and JRC meetings, including agendas, drafting minutes, publishing final minutes and facilitating dispute resolution as necessary. The Alliance Managers shall have the right to attend all meetings of the JSC and the JRC as non-voting members, and shall bring matters to the attention of the relevant committee if the Alliance Manager reasonably believes that such matter warrants such attention. Each Party may replace its Alliance Manager at any time upon written notice to the other Party.

ARTICLE 4

EXCLUSIVITY

4.1. Exclusivity Covenants. Except as expressly set forth in this Article 4 (Exclusivity), neither Party nor its Affiliates will (independently or with a Third Party) Develop or Commercialize any Competitive Compound until the earlier of (a) [***] or (b) [***]. For clarity, the exclusivity obligations in this Section 4.1 (Exclusivity Covenants) will not survive expiration or termination of this Agreement.

4.2. Limitations and Exceptions to the Parties’ Exclusivity Covenants. Notwithstanding anything to the contrary in Section 4.1 (Exclusivity Covenants), either Party or its Affiliates may perform the following activities:

(a) With regard to such Party and its Affiliates:

(i) all activities permitted or contemplated under this Agreement, including Exploiting a Licensed Product in accordance with this Agreement and those activities contained in Section 4.3 (Acquisition of a Competitive Compound), Section 4.4 (Change of Control), and Section 4.5 (Effect of Exclusivity on Indications); and

(ii) all activities permitted or contemplated under the Akcea-Novartis Collaboration Agreement.

(b) With regard to Ionis and its Affiliates:

(i) activities conducted pursuant to the Prior Agreements [***] in Appendix 3 (License Conditions; Limitations); and

(ii) the granting of, or performance of obligations under, Permitted Licenses.

4.3. Acquisition of a Competitive Compound. The Parties acknowledge that after the Effective Date a Party or any of its Affiliates may in-license or otherwise acquire rights (including through any merger or business combination but excluding through a Change of Control Event) to Develop or Commercialize a Competitive Compound (such Competitive Compound, an “Acquired Compound”). In the case of such a transaction where a Party acquires rights to Develop or Commercialize an Acquired Compound and, on the date of closing of such transaction, such Acquired Compound is being Developed or Commercialized and such activities would violate Section 4.1 (Exclusivity Covenants), then, (a) such Party must notify the other Party within [***] of closing of such transaction and (b) notwithstanding anything to the contrary in this Agreement, within [***] after such acquisition (such period, the “Evaluation Period”), such Party (or its Affiliate) or such Third Party must (i) [***], or (ii) [***]. Novartis will have the right to extend the Evaluation Period for an additional [***] by providing written notice to Ionis prior to the expiration of the [***] period and paying Ionis a one-time fee of $[***]. Following receipt of such notice, Ionis will promptly provide Novartis with an Invoice for such fee and Novartis shall pay such fee within [***] after receipt by Novartis of such Invoice. [***]. During the period between the closing of a transaction to acquire rights to an Acquired Compound and the date that the applicable Party completes the steps set forth in clause (b)(i) or (b)(ii) above, such Party must (1) establish and enforce internal processes, policies, procedures and systems to segregate information relating to any such Acquired Compound from any Confidential Information related to the Development Candidates and Licensed Products under this Agreement, (2) not use, directly or indirectly, any Patent Rights, Know-How or Confidential Information licensed or acquired from the other Party under this Agreement in the Exploitation of such Acquired Compound, and (3) segregate all activities relating to the Acquired Compound from the Exploitation of the Development Candidates and Licensed Products under this Agreement.

4.4. Change of Control. If there is a Change of Control Event involving a Party (where such Party or its parent is the acquired entity), then the obligations of Section 4.1 (Exclusivity Covenants) will not apply to any product that (a) is controlled by the relevant acquirer or its Affiliates and (b) exists prior to the closing of such Change of Control Event or is subsequently developed by the relevant acquirer or any of its Affiliates existing immediately prior to the effective date of such Change of Control Event (such product, a “Competitive Product”); provided that (i) the acquired Party and the acquirer and its Affiliates existing immediately prior to the effective date of such Change of Control Event establish and enforce internal processes, policies, procedures and systems to segregate information relating to any such Competitive Product from any Confidential Information related to the Development Candidates and Licensed Products under this Agreement, (ii) the acquirer and its Affiliates existing immediately prior to the effective date of such Change of Control Event do not use, directly or indirectly, any Patent Rights, Know-How or Confidential Information of the acquired Party (including any Patent Rights, Know-How or Confidential Information licensed or acquired from the other Party under this Agreement) in the Exploitation of such Competitive Product, and (iii) the acquired Party and the acquirer will segregate all activities relating to the Competitive Product from the Exploitation of the Development Candidates and Licensed Products under this Agreement.

4.5. Effect of Exclusivity on Indications. While Ionis and Novartis are subject to certain restrictive covenants under Section 4.1 (Exclusivity Covenants), the Parties acknowledge and agree that, for clarity, each Party (on its own or with a Third Party) may continue to Develop and Commercialize any therapeutic compound that is designed to directly modulate a gene other than APO(a) for any indication, even if such therapeutic compound is designed to treat the same indication as a Licensed Product.

ARTICLE 5

LICENSE GRANTS; TECHNOLOGY TRANSFER AND SUPPORT

5.1. License Grants to Novartis.

5.1.1. License for Research Activities. Subject to the terms of this Agreement, Ionis hereby grants to Novartis a worldwide, non-exclusive, sublicensable (in accordance with Section 5.3 (Sublicense Rights)) license under (a) the Ionis Research Activities Technology and the Licensed Technology, in each case, to (i) during the Research Term, perform the Research Activities allocated to Novartis under the Research Plan, (ii) during the Carryover Period or during the period after [***] until [***], conduct Research to identify a Compound that satisfies the Development Candidate Criteria and (iii) conduct internal Research utilizing any Licensed Compound solely to the extent such Research is in connection with the Exploitation of a Licensed Product or the Licensed Compound included in such Licensed Product; provided that, for clarity, such license to conduct internal Research shall not include a license to Develop or Commercialize such Licensed Compound or any product containing such Licensed Compound and will not be sublicensable to any Third Parties, and (b) the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know-How to Manufacture non-GMP API for the Research Activities solely if Novartis elects to assume responsibility for Manufacturing and supplying such non-GMP API in accordance with Section 2.7 (Manufacturing and Supply).

5.1.2. Licensed Product License. Subject to the terms and conditions of this Agreement, including Section 5.11 (HSR Matters), on a Development Candidate-by-Development Candidate basis, effective upon the DC Selection Date for such Development Candidate in accordance with Section 2.2.4 (Development Candidate Selection Process), Ionis hereby grants to Novartis an exclusive (even as to Ionis), royalty-bearing, sublicensable (in accordance with Section 5.3 (Sublicense Rights)) license under the Licensed Technology to Exploit such Development Candidate and Licensed Products containing such Development Candidate in the Field in the Territory (such license, a “Licensed Product License”).

5.2. Research License Grant to Ionis. Subject to the terms of this Agreement, Novartis hereby grants to Ionis a worldwide, non-exclusive license, with the right to grant sublicenses only to its Affiliates and to subcontractors set forth in the Research Plan, under the Novartis Research Activities Technology to perform the Research Activities allocated to Ionis under the Research Plan or, as applicable, to conduct Research to identify a Compound that satisfies the Development Candidate Criteria during the Carryover Period.

5.3. Sublicense Rights. Novartis will have the right to grant sublicenses under the licenses granted to Novartis in Section 5.1 (License Grants to Novartis) as expressly permitted by this Section 5.3 (Sublicense Rights).

5.3.1. Right to Grant Sublicenses. Notwithstanding anything to the contrary but subject to this Section 5.3 (Sublicense Rights), Novartis will have the right to grant sublicenses (through multiple tiers) under the licenses granted under Section 5.1 (License Grants to Novartis) to its Affiliates and Third Parties, provided, that:

(a) any sublicense under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know-How shall be subject to Section 5.4.2 (Novartis’ CMOs); and

(b) any [***] shall require Ionis’ prior written consent (which consent will not be unreasonably withheld, conditioned or delayed).

5.3.2. Sublicensing Requirements. Each sublicense granted by either Party will be consistent with and subject to the applicable terms and conditions of this Agreement and the Party granting such sublicense will remain responsible to the other Party for the compliance of each such sublicensee with such terms and conditions. Novartis will, within [***] following the grant of a sublicense pursuant to Section 5.3.1 (Right to Grant Sublicenses) other than [***], notify Ionis of its grant of any sublicense pursuant to Section 5.3.1 (Right to Grant Sublicenses), including the identity of the relevant Sublicensee as well as a [***]. [***], Novartis will promptly provide Ionis with a true and complete copy of any sublicense agreement for, or that includes, such country that is (a) granted to a CMO under Section 5.4.2 (Novartis’ CMOs) or (b) for a grant of all or substantially all of Novartis’ or its Affiliates’ rights to Commercialize a Licensed Product in such country to a Third Party; provided, however, that Novartis will have the right to redact any financial terms and other technical or business information from such copy of the sublicense agreement if Novartis determines in good faith that such redactions are necessary to protect any of its or its Sublicensee’s confidential or proprietary information unrelated to Novartis’ obligations under this Agreement.

5.3.3. Enforcement of Sublicense Agreements. In the event of a material breach of any sublicense granted by Novartis pursuant to Section 5.3.1 (Right to Grant Sublicenses), [***], Novartis will inform Ionis promptly after becoming aware of such breach. If such breach is [***], then Ionis may request Novartis to enforce the terms of the breached provision(s) of such sublicense. If Novartis fails to take any action to enforce such terms within [***] after Ionis’ request, then, [***], Ionis may enforce such terms on Novartis’ behalf and, in such case, Novartis will cooperate with Ionis, upon Ionis’ reasonable request, in connection with enforcing such terms. Notwithstanding the foregoing, Ionis shall not have the right to amend or otherwise modify the terms of any such sublicense or impose any obligations on Novartis in connection with such enforcement. For clarity, this Section 5.3.3 (Enforcement of Sublicense Agreements) will not limit or modify Novartis’ obligation to remain responsible to Ionis for Novartis’ sublicensees’ compliance with the terms and conditions of this Agreement.

5.3.4. Effect of Termination on Sublicenses. If this Agreement terminates for any reason, any Sublicensee that has been granted a sublicense pursuant to Section 5.3.1 (Right to Grant Sublicenses), other than [***], and that is not, at the time of termination, in material breach of its sublicense agreement with Novartis, will, from the effective date of such termination, automatically become a direct licensee of Ionis with respect to the rights sublicensed to the Sublicensee by Novartis; so long as (a) such Sublicensee agrees in writing to comply with all of the terms of this Agreement to the extent applicable to the rights originally sublicensed to it by Novartis, (b) such Sublicensee agrees to pay directly to Ionis such Sublicensee’s payments under this Agreement to the extent applicable to the rights sublicensed to it by Novartis, and (c) in no event will Ionis have any greater obligations to any such Sublicensee than it has to Novartis under this Agreement. Upon Ionis’ written request after such termination of this Agreement, Novartis will [***] deliver to Ionis within [***] a copy of any such sublicense with such Sublicensee; provided that Novartis may redact any information in such sublicense that does not relate to the Licensed Products.

5.4. Subcontracting.

5.4.1. General. Subject to the terms of Section 5.2 (Research License Grant to Ionis), Section 5.3.1 (Right to Grant Sublicenses), and this Section 5.4 (Subcontracting), each Party will have the right to engage Third Party subcontractors to perform certain of its obligations under this Agreement. Any subcontractor to be engaged by a Party to perform a Party’s obligations set forth in this Agreement will meet the qualifications typically required by such Party for the performance of work similar in scope and complexity to the subcontracted activity and will be bound by written obligations of confidentiality and non-use consistent with this Agreement. Any Party engaging a subcontractor hereunder will remain responsible and obligated for such activities and will not grant rights to such subcontractor that interfere with the rights of the other Party under this Agreement. As between the Parties, each Party will be responsible for any income or non-income taxes that arise as a result of such Party’s use of any Third Party subcontractors hereunder, including payroll, income, withholding, sales and use, VAT, customs, duties excise or property taxes, and such taxes will not be reimbursable expenditures.

5.4.2. Novartis’ CMOs.

(a) Ionis agrees that, where Novartis wishes to (sub)contract with a Third Party to Manufacture API or Licensed Products in accordance with Section 5.3.1(a) (Right to Grant Sublicenses), Ionis will, within [***] of any request by Novartis, provide Novartis with a letter of authorization as necessary for Novartis to be able to contract with such Third Party in accordance with the terms of this Agreement if such Third Party already has a valid license granted by Ionis or its Affiliates; provided that if Ionis has not provided the necessary letter of authorization to Novartis within such [***] period, then the required authorization shall be deemed granted by Ionis. If such Third Party does not have a valid license under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know-How, then Ionis will, within [***] (or such other period as mutually agreed between the Parties) of any request by Novartis, grant such license to such Third Party to Manufacture API or Licensed Products in a manufacturing facility owned or operated by such Third Party on reasonable terms consistent with the terms of the relevant Prior Agreements with CMOs, provided that if Ionis has not granted the required license to the Third Party within such [***] period (or such other period as mutually agreed between the Parties), then [***].

(b) Ionis furthermore agrees to [***], grant such Third Party the required license [***] with respect to the Manufacture of API or Licensed Products for Novartis or its Affiliates or Sublicensees.

(c) Novartis will use Commercially Reasonable Efforts to ensure that any CMOs Novartis may use to conduct any such Manufacturing activities will be obligated to assign to Novartis all right, title, and interest in and to any inventions developed by such (sub)contractors in the performance of such activities. In addition, Novartis will [***]. [***] will have final decision-making authority with regard to the selection of CMOs (provided that such CMO is engaged in accordance with Section 5.3.1(a)(Right to Grant Sublicenses) and this Section 5.4 (Subcontracting)) and the terms of any such CMO Agreement.

5.5. Consequence of Natural Expiration of this Agreement. If this Agreement naturally expires in accordance with Section 11.1.1 (Agreement Term; Expiration) or Section 11.1.2 (Agreement Term; Expiration), then with respect to any Licensed Product that is the subject of such expiration for which Novartis has a license under Section 5.1.2 (Licensed Product License) at such time, Ionis grants to Novartis a perpetual, non-exclusive, worldwide, royalty-free and sublicensable (through multiple tiers) license under Ionis Manufacturing and Analytical Patents and the Licensed Know-How to Develop, Manufacture, have Manufactured and Commercialize such Licensed Product.

5.6. No Implied Licenses. All rights in and to Licensed Technology not expressly licensed to Novartis under this Agreement are hereby retained by Ionis and its Affiliates. All rights in and to Novartis Technology not expressly licensed to Ionis under this Agreement are hereby retained by Novartis and its Affiliates. Except as expressly provided in this Agreement, no Party will be deemed by estoppel or implication to have granted the other Party any license or other right with respect to any intellectual property.

5.7. License Conditions; Limitations. The licenses granted under Section 5.1 (License Grants to Novartis), and the sublicense rights under Section 5.3 (Sublicense Rights) are subject to (a) [***] the Prior Agreements disclosed in Appendix 3 (License Conditions; Limitations), (b) the Ionis In-License Agreements, and (c) in-licenses to [***] included in the license granted to Novartis under Section 5.1 (License Grants to Novartis) pursuant to Section 7.9.2 (New In-License Agreements).

5.8. Trademark and Domain Names.

5.8.1. As between the Parties, Novartis will be solely responsible for selecting, registering and maintaining the Trademarks used to Commercialize Licensed Products. As between the Parties, Novartis will own and control the Trademarks and pay all relevant costs related thereto.

5.8.2. As between the Parties, only Novartis will be authorized to initiate at its own discretion legal Proceedings against any infringement or threatened infringement of the Trademarks.

5.8.3. As between the Parties, Novartis will be responsible for registering, hosting, maintaining and defending the Domain Names under all generic Top Level Domains (gTLDs) and under all relevant country code Top Level Domains (ccTLD). For the avoidance of doubt, Novartis may register such Domain Names in its own name, to host on its own servers, maintain and defend the Domain Names and use them for websites.

5.9. Technology and Information Transfer.

5.9.1. Licensed Know-How – Generally. On a Development Candidate-by-Development Candidate basis, within [***] after the DC Selection Date for a Development Candidate, the Parties will establish and mutually agree on a plan ([***]) pursuant to which Ionis will perform a technology transfer to Novartis of all Licensed Know-How (other than the Ionis Manufacturing and Analytical Know-How) related to such Development Candidate to the extent that such Licensed Know-How is in Ionis’ possession and has not previously been provided hereunder and for use solely in accordance with the licenses granted by Ionis to Novartis hereunder (with respect to each Development Candidate, the “Technology Transfer Plan”). The Technology Transfer Plan for a Development Candidate will set forth the type, name and quantity of any Know-How transferred and the anticipated timelines for completing such transfer.

5.9.2. Ionis Manufacturing and Analytical Know-How. On a Development Candidate-by-Development Candidate basis, within [***] after the DC Selection Date for a Development Candidate, the Parties will establish and mutually agree on a plan ([***]) pursuant to which Ionis will perform a technology transfer to Novartis of all Ionis Manufacturing and Analytical Know-How related to such Development Candidate and in Ionis’ possession that has not previously been provided hereunder solely for use by Novartis, its Affiliates or a Third Party as permitted under Section 5.3 (Sublicense Rights) in accordance with the licenses granted by Ionis to Novartis hereunder (with respect to each Development Candidate, the “Manufacturing Technology Transfer Plan”). The Manufacturing Technology Transfer Plan for a Development Candidate will set forth the type, name and quantity of any Know-How transferred and the anticipated timelines for completing such transfer.

5.9.3. Ionis Assistance. If requested by Novartis, Ionis will provide Novartis with a timely and reasonable level of assistance and cooperation in connection with such Licensed Know-How under Section 5.9.1 (Licensed Know-How – Generally) and such Ionis Manufacturing and Analytical Know-How under Section 5.9.2 (Ionis Manufacturing and Analytical Know-How). Novartis will compensate Ionis in accordance with Section 7.10 (Reimbursement for Ionis’ Time), for Ionis’ and its Affiliates’ activities conducted under Section 5.9.1 (Licensed Know-How – Generally) and Section 5.9.2 (Ionis Manufacturing and Analytical Know-How).

5.10. Cross-Licenses under Program Technology.

5.10.1. Enabling Patent License from Novartis to Ionis. Subject to the terms and conditions of this Agreement (including Ionis’ exclusivity obligations under Section 4.1 (Exclusivity Covenants) and without limiting the license(s) granted to Novartis under Section 5.1 (License Grants to Novartis)), Novartis hereby grants Ionis a fully-paid, royalty-free, irrevocable, worldwide, non-exclusive, sublicensable (through multiple tiers) license under any Novartis Program Technology ([***]), to Develop, manufacture, have manufactured, and Commercialize products that include an Oligonucleotide as an active pharmaceutical ingredient (other than a Licensed Product that is being Developed or Commercialized by Novartis, its Affiliates or Sublicensees under this Agreement).

5.10.2. Enabling Patent License from Ionis to Novartis. Subject to the terms and conditions of this Agreement (including Novartis’ exclusivity obligations under Section 4.1 (Exclusivity Covenants) and without limiting the license(s) granted to Novartis under Section 5.1 (License Grants to Novartis)), Ionis hereby grants Novartis a fully-paid, royalty-free, irrevocable, worldwide, non-exclusive, sublicensable (through multiple tiers) license under any Ionis Program Technology (excluding any Product-Specific Patents) to the extent it was discovered, invented, or created during the Research Term to Develop, manufacture, have manufactured, and Commercialize products that do not include an Oligonucleotide as an active pharmaceutical ingredient; provided, however, if [***].

5.11. HSR Matters.

5.11.1. Effectiveness of the Agreement. Except for the Parties’ rights and obligations under this Section 5.11 (HSR Matters), Article 9 (Representations, Warranties and Covenants), Article 12 (Confidentiality), and Article 13 (Miscellaneous), which will be effective as of the Execution Date, this Agreement will not become effective until the applicable waiting period (and any extensions thereof, including any timing agreement entered into with the United States Federal Trade Commission (“FTC”) or the Antitrust Division of the United States Department of Justice (“DOJ”)) under the HSR Act shall have expired or terminated (the “Effective Date”). Novartis will provide written notice to Ionis of such Effective Date. As of the Effective Date, all other provisions of this Agreement will become effective automatically without the need for further action by the Parties. Notwithstanding any other provisions of this Agreement to the contrary, if the Effective Date has not occurred on or before the date that is [***] after the Execution Date (the “Outside Date”), then either Party, by written notice to the other, may terminate this Agreement, which will then become void and of no further effect as of such notice, provided that the Outside Date may be extended upon written notice from either Party to the other Party prior to the then-applicable Outside Date expiring up to [***] times for a period of [***] each if the Effective Date has not occurred within such [***] period or such initial [***] period, as applicable; provided that such requesting Party is not in material breach of its obligations under this Section 5.11 (HSR Matters).

5.11.2. HSR Filing.

(a) Ionis and Novartis will, as promptly as practicable (but no later than [***] after the Execution Date), prepare and file with the FTC and DOJ, the Notification and Report Form for Certain Mergers and Acquisitions (as that term is defined in the HSR Act) required for the transactions contemplated hereby, together with all required documentary attachments thereto (the “HSR Filings”). Notwithstanding the foregoing, the Parties may, upon mutual agreement, delay the filing of any of the HSR Filings if they reasonably believe that such delay would result in obtaining any clearance required under the HSR Act for the consummation of this Agreement and the transactions contemplated hereby more expeditiously. Each of Ionis and Novartis will cooperate in the antitrust clearance process, including by furnishing to each other’s counsel such necessary information and reasonable assistance as the other may reasonably request in connection with its preparation of any filing or submission that is necessary under the HSR Act and to furnish promptly with the FTC and DOJ any information reasonably requested by them in connection with such filings. Each Party will be responsible for its own fees, costs and expenses associated with any HSR Filings or in connection with its obligations pursuant to this Section 5.11.2 (HSR Filing).

(b) Ionis and Novartis will each use commercially reasonable efforts to promptly obtain the expiration or termination of the HSR waiting period as it relates to this Agreement and the transactions contemplated hereby and will keep each other apprised of the status of any communications with, and any inquiries or requests for additional information from, the FTC or DOJ and will comply promptly with any such inquiry or request. Commercially reasonable efforts as used in this Section 5.11.2 (HSR Filing) will not include, and will not require, proposing, negotiating, committing to or effecting, by consent decree, hold separate order, or otherwise, (i) the sale, divestiture, disposition, licensing or sublicensing of any of a Party’s or its Affiliates’ assets, properties or businesses, (ii) behavioral limitations, conduct restrictions or commitments with respect to such assets, properties or business, or of any of the rights or obligations of a Party under this Agreement, or (iii) defending through litigation any claim asserted in court by any Third Party that would restrain, prevent or delay the Effective Date.

(c) The Parties will instruct their respective counsel to cooperate with each other and use commercially reasonable efforts to facilitate and expedite the identification and resolution of any issues arising under the HSR Act at the earliest practicable dates. Such commercially reasonable efforts and cooperation include counsel’s undertaking to (i) keep each other informed of communications, inquiries and requests from and to personnel of the FTC or DOJ, including by providing copies thereof to the other Party (subject to reasonable redactions for privilege or confidentiality concerns), and (ii) confer with each other regarding appropriate contacts with and response to such personnel of the FTC or DOJ and the content of any such contacts or presentations. Each of Ionis and Novartis will consult with the other Party, to the extent practicable, in advance of participating in any substantive meeting or discussion with the FTC or DOJ with respect to any such filings, applications, investigation, or other inquiry and, to the extent permitted by the DOJ or FTC, give the other Party the opportunity to attend and participate in such meeting or discussion. Ionis and Novartis will each give the other Party the opportunity to review in advance, and will consider in good faith the other Party’s reasonable comments in connection with, the content of any presentations, white papers or other written materials to be submitted to the FTC or DOJ. Notwithstanding any of the preceding, the final determination as to the appropriate course of action shall be made by [***]. For clarity, the Parties’ rights and obligations hereunder apply only in so far as they relate to this Agreement and to the transactions contemplated under this Agreement.

(d) Prior to designating a Development Candidate, Novartis will determine whether HSR Filings or any other antitrust or merger control filings are required in connection with the grant of the Licensed Product License for such Development Candidate. If Novartis reasonably determines that an HSR Filing is required, Novartis shall notify Ionis thereof, and the Parties will comply with the provisions of this Section 5.11.2 (HSR Filing), which will apply mutatis mutandis with respect to such HSR Filing. If Novartis reasonably determines that any other antitrust or merger control filings or submissions are required in connection with the grant of such Licensed Product License, the Parties will cooperate to effect such filing or submission and use commercially reasonable efforts to cause such Licensed Product License to go into effect as expeditiously as possible. If HSR Filings or any other antitrust or merger control filings are required in connection with the grant of the Licensed Product License for a Development Candidate, the Licensed Product License for such Development Candidate will not be effective until the applicable waiting period (and any extensions thereof, including any timing agreement entered into with the FTC or the DOJ under the HSR Act) shall have expired or terminated.

ARTICLE 6

DEVELOPMENT, REGULATORY, AND COMMERCIALIZATION

6.1. Development. Subject to the terms and conditions of this Agreement, from and after the expiration of the Research Term, (a) as between the Parties, Novartis will have sole and exclusive control over the Development of any Licensed Products and (b) Novartis shall itself, or through its Affiliates or Sublicensees, use Commercially Reasonable Efforts to Develop and seek Regulatory Approval for [***]. For clarity, (i) Novartis’ application of Commercially Reasonable Efforts shall not require Novartis to [***] and (ii) such obligation to use Commercially Reasonable Efforts shall [***].

6.2. The Strategic Plan for Licensed Product(s).

6.2.1. Scope. Novartis will adopt a [***] global strategic development and commercialization plan to Develop and Commercialize the Licensed Products (the “Strategic Plan”). The Strategic Plan will cover both the long-term global strategy for each Licensed Product and, on a rolling [***] basis, the material Development and Commercialization activities Novartis plans to perform over the course of the next [***].

6.2.2. Initial Strategic Plan. Novartis will deliver the initial Strategic Plan for the Licensed Products to Ionis within [***] after expiration of the Research Term, or if a Development Candidate has not been designated at such time, within [***] following [***] for the first Development Candidate designated thereafter. Ionis may review and comment on such plan and Novartis will consider such comments in good faith.

6.2.3. Updating the Strategic Plan. Novartis will review and update the Strategic Plan every [***] and, if requested by Ionis following receipt of such update, the Parties will meet (in person or virtually) to review such update, which meeting may be held as part of a JSC meeting if the JSC is still in existence. The Parties will mutually determine the location of such meetings. Each Party will be responsible for the costs of its own representatives attending such meetings.

6.2.4. Ad Hoc Meetings. At either Party’s reasonable request, the Parties may as mutually agreed on an ad-hoc basis meet or hold a telephone conference to address any urgent matters that arise with respect to the Licensed Products.

6.3. Commercialization. As between the Parties, Novartis will be solely responsible for all aspects of Commercialization of the Licensed Products, including planning and implementation, distribution, booking of sales, and pricing and reimbursement. Novartis shall itself, or through its Affiliates or Sublicensees, use Commercially Reasonable Efforts to Commercialize [***]. For clarity, (i) Novartis’ application of Commercially Reasonable Efforts shall not require Novartis to [***] and (ii) such obligation to use Commercially Reasonable Efforts shall [***].

6.4. Regulatory Interactions.

6.4.1. Regulatory Responsibility; Major Regulatory Submissions. As between the Parties, Novartis will be responsible for (i) determining the regulatory plans and strategies for the Licensed Products, (ii) (either itself or through its Affiliates or Sublicensees) making all regulatory filings with respect to the Licensed Products, and (iii) obtaining and maintaining Regulatory Approvals in the name of Novartis or its Affiliates or Sublicensees. [***], Novartis will provide Ionis with any Major Regulatory Submissions to any Regulatory Authority in each Major Market for such Licensed Product in advance of providing such submission to the applicable Regulatory Authority for Ionis to provide any comments on the contents thereof. If Ionis does not provide comments within [***] from receipt (or shorter notice as reasonably indicated by Novartis), then Novartis will be entitled to submit such submissions. Novartis will consider in good faith any such comments provided on a timely basis by Ionis. [***], Novartis will also provide Ionis with a copy of all final Major Regulatory Submissions without undue delay after providing such submission to the relevant Regulatory Authority and all Major Regulatory Communications without undue delay after receiving such correspondence from a Regulatory Authority. For the avoidance of doubt, Ionis’ performance under this Section 6.4.1 (Regulatory Responsibilities; Major Regulatory Submissions) shall be at no cost to Novartis.

6.4.2. Ionis Cooperation. If requested by Novartis, Ionis shall cooperate with and provide reasonable assistance to Novartis in connection with filings or submission to any Regulatory Authority relating to the Licensed Products, including by executing any required documents, providing access to personnel and providing Novartis with copies of all reasonably required documentation and supporting data. Novartis will compensate Ionis in accordance with Section 7.10 (Invoices) for Ionis’ and its Affiliates’ activities conducted under this Section 6.4.2 (Ionis Cooperation). To the extent required to submit a regulatory filing or submission to a Regulatory Authority, Ionis shall grant or cause to be granted to Novartis and its Affiliates or Sublicensees cross-reference rights to any relevant drug master files and other filings Controlled by Ionis or its Affiliates and submitted with any Regulatory Authority.

6.4.3. Class Generic Claims; Investigator’s Brochure. To the extent Novartis intends to make any claims in a Licensed Product label or regulatory filing that are class generic to Oligonucleotides, Ionis’ or its Affiliate’s chemistry platform(s), Conjugate Technology, or any other Ionis technology included in a Licensed Product, Novartis will provide such claims and regulatory filings to Ionis in advance and will consider in good faith any proposals and comments made by Ionis (or its Affiliates). Novartis will provide Ionis updated versions of the investigator’s brochure [***].

6.5. Compliance. Each Party will perform its activities pursuant to this Agreement (and will use reasonable efforts to require Third Parties to perform any such activities) in compliance with Applicable Law, including good laboratory practices (GLP), good clinical practices (GCP), and good manufacturing practices (GMP), in each case as applicable under the laws and regulations of the country and the state and local government wherein such activities are conducted or which are otherwise affected.

6.6. Pharmacovigilance and Ionis Internal Oligonucleotide Safety Database.

6.6.1. Pharmacovigilance Agreement. If, at any time during the Agreement Term, the Parties agree that it is necessary to enter into a separate pharmacovigilance agreement in order to fulfill their respective local and international regulatory reporting obligations to Regulatory Authorities and other Applicable Law, then the Parties will negotiate in good faith a pharmacovigilance agreement which is consistent with such reporting obligations and such other Applicable Law.

6.6.2. Ionis Internal Oligonucleotide Safety Database.

(a) Ionis maintains an internal database that includes information regarding the tolerability of its drug compounds, individually and as a class, including information discovered during non-clinical and clinical development (the “Ionis Internal Oligonucleotide Safety Database”). To the extent identified and collected by Novartis or its Affiliates, Novartis will [***] promptly provide Ionis with all material information concerning toxicology, pharmacokinetics, safety pharmacology study(ies) and adverse events directly related to the Licensed Products. Novartis may elect to provide such information in the form in which Novartis maintains such information for internal purposes. In addition, with respect to the Licensed Products, Novartis will provide Ionis with copies of Annual safety updates filed with each IND (e.g., DSURs or IND annual reports) and the safety sections of any final Clinical Study reports within [***] following the date such information is submitted to the applicable Regulatory Authority, as applicable. Furthermore, Novartis will answer in a timely manner any follow-up questions reasonably requested by Ionis or its Affiliates to the extent such data and answers are reasonably available to Novartis. In addition, so long as Ionis does not disclose the identity of a Licensed Product or the identity of Novartis, its Affiliates or its Sublicensees, Ionis may disclose any such information to (i) Ionis’ other partners pursuant to Section 6.6.2(b) (Ionis Internal Oligonucleotide Safety Database) below if such information is regarding class generic properties of Oligonucleotides, (ii) any other Third Party (other than a Regulatory Authority) that contributes to the populating of the Ionis Internal Oligonucleotide Safety Database, or (iii) a Regulatory Authority. Novartis will deliver all such information to Ionis for the Ionis Internal Oligonucleotide Safety Database to Ionis at 2855 Gazelle Court, Carlsbad, California 92010, Attention: Chief Medical Officer (or to such other address/contact designated in writing by Ionis). Novartis will [***] cause its Sublicensees to comply with this Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database). At either Party’s request, the Alliance Managers will use good faith efforts to establish mutually acceptable specific time periods for the provision of information under this Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database).

(b) From time to time, Ionis utilizes the information in the Ionis Internal Oligonucleotide Safety Database to conduct analyses to keep Ionis and its partners informed regarding class generic properties of Oligonucleotides, including with respect to safety. As such, if and when Ionis identifies safety or other related issues that may be relevant to a Licensed Product (including any potential class-related toxicity), Ionis will inform Novartis in a timely manner of such issues and, if requested, allow Novartis to review such issues and conclusions and allow Novartis the opportunity to review and align on safety statement and health authority submissions in a timely manner before release.

(c) During the Agreement Term, Novartis may submit written requests to Ionis for Ionis to have queries run of the Ionis Internal Oligonucleotide Safety Database relevant to the Licensed Products, and Ionis will [***] promptly cause such queries to be run and deliver to Novartis the results of such queries. Any information disclosed by a Party to the other Party under this Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database) will be treated as Confidential Information of such Party in accordance with Article 12 (Confidentiality).

(d) To the extent any information required to be disclosed by Novartis to Ionis under this Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database) is disclosed pursuant to a pharmacovigilance agreement entered into pursuant to Section 6.6.1 (Pharmacovigilance Agreement), such disclosure shall be deemed to satisfy the corresponding obligation under this Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database).

ARTICLE 7

FINANCIAL PROVISIONS

7.1. Upfront Fee. In consideration of the licenses and rights granted to Novartis hereunder, Novartis will pay Ionis a non-refundable, non-creditable upfront payment of $60,000,000 no later than [***] (the “Upfront Fee”).

7.2. Payments for Development Activities. Upon the designation of each of the [***] Development Candidates in accordance with Section 2.2.4 (Development Candidate Selection Process), Novartis will pay Ionis $[***]. Each payment is due within [***] after receipt by Novartis of an Invoice from Ionis for such amount, provided that such Invoice may not be provided earlier than the DC Selection Date for such Development Candidate. For clarity, the maximum amount payable under this Section 7.2 (Payments for Development Activities) is $[***].

7.3. Milestone Payments for Achievement of Early Development Milestone Events. In further consideration of the licenses and rights granted to Novartis hereunder, Novartis will pay Ionis each of the milestone payments set forth in Table 1 below upon the achievement of the corresponding development milestone event listed in Table 1 for [***] Licensed Products to achieve such milestone events:

Table 1
Early Development Milestone Event	Milestone Event Payment
1. [***]	US$[***]
2. [***]	US$[***]

Each milestone payment set forth in Table 1 above will be paid [***] upon the achievement of the milestone event by [***] Licensed Product regardless of how many Licensed Products achieve such milestone event or how many times such Licensed Products achieve such milestone event. For clarity, the maximum aggregate milestone payments payable under Table 1 above if each early development milestone event is achieved [***] is $[***].

7.4. Milestone Payments for First Achievement of Development Milestone Events. In further consideration of the licenses and rights granted to Novartis hereunder, Novartis will pay Ionis each of the milestone payments set forth in Table 2 below upon the achievement of the corresponding development milestone event listed in Table 2 for a Licensed Product:

Table 2
Development Milestone Event	Milestone Event Payment
1. [***]	US$[***]
2. (a) [*] or (b) [*]	US$[***]
3. [***]	US$[***]
4. [***]	US$[***]
5. [***]	US$[***]
6. [***]	US$[***]

Each milestone payment set forth in Table 2 above will be paid only once upon the first achievement of the milestone event by the applicable Licensed Product regardless of how many Licensed Products achieve such milestone event or how many times such Licensed Product achieves such milestone event. For clarity, the maximum aggregate milestone payments payable under Table 2 above if each development milestone event is achieved is $[***].

7.5. Milestone Payments for First Achievement of Sales Milestone Events. In further consideration of the licenses and rights granted to Novartis hereunder, on a Licensed Product-by-Licensed Product basis, Novartis will pay Ionis each of the sales milestone payments set forth in Table 3 below upon the achievement of the corresponding sales milestone event listed in Table 3 for a Licensed Product:

Table 3
Annual Worldwide Net Sales Levels	Milestone Payment
Exceeding US$[***] in Annual Net Sales for a Licensed Product	US$[***]
Exceeding US$[***] in Annual Net Sales for a Licensed Product	US$[***]
Exceeding US$[***] in Annual Net Sales for a Licensed Product	US$[***]
Exceeding US$[***] in Annual Net Sales for a Licensed Product	US$[***]
Exceeding US$[***] in Annual Net Sales for a Licensed Product	US$[***]

Each milestone payment set forth in Table 3 above will be paid only once upon the first achievement of the milestone event by the applicable Licensed Product regardless of how many Licensed Products achieve such milestone event or how many times such Licensed Product achieves such milestone event. For clarity, the maximum aggregate milestone payments payable under Table 3 above if each sales milestone event is achieved is $[***].

7.6. Skipped Milestone Payments; Notice and Payment.

7.6.1. Except with respect to (a) the [***] milestone event in Table 2 above which is addressed in Section 7.6.2 and (b) the [***] milestone event in Table 2 above which [***], if a particular milestone event in Table 2 is not achieved by a Licensed Product, then upon achievement of a later milestone event in Table 2 by a Licensed Product, the milestone event payment applicable to such earlier milestone event will also be due. For example, if [***] without achieving the “[***],” then upon achieving the “[***]” milestone event, both the “[***]” and “[***]” milestone event payments are due.

7.6.2. If the [***] milestone event in Table 2 above is not achieved by a Licensed Product, but the [***] milestone event in Table 2 above is achieved by a Licensed Product with a [***], then, upon achievement of the [***] milestone event, the applicable payments for the [***] and [***] milestone events in Table 2 will both be due.

7.6.3. Each time a milestone event other than a sales milestone event set forth in Table 3 above is achieved under this Article 7 (Financial Provisions), Novartis will send Ionis a written notice thereof within [***] following the date of achievement of such milestone event and the applicable milestone payment is due within [***] after receipt by Novartis of an Invoice from Ionis for such amount, provided that such Invoice may not be provided before such notice. With respect to the achievement of any sales milestone event set forth in Table 3 above, Novartis will notify Ionis thereof concurrently with the provision of the Royalty Report for the relevant Calendar Quarter in which such sales milestone event was achieved, and the applicable milestone payment is due within [***] after receipt by Novartis of an Invoice from Ionis for such amount, provided that such Invoice may not be provided before receipt of such notice by Ionis.

7.7. Royalty Payments.

7.7.1. Royalty. In further consideration of the licenses and rights granted to Novartis hereunder, subject to the provisions of this Section 7.7.1 (Royalty) and Section 7.7.2 (Application of Royalty Rates), Novartis will pay to Ionis royalties on Annual worldwide Net Sales of Licensed Products sold by Novartis, its Affiliates or Sublicensees, on a country-by-country and Licensed Product-by-Licensed Product basis, in each case in the amounts as follows in Table 4 below:

	Table 4
Royalty Tier	Annual Worldwide Net Sales of such Licensed Product	Royalty Rate
1	For the portion of Annual Worldwide Net Sales ≤ US$[***]	[***]%
2	For the portion of Annual Worldwide Net Sales > US$[*] but ≤ US$[*]	[***]%
3	For the portion of Annual Worldwide Net Sales > US$[*] but ≤ US$[*]	[***]%
4	For the portion of Annual Worldwide Net Sales > US$[*] but ≤ US$[*]	[***]%
5	For the portion of Annual Worldwide Net Sales > US$[*] but ≤ US$[*]	[***]%
6	For the portion of Annual Worldwide Net Sales > US$[***]	[***]%

Annual worldwide Net Sales will be calculated by taking the aggregate sum of Net Sales of a Licensed Product for all countries worldwide.

No royalties are due on Net Sales of Licensed Products arising from compassionate use and other programs providing for the delivery of a Licensed Product at or below cost. The sales of Licensed Products arising from named patient, compassionate use, or other similar programs will not be considered a First Commercial Sale for purposes of calculating the Royalty Term.

7.7.2. Application of Royalty Rates. All royalties set forth under Section 7.7.1 (Royalty) are subject to the provisions of this Section 7.7.2 (Application of Royalty Rates), and are payable as follows:

(a) Royalty Term. Novartis’ obligation to pay Ionis the royalties pursuant to Section 7.7.1 (Royalty) above with respect to a Licensed Product will continue on a country-by-country and Licensed Product-by-Licensed Product basis from the date of First Commercial Sale of such Licensed Product in such country until the later of the date of expiration of (i) the last Valid Claim of a Licensed Patent, Jointly-Owned Program Patent, or Novartis Royalty Bearing Patent Covering the sale of such Licensed Product in such country, (ii) any Regulatory Exclusivity Period conferred by the applicable Regulatory Authority in such country with respect to such Licensed Product, and (iii) the [***] anniversary of the First Commercial Sale of such Licensed Product in such country (such royalty period, the “Royalty Term”).

(b) Know-How Royalty. If a Licensed Product is sold in a country during the applicable Royalty Term at a time when there is no Valid Claim of a Licensed Patent, Jointly-Owned Program Patent, or Novartis Royalty Bearing Patent in such country that Covers the sale of such Licensed Product, then [***].

(c) Generic Competition During the Royalty Term. On a country-by-country and Licensed Product-by-Licensed Product basis, if at any time during the Royalty Term a Generic Product is sold in such country and the aggregate Net Sales of such Licensed Product in such country in any Calendar Quarter thereafter are at least [***]% lower as compared to the average quarterly Net Sales of such Licensed Product in such country during the last [***] Calendar Quarters immediately preceding the Calendar Quarter in which the Generic Product was first sold, then, following such reduction in Net Sales, the Net Sales of such Licensed Product in such country used for calculation of royalties pursuant to Section 7.7.1 (Royalty) shall be [***].

7.7.3. Limitation on Aggregate Reduction for Novartis Royalties. In no event will the aggregate royalty reductions under Section 7.7.2 (Application of Royalty Rates) and Section 7.9.4 (Right to Offset), alone or together, reduce the royalties payable to Ionis on Net Sales of a Licensed Product in any given Calendar Quarter by more than [***] of the applicable royalties that would otherwise be owed on such Net Sales in such Calendar Quarter without the reductions under Section 7.7.2 (Application of Royalty Rates) and Section 7.9.4 (Right to Offset). If Novartis would, but for the restriction set forth in this Section 7.7.3 (Limitation on Aggregate Reduction for Novartis Royalties), have the right to reduce the royalties due to Ionis for a Licensed Product in a Calendar Quarter by more than [***], then such unused reduction that may otherwise have been taken pursuant to Section 7.9.4 (Right to Offset) may be carried forward and used as a credit against royalties due to Ionis in one or more future Calendar Quarter(s) until such reduction is fully realized.

7.8. [***]. [***].

7.9. In-License Agreements.

7.9.1. Existing In-License Agreements. On a Licensed Product-by-Licensed Product basis, certain of the Licensed Technology Controlled by Ionis as of the Execution Date that may be licensed to Novartis under Section 5.1 (License Grants to Novartis) are in-licensed or were acquired by Ionis or its Affiliates under the agreements with Third Party licensors or sellers listed on Appendix 2 (Ionis In-License Agreements) (such license or purchase agreements being the “Ionis In-License Agreements”), and the payments set out on Appendix 2 (Ionis In-License Agreements) may become payable by Ionis or its Affiliates to such Third Parties under the Ionis In-License Agreements based on the Research, Development, or Commercialization of a Licensed Product by Novartis, its Affiliates or Sublicensees. Any such payment obligations set out on Appendix 2 (Ionis In-License Agreements) will be [***].

7.9.2. New In-License Agreements. Either Party will promptly provide written notice to the other Party of any Patent Rights or Know-How of a Third Party that it has identified and believes are [***] to Exploit a Development Candidate or Licensed Product, including in the case of Ionis, notice of any such Patent Rights or Know-How that it has identified and believes would constitute Necessary Platform IP (such Patent Rights and Know-How, “Identified Rights”). Ionis or its Affiliates will have the first right, but not the obligation, to negotiate with, and obtain a license from the Third Party Controlling Identified Rights that would have been considered Ionis Core Technology Patents, Ionis Manufacturing and Analytical Know-How, or Ionis Manufacturing and Analytical Patents had Ionis Controlled such Identified Rights on the Execution Date. If, however, Ionis and its Affiliates elect not to obtain such Identified Rights, Ionis will so notify Novartis within [***], and Novartis may obtain such Identified Rights. Novartis or its Affiliates will have the first right, but not the obligation, to negotiate with, and obtain a license from the Third Party Controlling Identified Rights other than those that would have been considered Ionis Core Technology Patents, Ionis Manufacturing and Analytical Know-How, or Ionis Manufacturing and Analytical Patents had Ionis Controlled such Identified Rights on the Execution Date. If, however, Novartis and its Affiliates elect not to obtain such Identified Rights, Novartis will so notify Novartis within [***], and Ionis may obtain such Identified Rights.

7.9.3. Ionis In-License Agreements.

(a) New Necessary Platform IP. If (i) Ionis obtains Identified Rights that would have been considered Ionis Core Technology Patents, Ionis Manufacturing and Analytical Know-How, or Ionis Manufacturing and Analytical Patents had Ionis Controlled such Identified Rights on the Execution Date and (ii) such Identified Rights are [***] (such Identified Rights, “Necessary Platform IP”), then such Necessary Platform IP will be included in the license granted to Novartis under Section 5.1 (License Grants to Novartis) and any and all costs arising under such Third Party agreement as they apply to a Licensed Product will be [***].

(b) Other Identified Rights. If Ionis obtains Identified Rights that are not Necessary Platform IP, then Ionis will include such Identified Rights in the license granted to Novartis under Section 5.1 (License Grants to Novartis) only [***] such Identified Right (or that, prior to the applicable transaction with Ionis or its Affiliates, [***]) to license or acquire such Identified Rights; provided that, if the applicable Identified Rights relate to both a Licensed Compound or Licensed Product and one or more other programs of Ionis or its Affiliates (“Shared Ionis Identified Rights”), then any such [***] will be [***], and Novartis will [***].

7.9.4. Right to Offset. If Novartis obtains a license or other rights to any Identified Rights for a Development Candidate or Licensed Product or [***] for obtaining such Identified Rights pursuant to Section 7.9.3(b) (Other Identified Rights) and such rights are necessary to Exploit a Development Candidate or Licensed Product, then Novartis may offset against any royalties payable to Ionis pursuant to Section 7.7.1 (Royalty) for the Exploitation of such Licensed Product in a Calendar Quarter an amount equal to [***]% of any amounts paid to such Third Party or Ionis, as applicable, with respect to the Identified Rights; provided that, if the applicable Identified Rights relate to both a Development Candidate or Licensed Product and one or more other programs of Novartis or its Affiliates (“Shared Novartis Identified Rights”), then [***], and Novartis will only be allowed to exercise the offset set forth in this Section 7.9.4 (Right to Offset) for the amount that is allocated to the applicable Development Candidate or Licensed Products. Any reductions pursuant to this Section 7.9.4 (Royalty Offset) will be [***] pursuant to Section 7.7.2 (Application of Royalty Rates).

7.9.5. Third Party IP Dispute. If Ionis does not agree that certain intellectual property acquired by Novartis constitutes Identified Rights that Novartis has the right to offset costs for in accordance with Section 7.9.4 (Right to Offset) or if the Parties do not agree on whether Identified Rights obtained by Ionis are Necessary Platform IP or the allocation of [***] payable in respect of Shared Ionis Identified Rights or the Shared Novartis Identified Rights, then, in any such case, the disputing Party will send written notice to such effect to the other Party and the Parties will engage a mutually agreed upon independent Third Party intellectual property lawyer with expertise in the patenting of Oligonucleotides, and appropriate professional credentials in the relevant jurisdiction, or other applicable expertise, to resolve such dispute. The determination of the Third Party expert engaged under the preceding sentence will be binding on the Parties solely for purposes of, as applicable, determining (a) [***], (b) [***] or (c) [***]. The costs of any Third Party expert engaged under this Section 7.9.5 (Right to Offset) will be paid by the Party against whose position the Third Party lawyer’s determination is made.

7.10. Reimbursement for Ionis’ Time. After the first [***] hours of Ionis’ time for any (a) technology transfer assistance provided by Ionis in accordance with Section 2.7.1 (Responsibility During the Research Term) and Section 5.9 (Technology and Information Transfer), and (b) any regulatory assistance provided in accordance with Section 6.4.1 (Regulatory Responsibilities; Major Regulatory Submissions), then Novartis will reimburse Ionis for the FTE Costs [***] within [***] from the date an Invoice is received by Novartis [***]; provided that before Ionis commences work for which it intends to invoice Novartis, Novartis and Ionis will agree to the scope of Ionis’ work and a budget for such work that will include Ionis’ good faith estimate of the [***].

7.11. Payments.

7.11.1. Royalty Reports and Payment.

(a) Beginning with the Calendar Quarter in which the First Commercial Sale for a Licensed Product is made and for each Calendar Quarter thereafter during the Royalty Term, Novartis will provide Ionis with a report summarizing Net Sales in USD and local currency for Licensed Products during the relevant Calendar Quarter and the calculation of royalties and sales milestones (if applicable) due thereon, including country and units, within [***] following the end of each such Calendar Quarter (each a “Royalty Report”). If no royalties are payable in respect of a given Calendar Quarter, Novartis will nevertheless submit a Royalty Report to Ionis so indicating together with an explanation as to why no such royalties are payable. After its receipt of such Royalty Report, Ionis will submit an Invoice to Novartis for the corresponding royalty payment. Novartis will pay to Ionis such amount within [***] after receipt by Novartis of such Invoice. For the avoidance of doubt, Royalty Reports and any feedback provided by Novartis pursuant to paragraph (b) are Novartis’ Confidential Information subject to the terms and conditions of this Agreement.

(b) Beginning with the Calendar Quarter in which the First Commercial Sale for a Licensed Product is made and for each Calendar Quarter thereafter during the Royalty Term, [***].

7.11.2. Mode of Payment. All payments under this Agreement will be (a) payable in full in U.S. dollars, regardless of the country(ies) in which sales are made, (b) made by wire transfer of immediately available funds to an account designated by Ionis in writing, and (c) non-creditable (except (i) as otherwise provided in Section 4.3 (Acquisition of a Competitive Compound) or Section 7.12 (Audits) and (ii) [***]. All payments under this Agreement shall be made in US Dollars. Any sales incurred in a currency other than US Dollars shall be converted to the US Dollar equivalent using [***] for the conversion of foreign currency sales into US Dollars. [***]. In addition, an Invoice will be deemed duly delivered by a Party to the other Party under this Agreement when delivered electronically to such other Party and, if so delivered electronically, will be promptly followed by delivery of a paper copy of such Invoice.

7.11.3. Records Retention. Commencing with the First Commercial Sale of a Licensed Product, Novartis will keep complete and accurate records pertaining to the Net Sales of Licensed Products for the [***] in accordance with Novartis’ Accounting Standards.

7.12. Audits.

7.12.1. During the Agreement Term and for a period of [***] thereafter, at [***] expense and upon written notice to Novartis, Novartis will permit an independent accounting firm of internationally recognized standing (the “Auditor”) appointed by Ionis and reasonably acceptable to Novartis, at reasonable times and upon reasonable notice, but in no case more than [***] per Calendar Year and not more frequently than [***] with respect to records covering any specific period of time, to examine such records as may be necessary for the sole purpose of verifying the accrual of any milestone payments, the calculation and reporting of Net Sales, and the correctness of any milestone or royalty payment made under this Agreement; provided that the Auditor shall only be entitled to audit Novartis’ records from the [***] prior to the Calendar Year in which the audit request is made.

7.12.2. As a condition to and prior to examining any of Novartis’ records, such Auditor will sign a nondisclosure agreement reasonably acceptable to Novartis in form and substance. Any and all of Novartis’ records examined by such independent certified public accountant will be deemed Novartis’ Confidential Information. Novartis and its Affiliates shall make their records available for inspection by such Auditor during regular business hours at such place or places where such records are customarily kept, upon receipt of reasonable advance notice from Ionis.

7.12.3. Upon completion of the audit, the Auditor will provide both Novartis and Ionis with a written audit report disclosing whether the milestone or royalty payments made by Novartis are correct (“Audit Report”). The Auditor shall have the right to disclose to Ionis only its conclusions regarding any payments owed under this Agreement and all information received and all information learned in the course of any audit or inspection will be deemed Novartis’ Confidential Information. Before it is considered final, Novartis shall have the right to [***] following receipt of such Audit Report. Novartis will provide Ionis and the Auditor with [***].

7.12.4. If, as a result of any inspection of Novartis’ books and records, it is [***] that Novartis’ payments under this Agreement were more or less than the milestone or royalty amount which should have been paid, then the relevant Party will make all payments required to be made by paying the other Party the difference between such amounts to eliminate any discrepancy revealed by said inspection within [***] of receiving the final Audit Report, with interest calculated in accordance with Section 7.14 (Interest) solely in the event the paying Party is responsible for the discrepancy; provided, however, that any such payment by Ionis to Novartis will be [***]. Ionis will pay for such audit, except that if Novartis is found to have underpaid Ionis by more than [***]% of the amount that should have been paid for the audited period, Novartis will reimburse Ionis [***] charged by the Auditor for the audit.

7.13. Taxes.

7.13.1. Taxes on Income. Each Party alone will be solely responsible for paying any and all taxes (other than withholding taxes required by Applicable Law to be paid by Novartis or Ionis (as the case may be)) levied on account of, or measured in whole or in part by reference to, the income of such Party.

7.13.2. Indirect Taxes. All amounts mentioned in this Agreement are exclusive of Indirect Taxes. If any Indirect Taxes are chargeable in respect of any payments, the paying Party will pay such Indirect Taxes at the applicable rate in respect of such payments following receipt, where applicable, of an Indirect Taxes invoice in the appropriate form issued by the receiving Party in respect of those payments. The Parties will issue invoices for all amounts payable under this Agreement consistent with Indirect Tax requirements and irrespective of whether the sums may be netted for settlement purposes. The Parties agree to reasonably cooperate to provide any information required by the Party pursuing a refund of Indirect Taxes paid.

7.13.3. Withholding Tax. To the extent the paying Party is required to deduct and withhold taxes on any payment under Applicable Law, including extra-territorial taxation, the paying Party will be authorized to deduct the withholding tax from such payments and will pay the amounts of such taxes to the proper Governmental Authority for the account of the receiving Party and remit the net amount to the receiving Party in a timely manner. The paying Party will promptly furnish the receiving Party with proof of payment of such taxes. If documentation is necessary in order to secure an exemption from, or a reduction in, any withholding taxes, the Parties will provide such documentation to the extent they are entitled to do so. The Parties will make all reasonable efforts to obtain relief or reduction of all withholding taxes under Applicable Law, including applicable tax treaties and including but not limited to the submission or issuance of requisite forms and information. If a special procedure is required for treaty relief by Applicable Law, such treaty relief will only be taken into account if the non-paying Party submits an exemption certificate requested by the paying Party to the paying Party in accordance with the requirements of Applicable Law on or prior to the time of the payment to the non-paying Party. If no withholding tax deduction has been made on the payments to the non-paying Party under this Agreement, but a Governmental Authority subsequently takes the position that a withholding tax deduction should have been made, including extra-territorial taxation, the non-paying Party shall provide, at its own expense, all reasonable support to the paying Party to obtain relief or reduction of the withholding taxes under the Applicable Law, including applicable tax treaties and including but not limited to the submission or issuance of requisite forms and information, and the Parties will bear such liability (and reimburse one another as necessary) in a manner consistent with that which would have resulted had the tax been originally withheld. Any refunds of withholding taxes that are granted to the non-paying Party by the relevant Governmental Authority and which would cause the non-paying Party to receive payments in excess of that which the paying Party would owe under this Agreement, including with interest calculated in accordance with Section 7.14 (Interest), shall be paid to the paying Party by the non-paying Party.

7.13.4. Tax Cooperation. To the extent that the paying Party is required to deduct and withhold taxes on any payments under this Agreement, the paying Party will pay the amounts of such taxes to the proper Governmental Authority in a timely manner and promptly transmit to the non-paying Party an official tax certificate or other evidence of such withholding sufficient to enable the non-paying Party to claim such payments of taxes. The paying Party will request from the non-paying Party any tax forms that may be reasonably necessary in order for the paying Party not to withhold tax or will withhold tax at a reduced rate under an applicable bilateral income tax treaty, if appropriate under the Applicable Law. Each Party will provide the other with reasonable assistance to enable the recovery, as permitted by Applicable Law, of withholding taxes resulting from payments made under this Agreement, such recovery to be for the benefit of the Party who would have been entitled to receive the money but for the application of withholding tax under this Section 7.13 (Taxes).

The provisions of this Section 7.13 (Taxes) are to be read in conjunction with the provisions of Section 13.4 (Assignment and Successors) below.

7.14. Interest. Any undisputed payments to be made hereunder that are not paid on or before the date such payments are due under this Agreement, and any payments that are pending resolution of any dispute unless the dispute is ruled in favor of the paying Party, will bear interest at a rate per annum equal to the lesser of (a) [***]% above the six-month CME Term Secured Overnight Financing Rate (USD SOFR) from the date on which such payment would have been first due until the date of payment or (b) the maximum rate permissible under Applicable Law.

7.15. No Estimate, Projection, Representation or Warranty. Novartis and Ionis acknowledge and agree that nothing in this Agreement shall be construed as representing an estimate or projection of anticipated achievement of any milestone events with respect to or sales of any Licensed Product, and that the milestones and Net Sales levels set forth above are only intended to define the milestone payment and royalty obligations to Ionis in the event such milestones or Net Sales levels are achieved. Neither Ionis nor Novartis makes any representation or warranty, either express or implied, that it will be able to successfully Research, Develop or Commercialize any Licensed Product or, if Commercialized, that any particular Net Sales of such Licensed Product will be achieved.

ARTICLE 8

INTELLECTUAL PROPERTY

8.1. Joint Patent Committee.

8.1.1. No later than [***] after the Effective Date, the Parties will establish a “Joint Patent Committee” or “JPC”. The JPC will serve as the primary contact and forum for discussion between the Parties with respect to intellectual property matters arising under this Agreement, and will cooperate with respect to the activities set forth in this Section 8.1 (Joint Patent Committee). If the JPC dissolves, each Party may designate a patent attorney who will be responsible for intellectual property matters under this Agreement. A strategy will be discussed with regard to (a) prosecution and maintenance, defense and enforcement of Ionis Product-Specific Patents that are licensed to Novartis under Section 5.1 (License Grants to Novartis) and Novartis Product-Specific Patents, including strategies in relation to the Unified Patent Court and Unitary Patent in Europe, such as but not limited to the filing or withdrawing of an opt-out of the respective European patents and validating as a Unitary Patent or a classical European Patent, (b) defense against allegations of infringement of Third Party Patent Rights, (c) licenses to Third Party Patent Rights or Know-How, and (d) the timing and subject matter of any potential publications regarding a Licensed Product, in each case to the extent such matter would be reasonably likely to have a material impact on this Agreement or the licenses granted hereunder, which strategy will be considered in good faith by the Party entitled to prosecute, enforce and defend such Patent Rights, as applicable, hereunder, but will not be binding on such Party. Upon expiration of the Research Term, each Party will no longer have the obligation, but will continue to have the right, to participate in the JPC, provided that, if requested by Novartis, Ionis shall consider in good faith and not unreasonably refuse to participate in the JPC.

8.1.2. The JPC will comprise an equal number of at most three members from each Party. The JPC will meet as often as agreed by them (and at least semi-Annually), to discuss matters arising out of the activities set forth in this Section 8.1 (Joint Patent Committee). The JPC will determine the JPC operating procedures at its first meeting, including the JPC’s policies for replacement of JPC members, and the location of meetings, which will be codified in the written minutes of the first JPC meeting. The Parties may escalate issues to the Executives for input and resolution pursuant to Section 13.1 (Dispute Resolution). Each Party’s representatives on the JPC will consider comments and suggestions made by the other in good faith. Each Party will bear their own cost of participation on the JPC.

8.2. Ownership.

8.2.1. Licensed Technology and Novartis Technology. As between the Parties, Ionis will own and retain all of its rights, title and interest in and to the Licensed Know-How and Licensed Patents and Novartis will own and retain all of its rights, title and interest in and to the Novartis Know-How and Novartis Patents, subject to any rights or licenses expressly granted by one Party to the other Party under this Agreement.

8.2.2. Program Technology.

(a) Allocation of Ownership. As between the Parties, Novartis is the sole owner of any Know-How discovered, invented or created solely by or on behalf of Novartis or its Affiliates under or in connection with this Agreement (“Novartis Program Know-How”) and any Patent Rights that claim or cover Novartis Program Know-How (“Novartis Program Patents” and together with the Novartis Program Know-How, the “Novartis Program Technology”), and will retain all of its rights, title and interest thereto, subject to any rights or licenses expressly granted by Novartis to Ionis under this Agreement. As between the Parties, Ionis is the sole owner of any Know-How discovered, invented or created solely by or on behalf of Ionis or its Affiliates under or in connection with this Agreement (“Ionis Program Know-How”) and any Patent Rights that claim or cover such Know-How (“Ionis Program Patents” and together with the Ionis Program Know-How, the “Ionis Program Technology”), and will retain all of its rights, title and interest thereto, subject to any rights or licenses expressly granted by Ionis to Novartis under this Agreement. Any Know-How discovered, invented or created jointly under or in connection with this Agreement by or on behalf of both Parties or their respective Affiliates or Third Parties acting on their behalf (“Jointly-Owned Program Know-How”), and any Patent Rights that claim or cover such Jointly-Owned Program Know-How (“Jointly-Owned Program Patents”, and together with the Jointly-Owned Program Know-How, the “Jointly-Owned Program Technology”), are owned jointly by Novartis and Ionis on an equal and undivided basis, including all rights, title and interest thereto, subject to any rights or licenses expressly granted by one Party to the other Party under this Agreement.

(b) Practice of the Jointly-Owned Program Technology. Except as expressly provided in this Agreement, neither Party will have any obligation to account to the other for profits with respect to, or to obtain any consent of the other Party to license or Exploit, the Jointly-Owned Program Technology by reason of joint ownership thereof, and each Party hereby waives any right it may have under the laws of any jurisdiction to require any such consent or accounting. The Parties acknowledge and agree that either Party may, subject to the exclusivity covenants in Section 4.1 (Exclusivity Covenants), freely utilize or otherwise Exploit any Jointly-Owned Program Technology without recourse, accounting or any other obligations to the other Party, except as expressly set out in this Agreement.

(c) Disclosure. Each Party will promptly disclose to the other Party in writing, and will cause its Affiliates to so disclose, the discovery, invention or creation of any Novartis Program Technology, Ionis Program Technology or Jointly-Owned Program Technology. The Novartis Program Patents, Ionis Program Patents and Jointly-Owned Program Patents are collectively referred to herein as the “Program Patents,” the Novartis Program Know-How, Ionis Program Know-How and Jointly-Owned Program Know-How are collectively referred to herein as the “Program Know-How,” and Novartis Program Technology, Ionis Program Technology and Jointly-Owned Program Technology are collectively referred to herein as “Program Technology.”

8.2.3. Inventorship. Determination of inventorship will be made by the JPC in accordance with US patent laws. In case of a dispute in the JPC (or otherwise between Ionis and Novartis) over inventorship of any Program Patents, if the JPC (or the Parties’ respective patent representatives if no JPC exists) cannot resolve such dispute, such dispute will be resolved by independent patent counsel not engaged or regularly employed in the past [***] years by either Party (or its Affiliates) and reasonably acceptable to both Parties. The decision of such independent patent counsel will be binding on the Parties. Expenses of such patent counsel will be shared equally by the Parties.

8.3. Filing, Prosecution and Maintenance of Patents.

8.3.1. General Principles.

(a) Ionis Core Technology Patents and Ionis Manufacturing and Analytical Patents. Ionis will control and be responsible for Prosecuting and Maintaining (i) the Ionis Core Technology Patents, and (ii) the Ionis Manufacturing and Analytical Patents, including any Jointly-Owned Program Patents in (i) or (ii).

(b) Product-Specific Patents. Novartis will control and be responsible for Prosecuting and Maintaining all Product-Specific Patents (including any Jointly-Owned Program Patents, Ionis Program Patents, and Novartis Program Patents, in each case, that are Product-Specific Patents).

(c) Other Jointly-Owned Program Patents. The Parties will decide through the JPC the appropriate Party to control and be responsible for Prosecuting and Maintaining all other Jointly-Owned Program Patents not provided for above.

(d) Other Program Patents. (i) Novartis will control and be responsible for Prosecuting and Maintaining all Novartis Program Patents and (ii) Ionis will control and be responsible for Prosecuting and Maintaining all Ionis Program Patents, in each case ((i) and (ii)) other than Product-Specific Patents.

8.3.2. Other Matters Pertaining to Prosecution and Maintenance of Patents.

(a) Each Party will keep the other Party informed through the JPC as to material developments with respect to the Prosecution and Maintenance of the Product-Specific Patents or Jointly-Owned Program Patents for which such Party has responsibility for Prosecution and Maintenance pursuant to Section 8.3.1 (General Principles) or this Section 8.3.2 (Other Matters Pertaining to Prosecution and Maintenance of Patents), including by providing copies of any office actions or office action responses or other correspondence that such Party provides to or receives from any patent office, including notice of all interferences, reissues, re-examinations, inter partes reviews, post-grant reviews, oppositions or requests for patent term extensions, and all patent-related filings, and by providing the other Party the timely opportunity to have reasonable input into the strategic aspects of such Prosecution and Maintenance.

(b) Each Party will fully cooperate with the other in connection, as necessary, in Prosecuting and Maintaining the Product-Specific Patents or Jointly-Owned Program Patents for which such Party has responsibility pursuant to Section 8.3.1 (General Principles) or this Section 8.3.2 (Other Matters Pertaining to Prosecution and Maintenance of Patents), in relation to the Unified Patent Court and Unitary Patent in Europe, including by providing access to relevant persons and executing all documentation reasonably requested by a Party within the timeframe reasonably requested by the Party.

(c) If Novartis elects (i) not to file and prosecute patent applications for a Patent Right Novartis is responsible for Prosecuting and Maintaining under Section 8.3.1(b) (Product-Specific Patents) above (“Novartis-Prosecuted Patents”) in a particular country, (ii) not to continue the prosecution (including any interferences, oppositions, reissue Proceedings, re-examinations, and patent term extensions, adjustments, and restorations) or maintenance of any Novartis-Prosecuted Patent in a particular country, or (iii) not to file and prosecute patent applications for the Novartis-Prosecuted Patent in a particular country following a written request from Ionis to file and prosecute in such country, then Novartis will so notify Ionis promptly in writing of its intention (including a reasonably detailed rationale for doing so) with sufficient time to enable Ionis to meet any deadlines by which an action must be taken to establish or preserve any such Patent Right in such country; and Ionis will have the right, but not the obligation, to file, prosecute, maintain, enforce or otherwise pursue such Novartis-Prosecuted Patent in the applicable country at its own expense with counsel of its own choice. In such case, Novartis will cooperate with Ionis to file for, or continue to Prosecute and Maintain or enforce, or otherwise pursue such Novartis-Prosecuted Patent in such country in Ionis’ own name, but only to the extent that Novartis is not required to take any position with respect to such abandoned Novartis-Prosecuted Patent that would be reasonably likely to adversely affect the scope, validity or enforceability of any of the other Patent Rights being prosecuted and maintained by Novartis under this Agreement. Notwithstanding anything to the contrary in this Agreement, if Ionis assumes responsibility for the Prosecution and Maintenance of any such Novartis-Prosecuted Patent under this Section 8.3.2(b) (Other Matters Pertaining to Prosecution and Maintenance of Patents), Ionis will have no obligation to notify Novartis if Ionis intends to abandon such Novartis-Prosecuted Patent.

(d) The Parties, through the JPC, will cooperate in good faith to determine if and when any divisional or continuation applications will be filed with respect to any Jointly-Owned Program Patents or Product-Specific Patents, and where a divisional or continuation patent application filing would be practical and reasonable, then such a divisional or continuation filing will be made.

(e) If the Party responsible for Prosecution and Maintenance pursuant to Section 8.3.1 (General Principles) intends to abandon a Jointly-Owned Program Patent (other than a Jointly-Owned Program Patent that is Novartis-Prosecuted Patent, which is covered under Section 8.3.2(b) (Other Matters Pertaining to Prosecution and Maintenance of Patents) above) without first filing a continuation or substitution, then such Party will notify the other Party of such intention at least [***] before such Jointly-Owned Program Patent will become abandoned, and such other Party will have the right, but not the obligation, to assume responsibility for the Prosecution and Maintenance thereof at its own expense (subject to Section 8.4 (Patent Costs)) with counsel of its own choice, in which case the abandoning Party will, and will cause its Affiliates to, assign to the other Party (or, if such assignment is not possible, grant a fully-paid exclusive license in) all of their rights, title and interest in and to such Jointly-Owned Program Patents. If a Party assumes responsibility for the Prosecution and Maintenance of any such Jointly-Owned Program Patents under this Section 8.3.2(e) (Other Matters Pertaining to Prosecution and Maintenance of Patents), such Party will have no obligation to notify the other Party of any intention of such Party to abandon such Jointly-Owned Program Patents.

8.4. Patent Costs. Except as set forth in Section 8.3.2 (Other Matters Pertaining to Prosecution and Maintenance of Patents) and this Section 8.4 (Patent Costs), each Party will be responsible for all Patent Costs incurred by such Party prior to and after the Effective Date in all countries designated by it in the Prosecution and Maintenance of Patent Rights for which such Party is responsible under Article 8 (Intellectual Property). Unless the Parties agree otherwise, Ionis and Novartis will [***] ([***]) the Patent Costs associated with the Prosecution and Maintenance of Jointly-Owned Program Patents; provided that, either Party may decline to pay its share of costs for filing, prosecuting and maintaining any Jointly-Owned Program Patents in a particular country or particular countries, in which case the declining Party will, and will cause its Affiliates to, assign to the other Party (or, if such assignment is not possible, grant a fully-paid exclusive license in) all of their rights, titles and interests in and to such Jointly-Owned Program Patents (as applicable) and, if Novartis’ is the declining Party, then such Patent Right will no longer be a Licensed Patent under this Agreement.

8.5. Defense of Claims Brought by Third Parties; Oppositions.

8.5.1. Defense of Third Party Claims. If a Third Party initiates a Proceeding claiming a Patent Right owned by or licensed to such Third Party is infringed by the Development, Manufacture or Commercialization of any Licensed Product, then, subject to Section 10.4.1 (Control of the Defense), Novartis will have the first right, but not the obligation, to defend against any such Proceeding at its sole cost and expense. If Novartis elects to defend against such Proceeding, then Novartis will have the sole right to direct the defense and to elect whether to settle such claim (but only with the prior written consent of Ionis, not to be unreasonably withheld, conditioned, or delayed). Ionis will reasonably assist Novartis in defending such Proceeding. Novartis will keep Ionis apprised of the progress of such Proceeding. If Novartis elects not to defend against a Proceeding, then Novartis will so notify Ionis in writing within [***] after Novartis first receives written notice of the initiation of such Proceeding, and Ionis will have the right, but not the obligation, to defend against such a Proceeding at its sole cost and expense and thereafter Ionis will have the sole right to direct the defense thereof, including the right to settle such claim (but only with the prior written consent of Novartis, which consent will not be unreasonably withheld, delayed or conditioned). In any event, the Parties will reasonably assist each other and cooperate in any such Proceedings at the other Party’s request and expense. Each Party may at its own expense and with its own counsel join any defense initiated or directed by the other Party under this Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions). Each Party will provide the other Party with prompt written notice of the commencement of any such Proceeding under this Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions), and such Party will promptly furnish the other Party with a copy of each communication relating to the alleged infringement that is received by such Party.

8.5.2. Interferences, Reissues, Re-Examinations and Oppositions. If a Third Party initiates a Proceeding related to an interference, reissue, re-examination, inter partes review, post-grant review or opposition of any Ionis Product-Specific Patent, then Novartis will, at Novartis’ expense, by written notice to Ionis either (a) control the defense of such Proceeding (including the right to elect whether to settle such Proceeding), or (b) have Ionis control the defense of such Proceeding. If Novartis makes no such election within [***], then Ionis will have the right, but not the obligation, to control the defense of such Proceeding and Ionis and Novartis will [***]. The Party not defending such Proceeding will reasonably assist the other Party and cooperate in any such litigation at the defending Party’s request and expense. Each Party may at its own expense and with its own counsel join any defense initiated or directed by the other Party under this Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions). Each Party will provide the other Party with prompt written notice of the commencement of any such Proceeding under this Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions), and such Party will promptly furnish the other Party with a copy of each communication relating to the alleged infringement that is received by such Party.

8.6. Enforcement of Patents Against Competitive Infringement. With respect to infringement, unauthorized use, or threatened infringement or such other activity by a Third Party of any Product-Specific Patents, Jointly-Owned Program Patents, or Ionis Core Technology Patents by reason of the development, manufacture, use or commercialization of a product that is designed to bind to the RNA encoding APO(a) (“Competitive Infringement”), the Parties will handle such Competitive Infringement in accordance with this Section 8.6 (Enforcement of Patents Against Competitive Infringement).

8.6.1. Duty to Notify of Competitive Infringement. If either Party learns of a Competitive Infringement by a Third Party, such Party will promptly notify the other Party in writing and will provide such other Party with available evidence of such Competitive Infringement; provided, however, that for cases of Competitive Infringement under Section 8.6.6 (35 USC 271(e)(2) Infringement) below, such written notice will be given within 10 calendar days.

8.6.2. Control of Competitive Infringement Proceedings. For any Competitive Infringement, Novartis will have the first right, but not the obligation, to institute, prosecute, and control a Proceeding to enforce any (a) Product-Specific Patents, (b) Jointly-Owned Program Patents, or (c) Ionis Core Technology Patents, in each case ((a)-(c)), with respect thereto by counsel of its own choice at its own expense, and Ionis will have the right, at its own expense, to be represented in that action by counsel of its own choice (but, for clarity, Novartis will have the right to control such litigation), including deciding on any litigation strategy and selecting the Licensed Patent(s) and jurisdictions for enforcement of such Licensed Patent(s), provided, that, in the case of a Competitive Infringement of Ionis Core Technology Patents, Novartis shall only have such first right to institute, prosecute, and control a Proceeding to enforce such Ionis Core Technology Patents so long as Novartis also enforces Patent Rights Controlled by Novartis that Cover the relevant Licensed Product, if any. If Novartis fails to initiate a Proceeding (i) within a period of [***] after receipt of written notice of such Competitive Infringement (subject to a [***] extension to conclude negotiations, if Novartis has commenced good faith negotiations with an alleged infringer for elimination of such Competitive Infringement within such [***] period), or (ii) prior to [***] before the time limit, if any, set forth in the appropriate Laws and regulations for the filing of such actions, whichever comes first, then, unless [***], Ionis will have the right to initiate and control a Proceeding with respect to such Competitive Infringement by counsel of its own choice, and Novartis will have the right to be represented in any such action by counsel of its own choice at its own expense (but, for clarity, Ionis will have the right to control such litigation); provided, however, that if Novartis notifies Ionis in writing prior to [***] before such time limit for the filing of any such action that Novartis intends to file such action before the time limit, then Novartis shall be obligated to file such action before the time limit, and Ionis will not have the right to bring and control such action.

8.6.3. Joinder; Cooperation.

(a) If a Party initiates a Proceeding in accordance with this Section 8.6 (Enforcement of Patents Against Competitive Infringement), the other Party agrees to be joined as a party plaintiff where necessary and to give the first Party reasonable assistance and authority to file and prosecute the Proceeding. Subject to Section 8.6.4 (Share of Recoveries), each Party will bear the costs and expenses it incurred pursuant to this Section 8.6.3(a) (Joinder; Cooperation); provided that Novartis will only be requested to join such a Proceeding if such Proceeding relates to a Patent Right or Licensed Product licensed to Novartis under Section 5.1 (License Grants to Novartis).

(b) If one Party initiates a Proceeding in accordance with this Section 8.6.3 (Joinder; Cooperation), the other Party may join such Proceeding as a party plaintiff where necessary for such other Party to seek lost profits with respect to such infringement.

8.6.4. Share of Recoveries. Any damages or other monetary awards recovered with respect to a Proceeding brought pursuant to Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions) or this Section 8.6 (Enforcement of Patents Against Competitive Infringement) will be shared as follows:

(a) the amount of such recovery will first be applied to the Parties’ reasonable Out-of-Pocket costs incurred in connection with such Proceeding (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses); then

(b) any remaining proceeds will be allocated as follows: (i) if Novartis initiates or controls the defense of the Proceeding pursuant to Section 8.5.1 (Defense of Third Party Claims) or Section 8.6.2 (Control of Competitive Infringement Proceedings), [***], or (ii) if Ionis initiates or controls the defense of the Proceeding, [***].

8.6.5. Settlement. Notwithstanding anything to the contrary in this Article 8 (Intellectual Property), neither Party may enter a settlement, consent judgment or other voluntary final disposition of a suit under this Article 8 (Intellectual Property) that disclaims, limits the scope of, admits the invalidity or unenforceability of, or grants a license, covenant not to sue or similar immunity under a Patent Right Controlled by the other Party without first obtaining the written consent of the Party that Controls the relevant Patent Right.

8.6.6. 35 USC 271(e)(2) Infringement. Notwithstanding anything to the contrary in this Section 8.6 (Enforcement of Patents Against Competitive Infringement), for a Competitive Infringement under 35 USC 271(e)(2), the time period set forth in Section 8.6.2 (Control of Competitive Infringement Proceedings) during which a Party will have the initial right to bring a Proceeding will be shortened to a total of 25 calendar days, so that, to the extent the other Party has the right, pursuant to such Section to initiate a Proceeding if the first Party does not initiate a Proceeding, such other Party will have such right if the first Party does not initiate a Proceeding within 25 calendar days after such first Party’s receipt of written notice of such Competitive Infringement.

8.7. Other Infringement – Jointly-Owned Program Patents. With respect to the infringement of a Jointly-Owned Program Patent which is not a Competitive Infringement, the Parties will cooperate in good faith to bring suit together against such infringing party or the Parties may decide to permit one Party to solely bring suit. Any damages or other monetary awards recovered with respect to a Proceeding brought pursuant to this Section 8.7 (Other Infringement – Jointly-Owned Program Patents) will be shared as follows: (a) the amount of such recovery will first be applied to the Parties’ reasonable Out-of-Pocket costs incurred in connection with such Proceeding (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses); (b) (i) if the Parties jointly initiate a Proceeding pursuant to this Section 8.7 (Other Infringement – Jointly-Owned Program Patents), [***]; and (ii) if only one Party initiates the Proceeding pursuant to this Section 8.7 (Other Infringement – Jointly-Owned Program Patents), [***]. Notwithstanding the provision of Section 8.6.4 (Share of Recoveries) the remaining proceeds contemplated under this Section 8.7 (Other Infringement – Jointly-Owned Program Patents), [***].

8.8. Patent Listing. Novartis will promptly, accurately and completely list, with the applicable Regulatory Authorities during the Agreement Term, all applicable Patent Rights for a Licensed Product that such Party intends to, or has begun to Commercialize, and that have become the subject of a Regulatory Approval, such listings include all so-called Orange Book listings required under the Hatch Waxman Act and all so-called “Patent Register” listings as required in Canada. Prior to such listings, the Parties will meet, through the JPC, to evaluate and identify all applicable Patent Rights, and Novartis will have the right to review, where reasonable, original records relating to any invention for which Patent Rights are being considered by the JPC for any such listing. Notwithstanding the preceding sentence, Novartis will retain final decision-making authority as to the listing of all applicable Orange Book Patents for a Licensed Product that are not Ionis Core Technology Patents or Ionis Manufacturing and Analytical Patents, regardless of which Party owns such Orange Book Patent.

8.9. Joint Research Agreement under the Leahy-Smith America Invents Act. If a Party intends to invoke its rights under 35 U.S.C. § 102(c) of the Leahy-Smith America Invents Act, it will notify the other Party and neither Party will make an election under such provision when exercising its rights under this Article 8 (Intellectual Property) without the prior written consent of the other Party (such consent not to be unreasonably withheld, conditioned or delayed), and the Parties will use reasonable efforts to cooperate and coordinate their activities with respect to any submissions, filings or other activities in support thereof. The Parties acknowledge and agree that this Agreement is a “joint research agreement” as defined in 35 U.S.C. § 100(h).

8.10. Obligations to Third Parties. Notwithstanding any of the foregoing, each Party’s rights and obligations with respect to Licensed Technology under this Article 8 (Intellectual Property) will be subject to the restrictions set forth in Section 5.7 (License Conditions; Limitations), provided, however, that, to the extent that Ionis has a non-transferable right to prosecute, maintain or enforce any Patent Rights licensed to Novartis hereunder and, this Agreement purports to grant any such rights to Novartis, Ionis will use reasonable efforts to act in such regard with respect to such Patent Rights at Novartis’ reasonable direction and expense.

8.11. Additional Rights and Exceptions. Other than as set forth in this Article 8 (Intellectual Property), Ionis retains the sole right to Prosecute and Maintain Ionis Core Technology Patents and Ionis Manufacturing and Analytical Patents during the Agreement Term and to control any enforcement of Ionis Core Technology Patents and Ionis Manufacturing and Analytical Patents, and will take the lead on such enforcement solely to the extent that the scope or validity of any Patent Rights Controlled by Ionis and Covering the Ionis Core Technology Patents or Ionis Manufacturing and Analytical Patents is at risk.

8.12. Patent Term Extension. If requested by Novartis, Ionis will cooperate in obtaining patent term restoration (including under the Drug Price Competition and Patent Term Restoration Act), supplemental protection certificates or their equivalents, and patent term extensions wherever applicable to a Licensed Product. Ionis will provide all reasonable assistance requested by Novartis, including permitting Novartis to proceed with applications for such in the name of Ionis, if deemed appropriate by Novartis, and executing documentation and providing any relevant information to Novartis. Novartis will in its sole discretion determine which Ionis Product-Specific Patents will be extended.

ARTICLE 9

REPRESENTATIONS, WARRANTIES AND COVENANTS

9.1. Representations and Warranties of Both Parties. Each Party hereby represents and warrants as of the Execution Date (and covenants as applicable) to the other Party that:

9.1.1. it is a corporation duly organized, validly existing, and in good standing under the laws of its jurisdiction of incorporation;

9.1.2. it has the power and authority and the legal right to enter into this Agreement and perform its obligations hereunder, and that it has taken all necessary action on its part required to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder;

9.1.3. this Agreement has been duly executed and delivered on behalf of such Party and constitutes a legal, valid and binding obligation of such Party and is enforceable against it in accordance with its terms subject to the effects of bankruptcy, insolvency or other laws of general application affecting the enforcement of creditor rights and judicial principles affecting the availability of specific performance and general principles of equity, whether enforceability is considered a Proceeding at law or equity;

9.1.4. all necessary consents, approvals and authorizations of all Regulatory Authorities and other parties required to be obtained by such Party in connection with the execution and delivery of this Agreement and the performance of its obligations hereunder have been obtained;

9.1.5. the execution and delivery of this Agreement and the performance of such Party’s obligations hereunder (a) do not conflict with or violate any requirement of Applicable Law or any provision of the certificate of incorporation, bylaws or any similar instrument of such Party, as applicable, and (b) do not conflict with, violate, or breach or constitute a default or require any consent not already obtained under, any contractual obligation or court or administrative order by which such Party is bound;

9.1.6. all employees, consultants, or (sub)contractors (except academic collaborators or Third Parties under material transfer agreements) of such Party or Affiliates performing development activities hereunder on behalf of such Party will be obligated to assign all right, title and interest in and to any inventions developed by them, whether or not patentable, to such Party or Affiliate, respectively, as the sole owner thereof;

9.1.7. (a) neither such Party nor, to the actual knowledge of such Party, any employee, agent or subcontractor of such Party involved or to be involved in the Development or Research of the Licensed Products has been debarred under Subsection (a) or (b) of Section 306 of the Federal Food, Drug and Cosmetic Act (21 U.S.C. 335a) or under comparable Applicable Law; (b) no Person who is known by such Party to have been debarred under Subsection (a) or (b) of Section 306 of said Act or under comparable Applicable Law will be employed by such Party in the performance of any activities hereunder; (c) to the actual knowledge of such Party, no Person on any of the FDA clinical investigator enforcement lists (including, but not limited to, the (1) Disqualified/Totally Restricted List, (2) Restricted List and (3) Adequate Assurances List) will participate in the performance of any activities hereunder and (d) if either Party becomes aware of the debarment or threatened debarment of any person or entity providing services to such Party, including the Party itself and its Affiliates, which directly or indirectly relate to activities under this Agreement, the other Party will be immediately notified in writing;

9.1.8. Ionis has taken and each Party will take reasonable precautions to preserve the confidentiality of the Licensed Know-How, including requiring each Person having access to the Licensed Know-How to be subject to confidentiality, non-use, and non-disclosure obligations protecting the Licensed Know-How as the confidential, proprietary materials and information of Ionis;

9.1.9. there are no claims pending or, to each Party’s Knowledge, threatened against such Party or any of its Affiliates, nor is such Party or any of its Affiliates a party to any judgment or settlement, that would be reasonably expected to adversely affect or restrict the ability of such Party to consummate any of the transactions contemplated under this Agreement or to perform any of its obligations under this Agreement, or which would affect any of the Licensed Technology, including the Licensed Patents, or Ionis’s Control thereof, or any Licensed Product;

9.1.10. all non-Clinical and Clinical studies and trials conducted by a Party for a Licensed Product will be conducted in accordance with Applicable Law including, as applicable, GLP and GCP; and

9.1.11. each Party and its Affiliates have conducted and will conduct their business in compliance with the Foreign Corrupt Practices Act of 1977, the UK Bribery Act of 2010 and any other applicable anti-corruption Laws.

9.2. Representations, Warranties and Covenants of Ionis. As of the Execution Date [***] (unless otherwise noted below), Ionis represents, warrants and, as applicable, covenants to Novartis that, except as set forth on Schedule 9.2 (Ionis Disclosure Schedule) (which schedule may be updated with respect to [***]):

9.2.1. Ionis is the sole and exclusive owner or exclusive licensee of, and has the right to grant all rights and licenses it purports to grant to Novartis with respect to, the Warranty Technology, free and clear of all liens, claims, security interests or other encumbrances of any kind (including prior license grants other than under the Ionis In-License Agreements) that would interfere, or the exercise of which would interfere, with Novartis’ exercise of any license or right granted, or that may be granted, hereunder;

9.2.2. Ionis is listed in the records of the appropriate governmental agencies as the sole and exclusive owner of record or exclusive licensee for each registration, grant and application included in the Warranty Patents;

9.2.3. the Warranty Technology owned by Ionis and, to Ionis’s Knowledge, the Warranty Technology licensed by Ionis was not and will not be funded by the U.S. federal government or otherwise subject to any rights of the U.S. federal government under the Bayh-Dole Act;

9.2.4. all Warranty Patents have been filed, prosecuted and maintained properly and correctly in all material respects;

9.2.5. neither Ionis nor any of its Affiliates has previously entered into, or during the term of this Agreement will enter into, any agreement, whether written or oral, with respect to, or has otherwise assigned, transferred, licensed, conveyed or otherwise encumbered, or during the term of this Agreement will otherwise assign, transfer, license, convey or otherwise encumber, any portion of its right, title or interest in or to, the Warranty Technology (including by granting any covenant not to sue with respect thereto) in such a way as to make the representation set forth in Section 9.2.1 (Representations, Warranties and Covenants of Ionis) not true;

9.2.6. each Ionis Product-Specific Patent and, to Ionis’ Knowledge, each of the other Warranty Patents properly identifies each and every inventor of the claims thereof as determined in accordance with the laws of the jurisdiction in which such Patent Right is issued or such application is pending;

9.2.7. to Ionis’ Knowledge, the issued patents in the Warranty Patents are valid and enforceable without any claims, challenges, oppositions, nullity actions, interferences, inter-partes reexaminations, inter-partes reviews, post-grant reviews, derivation Proceedings or other Proceedings pending or threatened;

9.2.8. to Ionis’ Knowledge, neither Ionis nor any of its Affiliates has committed any act, or omitted to commit any act, that may cause the Warranty Patents to expire prematurely or be declared invalid or unenforceable;

9.2.9. all application, registration, maintenance and renewal fees in respect of the Warranty Patents existing as of the Execution Date have been paid and all necessary documents and certificates have been filed with the relevant agencies for the purpose of maintaining such Warranty Patents;

9.2.10. neither Ionis nor any of its Affiliates has received any written claim alleging that any of the Warranty Technology is invalid or unenforceable;

9.2.11. where Ionis’ or its Affiliates’ ownership of any of the Warranty Technology is based upon or depends on a sequence of historical transfers of title to any of the Warranty Technology (i.e., chain of title to the applicable Warranty Technology) being valid, effective and free from defects and other problems, if at any time there is a potential defect with the validity or effectiveness in such transfers or other problems in such chain of title, then Ionis and its Affiliates shall, at their expense, with urgency and diligence, use reasonable efforts to make any and all corrections and clarifications, including preparing any documents and obtaining any necessary Third Party signatures and consents, as may be necessary, including filing such documents in any patent office as appropriate, to remedy any such problems and to restore such chain of title;

9.2.12. (a) the Ionis In-License Agreements are set forth on Appendix 2 (Ionis In-License Agreements), (b) the licenses granted to Ionis under the Ionis In-License Agreements are in full force and effect, (c) Ionis has not received any written notice, and is not aware, of any breach by any party to the Ionis In-License Agreements, and (d) Ionis’ performance of its obligations under this Agreement (including the Research Plan as it exists on the Execution Date) will not constitute a breach of Ionis’ obligations under the Ionis In-License Agreements or the licenses granted to Ionis thereunder;

9.2.13. to Ionis’ Knowledge, in respect of the pending United States patent applications included in the Warranty Patents, Ionis or its Affiliates have submitted all material prior art of which it or they are aware in accordance with the requirements of the United States Patent and Trademark Office;

9.2.14. to Ionis’ Knowledge, there are no rights of any Person that may be infringed, misappropriated or violated by any of the activities specifically anticipated by Ionis as of the Execution Date to be performed under this Agreement; provided that Novartis cannot assert a claim against Ionis for breach of this Section 9.2.14 (Representations, Warranties and Covenants of Ionis) related to any Third Party Patent Rights Novartis has Knowledge of as of the Execution Date;

9.2.15. as of the Execution Date, neither Ionis nor any of its Affiliates has initiated or been involved in any claim in which it has alleged that any Third Party is or was infringing or misappropriating any Warranty Technology, nor has any such claim been threatened by Ionis or any of its Affiliates, nor do Ionis or any of its Affiliates know of any valid basis for any such claim;

9.2.16. except for the Ionis In-License Agreements, there are no agreements between Ionis or any of its Affiliates and any Third Party pursuant to which Ionis or its Affiliate has in-licensed or otherwise acquired Control of any of the Warranty Technology;

9.2.17. to Ionis’ Knowledge, no officer, employee or consultant of Ionis or any of its Affiliates is, or during the term of this Agreement will be, subject to any agreement that requires such individual to assign any interest in any Warranty Technology to any Third Party;

9.2.18. the Patent Rights listed in Appendices 5 (Ionis Core Technology Patents), 6 (Ionis Manufacturing and Analytical Patents) and 7 (Ionis Product-Specific Patents) are a complete and correct listing of the relevant Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents, and Ionis Product-Specific Patents which are owned or otherwise Controlled by Ionis;

9.2.19. other than the Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents and Ionis Product-Specific Patents, no other Patent Rights are owned by or licensed to Ionis or any of its Affiliates as of the Execution Date that are necessary or reasonably useful for the Research Activities;

9.2.20. except as otherwise expressly provided in this Agreement, Ionis or its Affiliate shall be and remain solely responsible for fulfilling and performing at its cost and expense, any and all obligations under each Ionis In-License Agreement, including timely, full and complete payment of any and all amounts due thereunder or in connection therewith to the other parties thereto;

9.2.21. Ionis shall not, and shall cause its Affiliates not to, incur or permit to exist, with respect to any Licensed Technology, any lien, encumbrance, charge, security interest, mortgage, liability, assignment, grant of license or other obligation that is or would be inconsistent with the licenses and other rights granted to, or that may be granted to, Novartis under this Agreement;

9.2.22. Ionis shall not enter into any amendment to any Ionis In-License Agreement that adversely affects any rights granted to, or that may be granted to, Novartis hereunder without the prior written consent of Novartis;

9.2.23. Ionis will promptly furnish Novartis with true and complete copies of all amendments to the Ionis In-License Agreements arising after the Execution Date;

9.2.24. Ionis will remain, and cause its Affiliates to remain, in compliance in all material respects with all Ionis In-License Agreements; and

9.2.25. Ionis will furnish Novartis with copies of all notices received by it or any of its Affiliates relating to any alleged breach or default by Ionis or any of its Affiliates under any Ionis In-License Agreement within [***] after receipt thereof and thereafter furnish Novartis with copies of all correspondence and summaries of material discussions between the applicable parties to the Ionis In-License Agreement relating to the alleged breach, including any proposed resolution of the matter.

9.3. Novartis Covenant. During the Agreement Term, neither Novartis nor its Affiliates will (independently or with a Third Party) Exploit any Licensed Compounds except as Development Candidates or as included in Licensed Products under this Agreement; provided, that the foregoing restriction will not prohibit Novartis from (a) outside of the activities conducted under this Agreement, Exploiting any Novartis Compound that (i) targets and modulates another target other than APO(a) as its primary mechanism of action and (ii) does not modulate APO(a) or (b) Researching any Licensed Compound in accordance with the license grant under Section 5.1.1(a)(iii) (License for Research Activities).

9.4. DISCLAIMER OF WARRANTY. EXCEPT FOR THE EXPRESS WARRANTIES SET FORTH IN THIS ARTICLE 9 (REPRESENTATIONS, WARRANTIES AND COVENANTS), NOVARTIS AND IONIS MAKE NO REPRESENTATIONS AND GRANT NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND NOVARTIS AND IONIS EACH SPECIFICALLY DISCLAIM ANY WARRANTIES, WHETHER WRITTEN OR ORAL, OR EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE OR ANY WARRANTY AS TO THE VALIDITY OF ANY PATENT RIGHTS OR THE NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

ARTICLE 10

INDEMNIFICATION; INSURANCE

10.1. Indemnification by Novartis. Novartis agrees to defend Ionis, its Affiliates and their respective directors, officers, employees and their respective successors, heirs and assigns (collectively, the “Ionis Indemnitees”), and will indemnify and hold harmless the Ionis Indemnitees, from and against any liabilities, losses, costs, damages, fees or expenses payable to a Third Party, and reasonable attorneys’ fees and other legal expenses with respect thereto (collectively, “Losses”) arising out of any claim, action, lawsuit or other Proceeding by a Third Party (collectively, “Third Party Claims”) brought against any Ionis Indemnitee and resulting from or occurring as a result of: (a) any activities conducted by a Novartis employee, consultant, Affiliate, Sublicensee, or (sub)contractor in the performance of the activities Novartis agrees to perform under this Agreement, including, the Manufacture, Research, Development or Commercialization of any Licensed Product, or (b) any breach by Novartis of any of its representations, warranties or covenants pursuant to this Agreement; except in any such case to the extent such Losses result from: (i) the negligence or willful misconduct of any Ionis Indemnitee, (ii) any breach by Ionis of any of its representations, warranties, covenants or obligations pursuant to this Agreement, or (iii) any breach of Applicable Law by any Ionis Indemnitee, and provided that Novartis shall not be obliged to so indemnify, defend and hold harmless the Ionis Indemnitees for any claims for which Ionis has an obligation to indemnify Novartis Indemnitees pursuant to Section 10.2 (Indemnification by Ionis).

10.2. Indemnification by Ionis. Ionis agrees to defend Novartis, its Affiliates and their respective directors, officers, employees and their respective successors, heirs and assigns (collectively, the “Novartis Indemnitees”), and will indemnify and hold harmless the Novartis Indemnitees, from and against any Losses arising out of Third Party Claims brought against any Novartis Indemnitee and resulting from or occurring as a result of: (a) any activities that an Ionis employee, consultant, Affiliate, Sublicensee, or (sub)contractor has undertaken in respect of Licensed Products either outside the scope of this Agreement, or in the performance of the activities Ionis agreed to perform under this Agreement, including the Manufacture, Research, Development or Commercialization of any Licensed Product or Terminated Product, or (b) any breach by Ionis of any of its representations, warranties or covenants pursuant to this Agreement; except in any such case to the extent such Losses result from: (i) the negligence or willful misconduct of any Novartis Indemnitee, (ii) any breach by Novartis of any of its representations, warranties, covenants or obligations pursuant to this Agreement, or (iii) any breach of Applicable Law by any Novartis Indemnitee, and provided that Ionis shall not be obliged to so indemnify, defend and hold harmless the Novartis Indemnitees for any claims for which Novartis has an obligation to indemnify Ionis Indemnitees pursuant to Section 10.1 (Indemnification by Novartis).

10.3. Notice of Claim. If an Ionis Indemnitee or Novartis Indemnitee seeks indemnification (as applicable) (such Party, the “Indemnified Party”), then the Indemnified Party will give the indemnifying Party prompt written notice (an “Indemnification Claim Notice”) of any Losses or the discovery of any fact upon which the Indemnified Party intends to base a request for indemnification under Section 10.1 (Indemnification by Novartis) or Section 10.2 (Indemnification by Ionis), but in no event will the indemnifying Party be liable for any Losses to the extent such Losses result from any delay in providing such notice. The failure or delay to so notify the Indemnified Party shall not relieve the indemnifying Party of any obligation or liability to the Indemnified Party, except to the extent that the indemnifying Party demonstrates that its ability to defend or resolve such claim is adversely affected as a result of such failure or delay. Each Indemnification Claim Notice must contain a description of the claim and the nature and amount of such Loss (to the extent that the nature and amount of such Loss is known at such time). The Indemnified Party will furnish promptly to the indemnifying Party copies of all papers and official documents received or sent in respect of any Losses and Third Party Claims.

10.4. Defense, Settlement, Cooperation and Expenses.

10.4.1. Control of the Defense. At its option, the indemnifying Party may assume the defense and handling of any Third Party Claim by giving written notice to the Indemnified Party within 30 calendar days after the indemnifying Party’s receipt of an Indemnification Claim Notice. The assumption and handling of the defense of a Third Party Claim by the indemnifying Party shall not be construed as an acknowledgment that the indemnifying Party is liable to indemnify the Indemnified Party in respect of the Third Party Claim, nor shall it constitute a waiver by the indemnifying Party of any defenses it may assert against the Indemnified Party’s claim for indemnification. Upon assuming the defense of a Third Party Claim, the indemnifying Party may appoint as lead counsel in the defense of the Third Party Claim any legal counsel selected by the indemnifying Party. If the indemnifying Party assumes the defense of a Third Party Claim, the Indemnified Party will as soon as is reasonably possible deliver to the indemnifying Party all original notices and documents (including court papers) received or sent by the Indemnified Party in connection with the Third Party Claim. Should the indemnifying Party assume the defense of a Third Party Claim, except as provided in this Section 10.4.1 (Control of the Defense), the Indemnified Party will be responsible for the legal costs or expenses subsequently incurred by such Indemnified Party in connection with the analysis, defense or settlement of the Third Party Claim.

10.4.2. Right to Participate in Defense. Without limiting Section 10.4.1 (Control of the Defense), any Indemnified Party will be entitled to participate in, but not control, the defense of such Third Party Claim and to employ counsel of its choice for such purpose; provided, however, that such employment will be at the Indemnified Party’s own cost and expense unless (a) the employment thereof has been specifically authorized by the indemnifying Party in writing, (b) the indemnifying Party has failed to assume the defense and employ counsel in accordance with Section 10.4.1 (Control of the Defense) (in which case the Indemnified Party will control the defense), or (c) the interests of the Indemnified Party and the indemnifying Party with respect to such Third Party Claim are sufficiently adverse to prohibit the representation by the same counsel of both Parties under Applicable Law, ethical rules or equitable principles in which case the indemnifying Party will be responsible for any such costs and expenses of counsel for the Indemnified Party.

10.4.3. Settlement. With respect to any Third Party Claims relating solely to the payment of money damages in connection with a Third Party Claim and that will not admit liability or violation of Law on the part of the Indemnified Party or result in the Indemnified Party’s becoming subject to injunctive or other relief or otherwise adversely affecting the business of the Indemnified Party in any manner (such as granting a license or admitting the invalidity of a Patent Right Controlled by an Indemnified Party), and as to which the indemnifying Party will have acknowledged in writing the obligation to indemnify the Indemnified Party hereunder, the indemnifying Party will have the sole right to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss, on such terms as the indemnifying Party, in its sole discretion, will deem appropriate. With respect to all other Losses in connection with Third Party Claims, where the indemnifying Party has assumed the defense of the Third Party Claim in accordance with Section 10.4.1 (Control of the Defense), the indemnifying Party will have authority to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss provided it obtains the prior written consent of the Indemnified Party (which consent will not be unreasonably withheld, delayed or conditioned). The indemnifying Party will not be liable for any settlement, consent to entry of judgment, or other disposition of a Loss by an Indemnified Party that is reached without the written consent of the indemnifying Party. Regardless of whether the indemnifying Party chooses to defend or prosecute any Third Party Claim, no Indemnified Party will admit any liability with respect to or settle, compromise or discharge, any Third Party Claim without the prior written consent of the indemnifying Party, such consent not to be unreasonably withheld, delayed or conditioned.

10.4.4. Cooperation. Regardless of whether the indemnifying Party chooses to defend or prosecute any Third Party Claim, the Indemnified Party will, and will cause each other Indemnified Party to, cooperate in the defense or prosecution thereof and will furnish such records, information and testimony, provide such witnesses and attend such conferences, discovery Proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith. Such cooperation will include access during normal business hours afforded to indemnifying Party to, and reasonable retention by the Indemnified Party of, records and information that are reasonably relevant to such Third Party Claim, and making Indemnified Parties and other employees and agents available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder, and the indemnifying Party will reimburse the Indemnified Party for all its reasonable out-of-pocket costs and expenses in connection therewith.

10.4.5. Costs and Expenses. Except as provided above in this Section 10.4 (Defense, Settlement, Cooperation and Expenses), the costs and expenses, including attorneys’ fees and expenses, incurred by the Indemnified Party in connection with any claim will be reimbursed on a Calendar Quarter basis by the indemnifying Party, without prejudice to the indemnifying Party’s right to contest the Indemnified Party’s right to indemnification and subject to refund in the event the indemnifying Party is ultimately held not to be obligated to indemnify the Indemnified Party.

10.5. Insurance.

10.5.1. Ionis’ Insurance Obligations. Ionis will maintain, at its cost, reasonable insurance against liability and other risks associated with its activities contemplated by this Agreement, including its indemnification obligations herein, in such amounts and on such terms as are customary for prudent practices for biotech companies of similar size and with similar resources in the pharmaceutical industry for the activities to be conducted by it under this Agreement taking into account the scope of development of Licensed Products. Any deductibles associated with Ionis’ insurance programs are the responsibility of Ionis and may not be passed on to Novartis. Such insurance will not be construed to create a limit of Ionis’ liability with respect to its indemnification obligations under this Article 10 (Indemnification).

10.5.2. Novartis’ Insurance Obligations. Novartis will maintain, at its cost, reasonable insurance against liability and other risks associated with its activities contemplated by this Agreement (including product liability), including its indemnification obligations herein, in such amounts and on such terms as are customary for prudent practices for large companies in the pharmaceutical industry for the activities to be conducted by Novartis under this Agreement; provided, that Ionis hereby acknowledges and agrees that such obligation may be satisfied by a program of self-insurance that is consistently applied across Novartis’ other programs. Any deductibles associated with Novartis’ insurance programs are the responsibility of Novartis and shall not be passed on to Ionis. Such insurance will not be construed to create a limit of Novartis’ liability with respect to its indemnification obligations under this Article 10 (Indemnification).

10.6. LIMITATION OF CONSEQUENTIAL DAMAGES. EXCEPT FOR (A) THIRD PARTY CLAIMS THAT ARE SUBJECT TO INDEMNIFICATION UNDER THIS ARTICLE 10 (INDEMNIFICATION; INSURANCE), (B) CLAIMS ARISING OUT OF A PARTY’S WILLFUL MISCONDUCT OR FRAUD UNDER THIS AGREEMENT, (C) A PARTY’S BREACH OF ARTICLE 4 (EXCLUSIVITY), OR (D) CLAIMS ARISING OUT OF A PARTY’S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT, NEITHER PARTY NOR ANY OF ITS AFFILIATES WILL BE LIABLE TO THE OTHER PARTY TO THIS AGREEMENT OR ITS AFFILIATES FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR OTHER INDIRECT DAMAGES OR LOST OR IMPUTED PROFITS OR ROYALTIES, WHETHER LIABILITY IS ASSERTED IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT PRODUCT LIABILITY), INDEMNITY OR CONTRIBUTION, AND IRRESPECTIVE OF WHETHER THAT PARTY OR ANY REPRESENTATIVE OF THAT PARTY HAS BEEN ADVISED OF, OR OTHERWISE MIGHT HAVE ANTICIPATED THE POSSIBILITY OF, ANY SUCH LOSS OR DAMAGE.

ARTICLE 11

TERM; TERMINATION

11.1. Agreement Term; Expiration. Except as otherwise set forth in Section 5.11 (HSR Matters), this Agreement is effective as of the Effective Date and, unless earlier terminated pursuant to the other provisions of this Article 11 (Term; Termination), will continue in full force and effect until this Agreement expires as follows:

11.1.1. on a country-by-country and Licensed Product-by-Licensed Product basis, on the date of expiration of all payment obligations by Novartis under this Agreement with respect to such Licensed Product in such country;

11.1.2. in its entirety upon the expiration of all payment obligations by Novartis under this Agreement with respect to the last Licensed Product in all countries pursuant to Section 11.1.1 (Agreement Term; Expiration); or

11.1.3. in its entirety if, by the end of the Carryover Period, the JSC has not designated a Development Candidate (or no Licensed Product License for a Development Candidate has become effective in accordance with Section 5.11.2(d)), provided, that if Novartis has identified a Licensed Compound that it reasonably believes satisfies the Development Candidate Criteria and has started the internal processes for approval to have the JSC designate such Licensed Compound as a Development Candidate, the Agreement will be extended by up to 60 calendar days to allow for such approval.

The period from the Effective Date until the date of expiration of this Agreement pursuant to this Section 11.1 (Agreement Term; Expiration) or earlier termination of this Agreement pursuant to Section 11.2 (Termination of the Agreement), is the “Agreement Term.”

11.2. Termination of the Agreement.

11.2.1. Novartis’ Termination for Convenience. At any time after the Effective Date following payment by Novartis of the Upfront Fee under Section 7.1 (Upfront Fee), subject to Section 11.3 (Consequences of Expiration or Termination of this Agreement) below, Novartis will be entitled to, in its sole discretion, terminate this Agreement in its entirety or in part on a Licensed Product-by-Licensed Product basis for convenience by providing [***] written notice to Ionis of such termination.

11.2.2. Termination for Material Breach.

(a) Novartis’ Right to Terminate. Subject to Section 11.2.3(b) (Remedies for Failure to Use Commercially Reasonable Efforts), if Novartis has reason to believe that Ionis is in material breach of this Agreement, then Novartis may deliver notice of such material breach to Ionis. Ionis will have [***] to cure such breach (except to the extent such breach involves the failure to make a payment when due, which breach must be cured within [***] following such notice). If Ionis fails to cure such breach within such [***] or [***] period, as applicable, then Novartis may terminate this Agreement in its entirety if such breach relates to this Agreement in its entirety, or in relevant part on a Licensed Product-by-Licensed Product basis if such breach does not relate to this Agreement in its entirety, by providing written notice to Ionis.

(b) Ionis’ Right to Terminate. Subject to Section 11.2.3(a) (Remedies for Failure to Use Commercially Reasonable Efforts), if Ionis has reason to believe that Novartis is in material breach of this Agreement, then Ionis may deliver notice of such material breach to Novartis. Novartis will have [***] to cure such breach (except to the extent such breach involves the failure to make a payment when due, which breach must be cured within [***] following such notice). If Novartis fails to cure such breach within such [***] or [***] period, as applicable, Ionis may terminate this Agreement in its entirety if such breach relates to this Agreement in its entirety, or in relevant part on a Licensed Product-by-Licensed Product basis if such breach does not relate to this Agreement in its entirety, by providing written notice to Novartis.

11.2.3. Remedies for Failure to Use Commercially Reasonable Efforts.

(a) If Ionis fails to use Commercially Reasonable Efforts as contemplated in Section 2.9 (Conduct of Research Activities) in material breach of this Agreement, Novartis may notify Ionis and, within [***] thereafter, Ionis and Novartis will meet through the JSC (or directly if the JSC has been dissolved) and attempt to resolve the matter in good faith, and to devise a mutually agreeable plan to address any outstanding issues related to Ionis’s use of Commercially Reasonable Efforts in Section 2.9 (Conduct of Research Activities). Following such a meeting, if Ionis fails to use Commercially Reasonable Efforts as contemplated in Section 2.9 (Conduct of Research Activities) and such failure constitutes a material breach of this Agreement, then subject to Section 11.2.4 (Disputes Regarding Material Breach) below, Novartis will have the right, at its sole discretion, to terminate this Agreement in whole or in part on a Licensed Product-by-Licensed Product basis or elect the alternative remedy in lieu of terminating this Agreement, in each case pursuant to the terms (including the cure period) of Section 11.2.2 (Termination for Material Breach).

(b) If Novartis fails to use Commercially Reasonable Efforts as contemplated in Section 2.9 (Conduct of Research Activities), Section 6.1 (Development) or Section 6.3 (Commercialization) in material breach of this Agreement, Ionis may notify Novartis and, within [***] thereafter, Ionis and Novartis will meet and confer to discuss and resolve the matter in good faith, and attempt to devise a mutually agreeable plan to address any outstanding issues related to Novartis’ use of Commercially Reasonable Efforts in Section 2.9 (Conduct of Research Activities), Section 6.1 (Development) or Section 6.3 (Commercialization). Following such a meeting, if Novartis fails to use Commercially Reasonable Efforts as contemplated in Section 2.9 (Conduct of Research Activities), Section 6.1 (Development) or Section 6.3 (Commercialization), and such failure constitutes a material breach of this Agreement then subject to Section 11.2.4 (Disputes Regarding Material Breach) below, Ionis will have the right, at its sole discretion, to terminate this Agreement in part on a Licensed Product-by-Licensed Product basis pursuant to the terms (including the cure period) of Section 11.2.2 (Termination for Material Breach).

11.2.4. Disputes Regarding Material Breach. Notwithstanding the foregoing, if the Breaching Party in Section 11.2.2 (Termination for Material Breach) or Section 11.2.3 (Remedies for Failure to Use Commercially Reasonable Efforts) disputes in good faith the existence, materiality, or failure to cure any such breach and provides notice to the Non-Breaching Party or, as applicable, terminating Party of such dispute within such [***] or [***] cure period, as applicable, the Non-Breaching Party will not have the right to terminate this Agreement in accordance with Section 11.2.2 (Termination for Material Breach), or Section 11.2.3 (Remedies for Failure to Use Commercially Reasonable Efforts), unless and until it has been determined in accordance with Section 13.1 (Arbitration) that this Agreement was materially breached by the Breaching Party and the Breaching Party fails to cure such breach within [***] or [***], as applicable, following such determination. It is understood and acknowledged that during the pendency of such dispute, all the terms and conditions of this Agreement will remain in effect and the Parties will continue to perform all of their respective obligations hereunder, including satisfying any payment obligations.

11.2.5. Termination for Insolvency.

(a) Either Party may terminate this Agreement if, at any time, the other Party files in any court or agency pursuant to any statute or regulation of any state or country a petition in bankruptcy or insolvency or for the appointment of a receiver or trustee of the Party or of substantially all of its assets; or if the other Party proposes a written agreement of composition or extension of substantially all of its debts; or if the other Party will be served with an involuntary petition against it, filed in any insolvency Proceeding, and such petition will not be dismissed within 90 calendar days after the filing thereof; or if the other Party will propose or be a party to any dissolution or liquidation; or if the other Party will make an assignment of substantially all of its assets for the benefit of creditors.

(b) All rights and licenses granted under or pursuant to any section of this Agreement are and will otherwise be deemed to be for purposes of Section 365(n) of Title 11, United States Code (the “Bankruptcy Code”) or analogous provisions of Applicable Law outside the U.S. licenses of rights to “intellectual property” as defined in Section 101(56) of the Bankruptcy Code or analogous provisions of Applicable Law outside the U.S. The Parties will retain and may fully exercise all of their respective rights and elections under the Bankruptcy Code or analogous provisions of Applicable Law outside the U.S. Upon the commencement of a bankruptcy Proceeding of any Party, the non-bankrupt Party will further be entitled to a complete duplicate of, or complete access to, any such intellectual property, and all embodiments which, if not already in its possession, will be promptly delivered to the non-bankrupt Party upon written request.

11.2.6. Termination for Safety Issue. Novartis shall have the right to terminate this Agreement with respect to a Licensed Product, upon [***] written notice to Ionis, without any further obligations or liabilities towards Ionis (other than the consequences of termination set forth in Section 11.5 (Consequences of Expiration or Termination of this Agreement) below), to the extent applicable, if, during the Agreement Term, Novartis, based on applicable data, determines reasonably and in good faith that the continued Development or Commercialization of such Licensed Product presents safety concerns that pose a material risk or threat of harm in humans that, in Novartis’ reasonable and good faith determination are unable to be resolved through reasonable additional Development activities. Such determination shall be [***].

11.3. Remedy for Patent Challenge. If Novartis or its Affiliates disputes, or assists any Third Party to dispute, the validity of any Licensed Patent, in a patent re-examination, inter partes review, post grant or other patent-office Proceeding, opposition, litigation, or other court Proceeding and, within 60 calendar days from written notice from Ionis, Novartis fails to rescind any and all of such actions, Ionis may [***] by providing written notice of such [***] to Novartis, provided however that, nothing in this clause prevents Novartis or its Affiliates from taking any of the actions referred to in this clause and provided further that Ionis will not have the right to [***] if Novartis or its Affiliates (a) asserts invalidity as a defense in any court Proceeding brought by Ionis or its Affiliates asserting infringement of a Licensed Patent; or (b) acquires a Third Party that has an existing challenge, whether in a court or administrative Proceeding, against a Licensed Patent.

11.4. Alternative Remedy in Lieu of Termination. If Novartis has the right to terminate this Agreement in its entirety pursuant to Section 11.2.2(a) (Novartis’ Right to Terminate) (after giving effect to the applicable cure period under Section 11.2.2(a) (Novartis’ Right to Terminate)) for any material breach of this Agreement other than a payment breach, then in lieu of Novartis’ terminating this Agreement pursuant to Section 11.2.2(a) (Novartis’ Right to Terminate), Novartis will have the right to elect (in its sole discretion) by written notice to Ionis to have this Agreement continue in full force and effect, except that [***]; provided that such right, if exercised, will be Novartis’ sole and exclusive remedy with respect to the events giving rise to Novartis’ termination right. Novartis must provide Ionis with written notice that it is electing to exercise the alternative remedy set forth in this Section 11.4 (Alternative Remedy in Lieu of Termination) within [***] after expiration of the applicable cure period (as tolled pursuant to Section 11.2.4 (Disputes Regarding Material Breaches)) and, in any event, prior to initiating the damages phase of any arbitration proceeding with respect to such breach pursuant to Section 13.1 (Arbitration).

11.5. Consequences of Expiration or Termination of this Agreement.

11.5.1. Consequence of Termination of this Agreement. If this Agreement expires in accordance with Section 11.1.3 or is terminated by a Party in accordance with Section 11.2 (Termination of the Agreement) in its entirety or on a Licensed Product-by-Licensed Product basis at any time and for any reason, the following terms will apply to any such expiration or termination, but only to the extent of any such termination (i.e., with respect to any Terminated Product or in its entirety):

(a) Licenses and Compounds. Any license granted by Ionis to Novartis under Section 5.1 (License Grants to Novartis) will terminate. Novartis and its Affiliates and, subject to Section 5.3.4 (Effect of Termination on Sublicenses), its Sublicensees will cease selling Terminated Products under such licenses; provided, that (i) Novartis and its Affiliates and Sublicensees will have the right to sell any remaining inventory of Terminated Product over a period of no greater than [***] after the effective date of such termination and Novartis will pay Ionis royalties in accordance with Section 7.7 (Royalty Payments) on the Net Sales of such inventory of such Terminated Products, to the extent not already paid; and (ii) if there are any Clinical Studies being conducted at the date of termination, Novartis shall be entitled to continue Developing and Manufacturing Terminated Products to the extent and for the period necessary to effect an orderly transfer or wind down of such Clinical Studies in a timely manner and in accordance with all Applicable Law. In addition, Novartis and its Affiliates will not (independently or with a Third Party) Exploit any Licensed Compounds or any product containing any Licensed Compound after the effective date of termination, provided that the foregoing restriction will not prohibit Novartis from (A) Exploiting any Novartis Compound that (1) targets and modulates another target other than APO(a) as its primary mechanism of action and (2) does not modulate APO(a) or (B) solely in the event of termination after designation of a Development Candidate, Researching or Manufacturing any Novartis Compound other than a Novartis Compound that was designated as a Development Candidate.

(b) Exclusivity. If this Agreement is terminated in its entirety, then neither Party will have any further obligations under Article 4 (Exclusivity) of this Agreement.

(c) Research Plan. Neither Party will have any further obligations with respect to the Terminated Product under the Research Plan.

(d) Return of Information and Materials. The Parties will return (or destroy) all data, files, records and other materials containing or comprising the other Party’s Confidential Information to which it does not retain rights under the surviving provisions of this Agreement. Notwithstanding the foregoing, the Parties will be permitted to retain one copy of such data, files, records, and other materials for archival and legal compliance purposes. Each Party will also be permitted to retain such additional copies of or any computer records or files containing the other Party’s Confidential Information that have been created solely by automatic archiving and back-up procedures, to the extent created and retained in a manner consistent with the retaining Party’s standard archiving and back-up procedures, but not for any other use or purpose. All Confidential Information shall continue to be subject to the terms of this Agreement for the period set forth in Article 12 (Confidentiality).

(e) Accrued Rights. Termination of this Agreement for any reason will be without prejudice to any rights or financial compensation that have accrued to the benefit of a Party prior to such termination. Such termination will not relieve a Party from obligations that are expressly indicated to survive the termination of this Agreement. For purposes of clarification, milestone payments under Article 7 (Financial Provisions) accrue as of the date the applicable milestone event is achieved even if the payment is not due at the time of termination and royalty payments under Article 7 (Financial Provisions) accrue as of the date the applicable Net Sale even if the payment is not due at the time of termination.

11.5.2. Survival. In addition to the expiration or termination consequences set forth in this Section 11.5 (Consequences of Expiration or Termination of this Agreement), the following provisions of this Agreement will survive the expiration of this Agreement pursuant to Section 11.1 (Agreement Term; Expiration) or earlier termination of this Agreement pursuant to Section 11.2 (Termination of this Agreement): Section 2.4 (Research Costs) (with respect to any costs accrued prior to expiration or the date of the notice of termination), Section 2.10.1 (Records), Section 5.1.2 (Licensed Product License) ((1) in the event of expiration, solely in accordance with Section 5.5 (Consequence of Natural Expiration of this Agreement) and (2) in the event of termination, solely as set forth and pursuant to the terms of Section 11.5.1(a) (Consequence of Termination of this Agreement)), Section 5.5 (Consequence of Natural Expiration of this Agreement), Section 5.10 (Cross-Licenses under Program Technology), Section 7.7.2 (Application of Royalty Rates), Section 7.7.3 (Limitation on Aggregate Reduction for Novartis Royalties), and Section 7.9.4 (Right to Offset) (in each case solely with respect to any financial compensation that has accrued prior to expiry or termination in accordance with Section 11.5.1(e) (Accrued Rights)), Section 7.11 (Payments) through Section 7.14 (Interest) (in each case with respect to any financial compensation that has accrued prior to expiry or termination in accordance with Section 11.5.1(e) (Accrued Rights)), Section 8.2 (Ownership), Section 8.5 (Defense of Claims Brought by Third Parties; Oppositions) through Section 8.7 (Other Infringement - Jointly Owned Program Patents) (with respect to any action initiated prior to the effective date of expiration or termination), Section 9.4 (Disclaimer of Warranty), Section 10.1 (Indemnification by Novartis) through Section 10.4 (Defense, Settlement, Cooperation and Expenses), Section 10.6 (Limitation of Consequential Damages), Section 11.5 (Consequences of Expiration or Termination of this Agreement), Article 12 (Confidentiality), Article 13 (Miscellaneous) and Appendix 1 (Definitions) (to the extent definitions are embodied in the foregoing listed Articles and Section).

11.5.3. Ionis: Special Consequences of Certain Terminations. If (A) Novartis terminates this Agreement under [***], (B) Ionis terminates this Agreement under Section 11.2.2(b) (Ionis’ Right to Terminate), Section 11.2.3(b) (Remedies for Failure to Use Commercially Reasonable Efforts), or Section 11.2.5 (Termination for Insolvency), or (C) this Agreement expires in accordance with Section 11.1.3, then, in addition to the terms set forth in Section 11.5.1 (Consequence of Termination of this Agreement), the following additional terms will also apply but only with respect to any Terminated Products:

(a) Reversion License.

(i) License Grant. Subject to Section [***], Novartis will and hereby does grant to Ionis:

(1) a sublicensable, worldwide, exclusive royalty-bearing license or sublicense, as the case may be, under all Novartis Technology (excluding Novartis Background Technology and Trademarks) Controlled by Novartis as of the effective date of such termination that is necessary for or Actually Used in the Development, Manufacture, or Commercialization of a Terminated Product as of the effective date of termination;

(2) a sublicensable, worldwide, non-exclusive royalty-bearing license or sublicense, as the case may be, under all Novartis Background Technology (excluding Trademarks) Controlled by Novartis as of the effective date of such termination that is necessary for or Actually Used in the Development, Manufacture, or Commercialization of a Terminated Product as of the effective date of termination; provided, however, that [***]; and

(3) a sublicensable, worldwide, exclusive license under any Trademarks that are solely related to a Terminated Products (excluding any Novartis corporate names and logos); in each case of (1), (2) and (3) solely to Exploit the Terminated Product (the licenses set forth in clauses (1), (2), and (3), collectively, the “Reversion License”); provided, that if Ionis determines that any Antitrust Filings are required in connection with the grant of the Reversion License, such license shall not become effective unless and until the applicable waiting period (and any extensions thereof, including any timing agreement entered into with the DOJ or FTC) under the HSR Act shall have expired or been terminated and any other required clearances under Antitrust Laws shall have been obtained.

(ii) Reversion License Economics. Promptly following notice of termination, the Parties will negotiate and agree in good faith on a reasonable compensation to be paid by Ionis to Novartis in consideration of the Reversion License, taking into account, among other things, (i) the stage of Development or Commercialization of the Terminated Products at the time of termination, (ii) the nature of the Reversion License granted to Ionis (i.e., the scope of the Patent Rights, Know-How and Trademarks included in the Reversion License and if the Reversion License includes rights to any other active pharmaceutical ingredient that is not a Licensed Compound), (iii) the reason for termination, and (iv) the relative value of the Patent Rights and Know-How licensed under the Reversion License. If the Parties cannot agree on the applicable compensation for the Reversion License within [***] of initiating good faith negotiations (a “Reversion License Dispute”), then such Reversion License Dispute shall be finally settled [***] pursuant to terms set forth in Schedule 11.5.3. For the purpose of this Section 11.5.3(a) (Ionis: Special Consequences for Certain Terminations), the term “Control” shall not include any Novartis Technology or Novartis Background Technology for which Novartis or its relevant Affiliate or Sublicensee would be obligated to pay any additional royalties, milestones or other consideration or amounts in connection with granting the Reversion License or the Exploitation of the Terminated Products by Ionis, its Affiliates or sublicensees, unless Ionis agrees in writing to pay Novartis for any and all out-of-pocket costs, including upfront payments, purchase price, milestones, royalties, any license fees, option fees, option exercise fees, and other payments paid or payable by Novartis or its Affiliates to a Third Party that owns or controls such rights to license or acquire such rights; provided that, if the applicable rights relate to both a Terminated Product and one or more other programs of Novartis or its Affiliates, then any such out-of-pocket costs that are not specific to the Exploitation of a Terminated Product (e.g., upfront payments, purchase price, etc.) will be equitably allocated by Novartis among the applicable Terminated Product and such other programs, and Ionis will only be required to reimburse Novartis for the amount that is allocated to the applicable Terminated Product.

(iii) [***]. Notwithstanding any other provision of this Agreement, if a Terminated Product [***], then [***] (such [***]), unless the Parties [***] pursuant to this Section 11.5.3(a)(iii) ([***]). If Ionis [***], then Ionis shall [***]. If Ionis [***], the Parties will [***]; provided that Ionis may [***]. If Ionis does not [***], or Ionis [***] but the Parties [***], then Novartis [***]. Notwithstanding any other provision in this Agreement, in no event shall [***] except as set forth in this Section 11.5.3(a)(iii) ([***]).

(iv) Acquisition of Alternative Technologies. As part of the negotiations for the reasonable compensation to be paid by Ionis to Novartis in consideration of the Reversion License pursuant to Section 11.5.3(a)(ii) (Reversion License Economics), the Parties will discuss whether any of the Novartis Technology that is Actually Used but not necessary for the Exploitation of the Terminated Product (or a suitable alternative) [***].

(b) Within [***] following the date of termination, Novartis will deliver to Ionis for use with respect to the Research, Development, and Commercialization of the Terminated Product, any material Know-How, data, results (to the extent such Know-How, data, and results are included in the Reversion License), regulatory information, health economic study information, communications with payors, regulatory filings, or copies thereof, as of the date of such termination that relate [***] to such Terminated Product, in each case solely to the extent in Novartis’ or its Affiliates’ or Sublicensees’ possession or control;

(c) Ionis will control and be responsible for all aspects of the Prosecution and Maintenance of all Ionis Product-Specific Patents and Novartis will provide Ionis with (and will instruct its counsel to provide Ionis with) all of the material information and records in Novartis’ and its counsel’s possession related to the Prosecution and Maintenance of such Ionis Product-Specific Patents, in each case, with respect to the Terminated Product;

(d) If requested by Ionis, Novartis will sell to Ionis all remaining API or Finished Drug Product in Novartis’ possession at a price equal to [***];

(e) Upon Ionis’ reasonable request, Novartis shall support (or use Commercially Reasonable Efforts to cause to be supported by Novartis’ CMO) at [***] sole cost and expense a technology transfer to Ionis (or Ionis’ designated Third Party supplier) of any Novartis Technology necessary or Actually Used in the Development or Manufacture of a Terminated Product as of the effective date of termination for the manufacturing and supply of API or Finished Drug Product for such Terminated Product. In addition, Novartis will (or will use Commercially Reasonable Efforts to cause Novartis’ CMO to), at [***] sole cost and expense, (i) provide reasonable support and cooperation from time to time upon Ionis’ reasonable request, with Ionis’s regulatory filings and interactions with Regulatory Authorities related to Novartis’ or such CMO’s API or Finished Drug Product manufacturing (including any required inspections), and (ii) use Commercially Reasonable Efforts to supply (or cause to be supplied by Novartis’ CMO) API or Finished Drug Product to Ionis, at a price equal to [***], for a period of up to [***] from the effective date of termination to enable Ionis to identify and contract with a suitable Third Party API or Finished Drug Product manufacturer;

(f) Novartis will assign, and hereby assigns, to Ionis, for Ionis’ exclusive use with respect to the Research, Development and Commercialization of the Terminated Products, all of Novartis’ right, title and interest in and to regulatory filings and submissions in the possession or Control of Novartis, in each case, that are necessary and solely related to the Research, Development, Manufacture, or Commercialization of Terminated Products and will take such further action as may be reasonably requested to transfer (i) regulatory documents in Ionis’ name and (ii) control of regulatory proceedings to Ionis;

(g) In the event of any failure to effect any assignment described in Section 11.5.3(f) and, with respect to any other data, results, and regulatory information covered by the Reversion License, and regulatory filings and submissions in the possession or Control of Novartis, in each case, that are necessary or Actually Used to Develop, Manufacture, or Commercialize a Terminated Product as of the effective date of termination for the Exploitation of the Terminated Product but not assigned to Ionis pursuant to Section 11.5.3(f), Novartis hereby consents and grants to Ionis and any licensee of Ionis’ with rights to a Terminated Product the right to access and reference (without any further action required on the part of Novartis, whose authorization to file this consent with any Regulatory Authority is hereby granted) any such item with respect to all Terminated Products, and Novartis will promptly execute any document reasonably requested by Ionis to effect such right of access and reference; and

(h) At Ionis’ reasonable request, the Parties will negotiate in good faith a transition services agreement for Novartis to perform certain mutually agreed transition services to (i) provide patients with continued access to the applicable Terminated Products, and (ii) enable Ionis (or Ionis’ designee) to assume and execute the responsibilities under all Regulatory Approvals and ongoing Clinical Studies for the applicable Terminated Product, (collectively, the “Transition Services”), and Ionis will pay Novartis and commercially reasonable amount to perform the Transition Services.

11.5.4. Novartis: Special Consequences of Certain Terminations. If Novartis terminates this Agreement under Section 11.2.2(a) (Novartis’ Right to Terminate), Section 11.2.3(a) (Remedies for Failure to Use Commercially Reasonable Efforts) or Section 11.2.5 (Termination for Insolvency), all of the provisions of Section 11.5.1 (Consequence of Termination of this Agreement) will apply, except that Novartis, its Affiliates, and Sublicensees will have the right to sell any remaining inventory of Terminated Product and Novartis will pay Ionis royalties in accordance with Section 7.7 (Royalty Payments) on the Net Sales of such inventory of such Terminated Products to the extent not already paid.

ARTICLE 12

CONFIDENTIALITY

12.1. Confidentiality; Exceptions. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, during the Agreement Term and for five years thereafter, the receiving Party (the “Receiving Party”) and its Affiliates will keep confidential and will not publish or otherwise disclose or use for any purpose other than as provided for in this Agreement any Confidential Information disclosed by the other Party or its Affiliates (the “Disclosing Party”). Subject to the other provisions of this Article 12 (Confidentiality), each Party shall hold as confidential such Confidential Information of the other Party and its Affiliates in the same manner and with the same protection as such Receiving Party maintains its own Confidential Information.

12.2. Prior Confidentiality Agreement Superseded. As of the Execution Date, this Agreement supersedes the Confidential Disclosure Agreement executed by Ionis and Novartis on [***] (including any and all amendments thereto). All information exchanged among Ionis and Novartis under such Confidential Disclosure Agreement are deemed Confidential Information hereunder and subject to the terms of this Article 12 (Confidentiality).

12.3. Authorized Disclosure. Except as expressly provided otherwise in this Agreement, a Receiving Party or its Affiliates may use and disclose Confidential Information of the Disclosing Party to (a) employees, agents, contractors, consultants and advisors of the Receiving Party and its Affiliates, and sublicensees and to (b) Third Parties to the extent reasonably necessary for the performance of its obligations or exercise of rights granted or reserved in this Agreement, in each case under confidentiality provisions no less restrictive than those in this Agreement. In addition, a Receiving Party or its Affiliates may disclose Confidential Information of the Disclosing Party (i) to the extent reasonably necessary to file or prosecute patent, copyright and trademark applications (subject to Section 12.4 (Press Release; Publications; Disclosure of Agreement) below), complying with applicable governmental regulations, obtaining Regulatory Approvals, conducting non-Clinical Studies or Clinical Studies, marketing a Licensed Product, or as otherwise required by Applicable Law (including the rules of the SEC and any stock exchange); provided, however, that if a Receiving Party or any of its Affiliates is required by Applicable Law to make any such disclosure of a Disclosing Party’s Confidential Information it will, except where impracticable for necessary disclosures, give reasonable advance notice to the Disclosing Party of such disclosure requirement and will use its reasonable efforts to secure confidential treatment of such Confidential Information required to be disclosed; (ii) on a need-to-know basis, in communication with actual or potential lenders, potential acquirers, investors, merger partners, consultants, or professional advisors, in each case under confidentiality provisions no less restrictive than those of this Agreement; (iii) to the extent such disclosure is required to comply with existing expressly stated contractual obligations owed to such Party’s or its Affiliates’ licensor with respect to any intellectual property licensed to the other Party under this Agreement; or (iv) as mutually agreed to in writing by the Parties.

12.4. Press Release; Publications; Disclosure of Agreement.

12.4.1. Announcement of Transaction. Subject to the consent of the other Party, each Party may issue a press release announcing the signing of this Agreement after the Effective Date.

12.4.2. Other Disclosures.

(a) Clinical Studies. Novartis has the right to disclose the existence of, and the results from, any Clinical Studies conducted under this Agreement in accordance with its standard policies.

(b) During the Research Term. Except to the extent required to comply with Applicable Law or as otherwise permitted in accordance with this Section 12.4 (Press Release; Publications; Disclosure of Agreement), during the Research Term, neither Party nor its Affiliates will make any public announcements, press releases or other public disclosures concerning a Development Candidate or Licensed Product, this Agreement or the terms or the subject matter hereof without the prior written consent of the other Party, which consent will not be unreasonably withheld, conditioned or delayed. If, during the Research Term, a Party intends to make any public announcements, press releases or other public disclosures regarding a Licensed Product, this Agreement or the terms or the subject matter hereof, (i) such Party will submit such proposed public disclosure to the other Party for review at least [***] in advance of such proposed public disclosure, (ii) the other Party will have the right to review and recommend changes to such communication, and (iii) the publishing Party will in good faith consider any changes that are timely recommended by the other Party.

(c) After Expiration of the Research Term. Except to the extent required to comply with Applicable Law or as otherwise permitted in accordance with this Section 12.4 (Press Release; Publications; Disclosure of Agreement), after expiration of the Research Term, [***] will make any public announcements, press releases or other public disclosures regarding this Agreement or the terms or the subject matter hereof, or that will materially impact a Licensed Product or Development Candidate, without the prior written consent of [***], which consent will not be unreasonably withheld, conditioned or delayed.

(i) If, after expiration of the Research Term, [***] intend to make any public announcements, press releases or other public disclosures that will materially impact a Licensed Product or Development Candidate, (A) unless [***] existing confidentiality obligations to a Third Party prohibit it from doing so, [***] will submit such proposed public disclosure to [***] for review at least [***] in advance of such proposed public disclosure, (B) [***] will have the right to review and recommend changes to such communication, and (C) [***] will in good faith consider any changes that are timely recommended by [***].

(ii) If, after expiration of the Research Term, [***] intends to make any public announcements, press releases or other public disclosures regarding this Agreement or the terms or the subject matter hereof, or that are significant to a Licensed Product ([***]), (A) [***] will submit such proposed public disclosure to [***] for review at least [***] in advance of such proposed public disclosure, (B) [***] will have the right to review and recommend changes to such communication, and (C) [***] will in good faith consider any changes that are timely recommended by [***].

12.4.3. Use of Name. Except as set forth in Section 12.4.8 (Acknowledgment), neither Party will use the other Party’s name in a press release or other publication without first obtaining the prior consent of the Party to be named.

12.4.4. Notice of Significant Events. Each Party will use Commercially Reasonable Efforts to immediately notify (and provide as much advance notice as possible, but at a minimum [***] advance notice to) the other Party of any material event related to a Licensed Product so the Parties may analyze the need for or desirability of publicly disclosing or reporting such event.

12.4.5. Scientific or Clinical Presentations.

(a) Research Activities. Any scientific or clinical presentation related to the Research Activities will be mutually agreed to by Novartis and Ionis before any such abstract, presentation or publication is submitted to the Third Party publisher for publication and will appropriately represent the contribution of Ionis (or its Affiliate), Novartis and any Third Party collaborators. Industry-recognized principles of both inclusion of authors and order of authors will be applied to respect appropriately the contributions of all parties to the inventions or data being presented or published. Each Party will review any such proposed publication to avoid the unauthorized disclosure of a Party’s Confidential Information and to preserve the patentability of inventions arising under this Agreement. Each Party will first submit to the other Party an early draft of all such publications or presentations, whether they are to be presented orally or in written form, at least [***] prior to submission for publication including to facilitate the publication of any summaries of Clinical Studies data and results as required on the clinical trial registry of each respective Party. If at any time during such [***] period, the other Party informs such Party that its proposed publication discloses inventions made by either Party under this Agreement that have not yet been protected through the filing of a patent application, or the public disclosure of such proposed publication could be expected to have a material adverse effect on any Patent Rights or Know-How solely owned or Controlled by such other Party, then such Party will either (i) delay such proposed publication for up to [***] from the date the other Party informed such Party of its objection to the proposed publication, to permit the timely preparation and first filing of patent application(s) on the information involved or (ii) remove the identified disclosures prior to publication.

(b) After Expiration of the Research Term. Upon expiration of the Research Term, Novartis shall be solely responsible for any scientific or clinical presentations related to the Licensed Product that are not related to the Research Activities subject to the review procedure set forth in this Section 12.4.5(b) (After Expiration of the Research Term). Novartis will submit any such abstract, presentation or publication to Ionis whether they are to be presented orally or in written form, at least [***] prior to submission for publication. If at any time during such [***] period, Ionis informs Novartis that its proposed publication discloses inventions made by either Party under this Agreement that have not yet been protected through the filing of a patent application, or the public disclosure of such proposed publication could be expected to have a material adverse effect on any Patent Rights or Know-How solely owned or Controlled by Ionis, then such Novartis will either (i) delay such proposed publication for up to [***] from the date Ionis informed Novartis of its objection to the proposed publication, to permit the timely preparation and first filing of patent application(s) on the information involved or (ii) remove the identified disclosures prior to publication.

12.4.6. SEC Filings. Each Party will give the other Party a reasonable opportunity to review all material filings with the SEC describing the terms of this Agreement prior to submission of such filings, and will give due consideration to any reasonable comments by the non-filing Party relating to such filing.

12.4.7. Subsequent Disclosure. Notwithstanding the foregoing, to the extent information regarding this Agreement or a Licensed Product has already been publicly disclosed, either Party (or its Affiliates) may subsequently disclose the same information to the public without the consent of the other Party so long as such information remains true, correct and the most current information with respect to the subject matters set forth therein.

12.4.8. Acknowledgment. Novartis will [***]. Ionis may include each Licensed Product (and identify Novartis as its partner for the Licensed Product) in Ionis’ drug pipelines, any press release, public presentation or publication mentioning a Licensed Product.

ARTICLE 13

MISCELLANEOUS

13.1. Dispute Resolution.

13.1.1. General. The Parties recognize that a dispute may arise relating to this Agreement (“Dispute”). Except as set forth in Section 3.3 (Decision Making), Section 7.9.5 (Third Party IP Dispute), Section 8.2.3 (Inventorship) and Section 13.1.5 (Injunctive Relief; Court Actions), any Dispute between the Parties or their respective Affiliates will be resolved in accordance with this Section 13.1 (Dispute Resolution).

13.1.2. Continuance of Rights and Obligations during Pendency of Dispute Resolution. If there are any Disputes in connection with this Agreement, including Disputes related to termination of this Agreement under Article 11 (Term; Termination), all rights and obligations of the Parties will continue until such time as any Dispute has been resolved in accordance with the provisions of this Section 13.1 (Dispute Resolution).

13.1.3. Escalation. Subject to Section 13.1.5 (Injunctive Relief; Court Actions), any claim, Dispute, or controversy as to the breach, enforcement, interpretation or validity of this Agreement will be referred to the Novartis’ Global Head of Corporate and Business Development (or a designee appointed by the Global Head of Corporate and Business Development) and to the Chief Executive Officer of Ionis (or a designee appointed by the Chief Executive Officer) (the “Executives”) for attempted resolution. If the Executives are unable to resolve such Dispute within [***] of such Dispute being referred to them, then, upon the written request of either Party to the other Party, the Dispute will be subject to arbitration in accordance with Section 13.1.4 (Arbitration), except as expressly set forth in Section 13.1.5 (Injunctive Relief; Court Actions) or Section 13.3 (Recovery of Losses).

13.1.4. Arbitration.

(a) If the Parties cannot resolve the Dispute through escalation pursuant to Section 13.1.3 (Escalation), and a Party desires to pursue resolution of the Dispute, any Dispute will be solely and exclusively finally settled under the Rules of Arbitration of the ICC by a panel of three arbitrators appointed in accordance with said Rules, provided however, that the third arbitrator, who will act as president of the arbitral tribunal, will not be appointed by the International Court of Arbitration, but by the two arbitrators which have been appointed by either of the Parties in accordance with Article 4 para 4 of said Rules.

(b) The place of arbitration will be New York, New York and the language to be used in any such Proceeding (and for all testimony, evidence and written documentation) will be English. The IBA Rules on the Taking of Evidence in International Arbitration will apply on any evidence to be taken up in the arbitration.

(c) Without limiting any other remedies that may be available under law, the arbitrators will have no authority to award damages not permitted to be recovered pursuant to Section 10.6 (Limitation of Consequential Damages). The Parties agree to select the arbitrator(s) within [***] after initiation of the arbitration. The hearing will be concluded within [***] after selection of the arbitrator(s) and the award will be rendered within [***] after the conclusion of the hearing, or of any post hearing briefing, which briefing will be completed by both Parties within [***] after the conclusion of the hearing. If the Parties cannot agree upon a schedule, then the arbitrator(s) will set the schedule following the time limits set forth above as closely as practicable.

(d) EXCEPT IN THE CASE OF COURT ACTIONS PERMITTED BY SECTION 13.1.5 (INJUNCTIVE RELIEF; COURT ACTIONS) AND FOR CLAIMS NOT SUBJECT TO ARBITRATION PURSUANT TO SECTION 13.1.4 (ARBITRATION) AS SET FORTH IN SECTION 13.1.5 (INJUNCTIVE RELIEF; COURT ACTIONS), EACH PARTY HERETO WAIVES: (1) ITS RIGHT TO TRIAL OF ANY ISSUE BY JURY, AND (2) ANY CLAIM FOR ATTORNEY FEES, COSTS AND PREJUDGMENT INTEREST.

(e) Each Party will bear its own attorneys’ fees, costs, and disbursements arising out of the arbitration, and will pay an equal share of the fees and costs of the arbitrators; provided, however, [***].

(f) Notwithstanding any provision to the contrary, if the Dispute is regarding the existence, materiality, or failure to cure any material breach where Ionis is the alleged Breaching Party, then the arbitration will be bifurcated with respect to liability and damages, such that damages will only be determined if Novartis elects not to exercise the alternative remedy set forth in Section 11.4 (Alternative Remedy in Lieu of Termination).

13.1.5. Injunctive Relief; Court Actions. Notwithstanding anything to the contrary in this Agreement, each Party will be entitled to seek from any court of competent jurisdiction, in addition to any other remedy it may have at law or in equity, injunctive or other equitable relief in the event of an actual or threatened breach of this Agreement by the other Party, without the posting of any bond or other security, and such an action may be filed and maintained notwithstanding any ongoing discussions between the Parties or any ongoing arbitration Proceeding. The Parties agree that in the event of a threatened or actual material breach of this Agreement injunctive or equitable relief may be an appropriate remedy. In addition, except as set forth otherwise in Section 7.9.4 (Right to Offset) and Section 8.2.3 (Inventorship) either Party may bring an action in any court of competent jurisdiction to resolve disputes pertaining to the validity, construction, scope, enforceability, infringement or other violations of Patent Rights or other intellectual property rights, and no such claim will be subject to arbitration pursuant to Section 13.1.4 (Arbitration).

13.2. Governing Law; Jurisdiction. This Agreement and any Dispute will be governed by and construed and enforced in accordance with the laws of the State of New York, U.S.A., without reference to conflicts of laws principles. The United Nations Convention on Contract for the International Sales of Goods (1980) shall not apply to the interpretation of this Agreement.

13.3. Recovery of Losses. Neither Party will be entitled to recover any Losses relating to any matter arising under one provision of this Agreement to the extent that such Party has already recovered such Losses pursuant to other provisions of this Agreement, including recoveries under Section 10.1 (Indemnification by Novartis) or Section 10.2 (Indemnification by Ionis), and the offsets under Sections 7.9.4 (Right to Offset). Except for the offset and credits explicitly set forth in Section 4.3 (Acquisition of a Competitive Compound), Section 7.12 (Audits), Section 7.9.4 (Right to Offset), a final and binding decision of the arbitrators in accordance with Section 13.1.4 (Arbitration) or by the court of competent jurisdiction in accordance with Section 13.1.5 (Injunctive Relief; Court Actions) neither Party will have the right to set off any amount it is owed or believes it is owed against payments due or payable to the other Party under this Agreement. Notwithstanding the non-refundable or non-creditable nature of any milestone payments hereunder, but subject to the limitations set forth in Section 10.6 (Limitation of Consequential Damages), nothing in this Agreement shall limit either Party’s rights to assert or obtain damages for breach of this Agreement, including damages calculated based on the payments made under this Agreement.

13.4. Assignment and Successors.

13.4.1. Neither this Agreement nor any obligation of a Party hereunder may be assigned by either Party without the consent of the other, which will not be unreasonably withheld, delayed or conditioned, except that each Party may assign this Agreement and the rights, obligations and interests of such Party, in whole or in part, without the other Party’s consent, to any of its Affiliates, to any purchaser of all or substantially all of its assets or all or substantially all of its assets to which this Agreement relates or to any successor corporation resulting from any merger, consolidation, share exchange or other similar transaction. Notwithstanding the foregoing, [***]. In addition, Ionis may, subject to Section 7.8 ([***]), [***], without Novartis’ consent. Except in the case where [***], any permitted assignee will assume all applicable obligations of its assignor under this Agreement. Each Party shall remain primarily liable for any acts or omissions of its permitted assigns. Subject to the terms of this Agreement, this Agreement will be binding upon and inure to the benefit of the Parties and their respective successors and permitted assigns.

13.4.2. Unless explicitly agreed otherwise in writing between the Parties, if any assignment of this Agreement or of any rights or obligations under this Agreement results in [***], then [***] (“Transferring Party”) such that the Party (“Non-Transferring Party”) entitled to receive a given payment under this Agreement receives [***]. Any purported assignment or transfer made in contravention of this Section 13.4 (Assignment and Successors) will be null and void. This Section 13.4 (Assignment and Successors) will apply to the assignment of Licensed Technology mutatis mutandis.

13.5. Change of Control Event Involving Novartis or Ionis. A Party subject to a Change of Control Event will provide written notice to the other Party within [***] following the closing of a Change of Control Event, and such notice will identify the Third Party acquiring company (the “Acquirer”) and the contact information of the person at the Acquirer with whom the other Party will work to schedule meetings between the Acquirer and the other Party. Within [***] following the closing of such Change of Control Event, the Party or the Acquirer will [***]. Notwithstanding any other provision of this Agreement, in the case of a Change of Control Event [***].

13.6. Force Majeure. No Party will be held responsible to the other Party nor be deemed to be in default under, or in breach of any provision of, this Agreement for failure or delay in performing any obligation of this Agreement when such failure or delay is due to force majeure, and without the fault or negligence of the Party so failing or delaying. For purposes of this Agreement, force majeure means a cause beyond the reasonable control of a Party, which may include acts of God, war, terrorism, cyber-attacks, civil commotion, riot, fire, flood, earthquake, tornado, tsunami, explosion or storm, pandemic, epidemic, any action of a governmental authority or agency, national industry strike, lockout, sabotage, shortage in supply, energy shortage and failure of public utilities or common carriers. In such event the failing or delaying Party shall promptly notify the other Party of such inability and of the period for which such inability is expected to continue. The Party giving such notice will be excused from such of its obligations under this Agreement as it is thereby disabled from performing for so long as it is so disabled and shall use commercially reasonable efforts to minimize the duration of any force majeure and resume performance of its obligation as promptly as practicable. Notwithstanding the foregoing, if such force majeure event induced delay or failure of performance continues for a period of [***], after such time the Parties will negotiate in good faith any permanent or transitory modifications of the terms of this Agreement that may be necessary to arrive at an equitable solution, unless the Party giving such notice has set out a reasonable timeframe and plan to resolve the effects of such force majeure and execute such plan within such timeframe.

13.7. Notices. Any notice or request required or permitted to be given under or in connection with this Agreement will be deemed to have been sufficiently given if in writing and personally delivered or sent by certified mail (return receipt requested), or internationally recognized overnight express courier service (signature required), prepaid, to the Party for which such notice is intended, at the address set forth for such Party below:

If to Ionis, addressed to:

Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, CA 92010

Attention: Chief Business Officer

with a copy to (which copy will not constitute notice):

[***]

Attention: General Counsel

If to Novartis, addressed to:

Novartis Pharma AG

Lichtstrasse 35

4002, Basel, Switzerland

Attention: General Counsel

with a copy to:

Novartis Pharma AG

Lichtstrasse 35

4002, Basel, Switzerland

Attention: Head Global Business

Development & Licensing

or to such other address for such Party as it will have specified by like notice to the other Party; provided that notices of a change of address will be effective only upon receipt thereof. If delivered personally or by facsimile transmission, the date of delivery will be deemed to be the date on which such notice or request was given. If sent by overnight express courier service, the date of delivery will be deemed to be the next Business Day after such notice or request was deposited with such service.

13.8. Waiver. Neither Party may waive or release any of its rights or interests in this Agreement except in writing. The failure of either Party to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement shall not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition. No waiver by either Party of any condition or term in any one or more instances shall be construed as a continuing waiver or subsequent waiver of such condition or term or of another condition or term. No waiver shall be effective unless it has been given in writing and signed by the Party giving such waiver.

13.9. Severability. If any provision hereof should be held invalid, illegal or unenforceable in any jurisdiction, the Parties will 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 will remain in full force and effect in such jurisdiction and will 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 will not affect the validity, legality or enforceability of such provision in any other jurisdiction.

13.10. Entire Agreement; Modifications. This Agreement (including the attached Appendices, Schedules, and Exhibit) sets forth and constitutes the entire agreement and understanding between the Parties with respect to the subject matter hereof, and all prior agreements, understanding, promises and representations, whether written or oral, with respect thereto are superseded hereby. Each Party confirms that it is not relying on any representations or warranties of the other Party except as specifically set forth herein. No amendment, modification, release or discharge will be binding upon the Parties unless in writing and duly executed by authorized representatives of both Parties.

13.11. Independent Contractors. Nothing herein will be construed to create any relationship of employer and employee, agent and principal, partnership joint venture or legal entity of any type between the Parties. Each Party is an independent contractor. Neither Party will assume, either directly or indirectly, any liability of or for the other Party. Neither Party will have the authority to bind or obligate the other Party and neither Party will represent that it has such authority. Moreover, each Party agrees not to construe this Agreement, or any of the transactions contemplated hereby, as a partnership for any tax purposes.

13.12. Interpretation. Except as otherwise explicitly specified to the contrary, (a) references to a section, Exhibit, Appendix or Schedule means a Section of, or Schedule or Exhibit or Appendix to this Agreement, unless another agreement is specified, (b) the word “including” (in its various forms) means “including without limitation,” (c) the words “will” and “shall” have the same meaning, (d) references to a particular statute or regulation include all rules and regulations thereunder and any predecessor or successor statute, rules or regulation, in each case as amended or otherwise modified from time to time, (e) words in the singular or plural form include the plural and singular form, respectively, (f) references to a particular Person include such Person’s successors and assigns to the extent not prohibited by this Agreement, (g) unless otherwise specified, “$” is in reference to United States dollars, (h) the headings contained in this Agreement, in any Exhibit or Appendix or Schedule to this Agreement are for convenience only and will not in any way affect the construction of or be taken into consideration in interpreting this Agreement, (i) the word “or” will not be construed as exclusive and will have the meaning typically ascribed to the term “and/or”; (j) the words “hereof,” “herein,” and “herewith,” and words of similar import, will, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement and (k) general words will not be given a restrictive interpretation by reason of their being preceded or followed by words indicating a particular class of acts, matters or things.

13.13. Books and Records. Any books and records to be maintained under this Agreement by a Party or its Affiliates or Sublicensees will be maintained in accordance with their respective Applicable Law and Accounting Standards.

13.14. Further Actions. Each Party will execute, acknowledge and deliver such further instruments, and do all such other acts, as may be necessary or appropriate in order to carry out the expressly stated purposes and the clear intent of this Agreement.

13.15. Construction of Agreement. The terms and provisions of this Agreement represent the results of negotiations between the Parties and their representatives, each of which has been represented by counsel of its own choosing, and neither of which has acted under duress or compulsion, whether legal, economic or otherwise. Accordingly, the terms and provisions of this Agreement will be interpreted and construed in accordance with their usual and customary meanings, and each of the Parties hereto hereby waives the application in connection with the interpretation and construction of this Agreement of any rule of law to the effect that ambiguous or conflicting terms or provisions contained in this Agreement will be interpreted or construed against the Party whose attorney prepared the executed draft or any earlier draft of this Agreement.

13.16. Supremacy. In the event of any express conflict or inconsistency between this Agreement and any Schedule, Appendix, or Exhibit hereto, the terms of this Agreement will apply. The Parties understand and agree that the Appendices identifying the Licensed Technology are not intended to be the final and complete embodiment of any terms or provisions of this Agreement, and are to be updated from time to time during the Agreement Term, as appropriate and in accordance with the provisions of this Agreement.

13.17. Counterparts. This Agreement (or any notice, invoice or other document to be delivered by a Party hereunder) may be signed in counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument, notwithstanding variations in format or file designation which may result from the electronic transmission, storage and printing of copies of this Agreement from separate computers or printers, and facsimile signatures and signatures transmitted via electronic mail in PDF format will be treated as original signatures.

13.18. Compliance with Laws. Each Party will, and will ensure that its Affiliates will, comply with all Applicable Law in exercising its rights and fulfilling its obligations under this Agreement. No Party will, or will be required to, undertake any activity under or in connection with this Agreement which violates, or which it believes, in good faith, may violate, any Applicable Law.

13.19. Remedies at Law. Without limiting Section 13.3 (Recovery of Losses) and except as expressly stated in this Agreement, the rights and remedies provided in this Agreement and all other rights and remedies available to either Party at law or in equity are, to the extent permitted by law, cumulative and not exclusive of any other right or remedy now or hereafter available at law or in equity.

[SIGNATURE PAGE FOLLOWS]

* - * - * - *

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their representatives thereunto duly authorized as of the Execution Date.

NOVARTIS PHARMA AG

By:	/s/ Guillaume Vignon

Name:	Guillaume Vignon

Title:	Global Head BD&L Partnering

NOVARTIS PHARMA AG

By:	/s/ Mark Victor Rogers

Name:	Mark Victor Rogers

Title:	Global Head Pharma Transactions

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their representatives thereunto duly authorized as of the Execution Date.

IONIS PHARMACEUTICALS, INC.

By:	/s/ Brett Monia

Name:	Brett Monia
Title:	Chief Executive Officer

List of Appendices, Schedules, and Exhibits

Appendix 1 – Definitions

Appendix 2 – Ionis In-License Agreements

Appendix 3 – License Conditions; Limitations

Appendix 4 – Ionis Development Pipeline

Appendix 5 – Ionis Core Technology Patents

Appendix 6 – Ionis Manufacturing and Analytical Patents

Appendix 7 – Ionis Product-Specific Patents

Appendix 8 – Prior Agreements

Schedule 2.1.1 – Research Plan

Schedule 5.4.2(a) – [***]

Schedule 9.2 – Ionis Disclosure Schedules

Schedule 11.5.3 – [***]

Exhibit 1 – Novartis’ Form of Invoice

Appendix 1

DEFINITIONS

For purposes of this Agreement, the following capitalized terms will have the following meanings:

“AAA” has the meaning set forth in Schedule 11.5.3.

“Acceptance of NDA Filing” means the receipt of written notice from the FDA in accordance with 21 C.F.R. § 314.101(a)(2) that such NDA is officially “filed.”

“Accounting Standards” means, with respect to Ionis, U.S. GAAP (United States Generally Accepted Accounting Principles) and means, with respect to Novartis, the IFRS (International Financial Reporting Standards), in each case, as generally and consistently applied throughout the applicable Party’s organization. Each Party shall promptly notify the other in the event that it changes the Accounting Standards pursuant to which its records are maintained, it being understood that each Party may only use internationally recognized accounting standards (e.g., U.S. GAAP, IFRS or equivalent).

“Actually Used” means, with respect to any Novartis Technology and a Terminated Product and subject to Section 11.5.3(a)(iv) (Acquisition of Alternative Technologies), that such Novartis Technology was [***]. For clarity, (1) [***] will be considered “Actually Used”, and (2) [***] will be considered “Actually Used.”

“Acquired Compound” has the meaning set forth in Section 4.3 (Acquisition of a Competitive Compound).

“Acquirer” has the meaning set forth in Section 13.5 (Change of Control Event Involving Novartis or Ionis).

“Additional Ionis Research Activities” has the meaning set forth in Section 2.4 (Research Costs).

“Affiliate” of an entity means any corporation, firm, partnership or other entity which directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with a Party to this Agreement. An entity will be deemed to control another entity if it (a) owns, directly or indirectly, more than 50% of the outstanding voting securities (or such lesser percentage which is the maximum allowed to be owned by a foreign corporation in a particular jurisdiction) of such other entity, or has other comparable ownership interest with respect to any entity other than a corporation; or (b) has the power, whether pursuant to contract, ownership of securities or otherwise, to direct the management and policies of the entity.

“Agreement” has the meaning set forth in the Preamble of this Agreement.

“Agreement Term” has the meaning set forth in Section 11.1 (Agreement Term; Expiration).

“Akcea-Novartis Collaboration Agreement” means that certain Strategic Collaboration, Option and License Agreement between Novartis Pharma AG and Akcea Therapeutics, Inc., dated January 5, 2017, as amended on February 22, 2019.

“Alliance Manager” has the meaning set forth in Section 3.6 (Alliance Managers).

“Annual” or “Annually” means the period covering a Calendar Year or occurring once per Calendar Year, as the context requires.

“Antitrust Filings” means any filings, notices, applications or other submissions under Antitrust Law.

Appendix 1-1

“Antitrust Laws” means any federal, state, or foreign statutes, rules, regulations, orders, or decrees that are designed to prohibit, restrict, or regulate actions having the purpose or effect of monopolization, lessening of competition or restraint of trade, including the HSR Act.

“API” means the bulk active pharmaceutical ingredient manufactured in accordance with cGMP (unless expressly stated otherwise) for a Licensed Product.

“APO(a)” means the protein product encoded by the apolipoprotein(a) gene (also known as LPA, Lipoprotein A, or Lp(a) gene) (GenBank accession # NM_005577.2; NCBI Gene ID: 4018), including any alternative splice variants, mutants, polymorphisms and fragments thereof.

“Applicable Law” or “Law” means all applicable laws, statutes, rules, regulations and other pronouncements having the effect of law of any federal, national, multinational, state, provincial, county, city or other political subdivision, agency or other body, domestic or foreign, including any applicable rules, regulations, guidelines, or other requirements of the Regulatory Authorities that may be in effect from time to time.

“Audit Report” has the meaning set forth in Section 7.12.3 (Audits).

“Auditor” has the meaning set forth in Section 7.12.1 (Audits).

“Bankruptcy Code” has the meaning set forth in Section 11.2.5(b) (Termination for Insolvency).

“Breaching Party” means the Party that is believed by the Non-Breaching Party to be in material breach of this Agreement.

“[***]” has the meaning set forth in Schedule 11.5.3 ([***]).

“Business Day” means any calendar day, other than a Saturday or Sunday and December 24 to January 2, on which banking institutions in Basel, Switzerland or New York, New York are open for business.

“Calendar Quarter” means a period of three consecutive months ending on the last calendar day of March, June, September, or December, respectively, and will also include the period beginning on the Effective Date and ending on the last calendar day of the Calendar Quarter in which the Effective Date falls.

“Calendar Year” means a year beginning on January 1 (or, with respect to 2023, the Effective Date) and ending on December 31.

“Carryover Candidate” has the meaning set forth in Section 2.2.2 (Carryover Period).

“Carryover Period” has the meaning set forth in Section 2.2.2 (Carryover Period).

“cGMP” means current Good Manufacturing Practices as specified in the United States Code of Federal Regulations, ICH Guideline Q7A, or equivalent laws, rules, or regulations of an applicable Regulatory Authority at the time of manufacture.

Appendix 1-2

“Change of Control Event” means any (a) direct or indirect acquisition of all or substantially all of the assets of a Party, (b) direct or indirect acquisition by a Person, or group of Persons acting in concert, of [***]% or more of the voting equity interests of a Party, (c) tender offer or exchange offer that results in any Person, or group of Persons acting in concert, beneficially owning [***]% or more of the voting equity interests of a Party, or (d) merger, consolidation, other business combination or similar transaction involving a Party, pursuant to which any Person becomes the owner of all or substantially all of the consolidated assets, net revenues or net income of a Party, taken as a whole, or which results in the holders of the voting equity interests of a Party immediately prior to such merger, consolidation, business combination or similar transaction ceasing to hold [***]% or more of the combined voting power of the surviving, purchasing or continuing entity immediately after such merger, consolidation, other business combination or similar transaction, in all cases where such transaction is entered into with any Person other than the other Party to this Agreement or its Affiliates.

“Clinical Development Plan” has the meaning set forth in Section 2.5 (Clinical Development Plan).

“Clinical Study” or “Clinical Studies” means a Phase 1 Trial, Phase 2 Trial, Phase 3 Trial or such other study in humans that is conducted in accordance with good clinical practices and is designed to generate data in support or maintenance of an NDA, MAA, or other similar marketing application.

“CMO” means a Third Party contract manufacturer Manufacturing API, clinical supplies or Finished Drug Product for any purpose under this Agreement.

“CMO Agreement” has the meaning set forth in Section 5.4.2 (Novartis’ CMOs).

“Combination Product” has the meaning set forth in the definition of “Net Sales” in this Appendix 1 (Definitions).

“Commercialize,” “Commercialization” or “Commercializing” means any and all activities directed to registering, marketing, promoting, detailing, distributing, importing, having imported, exporting, having exported, selling or offering to sell a product (including a Licensed Product) following receipt of Regulatory Approval for such product in the applicable country, including conducting pre-and post-Regulatory Approval activities, and launching and promoting the product in each country.

“Commercially Reasonable Efforts” means the level of effort, budget and resources normally used by the respective Party for a product owned or controlled by it, which is of similar profitability and at a similar stage in its development or product life, taking into account with respect to a product inter alia any issues of patent coverage, safety and efficacy, pricing, product profile, the proprietary position of the product, the competitive environment for the product and the likely timing of the product(s) entry into the market, the regulatory environment of the product and other relevant scientific, technical and commercial factors. Commercially Reasonable Efforts will be determined on a Licensed Product-by-Licensed Product and country-by-country basis. Notwithstanding any provision to the contrary in this Agreement, Novartis will not be permitted to take into consideration any Acquired Compound in determining what constitutes Commercially Reasonable Efforts.

“Competitive Compound” means any Oligonucleotide that is designed to bind to the RNA encoding APO(a).

“Competitive Infringement” has the meaning set forth in Section 8.6 (Enforcement of Patents Against Competitive Infringement).

“Competitive Product” has the meaning set forth in Section 4.4 (Change of Control).

“Completion” means (a) with respect to an IND-Enabling Toxicology Study, receipt of the final report for such IND-Enabling Toxicology Study and (b) with respect to a Clinical Study, the point in time at which database lock for such study has occurred and, if such study has a statistical analysis plan, the primary and secondary endpoints and key safety data generated (including tables, listings and figures generated based on that database lock) for such study are available.

Appendix 1-3

“Compound” means any Oligonucleotide that is designed to bind to the RNA encoding APO(a) discovered by Ionis, Novartis, or jointly between the Parties.

“Compound Pool” has the meaning set forth in Section 2.2.1 (Development Candidate Data Packages).

“Confidential Information” means any confidential or proprietary information, data or materials, patentable or otherwise, including trade secrets, Know-How, inventions or discoveries, proprietary information, formulae, processes, techniques and other information, in any form (written, oral, photographic, electronic, magnetic, or otherwise) which is disclosed by the Disclosing Party or its Affiliates to the Receiving Party or its Affiliates in the course of performing its obligations or exercising its rights under this Agreement. “Confidential Information” does not include information that:

(a)

was in the lawful knowledge and possession of the Receiving Party or its Affiliates prior to the time it was disclosed to the Receiving Party or its Affiliates, or was otherwise developed independently by the Receiving Party or its Affiliates, in each case, as evidenced by written records kept in the ordinary course of business, or other documentary proof of the Receiving Party or its Affiliates;

(b)

was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party or its Affiliates;

(c)

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 or its Affiliates in breach of this Agreement; or

(d)

was disclosed to the Receiving Party or its Affiliates, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party or its Affiliates not to disclose such information to others.

“Conjugate Technology” means a group of atoms covalently bound to an Oligonucleotide designed to enhance one or more properties of the Oligonucleotide, such as targeting of antisense drugs to specific tissues and cells. Conjugate Technology includes N-acetylgalactosamine (GalNAc) ligand conjugates capable of binding to the asialoglycoprotein receptor (ASGP-R) and enhancing the targeting of antisense drugs.

“Control” or “Controlled” means possession of the legal authority or the right (whether by ownership, license or otherwise) to grant a license or sublicense hereunder without violating the terms of any agreement with any Third Party; provided that [***]. Notwithstanding anything to the contrary under this Agreement, with respect to any Third Party that becomes an Affiliate of a Party after the Effective Date (including a Third Party acquirer), no intellectual property of such Third Party owned or controlled by such Third Party immediately prior to the date such Third Party becoming an Affiliate of a Party hereunder will be included in the licenses granted hereunder by virtue of such Third Party becoming an Affiliate of such Party.

“Core European Countries” means the United Kingdom, Germany, France, Italy and Spain.

“Cover,” “Covered” or “Covering” means, with respect to a Patent Right and a product, technology, process, method, or mode of administration that the manufacture, use, offer for sale, sale, or importation of such product or the practice of such technology, process, method, or mode of administration falls within the scope of at least one claim of such Patent Right.

Appendix 1-4

“DC Selection Date” has the meaning set forth in Section 2.2.4 (Development Candidate Selection Process).

“Develop,” “Developing” or “Development” means, with respect to a product (including a Licensed Product) after such product is designated as a development candidate, any and all non-clinical, clinical or regulatory activity with respect to such product to support approval by a regulatory authority to market and sell such product (including the submission of all necessary filings with applicable Regulatory Authorities to support such non-clinical and clinical activities and Regulatory Approval), including pharmacokinetic and toxicology studies required to meet the requirements for filing an IND and filing an IND with any regulatory authority.

“Development Candidate” means any Compound that is designated by the JSC as a development candidate in accordance with Section 2.2.4 (Development Candidate Selection Process).

“Development Candidate Criteria” has the meaning set forth in Section 2.1.1 (Research Plan).

“Development Candidate Data Package” means the data package prepared by either Party or the JRC for the JSC to review and consider designating a Licensed Compound as a Development Candidate; provided that such package contains [***], but in any event at least the same level of detail as the data packages the relevant Party presents to its research management committee to approve its own internal development candidates. In the case of a Development Candidate Data Package prepared by Ionis, such package may include [***].

“Disclosing Party” has the meaning set forth in Section 12.1 (Confidentiality; Exceptions).

“Dispute” has the meaning set forth in Section 13.1.1 (General).

“DOJ” has the meaning set forth in Section 5.11.1 (Effectiveness of the Agreement).

“Domain Names” means any Domain Name identical or similar with the Trademarks under any ccTLD (country code Top Level Domain) and gTLD (generic Top Level Domain) address area.

“Draft Report” means, with respect to an IND-Enabling Toxicology Study, an integrated, audited draft report containing the toxicology data generated from such IND-Enabling Toxicology Study.

“Effective Date” has the meaning set forth in Section 5.11.1 (Effectiveness of the Agreement).

“EMA” means the European Medicines Agency and any successor entity thereto.

“[***]” means, with respect to a Licensed Product, any “[***]” as described in [***] for such Licensed Product, or, if a standard [***] is not applicable, then [***].

“Evaluation Period” has the meaning set forth in Section 4.3 (Acquisition of a Competitive Compound).

“[***]” has the meaning set forth in Section [***].

“Execution Date” has the meaning set forth in the Preamble of this Agreement.

“Executives” has the meaning set forth in Section 13.1.3 (Escalation).

Appendix 1-5

“Exploit” means, with respect to any product, to Research, Develop, have Developed, use, have used, offer for sale, have offered for sale, sell, have sold or otherwise Commercialize or have Commercialized, export, have exported, import, have imported, Manufacture, have Manufactured, or otherwise exploit such product. “Exploitation” and “Exploiting” will be construed accordingly.

“FDA” means the United States Food and Drug Administration and any successor entity thereto.

“Field” means all therapeutic, prophylactic, palliative, analgesic, and diagnostic uses in humans.

“Finished Drug Product” means any drug product containing API as an active ingredient, in finished form for Development or Commercialization by a Party under this Agreement.

“First Commercial Sale” means, on a Licensed Product-by-Licensed Product basis, the first sale of such Licensed Product by Novartis, its Affiliate or its Sublicensee to a Third Party in a country after Regulatory Approval of such Licensed Product has been obtained in such country.

“FTC” has the meaning set forth in Section 5.11.1 (Effectiveness of the Agreement).

“FTE” means the number of full-time-equivalent person-years (each consisting of a total of [***] hours) of research and development work by each Party’s personnel on or directly related to the applicable activity conducted hereunder. For clarity, [***].

“FTE Costs” means the cost of Ionis’ employees based on the time incurred at performing work under this Agreement at the then-applicable FTE Rate.

“FTE Rate” means $[***] per FTE per Calendar Year, which rate shall be prorated on a daily basis as necessary; provided, that on [***] and on January 1^st of each subsequent Calendar Quarter the FTE Rate will be [***] for the Calendar Year then commencing by the percentage [***] in the Consumer Price Index for All Urban Consumers (CPI-U); US City Average calculated by the Bureau of Labor Statistics during the immediately preceding Calendar Year.

“Generic Product” means, with respect to a Licensed Product in a country, a pharmaceutical product (other than such Licensed Product) that (a) is sold by a Third Party other than a Sublicensee under license from Novartis in such country, (b) is authorized for use in such country in one or more of the indications for which such Licensed Product has Regulatory Approval in such country; and (c) either (i) contains the same active pharmaceutical ingredient(s) as such Licensed Product or (ii) is a product approved by way of an abbreviated regulatory mechanism by the Regulatory Authority in such country that, in each case, meets the equivalency determination by the applicable Regulatory Authority (including a determination that the product is “comparable”, “interchangeable”, “bioequivalent”, “biosimilar” or other term of similar meaning, if applicable, with respect to such Licensed Product). A product shall not be considered to be a Generic Product if (a) Novartis or any of its Affiliates or Sublicensees was involved in or authorized the Development or Commercialization of such product, (b) Novartis or any of its Affiliates or Sublicensees has granted a license to such Third Party in respect of such product, or (c) such product is Commercialized by any Person who obtained such product in a chain of distribution that included Novartis or any of its Affiliates or Sublicensees.

“Governmental Authority” means any United States federal, state or local government or any foreign government, or political subdivision thereof, or any local, state, national or multinational organization or authority or any authority, agency or commission entitled to exercise any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power, any court or tribunal (or any department, bureau or division thereof), or any arbitrator or arbitral body.

Appendix 1-6

“HSR Act” means the United States Hart-Scott-Rodino Antitrust Improvements Act of 1976 and the rules promulgated thereunder.

“HSR Filings” has the meaning set forth in Section 5.11.2(a).

“Identified Rights” has the meaning set forth in Section 7.9.2 (New In-License Agreements).

“IND” means an Investigational New Drug Application (as defined in the Food, Drug and Cosmetic Act, as amended) filed with the FDA.

“Indemnification Claim Notice” has the meaning set forth in Section 10.3 (Notice of Claim).

“Indemnified Party” has the meaning set forth in Section 10.3 (Notice of Claim).

“IND-Enabling Toxicology Study” or “IND-Enabling Toxicology Studies” means the non-human primate toxicology studies of a Licensed Compound designed or otherwise required to meet the requirements for filing an IND.

“Indirect Taxes” means value added, goods and services, sales, use, excise, consumption and other similar indirect taxes required by law to be disclosed on the invoice.

“Initiation” or “Initiate” means, with respect to any Clinical Study, dosing of the first human subject in such Clinical Study.

“Invoice” means an original invoice in the form attached hereto as Exhibit 1 (Novartis’ Form of Invoice).

“Ionis” has the meaning set forth in the Preamble of this Agreement.

“Ionis Core Technology Patents” means any Patent Rights (other than Ionis Product-Specific Patents or Ionis Manufacturing and Analytical Patents) that (a) are owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Execution Date or at any time during the Agreement Term, (b) claim subject matter generally applicable to Oligonucleotides and (c) are necessary or reasonably useful to Research, Develop, Manufacture or Commercialize a Licensed Compound or Licensed Product, but excluding any Patent Rights to the extent solely related to any active pharmaceutical ingredient that is not a Licensed Compound. A list of the Ionis Core Technology Patents as of the Execution Date is set forth on Appendix 5 (Ionis Core Technology Patents) attached hereto.

“Ionis Indemnitees” has the meaning set forth in Section 10.1 (Indemnification by Novartis).

“Ionis In-License Agreements” has the meaning set forth in Section 7.9.1 (Existing In-License Agreements).

“Ionis Internal Oligonucleotide Safety Database” has the meaning set forth in Section 6.6.2 (Ionis Internal Oligonucleotide Safety Database).

“Ionis Know-How” means any Know-How, excluding Ionis’ interest in any Jointly-Owned Program Know-How, that is (a) owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Execution Date or at any time during the Agreement Term and (b) necessary or reasonably useful to Research, Develop, Manufacture or Commercialize a Licensed Compound or Licensed Product, but excluding any Know-How to the extent solely related to any active pharmaceutical ingredient that is not a Licensed Compound. Ionis Know-How does not include the Ionis Manufacturing and Analytical Know-How.

Appendix 1-7

“Ionis Manufacturing and Analytical Know-How” means Know-How, excluding Ionis’ interest in any Jointly-Owned Program Know-How, that (a) relates to the synthesis or analysis of a Licensed Compound or Licensed Product regardless of sequence or chemical modification, (b) is owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Execution Date or at any time during the Agreement Term and (c) is necessary or reasonably useful to Research, Develop, Manufacture or Commercialize a Licensed Compound or Licensed Product, but excluding any Know-How to the extent solely related to any active pharmaceutical ingredient that is not a Licensed Compound. Ionis Manufacturing and Analytical Know-How do not include the Ionis Know-How.

“Ionis Manufacturing and Analytical Patents” means Patent Rights, excluding Ionis’ interest in any Jointly-Owned Program Patents, that (a) claim Manufacturing Technology owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Execution Date or at any time during the Agreement Term and (b) are necessary or reasonably useful to Research, Develop, Manufacture or Commercialize a Licensed Compound or Licensed Product, but excluding any Patent Rights to the extent solely related to any active pharmaceutical ingredient that is not a Licensed Compound. A list of Ionis Manufacturing and Analytical Patents as of the Execution Date is set forth on Appendix 6 (Ionis Manufacturing and Analytical Patents) attached hereto.

“Ionis Product-Specific Patents” means all Product-Specific Patents that are (a) Controlled by Ionis or its Affiliates on the Execution Date or at any time during the Agreement Term and (b) necessary or reasonably useful to Research, Develop, Manufacture or Commercialize a Licensed Compound or Licensed Product, but excluding any Patent Rights to the extent solely related to any active pharmaceutical ingredient that is not a Licensed Compound. A list of Ionis Product-Specific Patents as of the Execution Date is set forth on Appendix 7 (Ionis Product-Specific Patents) attached hereto.

“Ionis Program Know-How” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Ionis Program Patents” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Ionis Program Technology” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Ionis Research Activities Technology” means any Know-How or Patent Rights that are (a) Controlled by Ionis or its Affiliates as of the Execution Date or any time during the Agreement Term and (b) necessary or reasonably useful for Novartis to perform any Research Activities or to conduct Research during the Carryover Period or the period after [***] until [***] for the first Licensed Product.

“Joint Patent Committee” or “JPC” has the meaning set forth in Section 8.1.1 (Joint Patent Committee).

“Jointly-Owned Program Know-How” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Jointly-Owned Program Patents” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Jointly-Owned Program Technology” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Joint Research Committee” or “JRC” has the meaning set forth in Section 3.2.1 (Establishment).

Appendix 1-8

“JSC” has the meaning set forth in Section 3.1.1 (Establishment).

“Know-How” means inventions, technical information, know-how and materials, including technology, data, compositions, formulas, biological materials, assays, reagents, constructs, compounds, discoveries, procedures, processes, practices, protocols, methods, techniques, results of experimentation or testing, knowledge, trade secrets, skill and experience, in each case whether or not patentable or copyrightable, and in each case that are unpatented.

“Knowledge” means the actual knowledge of a Party’s or any of its Affiliate’s [***] as of the Effective Date; provided that, with respect to information regarding the status of Patent Rights or other intellectual property rights, “Knowledge” means the actual knowledge of a Party’s or any of its Affiliate’s [***] as of the Effective Date [***].

“Licensed Compound” has the meaning set forth in Section 2.2.1 (Development Candidate Data Packages).

“Licensed Know-How” means (a) Ionis Manufacturing and Analytical Know-How, (b) Ionis Program Know-How, (c) Ionis’ and its Affiliate’s interest in any Jointly-Owned Program Know-How, and (d) Ionis Know-How. For clarity, Licensed Know-How does not include any Know-How covering formulation technology or delivery devices (other than Conjugate Technology).

“Licensed Patents” means (a) the Ionis Product-Specific Patents, (b) the Ionis Core Technology Patents, (c) the Ionis Manufacturing and Analytical Patents, (d) subject to Section 8.4 (Patent Costs), Ionis’ and its Affiliate’s interest in any Jointly-Owned Program Patents, and (e) the Ionis Program Patents. For clarity, Licensed Patents do not include any Patent Rights claiming formulation technology or delivery devices (other than Conjugate Technology).

“Licensed Product” means any product containing a Development Candidate as an active pharmaceutical ingredient. For clarity, all products with the same active pharmaceutical ingredient(s) will be deemed a single “Licensed Product” hereunder.

“Licensed Product License” has the meaning set forth in Section 5.1.2 (Licensed Product License).

“Licensed Technology” means any and all Licensed Patents and Licensed Know-How.

“Losses” has the meaning set forth in Section 10.1 (Indemnification by Novartis).

“MAA” means a marketing authorization application filed with the EMA after Completion of Clinical Studies to obtain approval for a Licensed Product under the centralized European filing procedure or, if the centralized EMA filing procedure is not used, filed using the applicable procedures in any European Union country or other country in Europe.

“MAA Approval” means, with respect to a Licensed Product in Europe, approval of the MAA from the applicable Regulatory Authority in at least [***] Core European Countries sufficient for the Manufacture, distribution, use, marketing and sale of such Licensed Product and pricing and reimbursement approval in such [***] Core European Countries in accordance with Applicable Laws has been obtained, provided that with respect to the Core European Countries where marketing approval and pricing and reimbursement approval are not granted simultaneously (e.g., Germany), separate pricing and reimbursement approval shall not be required if and to the extent Novartis, after the grant of the relevant marketing authorization, starts selling the Licensed Product in such Core European Countries and such sales generate Net Sales.

Appendix 1-9

“Major Market” means any of the following countries: the United States, the United Kingdom, Germany, France, Italy and Spain.

“Major Regulatory Communications” means any official, substantive response received from a Regulatory Authority related to a Major Regulatory Submission (e.g., meeting minutes).

“Major Regulatory Submissions” means, with respect to a Licensed Product, the (a) [***], (b) [***], (c) [***], (d) [***], (e) [***], (f) [***], and (g) [***].

“Manufacture” or “Manufactured” or “Manufacturing” means any activity involved in or relating to the manufacturing, quality control testing (including in-process, release and stability testing), releasing or packaging, for non-clinical and clinical purposes, of API or a Licensed Product in finished form.

“Manufacturing Technology” means (a) methods and materials used in the synthesis or analysis of an Oligonucleotide regardless of sequence or chemical modification, (b) methods of manufacturing components of an Oligonucleotide, and (c) methods and materials used in Manufacturing a Licensed Product.

“Manufacturing Technology Transfer Plan” has the meaning set forth in Section 5.9.2 (Ionis Manufacturing and Analytical Know-How).

“Material Research Costs” means, with respect to any FTE Costs and Out-of-Pocket Costs incurred by Ionis in conducting Additional Ionis Research Activities, any FTE Costs and Out-of-Pocket Costs that are in excess of $[***].

“[***]” has the meaning set forth in Section 7.8 ([***]).

“NDA” means a New Drug Application filed with the FDA after Completion of Clinical Studies to obtain Regulatory Approval for a Licensed Product in the United States.

“NDA Approval” means, with respect to a Licensed Product in the United States, FDA approval of an NDA sufficient for the Manufacture, distribution, use, marketing and sale of such Licensed Product.

“Necessary Platform IP” has the meaning set forth in Section 7.9.3(a) (New Necessary Platform IP).

“Net Sales” means the net sales recorded by Novartis or any of its Affiliates or their Sublicensees (excluding, for clarity, any distributors or wholesalers) for any Licensed Product sold to Third Parties other than Sublicensees as determined in accordance with Novartis’ Accounting Standards as consistently applied, less a deduction of [***] percent ([***]%) for direct expenses related to the sales of the Licensed Product, distribution and warehousing expenses and uncollectible amounts on previously sold products. The deductions booked on an accrual basis by Novartis and its Affiliates under its Accounting Standards to calculate the recorded net sales from gross sales include the following:

(i)

normal trade and cash discounts;

(ii)

amounts repaid or credited by reasons of defects, rejections, recalls or returns;

(iii)

rebates and chargebacks to customers and other Third Parties (including Medicare, Medicaid, Managed Healthcare and similar types of rebates);

(iv)

amounts provided or credited to customers through coupons and other discount programs;

Appendix 1-10

(v)

delayed ship order credits, discounts or payments related to the impact of price increases between purchase and shipping dates or retroactive price reductions;

(vi)

fee for service payments to customers for any non-separable services (including compensation for maintaining agreed inventory levels and providing information); and

(vii)

other reductions or specifically identifiable amounts deducted for reasons similar to those listed above in accordance with Novartis’ Accounting Standards.

With respect to the calculation of Net Sales:

(a)

Net Sales only include the value charged or invoiced on the first arm’s length sale to a Third Party. Sales between or among Novartis and its Affiliates and Sublicensees shall be disregarded for purposes of calculating Net Sales;

(b)

If a Licensed Product is delivered to the Third Party before being invoiced (or is not invoiced), Net Sales will be calculated at the time all the revenue recognition criteria under Novartis’ Accounting Standards are met;

(c)

In the event that the Licensed Product is in finished dosage form containing the Licensed Compound in combination with one (1) or more other active ingredients (such active ingredients, “Other Components,” and such Licensed Product, a “Combination Product”), the Net Sales will be calculated by multiplying the Net Sales of the Combination Product by the fraction, A/(A+B) where A is the weighted (by sales volume) average sale price in the relevant country of the Licensed Product containing the Licensed Compound as the sole active ingredient in finished form, and B is the weighted average sale price (by sales volume) in that country of the product(s) containing the Other Components as the sole active ingredient(s) in finished form. Regarding prices comprised in the weighted average price when sold separately referred to above, if these are available for different dosages from the dosages of the Licensed Compound and the Other Components, then Novartis shall be entitled to make a proportional adjustment to such prices in calculating the royalty-bearing Net Sales of the Combination Product. If the weighted average sale price cannot be determined for the Licensed Product or other product(s) containing the single Licensed Compound or Other Components, the calculation of Net Sales for Combination Products will be agreed by the Parties based on the relative value contributed by each component (each Party’s agreement not to be unreasonably withheld or delayed).

“Non-Breaching Party” means the Party that believes the Breaching Party is in material breach of this Agreement.

“Non-Transferring Party” has the meaning set forth in Section 13.4.2 (Assignment and Successors).

“Novartis” has the meaning set forth in the Preamble of this Agreement.

“Novartis Background Know-How” means any Know-How that (a) is Controlled by Novartis or its Affiliates as of the Execution Date or any time during the Agreement Term, (b) is not Program Know-How and (c) is necessary or actually used to Develop, Research, Manufacture or Commercialize a Licensed Product.

Appendix 1-11

“Novartis Background Patents” means Patent Rights that (a) Controlled by Novartis or its Affiliates as of the Execution Date or any time during the Agreement Term, (b) are not Program Patents and (c) are necessary or actually used to Develop, Research, Manufacture or Commercialize a Licensed Product.

“Novartis Background Technology” means Novartis Background Patents and Novartis Background Know-How.

“Novartis Compound” means a Licensed Compound that was discovered by Novartis prior to the Effective Date or outside of activities conducted pursuant to this Agreement.

“Novartis Indemnitees” has the meaning set forth in Section 10.2 (Indemnification by Ionis).

“Novartis Know-How” means any Know-How that is Controlled by Novartis or its Affiliates on the Execution Date or at any time during the Agreement Term.

“Novartis Patents” means any Patent Rights included in the Novartis Technology.

“Novartis Product-Specific Patents” means all Product-Specific Patents that are (a) owned, used, developed by, or licensed to Novartis or its Affiliates, in each case to the extent Controlled by Novartis or its Affiliates on the Execution Date or at any time during the Agreement Term and (b) necessary or actually used to Develop, Research, Manufacture or Commercialize a Licensed Product.

“Novartis Program Know-How” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Novartis Program Patents” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Novartis Program Technology” has the meaning set forth in Section 8.2.2(a) (Allocation of Ownership).

“Novartis Proposed Development Candidate” has the meaning set forth in Section 2.2.3 (Novartis Proposed Development Candidate).

“Novartis-Prosecuted Patents” has the meaning set forth in Section 8.3.2(b) (Other Matters Pertaining to Prosecution and Maintenance of Patents).

“Novartis Research Activities Technology” means any Know-How or Patent Rights that are (a) Controlled by Novartis or its Affiliates as of the Execution Date or any time during the Agreement Term and (b) necessary or reasonably useful for Ionis to perform any activities allocated to Ionis under the Research Plan or to conduct Research during the Carryover Period.

“Novartis Royalty Bearing Patent” means, with respect to a Licensed Product, any Novartis Patent that specifically Covers the composition of matter or method of use of such Licensed Product or the Licensed Compound included in such Licensed Product.

“Novartis Technology” means Novartis’ interest in Novartis Program Technology, Novartis Product-Specific Patents, Novartis Know-How, Novartis Background Technology, and any Trademarks described in Section 5.8 (Trademark and Domain Names), that, in each case, is owned, used, developed by, or licensed to Novartis or its Affiliates (other than from Ionis pursuant to this Agreement) that are necessary or actually used to Develop, Research, Manufacture or Commercialize a Licensed Product.

Appendix 1-12

“Oligonucleotide” means a synthetic compound that comprises or consists of at least one strand of at least five linked nucleosides (including any analog, variant, mimic, or mimetic thereof). For clarity, the nucleosides and internucleoside linkages of Oligonucleotides may be unmodified or modified. Oligonucleotides may include additional moieties, such as one or more covalently attached groups. Oligonucleotides may be [***].

“Orange Book Patents” means, on a country-by-country basis, the Licensed Patents that are listed with, or are required to be listed with, applicable Regulatory Authorities Covering any Licensed Product being Developed or Researched by Novartis, its Affiliates or Sublicensees hereunder that Novartis, its Affiliate or Sublicensee intends to, or has begun to, Commercialize, and that have become the subject of an NDA, MAA or other marketing application submitted to any applicable Regulatory Authority, such listings to include, without limitation, all so-called “Orange Book” listings required under the Hatch-Waxman Act and all so-called “Patent Register” listings as required in Canada. Orange Book Patents will include any and all foreign equivalent and counterpart Patent Rights to the Patent Rights described above.

For the avoidance of doubt, on a country-by-country basis, where there is:

(a)

a mandatory patent listing process in such country, only Licensed Patents that are listed in such country’s patent listing will be considered “Orange Book Patents” (and therefore royalty-bearing) in such country, irrespective of whether the foreign equivalent Patent Rights of such Licensed Patents are listed in another country;

(b)

a voluntary patent listing process in such country, both (x) Licensed Patents that are listed in such country’s patent listing, and (y) Licensed Patents that are not listed in such country’s patent listing but are the foreign equivalent Patent Rights of the Licensed Patents listed in the mandatory patent listing of another country, in each case will be considered “Orange Book Patents” (and therefore royalty-bearing) in such country; and

(c)

no patent listing process in such country, Licensed Patents that are the foreign equivalent of the Licensed Patents listed in the mandatory patent listing of another country, in each case will be considered “Orange Book Patents” (and therefore royalty-bearing) in such country, irrespective of whether the foreign equivalent Patent Rights of such Licensed Patents are listed in another country.

For example, if country “A” has a mandatory patent listing process that only requires that Licensed Patents “X” “Y” and “Z” be listed, and country “B” has a mandatory patent listing process that only requires that Licensed Patents “Y” and “Z” be listed, then Licensed Patents “X” “Y” and “Z” will be royalty-bearing Orange Book Patents in country “A”, and only Licensed Patents “Y” and “Z” will be royalty-bearing Orange Book Patents in country “B”.

For another example, if country “A” has a voluntary patent listing process that permits but does not require that Licensed Patents “X” “Y” and “Z” be listed and Novartis only lists in such patent listing Licensed Patents “X” and “Y”, and country “B” has a mandatory patent listing process that requires that Licensed Patents “X” “Y” and “Z” be listed, then the applicable foreign equivalent of Licensed Patents “X” “Y” and “Z” will be royalty-bearing Orange Book Patents in country “A” and in country “B”.

“[***]” has the meaning set forth in Section 5.3.2 (Sublicensing Requirements).

“Other Components” has the meaning set forth in the definition of “Net Sales” in this Appendix 1 (Definitions).

“Out-of-Pocket Costs” means with respect to any activity (including Development), [***].

Appendix 1-13

“Party” or “Parties” has the meaning set forth in the Preamble of this Agreement.

“Party Vote” has the meaning set forth in Section 3.3.1 (Committee Decisions).

“Patent Costs” means the reasonable fees and expenses paid to outside legal counsel, and filing, maintenance and other reasonable Out-of-Pocket Costs, incurred in connection with the Prosecution and Maintenance of Patent Rights.

“Patent Rights” means (a) patents, patent applications and similar government-issued rights protecting inventions in any country or jurisdiction however denominated, (b) all priority applications, divisionals, continuations, substitutions, continuations-in-part of and similar applications claiming priority to any of the foregoing, and (c) all patents and similar government-issued rights protecting inventions issuing on any of the foregoing applications, together with all registrations, reissues, renewals, re-examinations, confirmations, supplementary protection certificates, and extensions of any of (a), (b) or (c).

“Permitted Licenses” means (a) licenses granted by Ionis or its Affiliates after the Effective Date to any Third Party under the Ionis Core Technology Patents, the Ionis Manufacturing and Analytical Patents, or the Ionis Manufacturing and Analytical Know-How (but not under the Ionis Product-Specific Patents) to (x) use Oligonucleotides (or supply Oligonucleotides to end users) solely to conduct research, or (y) enable such Third Party to manufacture or formulate Oligonucleotides, where (i) such Third Party is primarily engaged in providing contract manufacturing or services and is not primarily engaged in drug discovery, development or commercialization of therapeutics; and (ii) Ionis and its Affiliates do not assist such Third Party to identify, discover or make an Oligonucleotide designed to bind to the RNA encoding APO(a); and (b) material transfer, collaboration, or sponsored research agreements with academic collaborators or non-profit institutions solely to conduct non-commercial research.

“Person” means any corporation, limited or general partnership, limited liability company, joint venture, trust, unincorporated association, governmental body, authority, bureau or agency, any other entity or body, or an individual.

“Phase 1 Trial” means, with respect to a Licensed Product, a human clinical trial that is intended to initially evaluate the safety, metabolism and pharmacokinetics of such Licensed Product that would otherwise satisfy the requirements of 21 C.F.R. § 312.21(a) or an equivalent clinical trial in a country other than the United States.

“Phase 2 Trial” means, with respect to a Licensed Product, a human clinical trial for which the primary endpoints include a determination of safety, dose ranges or an indication of efficacy of such Licensed Product in patients being studied as described in 21 C.F.R. § 312.21(b), or an equivalent clinical trial in a country other than the United States.

“Phase 2a Trial” means, with respect to a Licensed Product, the first Phase 2 Trial for such Licensed Product. A Phase 2a Trial does not need to generate sufficient data to commence a Phase 3 Trial.

“Phase 2b Trial” means, with respect to a Licensed Product, the first to occur of: (a) the second Phase 2 Trial for such Licensed Product or (b) any Phase 2 Trial the principal purpose of which is a determination of efficacy and safety, in the target population, at the intended clinical dose or doses or range of doses, on a sufficient number of subjects and for a sufficient period of time to confirm the optimal manner of use of the Licensed Product (dose and dose regimen) prior to the Initiation of a Phase 3 Trial.

Appendix 1-14

“Phase 3 Trial” means, with respect to a Licensed Product, a human clinical trial (regardless of whether actually designated as “Phase 3”) that is prospectively designed, along with other Phase 3 Trials, to demonstrate statistically whether such Licensed Product is safe and effective for use in humans in the indication being investigated as described in 21 C.F.R. § 312.21(c), or an equivalent clinical trial in a country other than the United States.

“Prior Agreements” means the agreements listed on Appendix 8 (Prior Agreements) attached hereto as they are in effect as of the Execution Date without giving effect to any amendments or modifications thereafter.

“Proceeding” means an action, suit or proceeding.

“Product-Specific Patents” means Patent Rights Controlled by a Party or any of its Affiliates on or after the Execution Date (including a Party’s interest in Jointly-Owned Program Patents) claiming: (a) the specific composition of matter of a Licensed Product or the Licensed Compound contained in such Licensed Product, or (b) methods of using such a Licensed Product or Licensed Compound contained in such Licensed Product as a prophylactic or therapeutic.

“Program Know-How” has the meaning set forth in Section 8.2.2(c) (Program Technology).

“Program Patents” has the meaning set forth in Section 8.2.2(c) (Program Technology).

“Program Technology” has the meaning set forth in Section 8.2.2(c) (Program Technology).

“[***]” has the meaning set forth in Section 11.5.3(a)(iv) (Acquisition of Alternative Technologies).

“Proposed Development Candidate” has the meaning set forth in Section 2.2.1 (Development Candidate Data Packages).

“Prosecution and Maintenance” or “Prosecuting and Maintaining” means, with regard to a Patent Right, the preparing, filing, prosecuting, maintaining and managing of such Patent Right, including strategies in relation to the Unified Patent Court and Unitary Patent in Europe, such as but not limited to the filing or withdrawing of an opt-out of a European Patent and validating as a Unitary Patent or a classical European Patent, as well as handling re-examinations, reissues, and requests for patent term extensions with respect to such Patent Right, together with the conduct of interferences, the defense of oppositions and other similar Proceedings with respect to the particular Patent Right. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” will not include any other enforcement actions taken with respect to a Patent Right.

“Receiving Party” has the meaning set forth in Section 12.1 (Confidentiality; Exceptions).

“Regulatory Approval” means (a) an NDA Approval, (b) an MAA Approval, or (c) such other approval by a Regulatory Authority in any other jurisdiction sufficient for the Manufacture, distribution, use, marketing and sale of a Licensed Product, which for the avoidance of doubt shall include pricing and reimbursement approval from a Regulatory Authority when applicable.

“Regulatory Authority” means any Governmental Authority, including the FDA, EMA or PMDA (i.e., the Japanese Ministry of Health and Welfare, or any successor agency thereto), that has responsibility for granting any licenses or approvals or granting pricing or reimbursement approvals necessary for the marketing and sale of a Licensed Product in any country.

Appendix 1-15

“Regulatory Exclusivity Period” means, with respect to any Licensed Product in any country or jurisdiction in the Territory, the period of time during which: (a) a Party or its Affiliate or Sublicensee has been granted the exclusive legal right by a Regulatory Authority, other than through a Patent Right, including orphan drug exclusivity, pediatric exclusivity, rights conferred in the U.S. under the FD&C Act, rights in the EU under Directive 2001/83/EC, or rights similar thereto in other countries or regulatory jurisdictions in the Territory, or is otherwise entitled to the exclusive legal right by operation of Applicable Law in such country to market and sell such Licensed Product, and such right precludes the receipt of Regulatory Approval of any Third Party product that is deemed to be the same or a similar drug, in each case, under applicable orphan drug regulations; or (b) the data and information submitted by a Party or its Affiliate or Sublicensee to the relevant Regulatory Authority in such country or jurisdiction for purposes of obtaining Regulatory Approval of such Licensed Product may not be disclosed, referenced, or relied upon in any way by any Third Party or such Regulatory Authority to support the Regulatory Approval or marketing of any product by any Third Party in such country or jurisdiction, or if such data and information is disclosed, referenced, or relied upon to support a Regulatory Approval granted to any Third Party in such country or jurisdiction, then the product may not be placed on the market for any indication.

“Research” means conducting research activities with or in order to identify Compounds and to evaluate any such Compound for potential designation as a Development Candidate, including nonclinical research, gene function, gene expression and target validation research, lead optimization, and which may include small pilot toxicology studies. When used as a verb, “Researching” means to engage in Research.

“Research Activities” has the meaning set forth in Section 2.1.1 (Research Plan).

“Research Plan” has the meaning set forth in Section 2.1.1 (Research Plan).

“Research Report” has the meaning set forth in Section 2.10.2 (Research Reports).

“Research Term” has the meaning set forth in Section 2.3 (Research Term).

“Reversion License” has the meaning set forth in Section 11.5.3(a)(i)(3) (License Grant).

“Reversion License Dispute” has the meaning set forth in Section 11.5.3(a)(ii) (Reversion License Economics).

“Royalty Report” has the meaning set forth in Section 7.11.1 (Commencement).

“Royalty Term” has the meaning set forth in Section 7.7.2(a) (Royalty Term).

“Shared Ionis Identified Rights” has the meaning set forth in Section 7.9.3 (Ionis In-License Agreements).

“Shared Novartis Identified Rights” has the meaning set forth in Section 7.9.4 (Right to Offset).

“[***]” means [***].

“[***]” means, with respect to [***].

“Sublicensee” means a Third Party to whom a Party or its Affiliates or Sublicensees has granted a sublicense or license under any Licensed Technology or Novartis Technology, as the case may be, licensed to such Party in accordance with the terms of this Agreement.

“Technology Transfer Plan” has the meaning set forth in Section 5.9.1 (Licensed Know-How – Generally).

Appendix 1-16

“Terminated Products” means:

(a)

With respect to termination of this Agreement in its entirety prior to designation of a Development Candidate, or this Agreement expires in accordance with Section 11.1.3, (i) any Licensed Compounds that are not Novartis Compounds and (ii) any Novartis Compounds that satisfy the Development Candidate Criteria as of the date of such termination;

(b)

with respect to termination of this Agreement in part with respect to a Licensed Product, (i) such Licensed Product and (ii) such Licensed Product’s Backup Compounds, if any; and

(c)

with respect to termination of this Agreement in its entirety, (i) any Licensed Product that is being Developed or Commercialized by Novartis, its Affiliates or Sublicensees as of the effective date of termination of this Agreement and (ii) such Licensed Product’s Backup Compounds, if any.

For purposes of the definition of “Terminated Products,” “Backup Compounds” means, with respect to a Licensed Product, any Licensed Compounds that (i) satisfy the Development Candidate Criteria and (ii) were presented by Ionis to the JRC as potential Development Candidates at the same time as the Development Candidate contained in such Licensed Product was so presented.

“Territory” means worldwide.

“Third Party” means a Person other than the Parties or their respective Affiliates.

“Third Party Claims” has the meaning set forth in Section 10.1 (Indemnification by Novartis).

“Trademark” means any trademark owned and controlled by Novartis and used by Novartis in connection with the marketing of a Licensed Product.

“Transferring Party” has the meaning set forth in Section 13.4.2 (Assignment and Successors).

“Transition Services” has the meaning set forth in Section 11.5.3(h) (Ionis: Special Consequences for Certain Termination).

“United States” or “U.S.” means the 50 states of the United States of America and all of its territories and possessions and the District of Columbia.

“Upfront Fee” has the meaning set forth in Section 7.1 (Upfront Fee).

“Valid Claim” means a claim (a) of any issued, unexpired United States or foreign Patent Right, which will not, in the country of issuance, have been donated to the public, disclaimed, nor held invalid or unenforceable by a court of competent jurisdiction in an unappealed or unappealable decision or (b) of any United States or foreign patent application within a Patent Right, which will not, in the country in question, have been cancelled, withdrawn, abandoned nor been pending for more than seven years from the date of filing of the earliest patent application to which such patent application claims priority in the country of question, not including in calculating such seven-year period of time in which such application is in interference or opposition or similar proceedings or time in which a decision of an examiner is being appealed. For clarity, on a country-by-country basis, a patent application pending for more than seven years will not be considered to have any Valid Claim for purposes of this Agreement unless and until a patent meeting the criteria set forth in clause (a) above with respect to such application issues.

Appendix 1-17

“Warranty Patents” means (a) with respect to any representation or warranty made as of the Execution Date, any Patent Rights that are (i) Controlled by Ionis or its Affiliates as of the Execution Date and (ii) necessary or reasonably useful to perform the Research Activities, and (b) with respect to any representation or warranty made [***], the Licensed Patents that are necessary or reasonably useful to Exploit the applicable Development Candidate or Licensed Products that contain such Development Candidate.

“Warranty Technology” means (a) with respect to any representation or warranty made as of the Execution Date, any Know-How or Patent Rights that are (i) Controlled by Ionis or its Affiliates as of the Execution Date and (ii) necessary or reasonably useful to perform the Research Activities, and (b) with respect to any representation or warranty made [***], the Licensed Technology that is necessary or reasonably useful to Exploit the applicable Development Candidate or Licensed Products that contain such Development Candidate. For clarity, Warranty Technology includes Warranty Patents.

Appendix 1-18

Appendix 2

Ionis In-License Agreements

[***].

[***]

[***].

Appendix 2-1

Appendix 3

License Conditions; Limitations

[***]

10.

[***]

Appendix 3-1

Appendix 4

Ionis Development Pipeline

Appendix 4-1

Appendix 4-2

Appendix 4-3

Appendix 5

Ionis Core Technology Patents^*

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]

^* pending identification or evaluation of Licensed Compounds

Appendix 5-1

Ionis Docket Number

Country/Treaty

Application/

Patent

Number

Grant Date

Title

[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]

Appendix 5-2

Ionis Docket Number

Country/Treaty

Application/

Patent

Number

Grant Date

Title

[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]

Appendix 5-3

Appendix 6

Ionis Manufacturing and Analytical Patents^*

Ionis Docket Number	Country	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]

^* pending identification or evaluation of Licensed Compounds

Appendix 6-1

Appendix 7

Ionis Product-Specific Patents^*

None.

^* pending identification or evaluation of Licensed Compounds

Appendix 7-1

Appendix 8

Prior Agreements

[***]

10.

[***]

Appendix 8-1

Schedule 2.1.1

Research Plan

[***]

Schedule 9.2

Schedule 5.4.2(a)

[***]

Schedule 9.2

Ionis Disclosure Schedule

[***]

Schedule 9.2

Schedule 11.5.3

[***]

Exhibit 1

Novartis’ Form of Invoice

Exhibit 1

Sender’s Logo			INVOICE

Name			INVOICE Date: xx.xx.xxxx
Street			INVOICE No.: xxxx
Town, Country
Phone and Fax Nr.

Bill To:
NOVARTIS PHARMA AG
Zentraler Faktureneingang Attn: Barbara Schultheiss	Purchase Order: xxxx [Reference to Novartis Purchase Order]
PO Box CH-4002 Basel
Switzerland


DESCRIPTION [Please specify the service or event for which the invoice is due]		AMOUNT (xxx) [specify the currency]
[Please reference the agreement and paragraph thereof describing the payment obligation] [Please specify the service period, e.g. Q1 20xx]		000’000.00


VAT (if applicable)		000’000.00

Please remit by wire transfer within 60 days to: [payment term as per agreement]
Receiving Bank – (name, address and country).
Swift Code -
Bank account number - IBAN (mandatory for Europe) ABA Number -

Have an electronic copy of this invoice please sent to: • [*] • [] • [**]
	TOTAL	000’000,00

If you have any questions concerning this invoice, contact ……… or e-mail to ……… [reference to invoice senders subject matter expert]

Novartis Pharma AG: VAT –Reg. No. CHE-116.268.023 MWST

Exhibit 1

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Exhibit 10.3

Certain portions of this exhibit, marked by [***], have been excluded because they are both not material and are the type that the registrant treats as private or confidential.

Research, Development, and License Agreement

Among

Ionis Pharmaceuticals, Inc.,

And

F. Hoffmann-La Roche Ltd

And

Hoffmann-La Roche Inc.

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RESEARCH, DEVELOPMENT, AND LICENSE AGREEMENT

This RESEARCH, DEVELOPMENT, AND LICENSE AGREEMENT (the “Agreement”) is entered into as of the 26^th day of September, 2023 (the “Effective Date”) by and among Ionis Pharmaceuticals, Inc., a Delaware corporation, having its principal place of business at 2855 Gazelle Court, Carlsbad, California 92010 (“Ionis”), F. Hoffmann-La Roche Ltd, a Swiss corporation, having its principal place of business at Grenzacherstrasse 124, 4070 Basel, Switzerland (“Roche Basel”) and Hoffmann-La Roche Inc., a New Jersey corporation, having its principal place of business at 150 Clove Road, Suite 8, Little Falls, New Jersey 07424 (“Roche US”; Roche Basel and Roche US are collectively referred to as “Roche”). Roche and Ionis each may be referred to herein individually as a “Party” or collectively as the “Parties.”

RECITALS

WHEREAS, Ionis has expertise in discovering and developing antisense drugs, and is researching compounds to identify and select drugs to treat Huntington’s Disease and Alzheimer’s Disease;

WHEREAS, Roche has expertise in developing and commercializing drugs, and Roche is interested in researching, developing and commercializing antisense drugs to treat Huntington’s Disease and Alzheimer’s Disease;

WHEREAS, Roche and Ionis desire to conduct research activities to identify and select at least one antisense drug to treat each of Huntington’s Disease and Alzheimer’s Disease;

WHEREAS, Roche desires Ionis to develop each drug until delivery of a Handoff Data Package, after which responsibility for further Development, Manufacturing and Commercialization (terms defined further below) of such drug will transition to Roche;

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

ARTICLE 1.

DEFINITIONS

The terms used in this Agreement with initial letters capitalized, whether used in the singular or the plural, will have the meaning set forth in APPENDIX 1, or if not listed in APPENDIX 1, the meaning designated in places throughout the Agreement.

ARTICLE 2.

AGREEMENT OVERVIEW

2.1.

The intent of this collaboration is for the Parties to conduct research programs directed to each of the gene targets [***] and [***] (each a “Target”). The research programs will be (i) an Ionis [***] program initially centered around the research of Oligonucleotides designed to bind to the RNA that encodes [***] with the goal of designating an Ionis Development Candidate for Huntington’s Disease and (ii) an Ionis [***] program centered around the research of Oligonucleotides designed to bind to the RNA that encodes [***] with the goal of designating an Ionis Development Candidate for Alzheimer’s Disease, and in each case ((i) and (ii)), Ionis will deliver for each Program a Handoff Data Package to Roche. On a Program-by-Program basis, (a) Ionis will perform and fund the activities allocated to it under the applicable R&D Plan from the Effective Date until the date of Handoff for such Program (the “Handoff Period”); (b) after Handoff has taken place, Roche will be responsible for all further development, manufacturing, regulatory and commercial activities related to the Products for such Program (including drafting the IND for such Products), unless agreed otherwise in a written agreement signed by each Party’s authorized representative; and (c) the Parties, through a joint manufacturing committee, will discuss and agree upon a manufacturing strategy for each Program through [***] for such Program.

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2.2.	In addition, the Parties intend to enter into an agreement to conduct [*]. Upon completion of []. Any [], which will incorporate the terms and principles set forth in SCHEDULE 2.2 but in any event will not [*].

2.3.

The purpose of this ARTICLE 2 is to provide a high-level overview of the roles, responsibilities, rights and obligations of each Party under this Agreement with regard to the R&D Plans and Products, and therefore this ARTICLE 2 is qualified in its entirety by the more detailed provisions of this Agreement set forth below.

ARTICLE 3.

RESEARCH AND DEVELOPMENT

3.1.

Programs.

3.1.1.

R&D Plans. The R&D Plans for each Target are attached hereto as APPENDIX 2. Each such R&D Plan sets forth the research and preclinical Development activities that Ionis (with certain contributions by Roche) will conduct within the given timelines to designate at least one Ionis Development Candidate and deliver one Handoff Data Package.

3.1.2.

Conducting the R&D Plans. For each Target, during the Handoff Period, Ionis and Roche will use Commercially Reasonable Efforts to conduct the research and Development activities allocated to such Party according to the applicable R&D Plan with the goal of delivering at least one Compound that fulfills the Success Criteria for such Target.

3.1.3.

Ionis Development Candidate Designation; IND-Enabling Toxicology Study Costs.

(a)

Unless otherwise mutually agreed by the Parties, Ionis’ Research Management Committee (“RMC”) [***]. For a given Compound that Ionis’ RMC proposes as a potential Ionis Development Candidate, Ionis will provide to Roche the applicable Development Candidate Data Package, which Development Candidate Data Package will identify the proposed Compound and all Related Compounds. Within [***] after Roche’s receipt of a Development Candidate Data Package pursuant to this Section 3.1.3(a), Roche will notify Ionis in writing of any omissions or deficiencies that Roche reasonably believes in good faith cause the Development Candidate Data Package to be incomplete with respect to the applicable proposed Ionis Development Candidate or Related Compound(s) described therein (a “Development Candidate Data Package Deficiency Notice”). Within [***] after Ionis’ receipt of a Development Candidate Data Package Deficiency Notice, Ionis will resubmit a complete Development Candidate Data Package to Roche. Within [***] after Roche’s receipt of the applicable complete Development Candidate Data Package, the JSC will convene to discuss and recommend the proposed Compound (or, alternatively, a Related Compound) as an Ionis Development Candidate. Should the JSC recommend the designation of the Compound (or a Related Compound) as an Ionis Development Candidate, then within [***] after such recommendation, Roche shall confirm designation of such Compound as an Ionis Development Candidate.

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(b)

If the JSC recommends such designation and Roche confirms such designation, then subject to Section 3.1.6 (Roche Performing IND- Enabling Toxicology Studies for First Ionis Development Candidate), Ionis shall be responsible to perform IND-Enabling Toxicology Studies with respect to such Ionis Development Candidate. The cost for such studies, including CMC cost, shall be handled, as follows: (i) if Ionis performs the IND-Enabling Toxicology Studies, then [***] will pay for the cost of such IND-Enabling Toxicology Studies for such Ionis Development Candidate (subject to Section 7.2 ([***])), and [***] will pay [***] for the Costs of the IND-Enabling Toxicology Studies for any subsequent Ionis Development Candidate, if applicable, for the same Target, and (ii) if Roche performs the IND-Enabling Toxicology Studies, then [***] will pay all costs for such studies.

(c)

If (i) the JSC does not recommend such designation (and does not, as an alternative, recommend designation of a Related Compound), or (ii) the JSC recommends such designation (or, alternatively, the designation of a Related Compound) but Roche does not confirm the designation of such Compound (or Related Compound, as applicable) as an Ionis Development Candidate within [***], then, unless the Compound is [***] and designated by Ionis as a potential Follow-On Ionis Development Candidate under Section 3.6.2 (Follow-On Development Candidates [***]), Ionis shall have the right to terminate the Agreement for such Program in accordance with Section 3.10 (Failure to Identify or Designate an Ionis Development Candidate).

3.1.4.

Handoff Data Package. Once available to Ionis, Ionis will promptly deliver to Roche the pharmacology, toxicology, histology and pharmacokinetic data generated from the IND-Enabling Toxicology Studies and any other studies it is responsible for under the R&D Plans and will provide Roche with Ionis’ portion of the applicable Handoff Data Package (i.e., the data for which Ionis is responsible). Within [***] after receipt of such information, Roche will notify Ionis of any omissions or deficiencies that Roche believes in good faith cause Ionis’ portion of the Handoff Data Package to be incomplete with respect to the applicable Ionis Development Candidate. Within [***] after Ionis’ receipt of such notice from Roche, Ionis will resubmit its complete portion of the Handoff Data Package to Roche. Roche will complement the Handoff Data Package with data that Roche is responsible for, and the JSC will then review the Handoff Data Package and assess if the Handoff Data Package Criteria are met, subject to Section 3.1.7 (Failure to Achieve Handoff Data Package Criteria; Disputes over Achievement of Handoff Data Package Criteria). For clarity, [***]. If the Parties mutually agree to [***], then the Parties will memorialize such agreement in a writing signed by each Party’s authorized representative.

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3.1.5.

Handoff. On an Ionis Development Candidate-by-Ionis Development Candidate basis, once the Handoff Data Package Criteria for the applicable Ionis Development Candidate is deemed to have been achieved as set forth in Section 3.1.4 (Handoff Data Package) or Section 3.1.6 (Roche Performing IND- Enabling Toxicology Studies for First Ionis Development Candidate), as applicable (the “Handoff”), the responsibility for further Development of such Ionis Development Candidate (including drafting the IND for such Ionis Development Candidate) transitions from Ionis to Roche, and Ionis will have no further responsibilities under the applicable R&D Plan.

3.1.6.

Roche Performing IND-Enabling Toxicology Studies for First Ionis Development Candidate. No later than [***] prior to the JSC’s expected designation of an Ionis Development Candidate for a given Target under Section 3.1.3 (Ionis Development Candidate Designation; IND-Enabling Toxicology Study Costs), Roche may, at its discretion, decide to perform IND-Enabling Toxicology Studies for such Ionis Development Candidate and prepare the related data package to be included within the Handoff Data Package instead of Ionis. In such instance, the milestone payment set forth in Section 7.2 ([***]) will not apply and [***] shall be responsible for the costs of such IND-Enabling Toxicology Studies. Once available to Roche, Roche will consolidate the respective pharmacology, toxicology, histology and pharmacokinetic data generated from the IND-Enabling Toxicology Studies together with other data each Party may be responsible for and present the completed Handoff Data Package at the JSC. The JSC will then convene to discuss such data package and confirm whether the Handoff Data Package Criteria have been met. If the JSC does not agree as to whether the Handoff Data Package Criteria have been met, then such matter shall be resolved in accordance with Section 3.1.7 (Failure to Achieve Handoff Data Package Criteria; Disputes over Achievement of Handoff Data Package Criteria). For clarity, [***]. If the Parties mutually agree to [***], then the Parties will memorialize such agreement in a writing signed by each Party’s authorized representative.

3.1.7.

Failure to Achieve Handoff Data Package Criteria; Disputes over Achievement of Handoff Data Package Criteria.

(a)

If the Parties agree that the Handoff Data Package Criteria for a given Ionis Development Candidate are not met, then for a period of [***] beginning [***], as applicable, the Parties shall reasonably cooperate to identify suitable Related Compound(s) and Roche may select one of these Related Compounds and present it to the JSC to decide whether to designate such Related Compound as a replacement of the initial Ionis Development Candidate. If the JSC designates such Related Compound as an Ionis Development Candidate, then, at [***] but subject to Section 3.1.7(b), either Roche or Ionis will perform the IND-Enabling Toxicology Studies for such Ionis Development Candidate, and [***] will pay for the costs of such studies.

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(b)

If the Parties disagree whether the Handoff Data Package Criteria have been met with respect to a given Ionis Development Candidate and Roche wishes to select a Related Compound to replace the initial Ionis Development Candidate, then for a period of [***] beginning [***], Roche may so designate such Related Compound as a replacement Ionis Development Candidate, and Roche will perform the IND-Enabling Toxicology Studies for such Ionis Development Candidate at [***] expense.

3.1.8.

Development of Additional Compounds.

(a)

Related Compounds. On a Target-by Target basis, at any time after [***] under Section 3.1.3(a), provided that [***], Roche may initiate a Development program on a Related Compound [***] Roche will promptly provide written notice to Ionis following [***], which notice will identify the Related Compound that is the subject of such Development program. Roche will be solely responsible for all subsequent Development and Commercialization of such Related Compound.

(b)

Compounds that Are Not Related Compounds. At any time after the Effective Date, provided that [***], if Roche wishes to [***] then Roche will notify Ionis in writing of the [***]. Within [***] after such notice, the JSC (or the Parties, if the JSC has been dissolved) will meet to discuss whether [***]. Following such meeting, Roche may [***], unless [***]. Following such meeting [***], Roche will be responsible for all subsequent Development and Commercialization of such Compound.

3.1.9.

Performance Milestones During the Handoff Period. For each Target, during the Handoff Period:

(a)

Ionis will use Commercially Reasonable Efforts to present to the JSC (i) at least [***] for [***] that Ionis in good faith believes meets the Success Criteria within [***] after the Effective Date and (ii) at least [***] for [***] that Ionis in good faith believes meets the Success Criteria within [***] after the Effective Date;

(b)

if Ionis is conducting the IND-Enabling Toxicology Studies for a given Ionis Development Candidate, then Ionis will use Commercially Reasonable Efforts to complete the IND-Enabling Toxicology Studies for such Ionis Development Candidate within [***] after the designation of such Ionis Development Candidate; and

(c)

if Roche is conducting the IND-Enabling Toxicology Studies for a given Ionis Development Candidate, then Roche will use Commercially Reasonable Efforts to complete the IND-Enabling Toxicology Studies for such Ionis Development Candidate within [***] after the designation of such Ionis Development Candidate.

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3.2.	Disclosure of Results. Ionis and Roche will provide reports and analyses at each JSC meeting, and more frequently [***], detailing the current status of each R&D Plan.

3.3.	Governance.

3.3.1.

Joint Steering Committee.

(a)

Establishment; Composition; Working Groups; Dissolution. Within [***] after the Effective Date, the Parties will establish a joint steering committee (“JSC”) to govern the activities under the R&D Plans (i.e. until Handoff). The Parties may utilize either a single JSC or may choose to have a JSC for each Target. The JSC will consist of [***] qualified representatives appointed by Ionis, and [***] qualified representatives appointed by Roche. Each Party will designate one of its representatives to act as the co-chairperson of the JSC. The co- chairpersons will be responsible for overseeing the activities of the JSC. The JSC will determine the JSC operating procedures at its first meeting, which will be codified in the written minutes of the first JSC meeting. The JSC will determine the frequency of meetings, location of meetings, and responsibilities for agendas and minutes. The JSC may hold meetings in person or by audio or video conference as determined by the JSC. Alliance Managers are invited to attend JSC meetings as participating non-members. In addition, upon prior approval of the other Party, each Party may invite its employees or consultants to attend JSC meetings, including any subject matter expert(s) with valuable knowledge of [***], [***], Huntington’s Disease, or Alzheimer’s Disease. The co-chairpersons will be responsible for ensuring that activities occur as set forth in this Agreement, including ensuring that JSC meetings occur, JSC recommendations are properly reflected in the minutes, and any dispute is given prompt attention and resolved in accordance with Section 3.3.1(c) (Decision-Making), Section 8.2.3 (Inventorship) and Section 13.1 (Dispute Resolution), as applicable. The JSC will form one or more subcommittees and working groups as it determines in order to discuss progress under the R&D Plans, [***], and to carry out its other activities under this Agreement. Any such subcommittees or working groups may act as an informal forum for the exchange of data arising from the performance of the R&D Plans, and will dissolve when the JSC dissolves. Reasonably in advance ([***]) of any meeting of [***], Ionis will share with any such working group [***]. On a Target-by-Target basis, the JSC will dissolve once all Ionis Development Candidates have either [***] or been terminated in accordance with Section 11.2 (Termination).

(b)

Responsibilities. The JSC will perform the following functions:

(i)

Oversee the Parties’ activities under the respective R&D Plans;

(ii)

Oversee subcommittees of the JSC;

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(iii)

Approve amendments to the R&D Plans;

(iv)

Approve amendments to the Success Criteria;

(v)

Determine whether a Development Candidate Data Package is complete;

(vi)

Determine whether to recommend designating a Compound or, if applicable, Related Compound as an Ionis Development Candidate following review of the applicable Development Candidate Data Package;

(vii)

Determine whether the Handoff Data Package Criteria have been satisfied;

(viii)

Approve the Technology Transfer Plan and amendments following Handoff;

(ix)

Record recommendations and decisions of the JSC in the JSC’s meeting minutes; and

(x)

Such other review and advisory responsibilities assigned to the JSC pursuant to this Agreement.

(c)

Decision-Making.

(i)

Committee Decision-Making. Decisions by the JSC will be made by unanimous consent with each Party’s representatives having, collectively, one vote. At any given meeting of the JSC, a quorum will be deemed reached if a voting representative of each Party is present or participating in such meeting. No action taken at any meeting of the JSC will be effective unless there is a quorum at such meeting. Unless otherwise specified in this Agreement, no action will be taken with respect to a matter for which the JSC has not reached unanimous consensus.

(ii)

Final Decision-Making Authority.

(1)

If the JSC cannot unanimously agree on a matter to be decided by it within [***], then the matter will be referred to the Executives for resolution as set forth in Section 13.1.1 (Escalation), without application of Section 13.1.2 (Binding Arbitration).

(2)

Except as set forth otherwise in this Agreement, if the Executives cannot reach agreement on a matter referred by the JSC within [***], then: (A) each Party will have final decision-making authority with respect to the conduct of its activities under each R&D Plan (provided that such conduct is in accordance with the applicable R&D Plan); (B) Roche will have final decision- making authority with respect to (1) [***], (2) [***], (3) [***], (x) [***], (y) [***], and (z) [***], (4) [***], (5) [***], and (6) [***].

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(3)

Additional Costs Due to [***]. For a given Program, if [***] or [***], then such increased Costs shall be shared as follows: [***] shall bear such Costs [***]; and [***] shall bear such Costs [***].

(4)

Notwithstanding anything to the contrary in this Section 3.3.1(c)(ii) (Final Decision-Making Authority), a Party will not have final decision-making authority with respect to [***] of a Product if the other Party has a reasonable good faith belief that [***].

(5)

Except as otherwise expressly stated in this Agreement, the JSC will have no decision-making authority and will act as a forum for sharing information about the activities conducted by the Parties hereunder and as an advisory body, in each case only on the matters described in, and to the extent set forth in, this Agreement.

(iii)

Decision-Making After Handoff. After Handoff has occurred for a given Ionis Development Candidate, the JSC has no authority to make decisions with respect to such candidate.

3.3.2.

Joint Manufacturing Committee.

(a)

Establishment; Composition; Dissolution. Within [***] after the creation of the JSC, the Parties will establish a joint manufacturing committee (“JMC”) to govern the manufacturing of API to support the activities under the R&D Plans (i.e. until Handoff). The JMC will be deemed a subcommittee of the JSC, as described above in Section 3.3.1(a) (Establishment; Composition; Working Groups; Dissolution), and will have the responsibilities set forth in Section 3.3.2(b) (JMC Responsibilities). The JMC will consist of [***] qualified representatives appointed by Ionis, and [***] qualified representatives appointed by Roche. Alliance Managers are invited to attend JMC meetings as participating non-members. In addition, upon prior approval of the other Party, each Party may invite its employees or consultants to attend JMC meetings, including any subject matter expert(s) with valuable knowledge of [***], [***], Huntington’s Disease, or Alzheimer’s Disease. The JMC will dissolve upon the earlier of (i) dissolution of the JSC, (ii) termination of this Agreement, and (iii) the Parties’ mutual agreement to dissolve the JMC.

(b)

JMC Responsibilities. The JMC will perform the following functions:

(i)

develop, discuss and approve the manufacturing strategy and plan for manufacturing API and Finished Drug Product for each Program through [***] for such Program, which plan will be part of the R&D Plan for the applicable Program;

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(ii)

establish and revise the Handoff Data Package Criteria related to CMC matters;

(iii)

determine whether the Handoff Data Package Criteria related to CMC matters for each Ionis Development Candidate have been satisfied;

(iv)

establish the manufacturing part of the Technology Transfer Plan;

(v)

perform such other functions as determined by the JSC.

(c)

JMC Decision-Making.

(i)

Committee Decision-Making. Decisions by the JMC will be made by unanimous consent with each Party’s representatives having, collectively, one vote. At any given meeting of the JMC, a quorum will be deemed reached if a voting representative of each Party is present or participating in such meeting. No action taken at any meeting of the JMC will be effective unless there is a quorum at such meeting. Unless otherwise specified in this Agreement, no action will be taken with respect to a matter for which the JMC has not reached unanimous consensus.

(ii)

Escalation to JSC. If the JMC cannot unanimously agree on a matter to be decided by it within [***], then the matter will be referred to the JSC for resolution in accordance with Section 3.3.1(c)(ii) (Final Decision-Making Authority).

3.3.3.

Alliance Managers. Each Party will appoint a representative to act as its alliance manager (each, an “Alliance Manager”) for facilitating communication and collaboration between the Parties. Each Alliance Manager will be responsible for (a) facilitating resolution of potential and pending issues and potential disputes to enable the JSC to reach consensus and avert escalation of such issues or potential disputes, (b) supporting the co-chairpersons with organization of JSC meetings, information exchange, meeting minutes, as necessary, and (c) preparing status and progress reports on the above as determined necessary by the JSC.

3.4.	Manufacturing and Supply. Unless otherwise expressly agreed to by the JMC:

3.4.1.

Supplies for Activities under R&D Plans.

(a)

Supplies for Activities During Handoff Period. Subject to Section 3.4.1(c) (Technology Transfer During Handoff Period), on a Program- by-Program basis, during the Handoff Period for such Program, at [***], Ionis will supply cGMP [***] for the [***] Program, and [***] API, or a combination of both [***] API for the [***] Program, in each case for use in IND- Enabling Toxicology Studies for the first Ionis Development Candidate generated under the applicable R&D Plan and, at [***] cost, cGMP material for use in the [***] for such Ionis Development Candidate. Ionis’ supply obligation hereunder will be at least [***], but no more than [***] of cGMP API per Ionis Development Candidate.

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(b)

Supplies for Activities After Handoff. After Handoff, Ionis will deliver to Roche, if Roche desires, any inventory of cGMP API, radiolabeled material, cGMP Finished Drug Product, packaged clinical trial material, and cGMP packaged trial material containing the Ionis Development Candidate then in Ionis’ possession, and Roche will pay Ionis for such materials at Ionis’ Fully Absorbed Cost of Goods, as set forth in SCHEDULE 3.4.1(b).

(c)

Technology Transfer During Handoff Period. For any Compound (except [***] as an Ionis Development Candidate that is designed to bind to the RNA that encodes [***]), Roche may, at its discretion, no later than [***] before the anticipated designation of an Ionis Development Candidate, request a technology transfer under Section 3.5 (Technology Transfer Implementation) and assume responsibility to manufacture and supply API for the IND-Enabling Toxicology Studies for such Ionis Development Candidate (and for all future Clinical Studies of such Ionis Development Candidate).

3.5.

Technology Transfer Implementation. After Handoff for a given Ionis Development Candidate (or earlier if agreed between the Parties), the Parties will establish a technology transfer plan (“Technology Transfer Plan”) under which Ionis will provide reports and information generated by or on behalf of Ionis in performing its activities under the applicable R&D Plan that are necessary for Roche to draft the IND, and the Parties will conduct the transfer activities with respect to the applicable Ionis Development Candidate in accordance with such Technology Transfer Plan.

3.5.1.

Licensed Know-How – Generally. As part of the activities to be performed under the Technology Transfer Plan, Ionis will deliver to Roche copies of Licensed Know-How with respect to the applicable Ionis Development Candidate (other than the Ionis Manufacturing and Analytical Know-How) in the Field in Ionis’ possession not previously provided hereunder, for use solely in accordance with the license granted under Section 5.1.2 (Development and Commercialization License Grant to Roche) to Roche for such Ionis Development Candidate, together with all regulatory documentation (including drafts) related to such Ionis Development Candidate. To assist with the transfer of such Licensed Know-How, Ionis will make its personnel reasonably available to Roche during normal business hours to transfer such Licensed Know-How.

3.5.2.

Ionis Manufacturing and Analytical Know-How. As part of the activities to be performed under the Technology Transfer Plan, Ionis will deliver, at Roche’s election, to one of either (a) [***], or (b) [***] solely to Manufacture API on Roche’s behalf, copies of the Ionis Manufacturing and Analytical Know-How relating to the applicable Ionis Development Candidate in Ionis’ possession not previously provided hereunder, which is necessary for the exercise by Roche, its Affiliates or a Third Party of the Manufacturing rights granted under Section 5.1.2 (Development and Commercialization License Grant to Roche).

3.5.3.

Technology Transfer Costs. Ionis will provide up to [***] of technology transfer activities under this Section 3.5 (Technology Transfer Implementation) at [***]. Thereafter, if reasonably requested by Roche, Ionis will provide reasonable transfer support, and [***].

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3.6.	Follow-On Ionis Development Candidates.

3.6.1.

Follow-On Development Candidates [***]. On a Program- by-Program basis, for a period starting from [***] and ending on the date that is [***], if Ionis’ RMC designates as a development candidate ready to start IND-Enabling Toxicology Studies one or more [***] discovered by or on behalf of Ionis that are designed to bind to the RNA that encodes the applicable Target for such Program and that satisfy the Success Criteria and that are not Compounds, then Ionis will notify Roche in writing and will provide Roche with the data package presented to Ionis’ RMC in connection with the approval by Ionis’ RMC of such [***]. Roche will then have [***] from delivery of such data package to provide written notice to Ionis electing to deem such [***] as a Follow-On Ionis Development Candidate and thereafter such Follow-On Ionis Development Candidate and [***] shall be considered Compounds, and Roche shall continue activities under this Agreement with respect to such Follow-On Ionis Development Candidate. If Roche provides such timely written notice, then Roche will be responsible for the conduct and costs of any further research, Development, Manufacturing, and Commercialization activities for such Follow-On Ionis Development Candidate, and all terms of this Agreement will apply to such Follow-On Ionis Development Candidate, including, but not limited to, Section 7.3 (One-time Milestone Payments for Achievement of Milestone Events), Section 7.4 (Royalties), and Section 7.5 (Royalty Payments and Reports). If [***], then [***].

3.6.2.

Follow-On Development Candidates [***]. Subject to Section 3.6.3 ([***]), on a Program-by-Program basis, for a period starting from [***] and ending on the date that is [***], if Ionis’ RMC designates as a development candidate ready to start IND-Enabling Toxicology Studies one or more [***] discovered by Ionis that are designed to bind to the RNA that encodes the applicable Target for such Program and that satisfy the Success Criteria and that are not Compounds, then Ionis will notify Roche in writing and will provide Roche with the data package presented to Ionis’ RMC in connection with the approval by Ionis’ RMC of such [***]. Roche will then have [***] from delivery of such data package to provide written notice to Ionis electing to deem such [***] as a Follow-On Ionis Development Candidate and thereafter continue activities under this Agreement with respect to such Follow-On Ionis Development Candidate. If Roche provides such timely written notice, then such Follow-On Ionis Development Candidate and [***] shall be considered Compounds, and Roche will be responsible for the conduct and costs of any further research, Development, Manufacturing, and Commercialization activities for such Follow-On Ionis Development Candidate, and all terms of this Agreement will apply to such Follow-On Ionis Development Candidate, including, but not limited to, Section 7.3 (One-time Milestone Payments for Achievement of Milestone Events), Section 7.4 (Royalties), and Section 7.5 (Royalty Payments and Reports). If [***], then [***].

3.6.3.

Roche [***]. On a [***] basis, at any time after [***] until the [***], if [***], then [***]. Upon [***] receipt of [***], [***] will [***] with respect to [***].

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3.6.4.

Agreement by the Parties to Discover and Develop Additional Ionis Development Candidates. At any time after the expiration of the period ending [***] after [***], the Parties may mutually agree to collaborate on the research, discovery and development of an Oligonucleotide designed to bind to a Target that is not a Related Compound or a Follow-On Ionis Development Candidate. Any such future collaboration is subject to the Parties’ good faith negotiation and execution of a new agreement or an amendment of this Agreement.

3.7.

Subcontracting. Each Party may engage Third Party subcontractors to perform certain of its obligations under this Agreement. Any subcontractor engaged to perform a Party’s obligations under this Agreement will meet the qualifications typically required by such Party for the performance of work similar in scope and complexity and will execute such Party’s standard nondisclosure agreement. Any Party engaging a subcontractor hereunder will remain responsible for such activities.

3.8.

Materials Transfer. To facilitate the activities under each R&D Plan, either Party may provide certain materials for use by the other Party. All such materials will be used by the receiving Party in accordance with terms of this Agreement solely for purposes of exercising its rights and performing its obligations under this Agreement, and the receiving Party will not transfer such materials to any Third Party except with the written consent of the supplying Party. Except as expressly set forth herein, THE MATERIALS ARE PROVIDED “AS IS” AND WITHOUT ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE OR ANY WARRANTY THAT THE USE OF THE MATERIALS WILL NOT INFRINGE OR VIOLATE ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.

3.9.

Applicable Laws. Each Party will perform its activities pursuant to this Agreement in compliance with good laboratory and clinical practices and, except where stated otherwise, cGMP, in each case as applicable under the laws and regulations of the country and the state and local government wherein such activities are conducted.

3.10.

Failure to Identify or Designate an Ionis Development Candidate. On a Program- by-Program basis:

3.10.1.

if, despite Ionis’ Commercially Reasonable Efforts, Ionis has not proposed any Compound for potential designation as an Ionis Development Candidate within (a) [***] after [***] for the [***] Program, or (b) [***] after [***] for the [***] Program, then, notwithstanding any provision to the contrary in this Agreement, (i) work under the applicable R&D Plan will stop; (ii) the Parties will no longer have an obligation to perform any activities under this ARTICLE 3 with respect to the applicable Program; and (iii) either Party may terminate the applicable Program, as further specified in Section 11.2.6(a); and

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3.10.2.

if the JSC does not recommend the designation of a proposed Compound (and does not, as an alternative, recommend designation of a Related Compound) within the timeline set forth in Section 3.1.3(a), or Roche, following the JSC’s recommendation to designate a Compound (or Related Compound, as applicable) as an Ionis Development Candidate, does not confirm such recommendation [***] in accordance with Section 3.1.3 (Ionis Development Candidate Designation; IND-Enabling Toxicology Study Costs), then, except as set forth in Section 3.1.3(c), and notwithstanding any other provision to the contrary in this Agreement, (a) work under the applicable R&D Plan will stop; (b) the Parties will no longer have an obligation to perform any activities under this ARTICLE 3 with respect to the applicable Program; and (c) Ionis may terminate the applicable Program, as further specified in Section 11.2.6(b).

ARTICLE 4.

EXCLUSIVITY COVENANTS

4.1.	Exclusivity.

4.1.1.

[***] Exclusivity Covenants Before Handoff. On a Target-by-Target basis, except in the performance of its obligations or exercise of its rights under this Agreement, and except as set forth in Section 4.1.3 (Limitations and Exceptions to Exclusivity Covenants), [***] will work [***] (including the grant of any license to any Third Party) with respect to the [***] that is designed to bind to the RNA that encodes the applicable Target in the Field from the Effective Date until the earlier of (a) the date of Handoff with respect to the first Ionis Development Candidate directed to such Target and (b) termination of this Agreement with respect to such Target.

4.1.2.

[***] Exclusivity Covenants After Handoff. On a Target-by-Target basis, except in the performance of its obligations or exercise of its rights under this Agreement, and except as set forth in Section 4.1.3 (Limitations and Exceptions to Exclusivity Covenants), [***] will not work on its own or with any of its Affiliates or any Third Party (including the grant of any license to any Third Party) with respect to the [***] that is designed to bind to the RNA that encodes the applicable Target in the Field from the date of Handoff with respect to the first Ionis Development Candidate directed to such Target until the earlier of (a) the [***] and (b) termination of this Agreement with respect to such Target; provided, however, that if (i) [***], then [***] exclusivity obligations hereunder will end on the [***], and (ii) provided that [***], then [***] exclusivity obligations hereunder will end on the [***].

4.1.3.

Limitations and Exceptions to Exclusivity Covenants. Notwithstanding anything to the contrary in Section 4.1.1 ([***] Exclusivity Covenants Before Handoff) and Section 4.1.2 ([***] Exclusivity Covenants After Handoff), the Parties and their Affiliates may perform the following activities:

(a)

all activities permitted or contemplated under this Agreement; and

(b)

with regard to Ionis and its Affiliates: (i) any activities pursuant to the Prior Agreements as in effect on the Effective Date; and (ii) the granting of, or performance of obligations or exercise of rights under, Permitted Licenses.

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4.2.

Effect of Exclusivity on Indications. Ionis and Roche are subject to certain exclusivity covenants under Section 4.1.1 ([***] Exclusivity Covenants Before Handoff) and Section 4.1.2 ([***] Exclusivity Covenants After Handoff); however, the Parties acknowledge and agree that each Party (on its own or with a Third Party or an Affiliate) may pursue products for the same indication as a Product so long as such product does not breach Section 4.1 (Exclusivity).

ARTICLE 5.

LICENSE GRANTS

5.1.	License Grants; Sublicense Rights.

5.1.1.

Research License Grant to Roche. Subject to the terms of this Agreement, Ionis hereby grants to Roche a worldwide, non-exclusive, royalty-free, sublicensable (in accordance with Section 5.1.4 (Sublicense Rights) below) license under the Licensed Technology to perform the Roche R&D Activities during the Handoff Period; provided that, (a) for clarity, such license shall not include a license to conduct any clinical Development activities with respect to, or Commercialize, any Compounds or Products, and (b) such license includes a license under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know-How to Manufacture API only if Roche elects to assume responsibility for Manufacturing and supplying such API under Section 3.4.1(c) (Technology Transfer During Handoff Period).

5.1.2.

Development and Commercialization License Grant to Roche. Subject to the terms of this Agreement, Ionis hereby grants to Roche a worldwide, exclusive, royalty-bearing, sublicensable (in accordance with Section 5.1.4 (Sublicense Rights) below) license under the Licensed Technology to research, Develop, Manufacture, have Manufactured (in accordance with Section 5.1.4 (Sublicense Rights) below) and Commercialize Compounds and Products in the Field; provided that [***].

5.1.3.

Cross-Licenses under Collaboration Intellectual Property.

(a)

Enabling License to Roche from Ionis. Subject to the terms of this Agreement (including [***]), Ionis hereby grants to Roche a worldwide, fully paid-up, royalty-free, non-exclusive, sublicensable license under any Ionis Collaboration Technology to research, develop, manufacture, have manufactured and commercialize products that are not Products in the Field; and

(b)

Enabling License to Ionis from Roche. Subject to the terms of this Agreement (including [***]), Roche hereby grants to Ionis a worldwide, fully paid-up, royalty-free, non-exclusive, sublicensable license under any Roche Collaboration Technology, to research, develop, manufacture, have manufactured and commercialize products that are not Products in the Field.

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5.1.4.

Sublicense Rights.

(a)

Subject to the terms of this Agreement, Roche will have the right to grant sublicenses under any license granted under Section 5.1.1 (Research License Grant to Roche), Section 5.1.2 (Development and Commercialization License Grant to Roche) and Section 5.1.3(a) (Enabling License to Roche from Ionis):

(i)

under the Ionis Core Technology Patents, Ionis Product-Specific Patents, Ionis Collaboration Technology and Ionis Know-How to an Affiliate of Roche or a Third Party; and

(ii)

under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know-How solely to (y) [***] or (z) [***].

(b)

Requests to Grant Sublicenses to CMOs. If Roche provides Ionis with a written request that Ionis grant a license under the Ionis Manufacturing and Analytical Patents and Ionis Manufacturing and Analytical Know- How to a CMO designated by Roche that is not a Licensed CMO, solely for such CMO to Manufacture Products for Roche, its Affiliate or Sublicensee in a manufacturing facility owned or operated by such CMO, Ionis will [***].

(c)

Enforcing Sublicenses. Each sublicense by Roche under this Agreement will be subject to, and consistent with, the terms of this Agreement. Roche shall be responsible to ensure compliance by its Sublicensees with the terms and conditions of this Agreement. If Ionis reasonably believes a Roche Sublicensee may be violating the terms of this Agreement, then, within [***] after [***], Roche will provide Ionis a full and complete copy of the sublicense Roche entered with such Sublicensee.

5.1.5.

No Implied Licenses. All rights in and to Licensed Technology not expressly licensed to Roche under this Agreement are hereby retained by Ionis or its Affiliates. All rights in and to Roche Technology not expressly licensed or assigned to Ionis under this Agreement, are hereby retained by Roche or its Affiliates. Except as expressly provided in this Agreement, no Party will be deemed by estoppel or implication to have granted the other Party any license or other right with respect to any intellectual property.

5.1.6.

License Conditions; Limitations. Any license granted under Section 5.1.2 (Development and Commercialization License Grant to Roche) and the sublicense rights under Section 5.1.4 (Sublicense Rights) are subject to and limited by (a) the Permitted Licenses, and (b) the Prior Agreements, in each case [***].

5.1.7.

Trademarks for Products. Roche shall be the owner and solely responsible for all trademarks, trade dress, logos, slogans, designs, copyrights and domain names used on or in connection with Products licensed under Section 5.1.2 (Development and Commercialization License Grant to Roche).

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ARTICLE 6.

DEVELOPMENT, MANUFACTURING, COMMERCIALIZATION AND DILIGENCE

6.1.	Roche Development, Manufacturing & Commercialization

6.1.1.

Responsibility. On an Ionis Development Candidate-by-Ionis Development Candidate basis, after Handoff for an Ionis Development Candidate, subject to the terms of this Agreement, Roche is solely responsible for all Development, Manufacturing and Commercialization activities, and for all costs and expenses associated therewith, with respect to the Development, Manufacture and Commercialization of Products containing such Ionis Development Candidate.

6.1.2.

Clinical Development Plan. After the Handoff for a given Ionis Development Candidate Roche will provide Ionis with a written [***] plan [***] of the [***] of the applicable Product through [***]. Such plan will include key [***] events for the applicable Product [***] for the achievement of such events [***] for such Product. Roche will provide to Ionis [***].

6.1.3.

[***]. On an Ionis Development Candidate-by-Ionis Development Candidate basis, after Handoff for an Ionis Development Candidate, [***] Roche will provide to Ionis the [***] for such Ionis Development Candidate, and subsequent updated versions of [***], [***]. The sharing of the [***] contemplated hereunder [***], and such [***] shall be Roche’s Confidential Information.

6.1.4.

Regulatory Communications and Submissions. As between the Parties, Roche will be responsible for (a) determining the regulatory plans and strategies for the Products, (b) making all regulatory filings with respect to the Products, and (c) obtaining and maintaining Approvals in the name of Roche or its Affiliates or Sublicensees. Up to and including [***], Roche will provide Ionis with any Key Regulatory Submissions to any Regulatory Authority in each Major Market for such Product before providing such submission to the applicable Regulatory Authority for Ionis to provide any comments on the contents thereof. Ionis will have [***] from the date of receipt of such submission to provide comments with respect thereto. Roche will [***] by Ionis. Following [***], Roche [***] also [***]. For clarification, [***].

6.1.5.

Class Generic Claims. If Roche intends to make any claims in a Product label or regulatory filing that are class generic to Oligonucleotides or Ionis’ chemistry platform(s), then Roche will provide such claims and regulatory filings to Ionis in advance and will [***] any proposals and comments made by Ionis.

6.2.

Diligence. On a Target-by-Target basis, after Handoff for an Ionis Development Candidate, Roche will use Commercially Reasonable Efforts to further Develop and Commercialize at least one Product with respect to the Target for such Ionis Development Candidate in the Field in the Territory. Without limiting the foregoing, within [***] after [***], Roche will [***]; provided, however, [***].

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6.3.	IND; Global Safety Database.

6.3.1.

IND. Roche will be the holder of the IND for each Ionis Development Candidate and will assume responsibility for the global safety database related to such Ionis Development Candidate. After Handoff, Roche will be solely responsible for reporting to Regulatory Authorities in accordance with the Applicable Law for expeditable adverse events and for periodic safety reporting relating to the safety of such Ionis Development Candidate and all subsequent Ionis Development Candidates with respect to the same Target.

6.3.2.

Ionis’ Antisense Safety Database.

(a)

Ionis maintains an internal database that includes information regarding the tolerability of its drug compounds, individually and as a class, including information discovered during pre-clinical and clinical development (the “Ionis Internal Oligonucleotide Safety Database”). In an effort to maximize understanding of the safety profile and pharmacokinetics of Ionis compounds, after Handoff, Roche will cooperate in connection with populating the Ionis Internal Oligonucleotide Safety Database. Roche and Ionis will [***].

(b)

Ionis utilizes the information in the Ionis Internal Oligonucleotide Safety Database to conduct analyses to keep Ionis and its partners informed regarding class generic properties of Oligonucleotides, including with respect to safety. As such, if and when Ionis identifies safety or other related issues that may be relevant to a Product (including any potential class-related toxicity), Ionis will promptly inform Roche of such issues and, if requested, provide the data supporting Ionis’ conclusions.

ARTICLE 7.

FINANCIAL PROVISIONS

7.1.	Upfront Fee. Within [***] days following the Effective Date and receipt by Roche of an invoice from Ionis, Roche will pay Ionis an upfront fee equal to sixty million dollars ($60,000,000). All dollar amounts in this Agreement are in U.S. dollars.

7.2.

[***] IND-Enabling Toxicology Studies [***]. For the first Ionis Development Candidate for a given Target, [***] will decide which Party will conduct IND-Enabling Toxicology Studies in accordance with Section 3.1.6 (Roche Performing IND-Enabling Toxicology Studies for First Ionis Development Candidate), and will either (a) [***], or (b) [***]. In case of (a) above, [***].

7.3.	One-time Milestone Payments for Achievement of Milestone Events.

7.3.1.

Development Milestones for [***]. Subject to Section 7.3.1(a) ([***]) and Section 7.3.1(b) ([***]), Roche will pay Ionis the milestone payments set forth in TABLE 1 below the first time a milestone event listed in TABLE 1 is first achieved by a Product directed to [***], regardless of how many times thereafter such Milestone Event is achieved by a subsequent Product to such Target.

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Table 1: Milestone Events for [***]

	Milestone Event	Milestone Payment for [***] Product
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	Total [***] Milestones	$[***]

(a)

[***]. The Milestone Event payment for “[***]” in TABLE 1 will be [***], subject to the following [***]:

(i)

If achievement of the “[***]” Milestone Event is [***] and [***] achieves the “[***]” Milestone Event, then [***].

(ii)

Following achievement of the “[***]” Milestone Event with a Product [***] and payment of the corresponding milestone payment, if [***], then [***].

(b)

[***]. If (i) following [***] with respect to a Product directed to [***], [***], (ii) [***], (iii) [***], and (iv) [***], then [***]. The [***].

7.3.2.

Development Milestones for [***].

(a)

Subject to Section 7.3.2(b) ([***]), Roche will pay Ionis the milestone payments set forth in TABLE 2 below the first time a Milestone Event listed in TABLE 2 is first achieved by a Product directed to [***], regardless of how many times thereafter such Milestone Event is achieved by a subsequent Product to such Target.

Table 2: Milestone Events for [***]

	Milestone Event	Milestone Payment for [***] Product
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	[***]	$[***]
	Total [***] Milestones	$[***]

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(b)

[***]. If (i) [***], (ii) [***], (iii) [***], and (iv) [***], then [***].

7.3.3.

Milestone Payments for First Achievement of Sales Milestone Event by [***] Product. Roche will pay Ionis the applicable one-time milestone payments set forth in TABLE 3 below after the first achievement of the listed events by a first Product directed against [***], regardless of how many times thereafter another Product directed against [***] achieves such event, by or on behalf of Roche or its Affiliates or Sublicensees. For clarity, notwithstanding any provision to the contrary in this Agreement, [***]. Net Sales will be [***], as applicable.

Table 3
Sales Milestone	Sales Milestone Payment

	≥ $[*] in aggregate worldwide Annual Net Sales of [*] Product	$[***]
	≥ $[*] in aggregate worldwide Annual Net Sales of [*] Product	$[***]
	≥ $[*] in aggregate worldwide Annual Net Sales of [*] Product	$[***]
	Total Sales Milestone Payments	$[***]

7.3.4.

Limitations on Milestone Payments; Exceptions; Notice.

(a)

Each milestone payment set forth in TABLE 1 in Section 7.3.1 (Development Milestones for [***]) and in TABLE 2 in Section 7.3.2 (Development Milestones for [***]) and in TABLE 3 in Section 7.3.3 (Milestone Payments for First Achievement of Sales Milestone Event by [***] Product) above will be paid only once upon the first achievement of the Milestone Event regardless of how many times such Milestone Event is achieved by the same or another Product directed to the same Target.

(b)

If a particular Development Milestone Event (i.e., [***]) in TABLE 1 in Section 7.3.1 (Development Milestones for [***]) or in TABLE 2 in Section 7.3.2 (Development Milestones for [***]) is not achieved because Development activities transpired such that achievement of such earlier Milestone Event was unnecessary or did not otherwise occur, then upon achievement of a later Milestone Event the Milestone Event payment applicable to such earlier Milestone Event will also be due. For example, if Roche proceeds directly to “[***]” without achieving the “[***],” then upon achieving the “[***]” Milestone Event, both the “[***]” and “[***]” Milestone Event payments are due to Ionis.

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(c)

Each time a Milestone Event is achieved under this Section 7.3 (One- time Milestone Payments for Achievement of Milestone Events), Roche will send to Ionis a written notice thereof promptly (but no later than [***]) following the date of achievement of such Milestone Event and such payment will be due within [***] of the date such Milestone Event was achieved and receipt of an invoice by Roche from Ionis.

7.4.	Royalties.

7.4.1.

Royalty Rates. As partial consideration for the rights granted to Roche hereunder, subject to the provisions of this Section 7.4.1 (Royalty Rates) and Section 7.4.3 (Royalty Adjustments), Roche will pay to Ionis royalties on worldwide Annual Net Sales of Products sold by Roche, its Affiliates or Sublicensees, on a country-by-country and Product-by-Product basis during the Royalty Term, in each case in the amounts (on an incremental basis) as follows:

Table 4
Royalty Tier	Annual Worldwide Net Sales	Royalty Rate for Product Comprising an Ionis Development Candidate
1	For the portion of Annual worldwide Net Sales < $[***]	[***]%
2	For the portion of Annual worldwide Net Sales ≥ $[*] but < $[*]	[***]%
3	For the portion of Annual worldwide Net Sales ≥ $[*] but < $[*]	[***]%
4	For the portion of Annual worldwide Net Sales ≥ $[***]	[***]%

(a)

For purposes of TABLE 4, worldwide Annual Net Sales for a particular Product will be calculated by summing the aggregate Net Sales for that Product for all countries in the world for such Product. For example, if worldwide Net Sales of a Product for a given Calendar Year are $[***], then royalties owed to Ionis on such Net Sales of such Product for that Calendar Year shall equal [***] dollars ($[***]), calculated as follows:

[([***]) + ([***])] = $[***] royalty payment

7.4.2.

Royalty Term. Roche’s obligation to pay Ionis royalties with respect to a Product will continue on a country-by-country and Product-by-Product basis from the date of First Commercial Sale of such Product in such country until the latest of (a) the date of expiration of the last Valid Claim [***], as applicable ([***]) that are licensed by Ionis to Roche under this Agreement that Covers the Product in the country in which such Product is made, used or sold, (b) the date of [***], and (c) the [***] anniversary after the First Commercial Sale of such Product in such country (the “Royalty Term”). Notwithstanding anything herein to the contrary, [***].

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7.4.3.

Royalty Adjustments. For the purpose of calculating royalties owed for a Product, the royalty rates set forth in Section 7.4.1 (Royalty Rates) shall be subject to the following adjustments, as applicable:

(a)

Net Sales Adjustment for [***] Product.

(i)

If Roche or its Affiliates or Sublicensees intend to [***], then the Parties shall meet approximately [***] after [***] to negotiate in good faith and agree to an appropriate adjustment to Net Sales to reflect [***]. If, after such good faith negotiations not to exceed [***], the Parties cannot agree to an appropriate adjustment, the dispute shall be initially referred to the Executives in accordance with Section 13.1.1 (Escalation), without application of Section 13.1.2 (Binding Arbitration).

(ii)

If the Executives are unable to agree on the [***] within [***] of such referral (a “[***]”), then such [***] Dispute shall be determined by arbitration pursuant to the terms set forth in SCHEDULE 7.4.3(a)(ii).

(b)

Adjustment of [***] for a [***] Product. On a [***] Product-by-[***] Product basis, for purposes of determining the [***] for a [***] Product, [***] shall be the [***] of such [***] Product in the relevant country.

(c)

No Valid Claim. Subject to Section 7.4.3(g) (Maximum Deduction), for a given Product, (i) if in a given country within the Territory there is no Valid Claim [***] that Covers the [***] Product, then the royalty rates listed in TABLE 4 in Section 7.4.1 (Royalty Rates) applicable to such Product will be reduced by [***] %; (ii) if [***], then [***]; and (iii) if both (i) and (ii) of this Section 7.4.3(c) (No Valid Claim) apply, then [***].

(d)

Generic Product. Subject to Section 7.4.3(g) (Maximum Deduction), on a country-by-country and Product-by-Product basis, if at any time during the Royalty Term a Generic Product is sold in such country and the aggregate Net Sales of such Product in such country in any Calendar Quarter thereafter decline by more than [***]% of the level of the Net Sales of such Product achieved in any of the [***] full Calendar Quarters immediately prior to the Calendar Quarter in which the Generic Product was first sold, then the royalty rates listed in TABLE 4 in Section 7.4.1 (Royalty Rates) applicable to such Product in such country will be [***] reduced by [***] ([***]%).

(e)

[***] Adjustment. Subject to Section 7.4.3(g) (Maximum Deduction), if at any time during the Royalty Term (i) [***], (ii) [***], and (iii) [***], then the royalty rates listed in TABLE 4 in Section 7.4.1 (Royalty Rates) applicable to such [***] Product will be [***] ([***]%) in the [***] solely for [***]. For any subsequent Calendar Quarter in which the [***].

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(f)

Third Party Payments.

(i)

Additional Ionis Core Intellectual Property.

(1)

Roche will promptly provide Ionis written notice of any [***] (“Additional Ionis Core IP”) that Roche believes it has identified, and Ionis will have the first right, but not the obligation, to negotiate with, and obtain a license from, the Third Party Controlling such Additional Ionis Core IP. For clarity, Additional Ionis Core IP does not include any Patent Rights claiming (or intellectual property related to) [***]. If Ionis obtains such a Third Party license, then Ionis will include such Additional Ionis Core IP in the license granted to Roche under Section 5.1.2 (Development and Commercialization License Grant to Roche), and any financial obligations under such Third Party agreement will be paid [***].

(2)

If, however, Ionis elects not to obtain such a license to such Third Party intellectual property, then Ionis will so notify Roche, and Roche may obtain such a Third Party license and, subject to Section 7.4.3(g) (Maximum Deduction), Roche may offset an amount equal to [***]% of any [***] paid by Roche under such Third Party license against any [***] due to Ionis under Section [***] of this Agreement in such country for [***].

(3)

If Ionis does not agree with Roche that a license to such [***], then Ionis will send written notice to such effect to Roche, and the Parties will engage a mutually agreed independent Third Party intellectual property lawyer, not regularly engaged or employed by either Party within the [***] prior to such written notice, with expertise in the patenting of Oligonucleotides and appropriate professional credentials in the relevant jurisdiction, to determine the question of whether such Third Party intellectual property is Additional Ionis Core IP. The determination of the Third Party expert engaged under the preceding sentence will be binding on the Parties solely for purposes of determining whether Roche is permitted to apply the offset under Section 7.4.3(f)(i)(2) above. The costs of any Third Party expert engaged under this Section 7.4.3(f)(i)(3) will be paid by the Party against whom the Third Party lawyer makes his or her determination.

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(ii)

Other Necessary Third Party Intellectual Property. Roche shall be responsible for and pay or have paid any consideration owed to any Third Party in relation to any other Third Party intellectual property rights necessary to make, use or sell Products. Subject to Section 7.4.3(g) (Maximum Deduction), Roche shall have the right to deduct [***]% of such consideration actually paid to a Third Party with respect to a Product from royalty payments otherwise due and payable by Roche to Ionis for such Product under Section 7.4 (Royalties). Any such deduction shall be permitted on a Product-by-Product and country-by-country basis.

(g)

Maximum Deduction. Except as set forth in this Section 7.4.3(g) (Maximum Deduction), in no event shall the aggregate royalty reductions set forth in Section 7.4.3 (Royalty Adjustments) reduce the royalties payable to Ionis for Net Sales of a Product in the applicable country in any given period to an amount that is less than [***]% of the royalty rates listed in TABLE 4 within Section 7.4.1 (Royalty Rates). Notwithstanding the foregoing, [***]. Roche may carry forward any amounts not utilized as a result of the maximum deduction cap in this Section 7.4.3(g) (Maximum Deduction) and offset against future royalties payable to Ionis for the applicable Product any amounts that, but for this Section 7.4.3(g) (Maximum Deduction), Roche would have been entitled to deduct from any royalty payments to Ionis until any amounts not utilized are fully deducted.

7.5.	Royalty Payments and Reports.

7.5.1.

Commencement. Beginning with the Calendar Quarter in which the First Commercial Sale, [***] is made and for each Calendar Quarter thereafter, Roche will make royalty payments to Ionis under this Agreement within [***] days following the end of each such Calendar Quarter.

7.5.2.

Royalty Reporting.

(a)

Each royalty payment will be accompanied by a report, summarizing in writing for the relevant Calendar Quarter on a Product-by-Product basis the following information:

(i)

Sales in Swiss Francs on a country-by-country basis;

(ii)

Net Sales in Swiss Francs on a country-by-country basis;

(iii)

Total worldwide Net Sales in Swiss Francs;

(iv)

Exchange rate used for the conversion of Net Sales from Swiss Francs to U.S. dollars pursuant to Section 7.6 (Mode of Payment);

(v)

Royalty rate pursuant to Section 7.4.1 (Royalty Rates) and/or Section 7.4.3 (Royalty Adjustments), as applicable; and

(vi)

Total royalty payable in U.S. dollars.

(b)

In addition, Roche will include in each report under this Section 7.5.2 (Royalty Reporting) information regarding any Net Sales of Products sold for named patient, compassionate use or other similar sales and any consideration received from any Compulsory Sublicensees.

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(c)

On a country-by-country basis, after first Approval, if no royalties or other payments from Product sales are payable in respect of a given Calendar Quarter, Roche will submit a written royalty report to Ionis so indicating together with an explanation as to why no such royalties are payable. In addition, beginning with the Calendar Quarter in which the First Commercial Sale for a Product (or any named patient sale, compassionate use sale or other similar sales of a Product) is made and for each Calendar Quarter thereafter, within [***] following the end of each such Calendar Quarter, Roche will provide Ionis a preliminary non-binding report estimating the total (A) Sales and Net Sales for Products projected for such Calendar Quarter, and (B) if available, the amount of any consideration payable to Roche under sublicenses with Compulsory Sublicensees.

7.6.

Mode of Payment. All payments under this Agreement will be (i) payable in full in U.S. dollars, regardless of the country(ies) in which sales are made, (ii) made by wire transfer of immediately available funds to an account designated by Ionis in writing, and (iii) irrevocable and non-refundable. Any corrections to calculations of royalty payments previously paid shall be adjusted to the next royalty payment due. When calculating the Sales of a Product that occur in currencies other than U.S. dollars, Roche will convert the amount of such sales into Swiss Francs and then into U.S. dollars using Roche’s then current internal foreign currency translation actually used on a consistent basis in preparing its audited financial statements (currently YTD average rate as reported by Reuters).

7.7.

Records Retention. Commencing with the First Commercial Sale [***] of a Product, Roche will keep complete and accurate records pertaining to the sale of Products for a period of [***] after the year in which such sales occurred, and in sufficient detail to permit Ionis to confirm the accuracy of the Net Sales or royalties paid by Roche hereunder.

7.8.

Audits. During the Agreement Term and for a period of [***] thereafter, at the request and expense of Ionis, Roche will permit an independent certified public accountant of internationally recognized standing appointed by Ionis, at reasonable times and upon at least [***] written notice, but in no case more than [***] per Calendar Year, to examine such records as may be necessary for the purpose of verifying the accrual of any milestone payments, the calculation and reporting of Net Sales, and the correctness of any milestone or royalty payment made under this Agreement for any full Calendar Quarter within the preceding [***]. No Calendar Year can be audited more than once. Any and all records of Roche examined by such independent certified public accountant will be deemed Roche’s Confidential Information. The independent certified public accountant shall share all draft reports with Roche before the draft audit report is shared with Ionis and before the final document is issued. Upon completion of the audit, the accounting firm will provide both Roche and Ionis with a written report disclosing whether the calculation of Sales, Net Sales and royalty payments made by Roche are correct and the specific details concerning any discrepancies (“Audit Report”). If any Audit Report shows that Roche’s payments under this Agreement were less than the milestone or royalty amount that should have been paid, then Roche will make all payments required to be made by paying Ionis the difference between such amounts to eliminate any discrepancy revealed by said inspection with the next payment due, with interest calculated in accordance with Section 7.10 (Interest). If any Audit Report shows that Roche’s payments under this Agreement were greater than the amount that should have been paid, then [***] equal to the difference between the amounts paid by Roche and the amounts that should have been paid. Ionis will pay all fees charged by such accountant pursuant to the audit, except that, if the audit determines that any additional amounts payable by Roche for an audited period exceed [***] percent ([***]%) of the amount actually paid for such audited period, then, in addition to paying Ionis any unpaid amounts discovered in such audit, and interest calculated in accordance with Section 7.10 (Interest), Roche will pay the fees and expenses charged by such accountant. Roche shall also [***].

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7.9.

Taxes.

7.9.1.

Taxes on Income. Each Party will be solely responsible for the payment of all taxes imposed on its share of income arising directly or indirectly from the activities of the Parties under this Agreement.

7.9.2.

Withholding Tax. To the extent the paying Party is required to deduct and withhold taxes on any payment, the paying Party will pay the amounts of such taxes to the proper governmental authority for the account of the receiving Party and remit the net amount to the receiving Party in a timely manner. The paying Party will promptly furnish the receiving Party with proof of payment of such taxes. If documentation is necessary in order to secure an exemption from, or a reduction in, any withholding taxes, the Parties will provide such documentation to the extent they are able to do so. In accordance with the procedures set forth in Section 10.3 (Procedure), the receiving Party will also indemnify the paying Party for any tax, interest or penalties imposed on the paying Party if the paying Party improperly reduces or eliminates withholding tax based upon representations made by the receiving Party.

7.9.3.

Tax Cooperation. At least [***] prior to the date a given payment is due under this Agreement, the non-paying Party will provide the paying Party with any and all tax forms that may be reasonably necessary in order for the paying Party to lawfully not withhold tax or to withhold tax at a reduced rate with respect to such payment under an applicable bilateral income tax treaty. Following the paying Party’s timely receipt of such tax forms from the non- paying Party, the paying Party will not withhold tax or will withhold tax at a reduced rate under an applicable bilateral income tax treaty, if appropriate under the Applicable Laws. The non-paying Party will provide any such tax forms to the paying Party upon request and in advance of the due date. Each Party will provide the other with reasonable assistance to enable the recovery, as permitted by Applicable Law, of withholding taxes resulting from payments made under this Agreement, such recovery to be for the benefit of the Party who would have been entitled to receive the money but for the application of withholding tax under this Section 7.9 (Taxes). The provisions of this Section 7.9 (Taxes) are to be read in conjunction with the provisions of Section 13.4 (Assignment and Successors) below.

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7.10.

Interest. Any undisputed payments to be made hereunder that are not paid on or before the date such payments are due under this Agreement will bear interest at a rate per annum equal to the lesser of (i) [***]% above the six-month CME Term Secured Overnight Financing Rate (USD SOFR) from the date on which such payment would have been first due until the date of payment, or (ii) the maximum rate permissible under Applicable Law.

ARTICLE 8.

INTELLECTUAL PROPERTY

8.1.	Ownership.

8.1.1.

Ionis Technology and Roche Technology. As between the Parties, Ionis will own and retain all of its rights, title and interest in and to the Licensed Know- How and Licensed Patents and Roche will own and retain all of its rights, title and interest in and to the Roche Know-How and Roche Patents, subject to any assignments, rights or licenses expressly granted by one Party to the other Party under this Agreement.

8.1.2.

Agreement Technology. Each Party will promptly disclose to the other Party in writing, and will cause its Affiliates to so disclose, the discovery, development, or creation of any invention made solely or jointly by such Party in connection with the performance of obligations under this Agreement. Except as expressly provided in this Agreement, neither Party will have any obligation to account to the other for profits with respect to, or to obtain any consent of the other Party to license or exploit, Joint Collaboration Technology by reason of joint ownership thereof, and each Party hereby waives any right it may have under the laws of any jurisdiction to require any such consent or accounting.

8.2.	Joint Patent Committee.

8.2.1.

Establishment. The Parties will establish a “Joint Patent Committee” or “JPC.” The JPC will serve as the primary contact and forum for discussion between the Parties with respect to intellectual property matters arising under this Agreement and will cooperate with respect to the activities set forth in this ARTICLE 8. The JPC determines the invention classification for each invention arising under this Agreement. The classifications are (i) Ionis Product-Specific Patents, (ii) Roche Collaboration Patents, (iii) Ionis Collaboration Patents, and (iv) Joint Collaboration Patents (collectively, the “Program Patents”). The JPC will endeavor to separate the claims within such Patent Rights into separate and distinct patent applications corresponding with the categories described in this Section 8.2.1 (Establishment) to the extent possible without diminishing the patentability of the inventions.

8.2.2.

Scope. The JPC will discuss strategies with regard to (a) prosecution and maintenance, defense and enforcement of Program Patents licensed to Roche under Section 5.1.2 (Development and Commercialization License Grant to Roche) in connection with a Product; (b) defense against allegations of infringement of Third Party Patent Rights; and (c) licenses to Third Party Patent Rights or Know-How (including whether to obtain any licenses under any such Third-Party Patent Rights or Know-How, and whether there are any known Third Party Obligations applicable to a particular Product), in each case ((a)- (c)) to the extent such matter would be reasonably likely to have a material impact on the Agreement or the licenses granted hereunder, which strategies will be considered in good faith by the Party entitled to prosecute, enforce and defend such Patent Rights hereunder, but will not be binding on such Party.

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8.2.3.

Inventorship. The JPC will be responsible for the determination of inventorship. The determination of inventorship will be in accordance with United States patent laws and therefore will determine if the invention is solely or jointly owned by the relevant Party or Parties. In case of a dispute in the JPC (or otherwise between Ionis and Roche) over inventorship or classification, if the JPC cannot resolve such dispute, even after seeking the JSC’s input, such dispute will be resolved by an independent patent counsel not engaged or regularly employed in the past two years by either Party and reasonably acceptable to both Parties. The decision of such independent patent counsel will be binding on the Parties. Expenses of such patent counsel will be shared equally by the Parties.

8.2.4.

Composition. The JPC will comprise an equal number of members from each Party. The JPC will meet as often as agreed by them (and at least semi- Annually), to discuss matters arising out of the activities set forth in this ARTICLE 8. The JPC will determine by unanimous consent the JPC operating procedures at its first meeting. To the extent reasonably requested by either Party, the JPC will solicit the involvement of more senior members of their respective legal departments with respect to critical issues. Each Party’s representatives on the JPC will consider comments and suggestions made by the other in good faith. If either Party deems it reasonably advisable, the Parties will enter into a mutually agreeable common interest agreement covering the matters contemplated by this Agreement.

8.3.	Prosecution and Maintenance of Patents.

8.3.1.

Patent Filings. The Party responsible for Prosecution and Maintenance of any Patent Rights as set forth in Section 8.3.2 (Ionis Patents and Roche Patents) and Section 8.3.3 (Joint Collaboration Patents) will endeavor to obtain patent protection for a Product as it Prosecutes and Maintains its other patents Covering products in development, using counsel of its own choice but reasonably acceptable to the other Party, in such countries as the responsible Party sees fit.

8.3.2.

Ionis Patents and Roche Patents.

(a)

Ionis Patents.

(i)

Ionis Core Technology Patents, Ionis Collaboration Patents, and Ionis Manufacturing and Analytical Patents. Ionis will at all times control and be responsible for all aspects of Prosecution and Maintenance of (A) the Ionis Core Technology Patents, (B) the Ionis Collaboration Patents, and (C) the Ionis Manufacturing and Analytical Patents.

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(ii)

Ionis Product-Specific Patents. On an Ionis Development Candidate-by-Ionis Development Candidate basis, before Handoff with respect to such Ionis Development Candidate, Ionis will control and be responsible for all aspects of the Prosecution and Maintenance of all Ionis Product-Specific Patents and will use commercially reasonable efforts to Prosecute and Maintain such Patent Rights. After Handoff and subject to Section 8.3.4 (Other Matters Pertaining to Prosecution and Maintenance of Patents), at Roche’s expense, Roche will control and be responsible for all aspects of the Prosecution and Maintenance of all Ionis Product-Specific Patents and will either (i) use commercially reasonable efforts to Prosecute and Maintain such Patent Rights or (ii) offer to assign Roche’s entire right, title and interest in such Patent Rights to Ionis, in which case following any such assignment all licenses granted in this Agreement by Ionis to Roche under such Patent Rights shall become non-exclusive and the exclusivity covenants under Section 4.1 (Exclusivity) will no longer apply to such Patent Rights. Such Ionis Product-Specific Patents will continue to be royalty-bearing under Section 7.4 (Royalties).

(b)

Roche Patents. Roche will at all times control and be responsible for all aspects of the Prosecution and Maintenance of all Roche Patents.

8.3.3.

Joint Collaboration Patents. Roche will control and be responsible for all aspects of the Prosecution and Maintenance of Joint Collaboration Patents and will (i) use commercially reasonable efforts to Prosecute and Maintain such Patent Rights, or (ii) offer to assign Roche’s entire right, title and interest in such Joint Collaboration Patents to Ionis, in which case following any such assignment all licenses granted in this Agreement by Ionis to Roche under such Patent Rights shall become non-exclusive and the exclusivity covenants under Section 4.1 (Exclusivity) will no longer apply to such Patent Rights.

8.3.4.

Other Matters Pertaining to Prosecution and Maintenance of Patents.

(a)

Each Party will keep the other Party informed through the JPC as to material developments with respect to the Prosecution and Maintenance of the Program Patents for which such Party has responsibility for Prosecution and Maintenance pursuant to Section 8.3.2 (Ionis Patents and Roche Patents), Section 8.3.3 (Joint Collaboration Patents) or this Section 8.3.4 (Other Matters Pertaining to Prosecution and Maintenance of Patents), including by providing copies of material data as it arises, any office actions or office action responses or other correspondence that such Party provides to or receives from any patent office, including notice of all interferences, reissues, re-examinations, oppositions or requests for patent term extensions, and all patent-related filings, and by providing the other Party the timely opportunity to have reasonable input into the strategic aspects of such Prosecution and Maintenance.

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(b)

If Roche elects (i) not to file and prosecute patent applications for the Program Patents for which Roche has responsibility for Prosecution and Maintenance pursuant to Section 8.3.2 (Ionis Patents and Roche Patents) (“Roche-Prosecuted Patents”) in a particular country, (ii) not to continue the prosecution (including any interferences, oppositions, reissue proceedings, re-examinations, and patent term extensions, adjustments, and restorations) or maintenance of any Roche-Prosecuted Patent in a particular country, or (iii) not to file and prosecute patent applications for the Roche-Prosecuted Patent in a particular country following a written request from Ionis to file and prosecute in such country, then Roche will so notify Ionis promptly in writing of its intention in good time to enable Ionis to meet any deadlines by which an action must be taken to establish or preserve any such Patent Right in such country; and Ionis will have the right, but not the obligation, to file, prosecute, maintain, enforce, or otherwise pursue such Roche- Prosecuted Patent in the applicable country at its own expense with counsel of its own choice. In such case, Roche will cooperate with Ionis to file for, or continue to Prosecute and Maintain or enforce, or otherwise pursue such Roche-Prosecuted Patent in such country in Ionis’ own name and Roche will keep a non-exclusive license under such Roche- Prosecuted Patents, and the exclusivity covenants under Section 4.1 (Exclusivity) will no longer apply to such Patent Rights. Notwithstanding anything to the contrary in this Agreement, if Ionis assumes responsibility for the Prosecution and Maintenance of any such Roche-Prosecuted Patent under this Section 8.3.4(b), then Ionis will have no obligation to notify Roche if Ionis intends to abandon such Roche-Prosecuted Patent. The analogous situation shall apply mutatis mutandis with regard to Patent Rights (excluding Ionis Core Technology Patents and Ionis Manufacturing and Analytical Patents) for which Ionis has responsibility for Prosecution and Maintenance pursuant to Section 8.3.2 (Ionis Patents and Roche Patents).

(c)

The Parties, through the JPC, will cooperate in good faith to determine if and when any divisional or continuation applications will be filed with respect to any Program Patents, and where a divisional or continuation patent application filing would be practical and reasonable, then such a divisional or continuation filing will be made.

(d)

If the Party responsible for Prosecution and Maintenance pursuant to Section 8.3.3 (Joint Collaboration Patents) intends to abandon such Joint Collaboration Patent, without first filing a continuation or substitution, then such Party will notify the other Party of such intention at least [***] days before such Joint Collaboration Patent will become abandoned, and such other Party will have the right, but not the obligation, to assume responsibility for the Prosecution and Maintenance thereof at its own expense (subject to Section 8.3.1 (Patent Filings)) with counsel of its own choice, in which case the abandoning Party will, and will cause its Affiliates to, assign to the other Party (or, if such assignment is not possible, grant a fully-paid exclusive license in) all of their rights, title and interest in and to such Joint Collaboration Patents. If a Party assumes responsibility for the Prosecution and Maintenance of any such Joint Collaboration Patents under this Section 8.3.4(d), then such Party will have no obligation to notify the other Party of any intention of such Party to abandon such Joint Collaboration Patents.

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(e)

In addition, the Parties will consult, through the JPC, and take into consideration the comments of the other Party for all matters relating to interferences, reissues, re-examinations and oppositions with respect to those Patent Rights in which such other Party (i) has an ownership interest, (ii) has received a license thereunder in accordance with this Agreement, or (iii) may in the future, in accordance with this Agreement, obtain a license or sublicense thereunder.

8.4.	Patent Costs.

8.4.1.

Joint Collaboration Patents. Unless the Parties agree otherwise, Ionis and Roche will share equally the Patent Costs associated with the Prosecution and Maintenance of Joint Collaboration Patents according to Section 8.3.3 (Joint Collaboration Patents); provided that, either Party may decline to pay its share of costs for filing, prosecuting and maintaining any Joint Collaboration Patents in a particular country or particular countries, in which case the declining Party will, and will cause its Affiliates to, assign to the other Party (or, if such assignment is not possible, grant a fully-paid exclusive license in) all of their rights, titles and interests in and to such Joint Collaboration Patents.

8.4.2.

Ionis Patents and Roche Patents. Except as set forth in and Section 8.3.4 (Other Matters Pertaining to Prosecution and Maintenance of Patents), each Party will be responsible for all Patent Costs incurred by such Party prior to and after the Effective Date in all countries in the Prosecution and Maintenance of Patent Rights for which such Party is responsible under Section 8.3.2 (Ionis Patents and Roche Patents); provided, however, that on an Ionis Development Candidate-by-Ionis Development Candidate basis after Handoff, Roche will be solely responsible for Patent Costs arising from the Prosecution and Maintenance of the Ionis Product-Specific Patents Covering such Ionis Development Candidate; provided that, Roche may decline to pay for filing, prosecuting and maintaining any Ionis Product-Specific Patents in a particular country or particular countries, in which case all licenses granted in this Agreement by Ionis to Roche under such Patent Rights shall become non- exclusive and the exclusivity covenants under Section 4.1 (Exclusivity) will no longer apply to such Patent Rights.

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8.5.	Defense of Claims Brought by Third Parties.

8.5.1.

Third-Party Claims Regarding Products. If a Third Party initiates a Proceeding claiming a Patent Right owned by or licensed to such Third Party is infringed by the Development, Manufacture or Commercialization of a Product, (a) Ionis will have the first right, but not the obligation, to defend against any such Proceeding initiated prior to Handoff at its sole cost and expense and (b) Roche will have the first right, but not the obligation, to defend against any such Proceeding initiated after Handoff at its sole cost and expense. If the Party having the first right to defend against such Proceeding (the “Lead Party”) elects to defend against such Proceeding, then the Lead Party will have the sole right to direct the defense and to elect whether to settle such claim (but only with the prior written consent of the other Party, not to be unreasonably withheld, conditioned or delayed). The other Party will reasonably assist the Lead Party in defending such Proceeding and cooperate in any such litigation at the request and expense of the Lead Party. The Lead Party will provide the other Party with prompt written notice of the commencement of any such Proceeding that is of the type described in this Section 8.5 (Defense of Claims Brought by Third Parties), and the Lead Party will keep the other Party apprised of the progress of such Proceeding. If the Lead Party elects not to defend against a Proceeding, then the Lead Party will so notify the other Party in writing within [***] after the Lead Party first receives written notice of the initiation of such Proceeding, and the other Party (the “Step-In Party”) will have the right, but not the obligation, to defend against such Proceeding at its sole cost and expense and thereafter the Step-In Party will have the sole right to direct the defense thereof, including the right to settle such claim. In any event, the Party not defending such Proceeding will reasonably assist the other Party and cooperate in any such litigation at the request and expense of the Party defending such Proceeding. Each Party may at its own expense and with its own counsel join any defense initiated or directed by the other Party under this Section 8.5 (Defense of Claims Brought by Third Parties). Each Party will provide the other Party with prompt written notice of the commencement of any such Proceeding under this Section 8.5 (Defense of Claims Brought by Third Parties), and such Party will promptly furnish the other Party with a copy of each communication relating to the alleged infringement that is received by such Party.

8.5.2.

Third Party Claims Regarding Discontinued Products. If a Third Party initiates a Proceeding claiming that any Patent Right or Know-How owned by or licensed to such Third Party is infringed by the Development, Manufacture or Commercialization of a Discontinued Product, Ionis will have the first right, but not the obligation, to defend against and settle such Proceeding at its sole cost and expense. Roche will reasonably assist Ionis in defending such Proceeding and cooperate in any such litigation at the request and expense of Ionis. Each Party may at its own expense and with its own counsel join any defense directed by the other Party. Ionis will provide Roche with prompt written notice of the commencement of any such Proceeding, or of any allegation of infringement of which Ionis becomes aware and that is of the type described in this Section 8.5.2 (Third Party Claims Regarding Discontinued Products), and Ionis will promptly furnish Roche with a copy of each communication relating to the alleged infringement received by Ionis.

8.5.3.

Interplay Between Enforcement of IP and Defense of Third Party Claims. Notwithstanding the provisions of Section 8.5.1 (Third Party Claims Regarding Products) and Section 8.5.2 (Third Party Claims Regarding Discontinued Products), to the extent that a Party’s defense against a Third Party claim of infringement under this Section 8.5 (Defense of Claims Brought by Third Parties) involves (a) the enforcement of the other Party’s Know-How or Patent Rights, or (b) the defense of an invalidity claim with respect to such other Party’s Know-How or Patent Rights, then, in each case, the general concepts of Section 8.6 (Enforcement of Patents Against Competitive Infringement) will apply to the enforcement of such other Party’s Know-How or Patent Rights or the defense of such invalidity claim (i.e., each Party has the right to enforce its own intellectual property, except that the relevant Commercializing Party will have the initial right, to the extent provided in Section 8.6 (Enforcement of Patents Against Competitive Infringement), to enforce such Know-How or Patent Rights or defend such invalidity claim, and the other Party will have a step-in right, to the extent provided in Section 8.6 (Enforcement of Patents Against Competitive Infringement), to enforce such Know-How or Patent Rights or defend such invalidity claim).

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8.6.	Enforcement of Patents Against Competitive Infringement.

8.6.1.

Duty to Notify of Competitive Infringement. If either Party learns of an infringement, unauthorized use, misappropriation or threatened infringement by a Third Party to which such Party does not owe any obligation of confidentiality with respect to any Ionis Product-Specific Patents by reason of the development, manufacture, use or commercialization of a product directed against the RNA that encodes a Target in the Field (“Competitive Infringement”), such Party will promptly notify the other Party in writing and will provide such other Party with available evidence of such Competitive Infringement; provided, however, that for cases of Competitive Infringement under Section 8.6.6 (35 USC § 271(e)(2) Infringement) below, the notifying Party will provide such written notice within ten (10) Business Days.

8.6.2.

Enforcement. For any Competitive Infringement with respect to a Product that Roche is Developing or Commercializing, Roche will have the first right, but not the obligation, to institute, prosecute, and control a Proceeding with respect thereto by counsel of its own choice at its own expense, and Ionis will have the right, at its own expense, to be represented in that action by counsel of its own choice. If Roche fails to initiate a Proceeding within a period of [***] after receipt of written notice of such Competitive Infringement (subject to a [***] extension to conclude negotiations, if Roche has commenced good faith negotiations with an alleged infringer for elimination of such Competitive Infringement within such [***] period), then Ionis will have the right to initiate and control a Proceeding with respect to such Competitive Infringement by counsel of its own choice, and Roche will have the right to be represented in any such action by counsel of its own choice at its own expense. Notwithstanding the foregoing, Ionis will at all times have the sole right to institute, prosecute, and control any Proceeding under this Section 8.6.2 (Enforcement) to the extent involving any Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents, or Ionis Collaboration Patents.

8.6.3.

Joinder.

(a)

If a Party initiates a Proceeding in accordance with this Section 8.6 (Enforcement of Patents Against Competitive Infringement), the other Party agrees to be joined as a party plaintiff where necessary and to give the first Party reasonable assistance and authority to file and prosecute the Proceeding. Subject to Section 8.6.4 (Share of Recoveries), the costs and expenses of each Party incurred pursuant to this Section 8.6.3(a) will be borne by the Party initiating such Proceeding.

(b)

If one Party initiates a Proceeding in accordance with this Section 8.6 (Enforcement of Patents Against Competitive Infringement), the other Party may join such Proceeding as a party plaintiff where necessary for such other Party to seek lost profits with respect to such infringement.

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8.6.4.

Share of Recoveries. Any damages or other monetary awards recovered with respect to a Proceeding brought pursuant to this Section 8.6 (Enforcement of Patents Against Competitive Infringement) will be shared as follows:

(a)

the amount of such recovery will first be applied to the Parties’ reasonable out-of-pocket costs incurred in connection with such Proceeding (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses); then

(b)

any remaining proceeds constituting direct or actual damages for acts of infringement occurring prior to Handoff will be (i) [***]; or (ii) [***]; then

(c)

any remaining proceeds constituting direct or actual damages for acts of infringement occurring after Handoff will be [***], and [***]; then

(d)

any remaining proceeds constituting punitive or treble damages will be allocated between the Parties as follows: the Party initiating the Proceeding will receive and retain [***] of such proceeds and the other Party will receive and retain [***] of such proceeds.

8.6.5.

Settlement. Notwithstanding anything to the contrary under this ARTICLE 8, neither Party may enter a settlement, consent judgment or other voluntary final disposition of a suit under this ARTICLE 8 that disclaims, limits the scope of, admits the invalidity or unenforceability of, or grants a license, covenant not to sue or similar immunity under a Patent Right Controlled by the other Party without first obtaining the written consent of the Party that Controls the relevant Patent Right.

8.6.6.

35 USC § 271(e)(2) Infringement. Notwithstanding anything to the contrary in this Section 8.6 (Enforcement of Patents Against Competitive Infringement), solely with respect to Licensed Patents, for a Competitive Infringement under 35 USC § 271(e)(2), the time period set forth in Section 8.6.2 (Enforcement) during which a Party will have the initial right to bring a Proceeding will be shortened to a total of twenty-five (25) days, so that, to the extent the other Party has the right, pursuant to such Section to initiate a Proceeding if the first Party does not initiate a Proceeding, such other Party will have such right if the first Party does not initiate a Proceeding within twenty-five (25) days after such first Party’s receipt of written notice of such Competitive Infringement.

8.7.	Other Infringement.

8.7.1.

Joint Collaboration Patents. With respect to the infringement of a Joint Collaboration Patent that is not a Competitive Infringement, the Parties will cooperate in good faith to bring suit together against such infringing party or the Parties may decide to permit one Party to solely bring suit. Any damages or other monetary awards recovered with respect to a Proceeding brought pursuant to this Section 8.7.1 (Joint Collaboration Patents) will be shared as follows: (a) the amount of such recovery will first be applied to the Parties’ reasonable out- of-pocket costs incurred in connection with such Proceeding (which amounts will be allocated pro rata if insufficient to cover the totality of such expenses); (b) any remaining proceeds constituting direct damages will be [***]; and (c) any remaining proceeds constituting punitive or treble damages will be allocated as follows: (i) if the Parties jointly initiate a Proceeding pursuant to this Section 8.7.1 (Joint Collaboration Patents), [***]; and (ii) if only one Party initiates the Proceeding pursuant to this Section 8.7.1 (Joint Collaboration Patents), such Party will receive [***] of such proceeds and the other Party will receive [***] of such proceeds.

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8.7.2.

Patents Solely Owned by Ionis. Ionis will retain all rights to pursue an infringement of any Patent Right solely owned by Ionis which is other than a Competitive Infringement and Ionis will retain all recoveries with respect thereto.

8.7.3.

Patents Solely Owned by Roche. Roche will retain all rights to pursue an infringement of any Patent Right solely owned by Roche which is other than a Competitive Infringement and Roche will retain all recoveries with respect thereto.

8.8.	Patent Listing.

8.8.1.

Roche’s Obligations. Roche will promptly, accurately and completely list, with the applicable Regulatory Authorities during the Agreement Term, all applicable Patent Rights that Cover a Product. Prior to such listings, the Parties will meet, through the JPC, to evaluate and identify all applicable Patent Rights, and Roche will have the right to review, where reasonable, original records relating to any invention for which Patent Rights are being considered by the JPC for any such listing. Notwithstanding the preceding sentence, Roche will retain final decision-making authority as to the listing of all applicable Patent Rights for a Product that are not Ionis Core Technology Patents, Ionis Collaboration Patents, or Ionis Manufacturing and Analytical Patents, regardless of which Party owns such Patent Rights.

8.8.2.

Ionis’ Obligations. Ionis will promptly, accurately and completely list, with the applicable Regulatory Authorities during the Agreement Term, all applicable Patent Rights that Cover a Discontinued Product. Prior to such listings, the Parties will meet, through the JPC, to evaluate and identify all applicable Patent Rights, and Ionis will have the right to review, where reasonable, original records relating to any invention for which Patent Rights are being considered by the JPC for any such listing. Notwithstanding the preceding sentence, Ionis will retain final decision-making authority as to the listing of all applicable Patent Rights for such Discontinued Products, as applicable, regardless of which Party owns such Patent Rights.

8.9.

Joint Research Agreement under the Leahy-Smith America Invents Act. If a Party intends to invoke its rights under 35 U.S.C. § 102(e) of the Leahy-Smith America Invents Act, it will notify the other Party and neither Party will make an election under such provision when exercising its rights under this ARTICLE 8 without the prior written consent of the other Party (such consent not to be unreasonably withheld, conditioned or delayed), and the Parties will use reasonable efforts to cooperate and coordinate their activities with respect to any submissions, filings or other activities in support thereof. The Parties acknowledge and agree that this Agreement is a “joint research agreement” as defined in 35 U.S.C. § 100(h).

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8.10.

Obligations to Third Parties. Notwithstanding any of the foregoing, each Party’s rights and obligations with respect to Licensed Technology under this ARTICLE 8 will be subject to the Third Party rights and obligations (i) for which Roche is responsible under Section 7.4.3(f) (Third Party Payments) and (ii) under Prior Agreements; provided, however, that, to the extent that Ionis has a non-transferable right to prosecute, maintain or enforce any Patent Rights licensed to Roche hereunder, and this Agreement purports to grant any such rights to Roche, Ionis will act in such regard with respect to such Patent Rights at Roche’s direction.

8.11.

Additional Right and Exceptions. Notwithstanding any provision of this ARTICLE 8, but subject to Section 8.5.3 (Interplay Between Enforcement of IP and Defense of Third Party Claims), Ionis retains the sole right to Prosecute and Maintain Ionis Core Technology Patents, Ionis Collaboration Patents, and Ionis Manufacturing and Analytical Patents during the Agreement Term and to control any enforcement of Ionis Core Technology Patents, Ionis Collaboration Patents, and Ionis Manufacturing and Analytical Patents, and will take the lead on such enforcement solely to the extent that the scope or validity of any Patent Rights Controlled by Ionis and Covering the Ionis Core Technology Patents, Ionis Collaboration Patents, or Ionis Manufacturing and Analytical Patents is at risk. If Ionis determines, in Ionis’ sole discretion, to not enforce any Ionis Core Technology Patents, Ionis Collaboration Patents, or Ionis Manufacturing and Analytical Patents and does not permit Roche to so enforce such Patent Rights, then the Parties will mutually agree on an appropriate adjustment (if any) of the future consideration payable by Roche under this Agreement to reflect any adverse impact Ionis’ failure to enforce such Patent Rights has on Products.

8.12.

Patent Term Extension. The Parties will cooperate with each other in gaining patent term extension wherever applicable to a Product, including European supplementary protection certificates and pediatric exclusivity. After Handoff, Roche will determine which patents will be extended and what extensions will be sought.

ARTICLE 9.

REPRESENTATIONS AND WARRANTIES

9.1.	Representations and Warranties of Both Parties. Each Party hereby represents and warrants and, where indicated, covenants, to the other Party, as of the Effective Date, that:

9.1.1.

such Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization and has full corporate power and authority to enter into this Agreement and to carry out the provisions hereof;

9.1.2.

such Party has taken all necessary action on its part to authorize the execution and delivery of this Agreement and the performance of its obligations hereunder;

9.1.3.

this Agreement has been duly executed and delivered on behalf of such Party, and constitutes a legal, valid and binding obligation, enforceable against it in accordance with the terms hereof;

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9.1.4.

the execution, delivery and performance of this Agreement by such Party will not constitute a default under or conflict with any agreement, instrument or understanding, oral or written, to which it is a party or by which it is bound, or to the best of its knowledge and belief violate any law or regulation of any court, governmental body or administrative or other agency having jurisdiction over such Party;

9.1.5.

to the best of its knowledge and belief, no government authorization, consent, approval, license, exemption of or filing or registration with any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, under any applicable laws, rules or regulations currently in effect, is or will be necessary for, or in connection with, the transaction contemplated by this Agreement or any other agreement or instrument executed in connection herewith, or for the performance by it of its obligations under this Agreement and such other agreements; and

9.1.6.

it has not employed (and, to the best of its knowledge and belief, has not used a contractor or consultant that has employed) and in the future will not employ (or, to the best of its knowledge, use any contractor or consultant that employs, provided that such Party may reasonably rely on a representation made by such contractor or consultant) any Person debarred by the FDA (or subject to a similar sanction of EMA or foreign equivalent), or any Person which is the subject of an FDA debarment investigation or proceeding (or similar proceeding of EMA or foreign equivalent), in the conduct of the Pre-Clinical Studies or Clinical Studies of a Product and its activities under the R&D Plans.

9.2.	Representations and Warranties of Ionis. Ionis hereby represents and warrants to Roche, as of the Effective Date, and solely with respect to the Oligonucleotide within an Ionis Development Candidate that:

9.2.1.

To the best of its knowledge and belief, there are no additional licenses (beyond those that would be granted to Roche under Section 5.1.2 (Development and Commercialization License Grant to Roche) upon the Handoff for a Product arising under the R&D Plans) under any intellectual property owned or Controlled by Ionis or its Affiliates as of the Effective Date that would be required in order for Roche to further Develop and Commercialize a Product arising under the R&D Plan existing on the Effective Date.

9.2.2.

The Licensed Technology existing as of the Effective Date constitutes all of the Patent Rights and Know-How Controlled by Ionis as of the Effective Date that are necessary to Develop, Manufacture or Commercialize Compounds contemplated under the R&D Plan existing on the Effective Date in the Field. Ionis has not previously assigned, transferred, conveyed or otherwise encumbered its right, title and interest in the Licensed Technology in a manner that conflicts with any rights granted to Roche hereunder.

9.2.3.

There are no claims, judgments or settlements against or owed by Ionis or its Affiliates or pending against Ionis or, to the best of Ionis’ knowledge, threatened against Ionis, in each case relating to the Licensed Technology that could impact activities under this Agreement. To the best of Ionis’ knowledge, there are no claims, judgments or settlements against or owed by any Third Party that is party to a Prior Agreement, or pending or threatened claims or litigation against any Third Party that is party to a Prior Agreement, in each case relating to the Licensed Technology that would impact activities under this Agreement.

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9.2.4.

SCHEDULE 9.2.4(a), SCHEDULE 9.2.4(b) and SCHEDULE 9.2.4(c) set forth true, correct and complete lists of all Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents, and Ionis Product-Specific Patents that, as of the Effective Date, are expected to apply to the Compounds contemplated under the R&D Plan as of the Effective Date, respectively, and indicates whether each such Patent Right is owned by Ionis or licensed by Ionis from a Third Party and if so, identifies the licensor or sublicensor from which the Patent Right is licensed. Ionis Controls such Patent Rights existing as of the Effective Date and is entitled to grant all rights and licenses (or sublicenses, as the case may be) under such Patent Rights it purports to grant to Roche under this Agreement.

9.2.5.

(a) There is no fact or circumstance known by Ionis that would cause Ionis to reasonably conclude that any Licensed Patent is invalid or un-enforceable, (b) there is no fact or circumstance known by Ionis that would cause Ionis to reasonably conclude the inventorship of each Licensed Patent is not properly identified on each patent, (c) all official fees, maintenance fees and annuities for the Licensed Patents have been paid and all administrative procedures with governmental agencies have been completed, (d) none of the Ionis Product- Specific Patents that would be licensed by Ionis to Roche upon Handoff under this Agreement are currently involved in any interference, reissue, re- examination, cancellation or opposition proceeding and neither Ionis, nor any of its Affiliates, has received any written notice from any person, or has knowledge, of such actual or threatened Proceeding, and (e) to the best of Ionis’ knowledge and belief, Roche’s practice of the inventions claimed in the Ionis Product-Specific Patents in the performance of the Roche R&D Activities contemplated as of the Effective Date will not [***].

9.2.6.

SCHEDULE 9.2.6 is a complete and accurate list of all agreements that create Third Party Obligations that affect the rights granted by Ionis to Roche under this Agreement with respect to Ionis Development Candidates contemplated by the R&D Plans on the Effective Date.

9.2.7.

Ionis has all rights necessary to grant the Handoff and licenses contained in this Agreement, and has the ability to work exclusively with Roche as set forth in this Agreement, including the covenants granted in Section 4.1 (Exclusivity).

9.3.	Ionis Covenants. Ionis hereby covenants to Roche that, except as expressly permitted under this Agreement:

9.3.1.

Ionis will promptly amend SCHEDULE 9.2.4(a), SCHEDULE 9.2.4(b) and SCHEDULE 9.2.4(c) and submit such amended Schedules to Roche if Ionis becomes aware that any Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents or Ionis Product-Specific Patents are not properly identified on the respective Schedules;

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9.3.2.

during the Agreement Term, Ionis will maintain and not breach any agreements with Third Parties entered into after the Effective Date (“New Third Party Licenses”) that provide a grant of rights from such Third Party to Ionis that are Controlled by Ionis and are licensed or may become subject to a license from Ionis to Roche for a Product under this Agreement;

9.3.3.

Ionis will promptly notify Roche of any material breach by Ionis or a Third Party of any New Third Party License, and in the event of a breach by Ionis, will permit Roche to cure such breach on Ionis’ behalf upon Roche’s request;

9.3.4.

Ionis will not amend, modify or terminate any New Third Party License in a manner that would adversely affect Roche’s rights hereunder without first obtaining Roche’s written consent, which [***];

9.3.5.

Ionis will not enter into any new agreement or other obligation with any Third Party, or amend an existing agreement with a Third Party, in each case that restricts, limits or encumbers the rights granted to Roche under this Agreement;

9.3.6.

Ionis will cause its Affiliates to comply with the terms of Section 4.1 (Exclusivity);

9.3.7.

All employees and contractors of Ionis performing research and Development activities hereunder on behalf of Ionis will be obligated to assign all right, title and interest in and to any inventions (or grant a license to Ionis prior to or upon Handoff to obtain such a license) developed by them, whether or not patentable, to Ionis or such Affiliate, respectively, as the sole owner thereof; and

9.3.8.

If, after the Effective Date, Ionis becomes the owner or otherwise acquires Control of any formulation or delivery devices that would be necessary or useful in order for Roche to further Develop, Manufacture or Commercialize a Product, and Roche has executed Handoff and the license granted to Roche under this Agreement is in effect, Ionis will make such technology available to Roche on commercially reasonable terms.

9.4.

Representations and Warranties of Roche. Roche hereby represents and warrants to Ionis, as of the Effective Date, that all employees and contractors of Roche performing research and Development activities hereunder on behalf of Roche will be obligated to assign all right, title and interest in and to any inventions (or grant a license to Roche prior to or upon Handoff to obtain such a license) developed by them, whether or not patentable, to Roche or such Affiliate, respectively, as the sole owner thereof.

9.5.

DISCLAIMER. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY NOR ITS AFFILIATES MAKES ANY REPRESENTATION OR EXTENDS ANY WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. ROCHE AND IONIS UNDERSTAND THAT PRODUCTS ARE THE SUBJECT OF ONGOING RESEARCH AND DEVELOPMENT AND THAT NEITHER PARTY CAN ASSURE THE SAFETY, USEFULNESS OR COMMERCIAL OR TECHNICAL VIABILITY OF THE PRODUCTS.

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ARTICLE 10.

INDEMNIFICATION; INSURANCE

10.1.

Indemnification by Roche. Roche will indemnify, defend and hold harmless Ionis and its Affiliates, and its or their respective directors, officers, employees and agents, from and against any and all liabilities, damages, losses, costs and expenses including the reasonable fees of attorneys (collectively “Losses”) arising out of or resulting from any and all Third Party suits, claims, actions, proceedings or demands (“Claims”) based upon:

10.1.1.

the gross negligence or willful misconduct of Roche, its Affiliates or Sublicensees and its or their respective directors, officers, employees and agents, in connection with Roche’s performance of its obligations or exercise of its rights under this Agreement;

10.1.2.

any breach of any representation or warranty or express covenant made by Roche under ARTICLE 9 or any other provision under this Agreement;

10.1.3.

the Development or Manufacturing activities that are conducted by or on behalf of Roche or its Affiliates or Sublicensees (which will exclude any Development or Manufacturing activities that are conducted by or on behalf of Ionis pursuant to this Agreement); or

10.1.4.

the Commercialization of a Product by or on behalf of Roche or its Affiliates or Sublicensees;

except, in each case above, to the extent such Claim arose out of or resulted from or is attributable to any acts or omissions of Ionis or its Affiliates, licensees, Sublicensees or contractors, and its or their respective directors, officers, employees and agents or other circumstance for which Ionis has an indemnity obligation pursuant to Section 10.2 (Indemnification by Ionis).

10.2.

Indemnification by Ionis. Ionis will indemnify, defend and hold harmless Roche and its Affiliates, and its or their respective directors, officers, employees and agents, from and against any and all Losses arising out of or resulting from any and all Claims based upon:

10.2.1.

the gross negligence or willful misconduct of Ionis, its Affiliates or Sublicensees or its or their respective directors, officers, employees and agents, in connection with Ionis’ performance of its obligations or exercise of its rights under this Agreement;

10.2.2.

any breach of any representation or warranty or express covenant made by Ionis under ARTICLE 9 or any other provision under this Agreement;

10.2.3.

any Development or Manufacturing activities that are conducted by or on behalf of Ionis or its Affiliates or Sublicensees (which will exclude any Development or Manufacturing activities that are conducted by or on behalf of Roche pursuant to this Agreement); or

10.2.4.

any Development, Manufacturing or Commercialization activities that are conducted by or on behalf of Ionis or its Affiliates or Sublicensees with respect to a Discontinued Product;

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except, in each case above, to the extent such Claim arose out of or resulted from or is attributable to any acts or omissions of Roche or its Affiliates, licensees, Sublicensees or contractors and its or their respective directors, officers, employees and agents or other circumstance for which Roche has an indemnity obligation pursuant to Section 10.1 (Indemnification by Roche).

10.3.

Procedure. If a Person entitled to indemnification under Section 10.1 (Indemnification by Roche) or Section 10.2 (Indemnification by Ionis) (an “Indemnitee”) seeks such indemnification, such Indemnitee will (i) inform the indemnifying Party in writing of a Claim as soon as reasonably practicable after such Indemnitee receives notice of such Claim, (ii) permit the indemnifying Party to assume direction and control of the defense of the Claim (including the sole right to settle such Claim at the sole discretion of the indemnifying Party, provided that such settlement or compromise does not admit any fault or negligence on the part of the Indemnitee, or impose any obligation on, or otherwise materially adversely affect, the Indemnitee or other Party), (iii) cooperate as reasonably requested (at the expense of the indemnifying Party) in the defense of the Claim, and (iv) undertake reasonable steps to mitigate any Losses with respect to the Claim. The provisions of Section 8.5 (Defense of Claims Brought by Third Parties) will govern the procedures for responding to a Claim of infringement described therein. Notwithstanding anything in this Agreement to the contrary, the indemnifying Party will have no liability under Section 10.1 (Indemnification by Roche) or Section 10.2 (Indemnification by Ionis), as the case may be, for Claims settled or compromised by the Indemnitee without the indemnifying Party’s prior written consent.

10.4.

Insurance.

10.4.1.

Ionis’ Insurance Obligations. Ionis hereby represents and warrants to Roche that it will maintain, at its cost, reasonable insurance against liability and other risks associated with its activities contemplated by this Agreement, including but not limited to its indemnification obligations herein, in such amounts and on such terms as are customary for prudent practices for biotech companies of similar size and with similar resources in the pharmaceutical industry for the activities to be conducted by it under this Agreement taking into account the scope of Development of Products. Ionis will furnish to Roche evidence of any insurance required under this Section 10.4.1 (Ionis’ Insurance Obligations), upon request.

10.4.2.

Roche’s Insurance Obligations. Roche hereby represents and warrants to Ionis that it will maintain, at its cost, reasonable insurance – which may be through self-insurance – against liability and other risks associated with its activities contemplated by this Agreement (including product liability), including but not limited to its indemnification obligations herein, in such amounts and on such terms as are customary for prudent practices for large companies in the pharmaceutical industry for the activities to be conducted by Roche under this Agreement. Roche will maintain such insurance throughout the Agreement Term and for [***] thereafter, and will furnish to Ionis evidence of such insurance, upon request.

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10.5.

LIMITATION OF CONSEQUENTIAL DAMAGES. EXCEPT FOR (a) CLAIMS OF A THIRD PARTY THAT ARE SUBJECT TO INDEMNIFICATION UNDER THIS ARTICLE 10 (INDEMNIFICATION; INSURANCE), (b) CLAIMS ARISING OUT OF A PARTY’S WILLFUL MISCONDUCT OF THIS AGREEMENT, (c) A PARTY’S BREACH OF ARTICLE 4 (EXCLUSIVITY COVENANTS), OR A BREACH OF SECTION 11.4.2 (LICENSE TERMINATION) BY ROCHE OR ITS AFFILIATES OR (d) CLAIMS ARISING OUT OF A PARTY’S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS UNDER THIS AGREEMENT, NEITHER PARTY NOR ANY OF ITS AFFILIATES WILL BE LIABLE TO THE OTHER PARTY TO THIS AGREEMENT OR ITS AFFILIATES FOR ANY INCIDENTAL, CONSEQUENTIAL, SPECIAL, PUNITIVE OR OTHER INDIRECT DAMAGES, WHETHER LIABILITY IS ASSERTED IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT PRODUCT LIABILITY), INDEMNITY OR CONTRIBUTION, AND IRRESPECTIVE OF WHETHER THAT PARTY OR ANY REPRESENTATIVE OF THAT PARTY HAS BEEN ADVISED OF, OR OTHERWISE MIGHT HAVE ANTICIPATED THE POSSIBILITY OF, ANY SUCH LOSS OR DAMAGE.

ARTICLE 11.

TERM; TERMINATION

11.1.

Agreement Term; Expiration. This Agreement is effective as of the Effective Date and, unless earlier terminated pursuant to the other provisions of this ARTICLE 11, will continue in full force and effect until this Agreement expires as follows:

11.1.1.

on a country-by-country and Product-by-Product basis, on the date of expiration of all payment obligations by the Commercializing Party under this Agreement with respect to such Product (or such Discontinued Product) in such country; and

11.1.2.

in its entirety upon the expiration of all payment obligations under this Agreement with respect to the last Product (or last Discontinued Product) in all countries pursuant to Section 11.1.1.

The period from the Effective Date until the date of expiration of this Agreement pursuant to this Section 11.1 (Agreement Term; Expiration) is the “Agreement Term.” On a Product-by-Product basis, if with respect to a particular Product this Agreement expires (i.e., is not terminated early) under Section 11.1.1 or Section 11.1.2 in a particular country, then, effective upon such expiration, Ionis will and hereby does grant to Roche a fully paid-up, royalty-free, and irrevocable non-exclusive license under the Licensed Know-How to Manufacture, Develop and Commercialize the Product that is the subject of such expiration in such country.

11.2.

Termination.

11.2.1.

Roche’s Termination for Convenience. Roche may terminate this Agreement for convenience as a whole or on a Program-by-Program basis, Target-by- Target basis, Product-by-Product basis or country-by-country basis by providing ninety (90) days written notice to Ionis of such termination.

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11.2.2.

Termination for Material Breach.

(a)

Roche’s Right to Terminate. If Roche believes that Ionis is in material breach of this Agreement (other than with respect to a failure to use Commercially Reasonable Efforts under Section 3.1.2 (Conducting the R&D Plans) or Section 3.1.9 (Performance Milestones During the Handoff Period), which are governed by Section 11.2.3 (Remedies for Failure to Use Commercially Reasonable Efforts) below), then Roche may deliver written notice of such material breach to Ionis. If the breach is curable, Ionis will have [***] to cure such breach. If Ionis fails to cure such breach within the [***] period, or if the breach is not subject to cure, Roche may terminate this Agreement in whole or on a Program-by-Program basis, Target-by-Target basis, Product-by- Product basis or country-by-country basis, as applicable, by providing written notice to Ionis.

(b)

Ionis’ Right to Terminate. If Ionis believes that Roche is in material breach of this Agreement (other than with respect to a failure to use Commercially Reasonable Efforts under Section 3.1.2 (Conducting the R&D Plans), Section 3.1.9 (Performance Milestones During the Handoff Period), or Section 6.2 (Diligence), which is governed by Section 11.2.3 (Remedies for Failure to Use Commercially Reasonable Efforts) below), then Ionis may deliver written notice of such material breach to Roche. If the breach is curable, Roche will have [***] days to cure such breach (except to the extent such breach involves the failure to make a payment when due, which breach must be cured within [***] days following such notice). If Roche fails to cure such breach within the [***] or [***] period, as applicable, or if the breach is not subject to cure, Ionis may terminate this Agreement by providing written notice to Roche in whole or on a Program-by-Program basis, Target-by-Target basis, Product-by-Product basis or country-by- country basis, as applicable, by proving written notice to Roche.

11.2.3.

Remedies for Failure to Use Commercially Reasonable Efforts.

(a)

If Ionis, in Roche’s reasonable determination, fails to use Commercially Reasonable Efforts in the activities contemplated in Section 3.1.2 (Conducting the R&D Plans) or Section 3.1.9 (Performance Milestones During the Handoff Period), then Roche will notify Ionis and, within [***] thereafter, Ionis and Roche will meet and confer to discuss and resolve the matter in good faith, and attempt to devise a mutually agreeable plan to address any outstanding issues related to Ionis’ use of Commercially Reasonable Efforts in Section 3.1.2 (Conducting the R&D Plans) or Section 3.1.9 (Performance Milestones During the Handoff Period), as applicable. Following such a meeting, if Ionis fails to use Commercially Reasonable Efforts as agreed, Roche will have the right to terminate this Agreement in whole or on a Program-by-Program basis, Target-by-Target basis, Product-by-Product basis or country-by-country basis, as applicable.

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(b)

If Roche, in Ionis’ reasonable determination, fails to use Commercially Reasonable Efforts in the activities contemplated in Section 3.1.2 (Conducting the R&D Plans), Section 3.1.9 (Performance Milestones During the Handoff Period), or Section 6.2 (Diligence), then Ionis will notify Roche and, within [***] thereafter, [***]. Following [***], if Roche fails to use Commercially Reasonable Efforts as agreed and subject to Section 11.2.4 (Disputes Regarding Material Breach), Ionis will have the right to terminate this Agreement in whole or on a Program-by-Program basis, Target-by-Target basis, Product-by-Product basis or country-by-country basis, as applicable.

11.2.4.

Disputes Regarding Material Breach. Notwithstanding the foregoing, if the Breaching Party in Section 11.2.2(a) (Roche’s Right to Terminate) or Section 11.2.2(b) (Ionis’ Right to Terminate) disputes in good faith the existence or materiality of, or failure to cure any such breach which is not a payment breach, and provides notice to the Non-Breaching Party of such dispute within such [***] or [***] period, as applicable, then the Non-Breaching Party will not have the right to terminate this Agreement in accordance with Section 11.2.2(a) (Roche’s Right to Terminate) or Section 11.2.2(b) (Ionis’ Right to Terminate), unless and until it has been determined in accordance with Section 13.1 (Dispute Resolution) that this Agreement was materially breached by the Breaching Party and the Breaching Party fails to cure such breach within [***] days following such determination. It is understood and acknowledged that during the pendency of such dispute, all the terms of this Agreement will remain in effect and the Parties will continue to perform all of their respective obligations hereunder, including satisfying any payment obligations.

11.2.5.

Termination for Insolvency.

(a)

Either Party may terminate this Agreement if, at any time, the other Party files in any court or agency pursuant to any statute or regulation of any state or country a petition in bankruptcy or insolvency or for reorganization or for an arrangement or for the appointment of a receiver or trustee of the Party or of substantially all of its assets; or if the other Party proposes a written agreement of composition or extension of substantially all of its debts; or if the other Party is served with an involuntary petition against it, filed in any insolvency proceeding, and such petition is not dismissed within ninety (90) days after the filing thereof; or if the other Party is a party to any dissolution or liquidation; or if the other Party makes an assignment of substantially all of its assets for the benefit of creditors.

(b)

All rights and licenses granted under or pursuant to any section of this Agreement are and will otherwise be deemed to be for purposes of Section 365(n) of Title 11, United States Code (the “Bankruptcy Code”) licenses of rights to “intellectual property” as defined in Section 101(35A) of the Bankruptcy Code. The Parties will retain and may fully exercise all of their respective rights and elections under the Bankruptcy Code. Upon the bankruptcy of any Party, the non-bankrupt Party will further be entitled to a complete duplicate of, or complete access to, any such intellectual property, and such, if not already in its possession, will be promptly delivered to the non-bankrupt Party, unless the bankrupt Party elects in writing to continue, and continues, to perform all of its obligations under this Agreement.

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11.2.6.

Termination if Ionis Development Candidate Not Identified or Designated.

(a)

On a Target-by-Target basis, if, [***], then either Party will have the right to terminate the Agreement with regard to the applicable Program by providing [***] days’ written notice to the other Party.

(b)

If the JSC does not recommend a Compound for designation as an Ionis Development Candidate (and does not, as an alternative, recommend designation of a Related Compound) within [***] after Roche’s receipt of the applicable Development Candidate Data Package, or Roche does not confirm the designation of a Compound (or Related Compound, as applicable) as an Ionis Development Candidate within [***] after the date of the JSC’s recommendation (or a longer period as the Parties may mutually agree in writing), in each case in accordance with Section 3.1.3 (Ionis Development Candidate Designation; IND- Enabling Toxicology Study Costs), then Ionis will have the right to terminate the Agreement with regard to the applicable Program by providing [***] days’ written notice to Roche.

(c)

If this Agreement is terminated under this Section 11.2.6(a) (Termination if Ionis Development Candidate Not Identified or Designated) with respect to a Program, then Section 11.4 (General Consequences of Termination of the Agreement) will apply solely with respect to the applicable Program. Nothing in this Section 11.2.6 (Termination if Ionis Development Candidate Not Identified or Designated) will terminate or otherwise affect the provisions of another Program, which shall remain in full force and effect.

(d)

If this Agreement is terminated under this Section 11.2.6 (Termination if Ionis Development Candidate Not Identified or Designated) with respect to a Program, then [***].

11.2.7.

Termination for Cessation of Development. If, (a) prior to [***], Roche has suspended Development activities for a period of [***] but (i) has not [***], or (ii) has not [***], or (b) Section 3.1.7 (Failure of IND-Enabling Toxicology Study to Achieve Handoff Data Package Criteria; Disputes over Achievement of Handoff Data Package Criteria) becomes applicable under this Agreement, within the [***] period no Related Compound has been designated as a replacement Ionis Development Candidate, and Roche is not otherwise [***], then in each case ((a) or (b)) Ionis shall have the right to terminate this Agreement in accordance with Section 11.2.2(b) (Ionis’ Right to Terminate). Ionis’ rights under this Section 11.2.7 (Termination for Cessation of Development) are without prejudice to Roche’s obligation to use Commercially Reasonable Efforts as set out in Section 6.2 (Diligence).

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11.3.

Patent Challenge. If, during the Agreement Term, solely with respect to rights to the Ionis Product-Specific Patents and the Ionis Core Technology Patents claiming technology incorporated in a Product, in each case that are included in a license granted to Roche under Section 5.1.2 (Development and Commercialization License Grant to Roche), Roche, its Affiliates or Sublicensees, in any country, (a) commence or otherwise voluntarily determine to participate in (other than as may be necessary or reasonably required to [***]) any action or proceeding, challenging or denying the enforceability or validity of any claim within an issued patent or patent application within such Ionis Product-Specific Patents or Ionis Core Technology Patents, or (b) direct, support or actively assist any other Person (other than as may be necessary or reasonably required to [***]) in bringing or prosecuting any action or proceeding challenging or denying the validity of any claim within an issued patent or patent application within such Ionis Product-Specific Patents or Ionis Core Technology Patents, then unless, within [***] after written notice from Ionis, Roche [***], Ionis may, to the extent permitted under Applicable Law, terminate this Agreement and the provisions of Section 11.4 (General Consequences of Termination of the Agreement) and Section 11.5 (Special Consequences of Termination of the Agreement) will apply, provided, however, [***].

11.4.

General Consequences of Termination of the Agreement. If any portion of this Agreement or the whole Agreement is terminated by a Party in accordance with this ARTICLE 11 at any time and for any reason, the following terms will apply to any such termination, either in whole or on a Program-by-Program basis, Target-by-Target basis, Product-by-Product basis or country-by-country basis:

11.4.1.

Return of Information and Materials. The Parties will return (or destroy, as directed by the other Party) all data, files, records and other materials containing or comprising the other Party’s Confidential Information that are the subject of such termination to the extent separable from data, files, records and other materials (a) required for the continuation of the Program(s), Target, Product(s) or countries which have not been terminated or (b) that constitute the Confidential Information of the returning Party. Notwithstanding the foregoing, the Parties will be permitted to retain one copy of such data, files, records, and other materials for archival and legal compliance purposes.

11.4.2.

License Termination. Upon termination but not expiration of the Agreement, except for the licenses granted under Section 5.1.3 (Cross-Licenses under Collaboration Intellectual Property) and Section 11.2.6(d), any licenses granted by Ionis to Roche under this Agreement will terminate and Roche, its Affiliates and Sublicensees will cease selling all Products that are the subject of such termination, unless Ionis elects to have Roche continue to sell the applicable Product(s) as part of the Transition Activities under Section 11.5.9 (Transition Activities).

11.4.3.

Exclusivity Covenants. On a Target-by-Target basis, neither Party will have any further obligations under Section 4.1 (Exclusivity) of this Agreement.

11.4.4.

Accrued Rights. Termination or expiration of this Agreement for any reason will be without prejudice to any rights or financial compensation that will have accrued to the benefit of a Party prior to such termination or expiration. Such termination or expiration will not relieve a Party from obligations that are expressly indicated to survive the termination or expiration of this Agreement. For purposes of clarification, milestone payments under ARTICLE 7 accrue as of the date the applicable Milestone Event is achieved even if the payment is not due at that time.

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11.4.5.

Survival. The following provisions of this Agreement will survive the expiration or termination of this Agreement: Section 3.10 (Failure to Identify or Designate an Ionis Development Candidate) (but only if this Agreement is terminated under Section 11.2.6 (Termination if Ionis Development Candidate Not Identified or Designated)), Section 5.1.3 (Cross-Licenses under Collaboration Intellectual Property), Section 5.1.5 (No Implied Licenses), Section 7.2 ([***]) through Section 7.6 (Mode of Payment) (in each case solely with respect to any financial compensation that has accrued prior to expiry or termination), Section 7.7 (Records Retention), Section 7.8 (Audits), Section 7.9 (Taxes), Section 7.10 (Interest), Section 8.1 (Ownership), Section 8.5.2 (Third Party Claims Regarding Discontinued Products), Section 8.5.3 (Interplay Between Enforcement of IP and Defense of Third Party Claims), Section 8.6.5 (Settlement), Section 9.5 (Disclaimer), ARTICLE 10 (Indemnification; Insurance), Section 11.1 (Agreement Term; Expiration), Section 11.2.5 (Termination for Insolvency), Section 11.2.6 (Termination if Ionis Development Candidate Not Identified or Designated), Section 11.4 (General Consequences of Termination of the Agreement), Section 11.5 (Special Consequences of Termination of the Agreement), Section 11.6 (Reverse Royalty Payments to Roche for Discontinued Products), Section 11.7 (Sublicensees), ARTICLE 12 (Confidentiality), ARTICLE 13 (Miscellaneous) and

11.4.6.

APPENDIX 1 (Definitions) (to the extent definitions are embodied in the foregoing listed Articles and Sections).

11.5.

Special Consequences of Termination of the Agreement. If Roche terminates the Agreement under Section 11.2.1 (Roche’s Termination for Convenience), or Ionis terminates this Agreement under Section 11.2.2(b) (Ionis’ Right to Terminate), Section 11.2.3 (Remedies for Failure to Use Commercially Reasonable Efforts), or Section 11.2.7 (Termination for Cessation of Development), then in addition to the terms set forth in Section 11.4 (General Consequences of Termination of the Agreement), the following additional terms will also apply:

11.5.1.

License to Ionis for Discontinued Products Comprising Ionis Development Candidates. Roche will and hereby does grant to Ionis a sublicensable, royalty- bearing, worldwide, exclusive license or sublicense, as the case may be, under all Roche Technology (excluding Companion Diagnostic IP) Controlled by Roche as of the date of such reversion that Covers Discontinued Products comprising an Ionis Development Candidate solely as necessary to Develop, make, have made, use, sell, offer for sale, have sold, import and otherwise Commercialize such Discontinued Products in the Field;

11.5.2.

License to Ionis for Companion Diagnostic Products. On request by Ionis, Roche will make available to Ionis, on commercially reasonable terms, any diagnostic products and/or services to select patients who will use Products (each, a “Companion Diagnostic Product”) and any Patent Rights and Know- How Covering such Companion Diagnostic Products (such intellectual property, “Companion Diagnostic IP”) Controlled by Roche as of the date of such reversion that is necessary to Develop or Commercialize such Companion Diagnostic Products;

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11.5.3.

Know-How Transfer. Within [***] following the date of termination, Roche will transfer to Ionis for use with respect to the Development and Commercialization of Discontinued Products, copies of any Roche Collaboration Know-How data, results, and regulatory information, and to the extent solely related to and necessary for the Development or Commercialization of such Discontinued Products, [***] in the possession of Roche as of the date of such reversion that relate to such Discontinued Products, and any other information or material specified in Section 3.5 (Technology Transfer Implementation);

11.5.4.

Regulatory Materials. Within [***] following the date of the termination, Roche will assign, and hereby does assign, to Ionis all of Roche’s right, title and interest in and to all regulatory materials for the Discontinued Product, including any IND, orphan drug designation and marketing authorizations that relate to the applicable Discontinued Product;

11.5.5.

Trademarks. Roche will license to Ionis any trademarks that are specific to Discontinued Products solely for use with such Discontinued Products; provided, however, that in no event will Roche have any obligation to license to Ionis any trademarks used by Roche both in connection with a Product and in connection with the sale of any other product or service, including any Roche- or Roche-formative marks, company logos, or trademarks of its Affiliates or Sublicensees;

11.5.6.

Prosecution and Maintenance of Patents for Discontinued Products. Ionis will control and be responsible at its sole cost for all aspects of the Prosecution and Maintenance of all Joint Collaboration Patents for Discontinued Products that claim Ionis Development Candidates and Ionis Product-Specific Patents for Discontinued Products, and Roche will provide Ionis with (and will instruct its counsel to provide Ionis with) all of the information and records in Roche’s and its counsel’s possession related to the Prosecution and Maintenance of such Joint Collaboration Patents for Discontinued Products that claim Ionis Development Candidates and Ionis Product-Specific Patents for Discontinued Products.

11.5.7.

Stocks of API and Finished Drug Product. Ionis will have the right to purchase from Roche any or all of the inventory of API and/or Finished Drug Product for such Discontinued Product held by Roche as of the effective date of termination (that are not committed to be supplied to any Third Party or Sublicensee, in the ordinary course of business, as of the effective date of termination), if any, [***]. Ionis will notify Roche within [***] after the effective date of termination whether Ionis elects to exercise such right;

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11.5.8.

Manufacturing Technology Transfer. If Roche or Roche’s CMO is manufacturing API and/or Finished Drug Product as of the termination triggering this provision, then Ionis may request Roche to conduct (or cause to be conducted by Roche’s CMO) a technology transfer to Ionis (or Ionis’ designated Third Party supplier) of any technology, information and data reasonably related to Roche’s or such CMO’s manufacturing and supply of API and/or Finished Drug Product for such Discontinued Product, and if so requested, Roche will conduct (or cause to be conducted by Roche’s CMO) such a technology transfer, and Ionis [***], and Roche will (or will cause Roche’s CMO to) continue to (i) provide reasonable support and cooperation with Ionis’ regulatory filings and interactions with Regulatory Authorities related to Roche’s or such CMO’s API and/or Finished Drug Product manufacturing (including any required inspections), and (ii) supply (or cause to be supplied by Roche’s CMO) API and/or Finished Drug Product to Ionis, [***] to enable Ionis to identify and contract with a suitable Third Party API and/or Finished Drug Product manufacturer; and

11.5.9.

Transition Activities. For a period of up to [***] following the effective date of termination:

(a)

The Parties wish to provide a mechanism to ensure that, assuming the Discontinued Product is available to patients as of the reversion date, patients who were being treated with the Discontinued Product prior to such termination or who desire access to the Discontinued Product can continue to have access to such Discontinued Product while the regulatory and commercial responsibilities for the Discontinued Product are transitioned from Roche to Ionis. As such, Ionis may request Roche to perform transition activities that are necessary or useful to (1) transition Roche’s Commercialization activities (if any) to Ionis to minimize disruption to sales, (2) provide patients with continued access to the applicable Discontinued Products (if applicable), (3) enable Ionis (or Ionis’ designee) to assume and execute the responsibilities under all Approvals and ongoing Clinical Studies for the applicable Discontinued Product, and (4) ensure long-term continuity of supply for the Discontinued Product (collectively, the “Transition Activities”), including, if applicable, the categories of services and deliverables listed on SCHEDULE 11.5.9, but no longer than [***] following the effective date of termination. If applicable, Roche will [***] SCHEDULE 11.5.9; provided Roche and Ionis may mutually agree in writing to [***].

(b)

Ionis may elect to have Roche perform the applicable Transition Activities by providing written notice to Roche no later than [***] following the effective date of the termination. If Ionis requests Transition Activities, without limiting the provisions of Section 11.5 (Special Consequences of Termination of the Agreement), the Parties will mutually agree upon a transition plan for Roche to perform the applicable Transition Activities including delivery and transition dates. In addition, the Parties will establish a transition committee consisting of at least each Party’s Alliance Managers, a representative from each Party’s chemistry, manufacturing and controls (“CMC”) group who was responsible for the Discontinued Product prior to the termination, and up to two (2) additional representatives from each Party who are from other relevant functional groups to facilitate a smooth transition. While Roche is providing applicable Transition Activities, Roche and Ionis will [***].

(c)

Ionis will [***] to perform the Transition Activities. In addition, Ionis will [***] to perform the Transition Activities. Ionis will own [***].

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11.6.

Reverse Royalty Payments to Roche for Discontinued Products.

11.6.1.

If either party terminates the Agreement with respect to a Product after payment of the applicable milestone amount for the “[***]” Milestone Event set forth in TABLE 1 of Section 7.3.1 (Development Milestones for [***]) or TABLE 2 of Section 7.3.2 (Development Milestones for [***]) but before the payment of the applicable milestone amount for the “[***]” Milestone Event set forth in TABLE 1 of Section 7.3.1 (Development Milestones for [***]) or TABLE 2 of Section 7.3.2 (Development Milestones for [***]) with respect to the Discontinued Product that is the subject of such termination, and Ionis or any of its Affiliates or Sublicensees Commercializes such Discontinued Product, then Ionis will pay Roche a reversion royalty of [***] of Annual worldwide Net Sales of such Discontinued Product [***].

11.6.2.

If either Party terminates this Agreement with respect to a Product after payment of the applicable milestone amount for the “[***]” Milestone Event set forth in TABLE 1 of Section 7.3.1 (Development Milestones for [***]) or TABLE 2 of Section 7.3.2 (Development Milestones for [***]) but before the payment of the first applicable milestone amount for the “[***]” Milestone Event set forth in TABLE 1 of Section 7.3.1 (Development Milestones for [***]) or TABLE 2 of Section 7.3.2 (Development Milestones for [***]) with respect to the Product that is the subject of such termination, and Ionis or any of its Affiliates or Sublicensees Commercializes such Discontinued Product, then Ionis will pay Roche a reversion royalty of [***] of Annual worldwide Net Sales of such Discontinued Product [***].

11.6.3.

If either Party terminates this Agreement with respect to a Product after payment of the first applicable milestone amount for the “[***]” Milestone Event set forth in TABLE 1 of Section 7.3.1 (Development Milestones for [***]) or TABLE 2 of Section 7.3.2 (Development Milestones for [***]) with respect to the Discontinued Product that is the subject of such termination, and Ionis or any of its Affiliates or Sublicensees Commercializes such Discontinued Product, then Ionis will pay Roche a reversion royalty of [***] of Annual worldwide Net Sales of such Discontinued Product [***].

11.6.4.

Ionis will pay Roche reversion royalties under this Section 11.6 (Reverse Royalty Payments to Roche for Discontinued Products) in accordance with the provisions governing payment of royalties from Roche to Ionis in Section 7.4 (Royalties) (mutatis mutandis).

11.6.5.

Limitations on Grant-Backs.

For purposes of clarity, irrespective of anything to the contrary in this Agreement:

(a)

All transfers and licenses from Roche to Ionis (or other obligations of Roche) under Section 11.6 (Reverse Royalty Payments to Roche for Discontinued Products) are solely with respect to Product(s) [***]. Should at the effective date of termination (i) [***], or (ii) [***], then [***]. For clarity, Roche [***].

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(b)

In connection with research studies, Clinical Studies or other activities associated with the Development and Commercialization of Products, Roche may have collected (i) personally identifiable information about individual human subjects or (ii) human biological samples (collectively, “PII/Samples”). Legal and contractual restrictions may apply to such PII/Samples. Roche shall have no obligation to transfer such PII/Samples unless necessary for the continued development of the Product, in which case Roche shall not be obliged to transfer any PII/Samples that Roche in good faith believes would be prohibited or would subject Roche to potential liability by reason of Applicable Law, contractual restrictions or insufficient patient consent. If Roche transfers any such PII/Samples, the Parties will enter into the relevant agreements under applicable data privacy laws (such as a data transfer agreement) when required in accordance with Section 12.1 (Confidentiality; Exceptions). Upon the transfer of such PII/Samples by Roche, Ionis shall use such PII/Samples for the sole purpose of Developing and Commercializing the Product, and Ionis shall be responsible for the correct and lawful use of the PII/Sample in compliance with the applicable data protection laws, the informed consent forms and privacy notices (including but not limited to potential re-consenting of the patients at Ionis’ costs if the legal basis for the processing of the patients’ data was their explicit consent).

11.7.

Sublicensees. If this Agreement terminates for any reason, any Sublicensee granted a sublicense by Roche to Develop or Commercialize Products will, from the effective date of such termination, automatically become a direct licensee of Ionis with respect to the rights sublicensed to the Sublicensee by Roche; so long as (i) such Sublicensee is not in breach of its sublicense agreement, (ii) such Sublicensee agrees in writing to comply with all of the terms of this Agreement to the extent applicable to the rights originally sublicensed to it by Roche, and (iii) such Sublicensee agrees to pay directly to Ionis such Sublicensee’s payments under this Agreement to the extent applicable to the rights sublicensed to it by Roche. Roche agrees that it will confirm clause (i) of the foregoing in writing at the request and for the benefit of Ionis and if requested, the Sublicensee.

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ARTICLE 12.

CONFIDENTIALITY

12.1.

Confidentiality; Exceptions. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, during the Agreement Term and for five years thereafter, the receiving Party (the “Receiving Party”) and its Affiliates will keep confidential and will not publish or otherwise disclose or use for any purpose other than as provided for in this Agreement any confidential or proprietary information or materials, patentable or otherwise, in any form (written, oral, photographic, electronic, magnetic, or otherwise) which is disclosed to it by the other Party (the “Disclosing Party”) or its Affiliates or otherwise received or accessed by a Receiving Party in the course of performing its obligations or exercising its rights under this Agreement, including trade secrets, Know-How, inventions or discoveries, proprietary information, formulae, processes, techniques and information relating to the past, present and future marketing, financial, and research and development activities of any product or potential product or useful technology of the Disclosing Party or its Affiliates and the pricing thereof (collectively, “Confidential Information”). Without limiting the foregoing, Roche agrees that it will not disclose or use Ionis’ Confidential Information or the Licensed Know-How for any purpose other than as provided in this Agreement. Roche has procedures in place to protect such information and will ensure it implements such procedures appropriately to prevent Ionis’ Confidential Information and the Licensed Know-How from being disclosed or used for any purpose other than as provided in this Agreement. In addition to the confidentiality obligations set forth in this Agreement, in the event that, during the implementation of the Agreement, one of the Parties processes any information that is protected by applicable data privacy laws, including without limitation, the Health Insurance Portability & Accountability Act of 1996 (HIPAA) in the US, the Swiss Data Protection Act, the European Union General Data Protection Regulation 2016/679 (GDPR), the Personal Information Protection and Electronic Documents Canada (PIPEDA) in Canada, and any other applicable data protection laws, the respective Party agrees to fully comply with such laws, as they may be applicable to the Party. If and as required by applicable data privacy laws, including but not limited to the EU GDPR, Swiss or United Kingdom laws, the Parties shall execute additional data protection documentation, such as the Standard Contractual Clauses issued by the European Commission to cover any cross-border transfers of personal data. If a Party to this Agreement becomes subject to an investigation by a data protection authority or any other competent authority in relation to the processing of personal data under this Agreement, then the Party affected will inform the other Party without any undue delay unless the Party is not permitted to provide such information. The Parties will inform each other without any undue delay and provide each other with reasonable support in case of a Data Subject Request (as such term is defined under the applicable data privacy law(s)) or in case of a Data Breach (as such term is defined under the applicable data privacy law(s)) that would potentially affect the other Party to this Agreement. If changes to the applicable data privacy laws affect the compliance of data processing activities under this Agreement, then the Parties will negotiate in good faith adjustments to the data privacy language in this Agreement, or additional data privacy documentation if and as required by applicable data privacy laws. The Parties warrant that they will implement and maintain adequate technical and organizational measures to ensure the integrity and security of personal data processed under this Agreement.

12.2.

Prior Confidentiality Agreement. The Non-Disclosure Agreement executed by Ionis and Roche on November 11, 2021 (including any and all amendments thereto) (the “CDA”) will govern disclosures of Information (as defined in the CDA) between the Parties prior to the Effective Date. All Confidential Information exchanged between the Parties on or after the Effective Date under this Agreement will be subject to the terms of this ARTICLE 12.

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12.3.

Authorized Disclosure. Except as expressly provided otherwise in this Agreement, a Receiving Party or its Affiliates may use and disclose to Third Parties Confidential Information of the Disclosing Party as follows: (i) solely in connection with the performance of its obligations or exercise of rights granted or reserved in this Agreement under confidentiality provisions no less restrictive than those in this Agreement, provided, a Receiving Party may disclose Confidential Information to a governmental entity or agency without requiring such entity or agency to enter into a confidentiality agreement; (ii) to the extent reasonably necessary to file or prosecute patent, copyright and trademark applications (subject to Section 12.4 (Press Release; Publications; Disclosure of Agreement) below), complying with applicable governmental regulations, obtaining Approvals, conducting Pre-Clinical Studies or Clinical Studies, marketing a Product, or as otherwise required by Applicable Law, regulation, rule or legal process (including the rules of the SEC and any stock exchange); provided, however, that if a Receiving Party or any of its Affiliates is required by law or regulation to make any such disclosure of a Disclosing Party’s Confidential Information it will, except where impracticable for necessary disclosures, give reasonable advance notice to the Disclosing Party of such disclosure requirement and will use its reasonable efforts to secure confidential treatment of such Confidential Information required to be disclosed; (iii) in communication with actual or potential lenders, investors, merger partners, acquirers, consultants, or professional advisors on a need-to-know basis, in each case under confidentiality provisions no less restrictive than those of this Agreement; (iv) to the extent such disclosure is required to comply with existing expressly stated contractual obligations owed to such Party’s or its Affiliates’ licensor with respect to any intellectual property licensed to the other Party under this Agreement; or (v) as mutually agreed to in writing by the Parties. Notwithstanding the foregoing, if either Party concludes based on the reasonable opinion of counsel that a copy of this Agreement must be filed with the United States Securities and Exchange Commission or similar regulatory agency in a country other than the United States, such Party will, within a reasonable time prior to any such filing (and to the extent possible at least [***] prior to any such filing), provide the other Party with a copy of this Agreement showing any provisions hereof as to which such Party proposes to request confidential treatment, and the Parties shall coordinate with each other and will use good faith efforts to mutually agree on the redaction of certain provisions of this Agreement (together with all exhibits and schedules) before filing such copy of this Agreement, provided that notwithstanding the foregoing, the filing Party shall retain final decision-making authority over the redactions to be made in its filed copy of this Agreement.

12.4.

Press Release; Publications; Disclosure of Agreement.

12.4.1.

Public Announcements – Generally. Either Party may issue a press release announcing the execution of this Agreement and disclosing selected key terms, subject to prior agreement of the Parties on the final draft of press release to be issued. Except to the extent required to comply with Applicable Law, regulation, rule or legal process or as otherwise permitted in accordance with this Section 12.4 (Press Release; Publications; Disclosure of Agreement), each Party agrees not to issue any other press release or other public statement disclosing other information relating to this Agreement or the terms of this Agreement or the transactions contemplated hereby without the prior written consent of the other Party, which consent will not be unreasonably withheld or delayed.

12.4.2.

Use of Name. Except as set forth in Section 12.4.8 (Acknowledgement; Commercial Materials), neither Party will use the other Party’s name in a press release or other publication without first obtaining the prior written consent of the Party to be named.

12.4.3.

Notice of Significant Events. Each Party will notify (no later than [***] after the information or results are obtained) the other Party of any significant event related to a Product (including any data, serious adverse event or regulatory advice or approval) so that the Parties may analyze the need to or desirability of publicly disclosing or reporting such event. Notwithstanding Section 12.4.1 (Public Announcements – Generally) above, any press release or other similar public communication by either Party related to a Product’s efficacy or safety data and/or results, will be submitted to the other Party for review and approval at least [***] in advance of such proposed public disclosure, which approval will not be unreasonably withheld or delayed.

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12.4.4.

Press Releases. Roche will have the sole right, consistent with its practice with its other compounds and products, to issue press releases, publish, present or otherwise disclose the progress and results regarding the Products to the public; provided, that with respect to any proposed press release or other similar public communication by Roche disclosing regulatory discussions, the efficacy or safety data or results related to the Products or Roche’s sales projections, (i) Roche will submit such proposed communication to Ionis for review at least [***] in advance of such proposed public disclosure, (ii) Ionis will have the right to review and recommend changes to such communication, and (iii) Roche will in good faith consider any changes that are timely recommended by Ionis.

12.4.5.

Scientific or Clinical Presentations. Regarding any proposed scientific publications related to results from any Clinical Studies of a Product, the Parties agree to use Commercially Reasonable Efforts to control public scientific disclosures of such results to prevent any adverse effect of any premature public disclosure of such results. The Parties will establish a procedure for publication review and each Party will first submit to the other Party through the JPC an early draft of all such publications or presentations, at least [***] prior to submission for publication including to facilitate the publication of any summaries of Clinical Studies data and results as required on the clinical trial registry of each respective Party. Each Party will review such proposed publication to avoid the unauthorized disclosure of a Party’s Confidential Information and to preserve the patentability of inventions arising from an R&D Plan. If, during such [***] period, the other Party informs such Party that its proposed publication contains Confidential Information of the other Party, then such Party will delete such Confidential Information from its proposed publication. In addition, if during such [***] period, the other Party informs such Party that its proposed publication discloses non-public inventions made by either Party in the course of the Development under this Agreement, or the public disclosure of such proposed publication may have a material adverse effect on any Patent Rights or Know-How solely owned or Controlled by such other Party, then such Party will either (i) delay such proposed publication for up to [***] from the date of such Party’s objection, to permit the timely first filing of patent application(s), or (ii) remove the identified disclosures prior to publication.

12.4.6.

SEC Filings. Each Party will give the other Party a reasonable opportunity to review all material filings with the SEC describing the terms of this Agreement prior to submission of such filings, and will give due consideration to any reasonable comments by the non-filing Party relating to such filing.

12.4.7.

Subsequent Disclosure. Notwithstanding the foregoing, to the extent information regarding this Agreement or a Product has already been publicly disclosed, either Party (or its Affiliates) may subsequently disclose the same information to the public without the consent of the other Party.

12.4.8.

Acknowledgment; Commercial Materials. Each Party will acknowledge in any press release, public presentation, publication or commercial marketing materials regarding the collaboration or a Product, the other Party’s role in discovering and Developing a Product or Discontinued Product, as applicable, that the Product is under license from Ionis and otherwise acknowledge the contributions from the other Party, and each Party’s stock ticker symbol (e.g., Ionis: Nasdaq: IONS; Roche: SIX: RO, ROG; OTCQX: RHHBY). Ionis may include the Products (and identify Roche as its partner for the Product) in Ionis’ drug pipeline. In addition, subject to Applicable Law, the words “Discovered by Ionis” will be included in Product communications, provided that Roche will have final decision-making authority regarding the applicability of any legal and regulatory requirements for such acknowledgement.

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ARTICLE 13.

MISCELLANEOUS

13.1.

Dispute Resolution.

13.1.1.

Escalation. If any dispute occurs under this Agreement (other than a dispute regarding the construction, validity or enforcement of either Party’s Patent Rights, which disputes will be resolved pursuant to Section 13.2 (Governing Law; Jurisdiction; Venue; Service of Process)), then either Party may request in writing that the dispute be referred for resolution to the Head of Roche Pharma Partnering and the Chief Executive Officer of Ionis (the “Executives”). Within [***] after such a request, the Executives will meet in person at a mutually acceptable time and location or by means of telephone or video conference to negotiate a settlement of the dispute. Each Party’s JSC representatives may participate in such meeting if desired. If the Executives fail to resolve the dispute within such [***] period, then the dispute will be referred to binding arbitration under Section 13.1.2 (Binding Arbitration).

13.1.2.

Binding Arbitration. If a dispute subject to Section 13.1.1 (Escalation) is not resolved pursuant to Section 13.1.1 (Escalation), except as otherwise set forth in this Agreement such dispute will be resolved through binding arbitration in accordance with this Section 13.1.2 (Binding Arbitration) and under the Commercial Arbitration Rules of the [***] then in effect, including application of the “Expedited Procedures” (sections E-1, et al) of the Commercial Arbitration Rules of the [***]. The proceedings and decisions of the arbitrator will be confidential, final and binding on the Parties, and judgment upon the award of such arbitrators may be entered in any court having jurisdiction thereof. The arbitration will take place in Boston, Massachusetts USA and will be conducted by three (3) arbitrators. Each of Roche and Ionis shall appoint one (1) arbitrator within thirty (30) days after the notice that initiated the arbitration. These two (2) arbitrators shall in turn appoint a third arbitrator who will be reasonably acceptable to the Parties and who will be appointed in accordance with [***] rules. Each arbitrator chosen hereunder will have educational training and industry experience sufficient to demonstrate a reasonable level of scientific, financial, medical and industry knowledge relevant to the particular dispute.

13.2.

Governing Law; Jurisdiction; Venue; Service of Process.

13.2.1.

This Agreement and any dispute will be governed by and construed and enforced in accordance with the laws of [***], without reference to conflicts of laws principles.

13.2.2.

Each Party hereby agrees that service of process: (a) made in any manner permitted by [***] law, or (b) made by overnight express courier service (signature required), prepaid, at its address specified pursuant to Section 13.7 (Notices), will constitute good and valid service of process in any such action and (c) waives and agrees not to assert (by way of motion, as a defense, or otherwise) in any such action any claim that service of process made in accordance with clause (a) or (b) does not constitute good and valid service of process.

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13.3.

Remedies. Notwithstanding anything to the contrary in this Agreement, each Party will be entitled to seek, in addition to any other right or remedy it may have, at law or in equity, a temporary restraining order or a preliminary injunction, without the posting of any bond or other security, enjoining or restraining the other Party from any violation or threatened violation of this Agreement, and the Parties agree that in the event of a threatened or actual material breach of this Agreement injunctive relief would be appropriate. Neither Party may recover any Losses relating to any matter arising under one provision of this Agreement to the extent that such Party has already recovered Losses with respect to such matter pursuant to other provisions of this Agreement (including recoveries under Section 10.1 (Indemnification by Roche) or Section 10.2 (Indemnification by Ionis)). Except for the offsets and credits explicitly set forth in Section 7.4.3(f)(i) (Additional Ionis Core Intellectual Property) and Section 7.8 (Audits), neither Party will have the right to set-off any amount it is owed or believes it is owed against payments due or payable to the other Party under this Agreement.

13.4.

Assignment and Successors. Neither this Agreement nor any obligation of a Party hereunder may be assigned by either Party without the consent of the other, except that each Party may assign this Agreement and the rights, obligations and interests of such Party, in whole or in part, without the other Party’s consent, to any of its Affiliates, to any purchaser of all or substantially all of its assets or all or substantially all of its assets to which this Agreement relates or to any successor corporation resulting from any merger, consolidation, share exchange or other similar transaction; provided, if a Party transfers or assigns this Agreement to [***], then such transferring Party (or such Affiliate) (“Transferring Party”), will [***] any payment that the Transferring Party is obligated to pay to the non-transferring Party (“Non-Transferring Party”) under ARTICLE 7 for the taxes withheld such that the Non-Transferring Party receives [***]. In addition, Ionis may assign or transfer its rights to receive payments under this Agreement (but no liabilities), without Roche’s consent, to an Affiliate or to a Third Party in connection with a payment factoring transaction. Any purported assignment or transfer made in contravention of this Section 13.4 (Assignment and Successors) will be null and void. To the extent the Non-Transferring Party utilizes [***], the Non- Transferring Party will [***] to the Transferring Party [***]. To assist the Transferring Party in determining when [***], beginning with the first Annual tax return for the year in which the Transferring Party [***], and each year thereafter (including, for clarity, all years in which the Non-Transferring Party utilizes [***], the Non-Transferring Party will provide the Transferring Party with the Non-Transferring Party’s’ Annual tax returns (federal and state) and, in years in which the Non-Transferring Party utilizes [***], supporting documentation for such [***].

13.5.

Change of Control. If Ionis undergoes a Change of Control, then Roche shall have the right at any time after Handoff to disband the JSC and make unilateral decisions with respect to the R&D Plans, and the Development and Commercialization of Products with no obligation to seek input from Ionis or its successor, if applicable.

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13.6.

Force Majeure. No Party will be held responsible to the other Party nor be deemed to be in default under, or in breach of any provision of, this Agreement for failure or delay in performing any obligation of this Agreement when such failure or delay is due to force majeure, and without the fault or negligence of the Party so failing or delaying. For purposes of this Agreement, force majeure means a cause beyond the reasonable control of a Party, which may include acts of God; acts, regulations, or laws of any government; war; terrorism; civil commotion; fire, flood, earthquake, tornado, tsunami, explosion or storm; pandemic; epidemic and failure of public utilities or common carriers. In such event the Party so failing or delaying will immediately notify the other Party of such inability and of the period for which such inability is expected to continue. The Party giving such notice will be excused from such of its obligations under this Agreement as it is thereby disabled from performing for so long as it is so disabled for up to a maximum of ninety (90) days, after which time the Parties will negotiate in good faith any modifications of the terms of this Agreement that may be necessary to arrive at an equitable solution, unless the Party giving such notice has set out a reasonable timeframe and plan to resolve the effects of such force majeure and executes such plan within such timeframe. To the extent possible, each Party will use reasonable efforts to minimize the duration of any force majeure.

13.7.

Notices. Any notice or request required or permitted to be given under or in connection with this Agreement will be deemed to have been sufficiently given if in writing and personally delivered or sent by certified mail (return receipt requested), facsimile transmission (receipt verified), or overnight express courier service (signature required), prepaid, to the Party for which such notice is intended, at the address set forth for such Party below:

If to Ionis, addressed to:

Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, CA 92010

Attention: Chief Executive Officer

with a copy to:

Ionis Pharmaceuticals, Inc.

2855 Gazelle Court

Carlsbad, CA 92010

Attention: General Counsel

Email: [***]

If to Roche, addressed to:

F. Hoffmann-La Roche Ltd

Grenzacherstrasse 124

4070 Basel, Switzerland

Attention: Corporate Legal Department

Fax: [***]

If to Roche, addressed to:

Hoffmann-La Roche Inc.

150 Clove Road, Suite 8

Little Falls, New Jersey 07424

Attention: Corporate Secretary

Fax: [***]

with a copy to:

F. Hoffmann-La Roche Ltd

Grenzacherstrasse 124

4070 Basel, Switzerland

Attention: Alliance Manager

Fax: [***]

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13.8.

Invoices. All invoices that are required or permitted hereunder shall be in writing and sent by Ionis to Roche at the following address or any other address that Roche may later provide:

F. Hoffmann-La Roche AG

Kreditorenbuchhaltung

Grenzacherstrasse 124

CH - 4070 Basel

Upon Ionis’ request, Roche’s Alliance Manager will provide Ionis’ Alliance Manager with any additional information reasonably requested by Ionis to facilitate the prompt delivery of invoices to Roche, including an email address for sending invoices.

13.9.

Export Clause. Each Party acknowledges that the laws and regulations of the United States restrict the export and re-export of commodities and technical data of United States origin. Each Party agrees that it will not export or re-export restricted commodities or the technical data of the other Party in any form without the appropriate United States and foreign government licenses.

13.10.

Waiver. Neither Party may waive or release any of its rights or interests in this Agreement except in writing. The failure of either Party to assert a right hereunder or to insist upon compliance with any term or condition of this Agreement will not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term or condition. No waiver by either Party of any condition or term in any one or more instances will be construed as a continuing waiver or subsequent waiver of such condition or term or of another condition or term.

13.11.

Severability. If any provision hereof should be held invalid, illegal or unenforceable in any jurisdiction, the Parties will 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 will remain in full force and effect in such jurisdiction and will 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 will not affect the validity, legality or enforceability of such provision in any other jurisdiction.

13.12.

Entire Agreement. This Agreement, together with the Schedules and Appendices hereto, sets forth all the covenants, promises, agreements, warranties, representations, conditions and understandings between the Parties regarding the subject matter hereof and supersedes and terminates all prior agreements and understanding between the Parties pertaining to the subject matter hereof. There are no covenants, promises, agreements, warranties, representations, conditions or understandings, either oral or written, between the Parties regarding the subject matter hereof other than as set forth in this Agreement and the Schedules and Appendices hereto. No subsequent alteration, amendment, change or addition to this Agreement will be binding upon the Parties hereto unless reduced to writing and signed by the respective authorized representatives of the Parties.

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13.13.

Independent Contractors. Nothing herein will be construed to create any relationship of employer and employee, agent and principal, partnership or joint venture between the Parties. Each Party is an independent contractor. Neither Party will assume, either directly or indirectly, any liability of or for the other Party. Neither Party will have the authority to bind or obligate the other Party and neither Party will represent that it has such authority.

13.14.

Interpretation. Except as otherwise explicitly specified to the contrary, (a) references to a section, exhibit or schedule means a section of, or schedule or exhibit to this Agreement, unless another agreement is specified, (b) the word “including” (in its various forms) means “including without limitation,” (c) the words “will” and “shall” have the same meaning, (d) references to a particular statute or regulation include all rules and regulations thereunder and any predecessor or successor statute, rules or regulation, in each case as amended or otherwise modified from time to time, (e) words in the singular or plural form include the plural and singular form, respectively, (f) references to a particular Person include such Person’s successors and assigns to the extent not prohibited by this Agreement, (g) unless otherwise specified, “$” is in reference to United States dollars, and (h) the headings contained in this Agreement, and in any Appendix or Schedule to this Agreement are for convenience only and will not in any way affect the construction of or be taken into consideration in interpreting this Agreement.

13.15.

Further Actions. Each Party will execute, acknowledge and deliver such further instruments, and do all such other acts, as may be necessary or appropriate in order to carry out the expressly stated purposes and the clear intent of this Agreement.

13.16.

Construction of Agreement. The terms and provisions of this Agreement represent the results of negotiations between the Parties and their representatives, each of which has been represented by counsel of its own choosing, and neither of which has acted under duress or compulsion, whether legal, economic or otherwise. Accordingly, the terms and provisions of this Agreement will be interpreted and construed in accordance with their usual and customary meanings, and each of the Parties hereto hereby waives the application in connection with the interpretation and construction of this Agreement of any rule of law to the effect that ambiguous or conflicting terms or provisions contained in this Agreement will be interpreted or construed against the Party whose attorney prepared the executed draft or any earlier draft of this Agreement.

13.17.

Supremacy. In the event of any express conflict or inconsistency between this Agreement and any Schedule or Appendix hereto, the terms of this Agreement will apply. The Parties understand and agree that the Schedules and Appendices hereto are not intended to be the final and complete embodiment of any terms or provisions of this Agreement, and are to be updated from time to time during the Agreement Term, as appropriate and in accordance with the provisions of this Agreement.

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13.18.

Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which taken together shall be deemed to constitute one and the same agreement. The Parties agree that execution of this Agreement by e-Signatures or by exchanging executed signature pages in .pdf format shall have the same legal force and effect as the exchange of original signatures. As used in this Section, “e-Signature” shall mean a signature that consists of one or more letters, characters, numbers or other symbols in digital form incorporated in, attached to or associated with the electronic document, that (a) is unique to the person executing the signature; (b) the technology or process used to make the signature is under the sole control of the person making the signature; (c) the technology or process can be used to identify the person using the technology or process; and (d) the electronic signature can be linked with an electronic document in such a way that it can be used to determine whether the electronic document has been changed since the electronic signature was incorporated in, attached to or associated with the electronic document.

[SIGNATURE PAGES FOLLOW]

* - * - * - *

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their representatives thereunto duly authorized as of the Effective Date.

F. Hoffmann-La Roche Ltd

By:	/s/ James Sabry
Name: James Sabry
Title: Global Head – Roche Pharma Partnering Date: September 26, 2023

By:	/s/ Stephanie Harloff
Name: Stephanie Harloff
Title: Legal Counsel – Legal Pharma Partnering
Date: September 26, 2023

Signature Page to Research, Development, and License Agreement

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their representatives thereunto duly authorized as of the Effective Date.

Hoffmann-La Roche Inc.

By:	/s/ Gerald Bohm
Name: Gerald Bohm
Title: Principal Counsel Associate General Counsel
Date: September 26, 2023

Signature Page to Research, Development, and License Agreement

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their representatives thereunto duly authorized as of the Effective Date.

Ionis Pharmaceuticals, Inc.

By:	/s/ Brett Monia
Name: Brett Monia
Title: Chief Executive Officer
Date: September 26, 2023

Signature Page to Research, Development, and License Agreement

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List of Appendices and Schedules

APPENDIX 1 – Definitions

APPENDIX 2 –R&D Plans

APPENDIX 3 – Success Criteria for Ionis Development Candidates

APPENDIX 4 – Handoff Data Package Criteria

APPENDIX 5 – Relevant Permitted Licenses as of the Effective Date

SCHEDULE 2.2 – [***]

SCHEDULE 3.4.1(b) – Ionis’ Fully Absorbed Cost of Goods

SCHEDULE 7.4.3(a)(ii) – [***]

SCHEDULE 9.2.4(a) – Ionis Core Technology Patents

SCHEDULE 9.2.4(b) – Ionis Manufacturing and Analytical Patents

SCHEDULE 9.2.4(c) – Ionis Product-Specific Patents

SCHEDULE 9.2.6 – Prior Agreements

SCHEDULE 11.5.9 – Transition Activities

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Appendix 1

DEFINITIONS

For purposes of this Agreement, the following capitalized terms will have the following meanings:

“[***]” means [***].

“Acceptance” means, with respect to an NDA, BLA, MAA or JNDA filed for a Product, (a) in the United States, the receipt of written notice from the FDA that such NDA or BLA is officially “filed,” (b) in the European Union, receipt of written notice of acceptance by the EMA of such MAA for filing under the centralized European procedure in accordance with any feedback received from European Regulatory Authorities; provided that if the centralized filing procedure is not used, then Acceptance will be determined upon the acceptance of such MAA by the applicable Regulatory Authority in a Major Market in the EU, and (c) in Japan, receipt of written notice of acceptance of filing of such JNDA from the Koseisho (i.e., the Japanese Ministry of Health and Welfare, or any successor agency thereto).

“Accounting Standard” means (a) the United States Generally Accepted Accounting Principles (“GAAP”) or (b) International Financial Reporting Standards of the International Accounting Standards Boards (“IFRS”), in each case ((a) and (b)) as generally and consistently applied throughout the applicable Person’s organization. Each Party will promptly notify the other Party in writing if such Party changes the Accounting Standards pursuant to which its records are maintained.

“Additional Ionis Core IP” has the meaning set forth in Section 7.4.3(f)(i)(1).

(i) owns, directly or indirectly, more than fifty percent (50%) of the outstanding voting securities or capital stock (or such lesser percentage which is the maximum allowed to be owned by a foreign corporation in a particular jurisdiction) of such other entity, or has other comparable ownership interest with respect to any entity other than a corporation; or (ii) has the power, whether pursuant to contract, ownership of securities or otherwise, to direct the management and policies of the entity. Anything to the contrary in this paragraph notwithstanding, Chugai Pharmaceutical Co., Ltd, a Japanese corporation (“Chugai”), shall not be deemed an Affiliate of Roche unless Roche provides written notice to Ionis of its desire to include Chugai as an Affiliate of Roche.

“Agreement” has the meaning set forth in the Preamble of this Agreement.

“Agreement Term” has the meaning set forth in Section 11.1 (Agreement Term; Expiration).

“Alliance Manager” has the meaning set forth in Section 3.3.3 (Alliance Managers).

“Alzheimer’s Disease” means a neurodegenerative disease associated with cognitive disorders as per ICD 11.

“Annual” means the period covering a Calendar Year or occurring once per Calendar Year, as the context requires.

“API” means the bulk active pharmaceutical ingredient manufactured in accordance with cGMP (unless stated otherwise herein) for a Product. The quantity of API will be the as-is gross mass of the API after lyophilization (i.e., including such amounts of water, impurities, salt, heavy metals, etc., within the limits set forth in the API specifications) and before release, retention, stability or characterization samples are removed (if needed).

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“[***]” ([***]) means [***].

“Approval” means (i) with respect to a Product in the EU, the earlier to occur of (A) approval from the applicable Regulatory Authority in at least one member state in the EU sufficient for the manufacture, distribution, use, marketing and sale of such Product, including pricing and reimbursement approval, in such jurisdiction in accordance with Applicable Laws, or (B) the First Commercial Sale of a Product in the EU; and (ii) with respect to a Product in any regulatory jurisdiction other than the EU, approval sufficient for the manufacture, distribution, use, marketing and sale of such Product in such jurisdiction in accordance with Applicable Laws.

“ASO” means a compound comprising a [***] Oligonucleotide.

“Audit Report” has the meaning set forth in Section 7.8 (Audits).

“Bankruptcy Code” has the meaning set forth in Section 11.2.5(b).

“BLA” means a biologics license application that is submitted to the FDA for a Product, pursuant to 21 C.F.R. § 601.2.

“Breaching Party” means the Party that is believed by the Non-Breaching Party to be in material breach of this Agreement.

“Business Day” means any day other than a Saturday or Sunday on which banking institutions in New York, New York are open for business.

“Calendar Quarter” means a period of three consecutive months ending on the last day of March, June, September, or December, respectively, and will also include the period beginning on the Effective Date and ending on the last day of the Calendar Quarter in which the Effective Date falls.

“Calendar Year” means a year beginning on January 1 (or, with respect to 2023, the Effective Date) and ending on December 31.

“CDA” has the meaning set forth in Section 12.2.

“Change of Control” means, with respect to a Party: (a) the acquisition by any Third Party of beneficial ownership of more than fifty percent (50%) of the then outstanding common shares or voting power of such Party, other than acquisitions by employee benefit plans sponsored or maintained by such Party; (b) the consummation of a business combination involving such Party, unless, following such business combination, the stockholders of such Party immediately prior to such business combination beneficially own directly or indirectly more than fifty percent (50%) of the then outstanding common shares or voting power of the entity resulting from such business combination.

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“Claims” has the meaning set forth in Section 10.1 (Indemnification by Roche).

“Clinical Study” or “Clinical Studies” means a Phase 1 Trial, Phase 2 Trial, Phase 3 Trial, Pivotal Trial or Phase 4 Trial, or such other study in humans that is conducted in accordance with good clinical practices and is designed to generate data in support or maintenance of an NDA, BLA, MAA, JNDA or other similar marketing application.

“CMC” has the meaning set forth in Section 11.5.9(b).

“CMO” means a Third Party contract manufacturer Manufacturing API or Finished Drug Product for any purpose under this Agreement.

“Combination Product” means a Product that will be [***].

“Commercialize,” “Commercialization” or “Commercializing” means any and all activities directed to marketing, promoting, detailing, distributing, importing, having imported, exporting, having exported, selling or offering to sell a Product following receipt of Approval for a Product in the applicable country, including conducting pre-and post-Approval activities, including studies reasonably required to increase the market potential of a Product and studies to provide improved formulation and Product delivery, and launching and promoting a Product in each country.

“Commercializing Party” means (a) Roche, with respect to a Product that is being Developed and Commercialized by or on behalf of Roche, its Affiliates or Sublicensees hereunder, and (b) Ionis, with respect to a Discontinued Product that is being Developed and Commercialized by or on behalf of Ionis, its Affiliates or Sublicensees hereunder.

“Commercially Reasonable Efforts” means the carrying out of discovery, research, development or commercialization activities using good-faith commercially reasonable [***] efforts that the applicable Party would reasonably devote to a compound or product of similar market potential or profit potential at a similar stage in development or product life resulting from its own research efforts, based on conditions then prevailing and taking into account, without limitation, issues of safety and efficacy, regulatory authority-approved labeling, product profile, the competitiveness of alternative products in the marketplace, the likely timing of the product’s entry into the market, the patent and other proprietary position, the likelihood of approval and other relevant scientific, technical and commercial factors. The R&D Plans attached to this Agreement as of the Effective Date as APPENDIX 2 exemplify a level of diligence that meets the Commercially Reasonable Efforts standard required under this Agreement. Without limiting any of the foregoing, (A) Commercially Reasonable Efforts as it applies to Roche’s Development or Commercialization of a Product hereunder includes the use of Commercially Reasonable Efforts to perform the Roche R&D Activities designated under the R&D Plans [***]; and (B) Commercially Reasonable Efforts as it applies to Ionis’ Development of an Ionis Development Candidate hereunder includes the use of Commercially Reasonable Efforts to perform the Ionis R&D Activities designated under the R&D Plans in accordance with the timelines set forth therein. Roche [***].

“Companion Diagnostic IP” has the meaning set forth in Section 11.5.2 (License to Ionis for Companion Diagnostic Products).

“Companion Diagnostic Product” has the meaning set forth in Section 11.5.2 (License to Ionis for Companion Diagnostic Products).

“Competitive Infringement” has the meaning set forth in Section 8.6.1 (Duty to Notify of Competitive Infringement).

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“Compound” means an Oligonucleotide that is designed to bind to (a) the RNA that encodes [***], or (b) the RNA that encodes [***], in each case ((a) and (b)) that are (1) discovered by Ionis prior to the Effective Date or by Ionis on its own or in collaboration with Roche in the performance of the applicable R&D Plan or (2) designated as a Compound according to Section 3.6 (Follow-On Ionis Development Candidates).

“Compulsory Sublicense” means a sublicense granted to a Third Party, through the order, decree or grant of a governmental authority having competent jurisdiction, authorizing such Third Party to manufacture, use, sale, offer for sale, import or export a Product in any country.

“Compulsory Sublicensee” means a Third Party that was granted a Compulsory Sublicense.

“Confidential Information” has the meaning set forth in Section 12.1 (Confidentiality; Exceptions). “Confidential Information” does not include information that:

(a)

was in the lawful knowledge and possession of the Receiving Party or its Affiliates prior to the time it was disclosed to, or learned by, the Receiving Party or its Affiliates, or was otherwise developed independently by the Receiving Party or its Affiliates, as evidenced by written records kept in the ordinary course of business, or other documentary proof of actual use by the Receiving Party or its Affiliates;

(b)

was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party or its Affiliates;

(c)

(d)

“Control” or “Controlled” means possession of the ability to grant a license or sublicense hereunder without violating the terms of any agreement with any Third Party; provided, however, that if a Party has a right to grant a license or sublicense, with respect to an item of intellectual property to the other Party only upon payment of compensation (including milestones or royalties) to a Third Party (“Third Party Compensation”), then the first Party will be deemed to have “Control” of the relevant item of intellectual property only if the other Party agrees to bear the cost of such Third Party Compensation. Notwithstanding anything to the contrary under this Agreement, with respect to any Third Party that becomes an Affiliate of a Party after the Effective Date (including a Third Party acquirer), no intellectual property of such Third Party will be included in the licenses granted hereunder by virtue of such Third Party becoming an Affiliate of such Party.

“Costs” means, with respect to particular activities performed, or to be performed, by Ionis, Ionis’ time incurred in performing such activities, at the FTE Rate, and the out-of-pocket expenses incurred by or on behalf of Ionis in connection with the performance of such activities.

“Cover,” “Covered” or “Covering” means, with respect to a patent, that the act of making, using or selling by an unauthorized Person would infringe a Valid Claim included in such patent, or in the case of a patent that is a patent application, would infringe a Valid Claim in such patent application if it were to issue as a patent.

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“Develop,” “Developing” or “Development” means with respect to a Product, any and all preclinical (i.e., IND-Enabling Toxicology Studies), clinical, or regulatory activity with respect to a Product to seek Approval (including the submission of all necessary filings with applicable Regulatory Authorities to support such preclinical and clinical activities and Approval), including human clinical trials conducted after Approval of a Product to seek Approval for additional indications for a Product.

“Development Candidate Data Package” means, with respect to a Compound, either (a) the data package Ionis presents to the JSC as the basis for deciding whether to designate such Compound an Ionis Development Candidate; provided such package meets the Success Criteria listed in APPENDIX 3.

“Development Candidate Data Package Deficiency Notice” has the meaning set forth in Section 3.1.3(a).

“Disclosing Party” has the meaning set forth in Section 12.1 (Confidentiality; Exceptions).

“Discontinued Product” means a Product that is the subject of a termination under this Agreement.

“Effective Date” has the meaning set forth in the Preamble of this Agreement.

“EMA” means the European Medicines Agency and any successor entity thereto.

“European Union” or “EU” means each and every country or territory that is officially part of the European Union.

“Executives” has the meaning set forth in Section 13.1.1 (Escalation).

“[***]” has the meaning set forth in Section 7.3.2(b) ([***]).

“[***]” has the meaning set forth in Section 7.3.1(b) ([***]).

“FDA” means the United States Food and Drug Administration and any successor entity thereto.

“FDCA” shall mean the United States Food, Drug and Cosmetics Act.

“Field” means all prophylactic or therapeutic uses for any indication in humans.

“Finished Drug Product” means any drug product containing API as an active ingredient in finished bulk form for the Development or Commercialization of a Product by a Party under this Agreement.

“First Commercial Sale” means, on a country-by-country basis, the first invoiced sale of a Product to a Third Party by Roche following the receipt of any Regulatory Approval (including pricing and reimbursement approvals) required for the sale of such Product, or if no such Regulatory Approval is required, the date of the first invoiced sale of a Product to a Third Party by Roche in such country.

“Follow-On Ionis Development Candidate” means a Compound comprising [***] that is designated as a Follow-On Ionis Development Candidate under either Section 3.6.1 (Follow-On Ionis Development Candidate [***]) or Section 3.6.2 (Follow-On Development Candidates [***]), as applicable, and that, in each case, is reasonably likely to be Covered by a composition of matter patent that is different from the composition of matter patent within the Patent Rights Covering another Compound directed to the same Target.

“FTE” means a total of [***] weeks or [***] hours per year of work on the Development of a Product carried out by employees of a Party having the appropriate relevant expertise to conduct such activities. For clarity, the FTE Rate and out-of-pocket costs must not include duplicative costs.

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“FTE Rate” means the amount of $[***] per FTE, on a fully burdened cost basis. The FTE Rate will be increased each Calendar Year after [***] by the [***].

“Fully Burdened Manufacturing Cost” or “FBMC” means for the Manufacture of the Product or Ionis Development Candidate the following: [***].

“Generic Product” shall mean, with respect to a Product in a country, a pharmaceutical product (other than such Product) that (a) is sold by a Third Party other than a Sublicensee under license from Roche in such country, (b) is authorized for use in such country in one or more of the indications for which such Product has Regulatory Approval in such country, and (c) either (i) contains the same active pharmaceutical ingredient(s) as such Product or (ii) is a product approved by way of an abbreviated regulatory mechanism by the Regulatory Authority in such country that, in each case, meets the equivalency determination by the applicable Regulatory Authority (including a determination that the produce is “comparable,” “interchangeable,” “bioequivalent,” “biosimilar,” or other term of similar meaning, if applicable, with respect to such Product). A product shall not be considered to be a Generic Product if (x) Roche or any of its Affiliates or Sublicensees was involved in or authorized the development or commercialization of such product, (y) Roche or any of its Affiliates or Sublicensees has granted a license to such Third Party in respect of such product, or (z) such product is commercialized by any Person who obtained such product in a chain of distribution that included Roche or any of its Affiliates or Sublicensees.

“Group Sublicensee” means any individual, corporation, association or other business entity:

(i)

to which Roche has granted a sublicense or license under any Licensed Technology or Roche Technology, as the case may be, in accordance with the terms of this Agreement;

(ii)

that is not an Affiliate of Roche; and

(iii)

that is consolidated within Roche’s externally published audited financial statements,

(iv)

excluding Chugai unless Roche explicitly includes Chugai as an Affiliate pursuant to the “Affiliate” definition.

“Handoff” has the meaning set forth in Section 3.1.5 (Ionis Development Candidate Handoff).

“Handoff Data Package” means, with respect to an Ionis Development Candidate, the pharmacology, toxicology, histology and pharmacokinetic data generated from the IND- Enabling Toxicology Studies under the R&D Plan for such Ionis Development Candidate.

“Handoff Data Package Criteria” means the criteria a Handoff Data Package must meet in order for Handoff to occur in accordance with Section 3.1.5 (Handoff), which criteria are set forth as of the Effective Date in APPENDIX 4.

“Handoff Period” has the meaning set forth in Section 2.1.

“Huntington’s Disease” means the hereditary disorder caused by mutation associated with trinucleotide repeat expansion in the Huntingtin gene on chromosome 4p as defined in the ICD 11.

“IND” means an Investigational New Drug Application (as defined in the Food, Drug and Cosmetic Act, as amended) filed with the FDA or its foreign counterparts.

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“IND-Enabling Toxicology Studies” means the pre-clinical toxicology studies conducted in compliance with current Good Laboratory Practice (“cGLP”) which are required to file an IND, which will consist of one 13-week cGLP rodent toxicology study and one 5-week cGLP non- human primate toxicology study.

“Indemnitee” has the meaning set forth in Section 10.3 (Procedure).

“[***]” or “[***]” means [***].

“Initiation” or “Initiate” means, (i) with respect to any IND-Enabling Toxicology Study, dosing of the first animal subject in such IND-Enabling Toxicology Study, and (ii) with respect to any Clinical Study performed by Roche, its Affiliates or Sublicensees, the date the first patient is dosed with a Product in such Clinical Study.

“Ionis” has the meaning set forth in the Preamble of this Agreement.

“Ionis Collaboration Know-How” means Know-How discovered, developed, invented or created solely by or on behalf of Ionis or its Affiliate or a Third Party acting on their behalf in the performance of activities under this Agreement, that is necessary or useful to Develop, Manufacture or Commercialize a Product in the Field.

“Ionis Collaboration Patents” means Patent Rights invented solely by or on behalf of Ionis or its Affiliate or a Third Party acting on their behalf in the performance of activities under this Agreement, that are necessary or useful to Develop, Manufacture or Commercialize a Product in the Field. Ionis Collaboration Patents do not include the Ionis Product-Specific Patents.

“Ionis Collaboration Technology” means Ionis Collaboration Know-How and Ionis Collaboration Patents, and Ionis’ interest in any Joint Collaboration Technology.

“Ionis Core Technology Patents” means all Patent Rights owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Effective Date or at any time during the Agreement Term, claiming subject matter generally applicable to Oligonucleotides, other than Ionis Product-Specific Patents or Ionis Manufacturing and Analytical Patents. A representative list of Ionis Core Technology Patents as of the Effective Date is set forth on SCHEDULE 9.2.4(a) attached hereto.

“Ionis Development Candidate” means a Compound discovered by Ionis in performing the R&D Plan that is reasonably determined by the JSC as ready to start IND-Enabling Toxicology Studies in accordance with Section 3.1.3 (Ionis Development Candidate Designation; IND- Enabling Toxicology Study Costs).

“Ionis’ Fully Absorbed Cost of Goods” means the costs incurred by Ionis as determined using the methodology set forth in SCHEDULE 3.4.1(b), fairly applied and as employed on a consistent basis throughout Ionis’ operations.

“Ionis Internal Oligonucleotide Safety Database” has the meaning set forth in Section 6.3.2(a).

“Ionis Know-How” means any Know-How, including Ionis’ interest in any Joint Collaboration Know-How, owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Effective Date or at any time during the Agreement Term. Ionis Know-How does not include the Ionis Manufacturing and Analytical Know-How.

“Ionis Manufacturing and Analytical Know-How” means Know-How, including Ionis’ interest in any Joint Collaboration Know-How, that relates to the synthesis or analysis of a Product regardless of sequence or chemical modification, owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Effective Date or at any time during the Agreement Term. Ionis Manufacturing and Analytical Know-How does not include the Ionis Know-How.

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“Ionis Manufacturing and Analytical Patents” means Patent Rights, including Ionis’ interest in any Joint Collaboration Patents, that claim methods and materials used in the synthesis or analysis of a Product regardless of sequence or chemical modification, owned, used, developed by, or licensed to Ionis or its Affiliates, in each case to the extent Controlled by Ionis or its Affiliates on the Effective Date or at any time during the Agreement Term. A representative list of Ionis Manufacturing and Analytical Patents as of the Effective Date is set forth on SCHEDULE 9.2.4.(b) attached hereto. Ionis Manufacturing and Analytical Patents do not include the Ionis Product-Specific Patents or the Ionis Core Technology Patents.

“Ionis Product-Specific Patents” means Patent Rights Controlled by Ionis or any of its Affiliates on or after the Effective Date claiming (i) the specific composition of matter of an Ionis Development Candidate; (ii) methods of using an Ionis Development Candidate as a prophylactic or therapeutic; or (iii) the specific mechanism of action of an Ionis Development Candidate, in each case to the extent necessary to Develop, Manufacture or Commercialize an Ionis Development Candidate; provided however, Patent Rights Controlled by Ionis or any of its Affiliates that (y) include claims that are directed to subject matter applicable to Oligonucleotides in general, or (z) include an Oligonucleotide, the sequence of which targets both (1) the RNA that encodes [***] or [***] and (2) Oligonucleotides that do not target the RNA encoding [***] or [***], will not be considered Ionis Product-Specific Patents, and in the case of (y) and (z), such Patent Rights will be considered Ionis Core Technology Patents. A list of Ionis Product-Specific Patents as of the Effective Date is set forth on SCHEDULE 9.2.4(c) attached hereto.

“Ionis R&D Activities” means the research and/or pre-clinical activities for which Ionis is designated as responsible under an R&D Plan.

“[***]” has the meaning set forth in Section 7.4.3(e) ([***]).

“Japan NDA” or “JNDA” means the Japanese equivalent of an NDA filed with the Koseisho (i.e., the Japanese Ministry of Health and Welfare, or any successor agency thereto).

“JMC” has the meaning set forth in Section 3.3.2(a) (Establishment; Composition; Dissolution).

“JNDA Approval” means the Approval of a JNDA by the Koseisho (i.e., the Japanese Ministry of Health and Welfare, or any successor agency thereto) for the applicable Product in Japan.

“Joint Patent Committee” or “JPC” has the meaning set forth in Section 8.2.1 (Establishment).

“Joint Collaboration Know-How” means Know-How discovered, developed, invented or created jointly in the performance of activities under this Agreement by or on behalf of both Parties or their respective Affiliates or Third Parties acting on their behalf that is necessary or useful to Develop, Manufacture or Commercialize a Product in the Field.

“Joint Collaboration Patents” means any Patent Rights invented jointly in the performance of activities under this Agreement by or on behalf of both Parties or their respective Affiliates or Third Parties acting on their behalf that is necessary or useful to Develop, Manufacture or Commercialize a Product in the Field.

“Joint Collaboration Technology” means Joint Collaboration Know-How and Joint Collaboration Patents.

“JSC” has the meaning set forth in Section 3.3.1(a) (Establishment; Composition; Working Groups; Dissolution).

“[***] Communications” means [***].

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“Key Regulatory Submissions” means, with respect to a Product, (a) [***], (b) [***], (c) [***], (d) [***], and (e) [***].

“Know-How” means unpatented inventions, technical information, know-how and materials, including technology, data, compositions, formulas, biological materials, assays, reagents, constructs, compounds, discoveries, procedures, processes, practices, protocols, methods, techniques, results of experimentation or testing, knowledge, trade secrets, skill and experience.

“Lead Party” has the meaning set forth in Section 8.5.1 (Third-Party Claims Regarding Products).

“Licensed CMO” has the meaning set forth in Section 5.1.4(a)(ii).

“Licensed Know-How” means Ionis Manufacturing and Analytical Know-How, Ionis Know- How, Ionis Collaboration Know-How, and Ionis’ interest in any Joint Collaboration Know- How. For clarity, Licensed Know-How does not include any Know-How covering formulation technology or delivery devices unless such Know-How is included in any Ionis Collaboration Know-How or Joint Collaboration Know-How.

“Licensed Patents” means the Ionis Product-Specific Patents, Ionis Core Technology Patents, Ionis Manufacturing and Analytical Patents, Ionis Collaboration Patents, and Ionis’ interest in any Joint Collaboration Patents. For clarity, Licensed Patents do not include any Patent Rights claiming formulation technology or delivery devices unless such Patent Rights are included in any Ionis Collaboration Patents or Joint Collaboration Patents.

“Licensed Technology” means any and all Licensed Patents and Licensed Know-How, in each case to the extent necessary or useful to Develop, Manufacture or Commercialize a Product.

“Losses” has the meaning set forth in Section 10.1 (Indemnification by Roche).

“[***]” ([***]) means [***].

“MAA” means a marketing authorization application filed with the EMA after completion of Clinical Studies to obtain Approval for a Product under the centralized European filing procedure or, if the centralized EMA filing procedure is not used, filed using the applicable procedures in any European Union country.

“MAA Approval” means the Approval of an MAA by the EMA for a Product in any country in the EU.

“Major Market” means any of the following countries: the United States, the United Kingdom, Germany, France, Italy, Spain.

“Manufacture” or “Manufactured” or “Manufacturing” means any activity involved in or relating to the manufacturing, quality control testing (including in-process, release and stability testing), releasing or packaging, for pre-clinical and clinical purposes, of API or a Product in finished form.

“Milestone Event” means a milestone event listed in TABLE 1 of Section 7.3.1 (Development Milestones for [***]), TABLE 2 of Section 7.3.2 (Development Milestones for [***]), or TABLE 3 of Section 7.3.3 (Milestone Payments for First Achievement of Sales Milestone Event by an [***] Product).

“NDA” means a New Drug Application filed with the FDA after completion of Clinical Studies to obtain Approval for a Product in the United States.

“NDA Approval” means the Approval of an NDA by the FDA for a Product in the U.S.

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“Net Sales” of a Product in a particular period will mean the amount calculated by subtracting from the Sales of such Product for such period: (A) a lump sum deduction of [***] of Sales under item (i) of the “Sales” definition in lieu of those deductions that are not accounted for on a Product-by-Product basis (e.g., freight, postage charges, transportation insurance, packing materials for dispatch of goods, custom duties); (B) uncollectible amounts accrued during such period based on a proportional allocation of the total bad debts accrued during such period; (C) credit card charges (including processing fees) accrued during such period on such Sales; and (D) government mandated fees and taxes and other government charges accrued during such period for such Product including, for example, any fees, taxes or other charges that become due in connection with any healthcare reform, change in government pricing or discounting schemes, or other action of a government or regulatory body; provided that the foregoing deductions under (A) to (D) were not already taken as a gross-to-net deduction in accordance with the then currently used International Financial Reporting Standards (IFRS) in the calculation of Sales of such Product for such period.

“New Third Party Licenses” has the meaning set forth in Section 9.3.2.

“Non-Breaching Party” means the Party that believes the Breaching Party is in material breach of this Agreement.

“Non-Transferring Party” has the meaning set forth in Section 13.4 (Assignment and Successors).

“Oligonucleotide” means an oligonucleotide compound, or analog or variant thereof, having [***] and is designed to inhibit expression of a gene target via the binding, partially or wholly, of such compound to the RNA transcript of such gene target. For clarity, [***].

“[***]” means [***].

“Party” or “Parties” means Roche and Ionis individually or collectively.

“Patent Costs” means the reasonable fees and expenses paid to outside legal counsel, and filing, maintenance and other reasonable out-of-pocket expenses paid to Third Parties, incurred in connection with the Prosecution and Maintenance of Patent Rights.

“Permitted Licenses” means (1) licenses granted by Ionis before or after the Effective Date to any Third Party under the Ionis Core Technology Patents, the Ionis Manufacturing and Analytical Patents, or the Ionis Manufacturing and Analytical Know-How (but not under the Ionis Product-Specific Patents) to (a) use oligonucleotides (or supply oligonucleotides to end users) solely to conduct pre-clinical research, or (b) enable such Third Party to manufacture or formulate oligonucleotides, where Ionis does not assist such Third Party to identify, discover or make a Compound or Product; and (2) material transfer agreements with academic collaborators or non-profit institutions solely to conduct noncommercial research. A list of relevant Permitted Licenses as of the Effective Date is set forth on APPENDIX 5 attached hereto.

“Person” will mean any corporation, limited or general partnership, limited liability company, joint venture, trust, unincorporated association, governmental body, authority, bureau or agency, any other entity or body, or an individual.

“Phase 1 Trial” means the initial clinical testing of a Product in humans (first-in-humans study) in any country that is designed to satisfy the requirements of 21 C.F.R. § 312.21(a), as amended from time to time, or a foreign equivalent thereof.

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“Phase 2 Trial” means, with respect to a Product, a human clinical study for which the primary endpoints include a determination of safety, dose ranges, or an indication of efficacy of such Product in patients being studied as described in 21 C.F.R. § 312.21(b), as amended from time to time, or a foreign equivalent thereof.

“Phase 3 Trial” means, with respect to a Product, a human clinical study that is prospectively designed, along with other Phase 3 Trials, to demonstrate statistically whether such Product is safe and efficacious for use in humans in the indication being investigated as described in 21

C.F.R. § 312.21(c), as amended from time to time, or a foreign equivalent thereof.

“Phase 4 Trial” means (i) any Clinical Study conducted to satisfy a requirement of a Regulatory Authority in order to maintain Approval, or (ii) any Clinical Study conducted after the first Approval in the same disease state for which a Product received Approval other than for purposes of obtaining Approval.

“PII/Samples” has the meaning set forth in Section 11.6.5(b).

“Pivotal Trial” means (a) a Phase 3 Trial, or (b) a human Clinical Study of a Product that satisfies the requirements of 21 C.F.R. § 312.21(c) and is a registration trial on a sufficient number of patients designed to establish statistically significant efficacy and safety of such Product for its target patient population, and to determine warnings, precautions and adverse reactions that are associated with such Product in the dosage range to be prescribed, for the purpose of enabling the preparation and submission of an application for an NDA, BLA, MAA or similar application for marketing approval to the competent Regulatory Authorities in a given country, as evidenced by (i) an agreement with or statement from the FDA on a Special Protocol Assessment or equivalent in another country, or (ii) other guidance or minutes issued by the FDA, for such registration trial or equivalent in another country, or (iii) Roche’s public statements, with respect to each, where the results of such clinical trial are intended (if supportive) to be used to establish both safety and efficacy of such product in patients that are the subject of such trial and serve as the basis for obtaining initial or supplemental Approval in the United States of such Product.

“Pre-Clinical Studies” means in vitro and in vivo studies of a Product, not in humans, including those studies conducted in whole animals and other test systems, designed to determine the toxicity, bioavailability, and pharmacokinetics of a Product and whether a Product has a desired effect.

“[***]” has the meaning set forth in Section 4.1.1 ([***] Exclusivity Covenants Before Handoff).

“Prior Agreements” means the agreements listed on SCHEDULE 9.2.6 attached hereto.

“Proceeding” means an action, suit or proceeding.

“Product” means a product, including without limitation any Combination Product, containing an Ionis Development Candidate, a Follow-On Ionis Development Candidate or a Compound as an active pharmaceutical ingredient, regardless of its finished form, formulation or dosage. One Product may be distinguished from another Product by the Compound being a distinctive active pharmaceutical ingredient.

“Program” means, respectively, the research program to be carried out under the R&D Plan for (a) the Ionis Development Candidates for [***], or (b) the Ionis Development Candidates for [***].

“Program Patents” has the meaning set forth in Section 8.2.1 (Establishment).

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“Prosecution and Maintenance” or “Prosecute and Maintain” means, with regard to a Patent Right, the preparing, filing, prosecuting and maintenance of such Patent Right, as well as handling re-examinations, reissues, and requests for patent term extensions with respect to such Patent Right, together with the conduct of interferences, the defense of oppositions and other similar proceedings with respect to the particular Patent Right. For clarification, “Prosecution and Maintenance” or “Prosecute and Maintain” will not include any other enforcement actions taken with respect to a Patent Right.

“R&D Plan” means, for each Target, the research and preclinical development plan attached hereto as APPENDIX 2 (as may be amended in accordance with this Agreement) to conduct certain research, pre-clinical, and clinical activities for the purpose of designating at least one Ionis Development Candidate directed against such Target and delivering a Handoff Data Package with respect to such Ionis Development Candidate.

“Receiving Party” has the meaning set forth in Section 12.1 (Confidentiality; Exceptions).

“Regulatory Approval” means any approvals, licenses, registrations or authorizations by a Regulatory Authority, necessary for the sale of a Product in the Field in a regulatory jurisdiction in the Territory.

“Regulatory Authority” shall mean any national, supranational (e.g., the European Commission, the Council of the European Union, the European Medicines Agency), regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity including the FDA, in each country involved in the granting of regulatory approval for the Product.

“Related Compound” means, with respect to an Ionis Development Candidate, all other Compounds Ionis’ RMC considered as possible Ionis Development Candidates in connection

with its review of Compounds generated under the applicable R&D Plan to propose a potential Ionis Development Candidate.

“[***]” has the meaning set forth in Section 7.4.3(a)(i).

“[***]” has the meaning set forth in Section 7.4.3(a)(ii).

“RMC” has the meaning set forth in Section 3.1.3(a).

“Roche” has the meaning set forth in the Preamble of this Agreement.

“[***]” has the meaning set forth in Section 2.2.

“Roche Collaboration Know-How” means Know-How discovered, developed, invented or created solely by or on behalf of Roche or its Affiliate or a Third Party acting on their behalf in the performance of activities under this Agreement, that is necessary or useful to Develop, Manufacture or Commercialize a Product in the Field.

“Roche Collaboration Patents” means Patent Rights discovered, developed, invented or created solely by or on behalf of Roche or its Affiliate or a Third Party acting on their behalf in the performance of activities under this Agreement, that are necessary or useful to Develop, Manufacture or Commercialize a Product in the Field.

“Roche Collaboration Technology” means Roche Collaboration Know-How, Roche Collaboration Patents, Roche interest in any Joint Collaboration Technology.

“Roche Know-How” means any Know-How that (i) did not arise in connection with the performance of an R&D Plan, (ii) is owned, used, developed by, or licensed to Roche or its Affiliates, and (iii) is necessary or useful to Develop, Manufacture or Commercialize a Product in the Field, in each case to the extent Controlled by Roche or its Affiliates on the Effective Date or at any time during the Agreement Term.

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“Roche Patents” means any Patent Rights that are owned, used, developed by, or licensed to Roche or its Affiliates, and are necessary or useful to Develop, Manufacture or Commercialize a Product in the Field, in each case to the extent Controlled by Roche or its Affiliates on the Effective Date or at any time during the Agreement Term. Roche Patents include the Roche Collaboration Patents and Roche’s interest in any Joint Collaboration Patent.

“Roche-Prosecuted Patents” has the meaning set forth in Section 8.3.4(b).

“Roche R&D Activities” means the research, pre-clinical and/or clinical activities for which Roche is designated as responsible under an R&D Plan.

“Roche Technology” means Roche’s interest in Roche Collaboration Technology, Roche Know-How, Roche Patents and any trademarks described in Section 5.1.7 (Trademarks for Products), owned, used, developed by, or licensed to Roche or its Affiliates that is necessary or useful to Develop, Manufacture or Commercialize a Product.

“Royalty Term” has the meaning set forth in Section 7.4.2 (Royalty Term).

“Sales” of a Product in a particular period will mean the sum of (i) and (ii):

(i)

the amount stated in Roche sales line of its externally published audited financial statements with respect to such Product for such period (excluding sales to any Sublicensee that are used for research or Development or re-sold by such Sublicensee as sales under item (ii) below). This amount reflects the gross invoice price at which such Product was sold or otherwise disposed of (other than for use as clinical supplies or free samples) by Roche/Genentech, its Affiliates and Group Sublicensees to Third Parties (excluding sales to any Sublicensee that are used for research or Development or re-sold by such Sublicensee as sales under item (ii) below) in such period reduced by gross-to- net deductions, if not previously deducted from such invoiced amount, taken in accordance with the then currently used International Financial Reporting Standards (IFRS).

For clarity, any sales by a Compulsory Sublicensee are excluded from Sales (but sharing of Compulsory Sublicense compensation received by Roche or any of its Affiliates or Sublicensees will be subject to Section 7.3.3 (Milestone Payments for First Achievement of Sales Milestone Event by an [***] Product) and Section 8.6.4 (Share of Recoveries)).

By way of example, the gross-to-net deductions taken in accordance with International Financial Reporting Standards (IFRS) as of the Effective Date include the following:

(a)

credits, reserves or allowances granted for (w) damaged, outdated, returned, rejected, withdrawn or recalled Product, (x) wastage replacement and short-shipments, (y) billing errors and (z) indigent patient and similar programs (e.g., price capitation);

(b)

governmental price reductions and government mandated rebates;

(c)

chargebacks, including those granted to wholesalers, buying groups and retailers;

(d)

customer rebates, including cash sales incentives for prompt payment, cash and volume discounts; and

(e)

taxes, duties and any other governmental charges or levies imposed upon or measured by the import, export, use, manufacture or sale of a Product (excluding income or franchise taxes).

For the purpose of clarity, sales by Roche/Genentech and its Affiliates to any Sublicensee and/or Group Sublicensee that are used for research or Development or re- sold by such Sublicensee or Group Sublicensee as sales under item (ii) below will be excluded from “Sales” calculated under this item (i).

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(ii)

Sublicensee (excluding Compulsory Sublicensee) sales amounts reported to Roche and its Affiliates in accordance with Sublicensee contractual terms and their then currently used accounting standards. For the purpose of clarity, any Sublicensee sales as reported to Roche in accordance with Compulsory Sublicense agreements will be excluded from the Sales amount.

“Step-In Party” has the meaning set forth in Section 8.5.1 (Third-Party Claims Regarding Products).

“Sublicensee” means a Third Party to whom a Party or its Affiliates or Sublicensees has granted a sublicense or license under any Licensed Technology or Roche Technology, as the case may be, licensed to such Party in accordance with the terms of this Agreement.

“Submission” has the meaning set forth in SCHEDULE 7.4.3(a)(ii).

“[***]” has the meaning set forth in Section 7.3.2(b) ([***]).

“[***]” has the meaning set forth in Section 7.3.1(b) ([***]).

“[***]” means either a [***] or a [***], as applicable.

“Success Criteria” means the success criteria for an Ionis Development Candidate for the applicable Program as set out in APPENDIX 3.

“Target” has the meaning set forth in Section 2.1.

“Technology Transfer Plan” has the meaning set forth in Section 3.5 (Technology Transfer Implementation).

“Territory” means worldwide.

“Third Party” means a Person or entity other than the Parties or their respective Affiliates.

“Third Party Obligations” means any financial and non-financial encumbrances, obligations, restrictions, or limitations imposed by an agreement between Ionis and a Third Party that relate to a Product, [***] or [***], including field or territory restrictions, covenants, milestone payments, diligence obligations, sublicense revenue, royalties, or other payments.

“Transferring Party” has the meaning set forth in Section 13.4 (Assignment and Successors).

“Transition Activities” has the meaning set forth in Section 11.5.9 (Transition Activities).

“United States” or “U.S.” means the fifty states of the United States of America and all of its territories and possessions and the District of Columbia.

“Valid Claim” means a claim (i) of any issued, unexpired United States or foreign Patent Right, which will not, in the country of issuance, have been donated to the public, disclaimed, nor held invalid or unenforceable by a court of competent jurisdiction in an unappealed or unappealable decision, or (ii) of any United States or foreign patent application within a Patent Right, which will not, in the country in question, have been cancelled, withdrawn, abandoned nor been pending for more than seven (7) years, not including in calculating such seven-year period of time in which such application is in interference or opposition or similar proceedings or time in which a decision of an examiner is being appealed. Notwithstanding the foregoing, on a country-by-country basis, a patent application pending for more than seven years will not be considered to have any Valid Claim for purposes of this Agreement unless and until a patent meeting the criteria set forth in clause (i) above with respect to such application issues.

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Appendix 2

R&D Plan(s)

[***]

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Appendix 3

Success Criteria

[***]

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Appendix 4

Handoff Data Package Criteria

[***]

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Appendix 5

Relevant Permitted Licenses as of the Effective Date

[***].

10.

[***].

11.

[***].

12.

[***].

13.

[***].

14.

[***].

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Schedule 2.2

[***]

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SCHEDULE 3.4.1(a)

Ionis’ Fully Absorbed Cost of Goods

[***]

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SCHEDULE 7.4.3(a)(ii)

[***]

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SCHEDULE 9.2.4(a)

Representative Ionis Core Technology Patents

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
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A-22

Confidential

Execution Version

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
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[***]	[***]	[***]	[***]	[***]
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A-23

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Execution Version

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
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[***]	[***]	[***]		[***]
[***]	[***]	[***]		[***]
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A-24

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Execution Version

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
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A-25

Confidential

Execution Version

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]		[***]
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A-26

Confidential

Execution Version

Ionis Docket Number	Country/Treaty	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]		[***]
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A-27

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Execution Version

SCHEDULE 9.2.4 (b)

Ionis Manufacturing and Analytical Patents

Ionis Docket Number	Country	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
[***]	[***]	[***]	[***]	[***]
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A-28

Confidential

Execution Version

Ionis Docket Number	Country	Application/ Patent Number	Grant Date	Title
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A-29

Confidential

Execution Version

Ionis Docket Number	Country	Application/ Patent Number	Grant Date	Title
[***]	[***]	[***]		[***]
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Execution Version

SCHEDULE 9.2.4 (c)

Ionis Product-Specific Patents

Ionis File No.	Country	Status	Application No.	Filing Date	Title
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A-31

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Execution Version

Schedule 9.2.6

Prior Agreements

[***].

A-32

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Execution Version

Schedule 11.5.9

Transition Activities

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A-33

Delaware		33-0336973
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

Title of each class		Trading symbol		Name of each exchange on which registered
Common Stock, $.001 Par Value		“IONS”		The Nasdaq Stock Market LLC

Large Accelerated Filer ☒	Accelerated Filer ☐

Non-accelerated Filer ☐	Smaller Reporting Company ☐
	Emerging Growth Company ☐

PART I	FINANCIAL INFORMATION

ITEM 1:	Financial Statements:

	Condensed Consolidated Balance Sheets as of September 30, 2023 (unaudited) and December 31, 2022	3

	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2023 and 2022 (unaudited)	4

	Condensed Consolidated Statements of Comprehensive Loss for the three and nine months ended September 30, 2023 and 2022 (unaudited)	5

	Condensed Consolidated Statements of Stockholders’ Equity for the three and nine months ended September 30, 2023 and 2022 (unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2023 and 2022 (unaudited)	8

	Notes to Condensed Consolidated Financial Statements (unaudited)	9

ITEM 2:	Management’s Discussion and Analysis of Financial Condition and Results of Operations:

	Overview	22

	Critical Accounting Estimates	24

	Results of Operations	24

	Liquidity and Capital Resources	31

ITEM 3:	Quantitative and Qualitative Disclosures about Market Risk	33

ITEM 4:	Controls and Procedures	33

PART II	OTHER INFORMATION	33

ITEM 1:	Legal Proceedings	33

ITEM 1A:	Risk Factors	33

ITEM 2:	Unregistered Sales of Equity Securities and Use of Proceeds	51

ITEM 3:	Default upon Senior Securities	51

ITEM 4:	Mine Safety Disclosures	51

ITEM 5:	Other Information	51

ITEM 6:	Exhibits	52

SIGNATURES		53

	September 30, 2023			December 31, 2022
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	352,060		$	276,472
Short-term investments		1,883,522			1,710,397
Contracts receivable		142,359			25,538
Inventories		25,634			22,033
Other current assets		181,075			168,254
Total current assets		2,584,650			2,202,694
Property, plant and equipment, net		70,928			74,294
Right-of-use assets		174,310			181,544
Deposits and other assets		104,083			75,344
Total assets	$	2,933,971		$	2,533,876

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	5,615		$	17,921
Accrued compensation		33,781			49,178
Accrued liabilities		118,968			140,101
Income taxes payable		31,070			6,249
Current portion of deferred contract revenue		204,824			90,577
Other current liabilities		9,952			7,535
Total current liabilities		404,210			311,561
Long-term deferred contract revenue		249,272			287,768
1.75 percent convertible senior notes, net		561,609			—
0 percent convertible senior notes, net		624,594			622,242
0.125 percent convertible senior notes, net		44,287			544,504
Liability related to sale of future royalties, net		512,700			—
Long-term lease liabilities		173,038			178,941
Long-term obligations		48,801			15,973
Total liabilities		2,618,511			1,960,989
Stockholders’ equity:
Common stock, $0.001 par value; 300,000,000 shares authorized, 143,393,493 and 142,057,736 shares issued and outstanding at September 30, 2023 (unaudited) and December 31, 2022, respectively		143			142
Additional paid-in capital		2,148,002			2,059,850
Accumulated other comprehensive loss		(46,037	)		(57,480	)
Accumulated deficit		(1,786,648	)		(1,429,625	)
Total stockholders’ equity		315,460			572,887
Total liabilities and stockholders’ equity	$	2,933,971		$	2,533,876

2855 Gazelle Court, Carlsbad, California		92010
(Address of Principal Executive Offices)		(Zip Code)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2023			2022			2023			2022
Revenue:
Commercial revenue:
SPINRAZA royalties	$	67,253		$	61,647		$	178,511		$	175,092
Other commercial revenue		16,828			10,763			51,235			47,787
Total commercial revenue		84,081			72,410			229,746			222,879
Research and development revenue:
Collaborative agreement revenue		44,167			69,250			173,513			157,282
Eplontersen joint development revenue		15,959			18,107			59,883			55,317
Total research and development revenue		60,126			87,357			233,396			212,599
Total revenue		144,207			159,767			463,142			435,478

Expenses:
Cost of sales		2,191			1,515			6,071			10,430
Research, development and patent		215,330			182,990			643,070			524,875
Selling, general and administrative		69,951			34,416			161,608			102,345
Total operating expenses		287,472			218,921			810,749			637,650

Loss from operations		(143,265	)		(59,154	)		(347,607	)		(202,172	)

Other income (expense):
Investment income		23,935			7,524			63,355			13,447
Interest expense		(4,203	)		(2,139	)		(8,102	)		(6,391	)
Interest expense related to sale of future royalties		(17,779	)		—			(50,948	)		—
Gain (loss) on investments		(1,943	)		2,347			(1,753	)		(10,616	)
Other income (expense)		2,447			4,713			13,857			(7,923	)

Loss before income tax expense		(140,808	)		(46,709	)		(331,198	)		(213,655	)

Income tax expense		(6,602	)		(283	)		(25,825	)		(3,637	)

Net loss	$	(147,410	)	$	(46,992	)	$	(357,023	)	$	(217,292	)

Basic and diluted net loss per share	$	(1.03	)	$	(0.33	)	$	(2.50	)	$	(1.53	)
Shares used in computing basic and diluted net loss per share		143,317			141,950			143,052			141,782

	Common Stock					Additional			Accumulated Other			Accumulated			Total Stockholders’
Description	Shares			Amount		Paid in Capital			Comprehensive Loss			Deficit			Equity
Balance at June 30, 2022		141,831		$	142	$	2,008,794		$	(54,007	)	$	(1,330,203	)	$	624,726
Net loss		—			—		—			—			(46,992	)		(46,992	)
Change in unrealized losses, net of tax		—			—		—			(8,734	)		—			(8,734	)
Foreign currency translation		—			—		—			(399	)		—			(399	)
Issuance of common stock in connection with employee stock plans		203			—		2,567			—			—			2,567
Stock-based compensation expense		—			—		23,837			—			—			23,837
Payments of tax withholdings related to vesting of employee stock awards and exercise of employee stock options		(17	)		—		(644	)		—			—			(644	)
Balance at September 30, 2022		142,017		$	142	$	2,034,554		$	(63,140	)	$	(1,377,195	)	$	594,361

Balance at June 30, 2023		143,167		$	143	$	2,118,309		$	(50,913	)	$	(1,639,238	)	$	428,301
Net loss		—			—		—			—			(147,410	)		(147,410	)
Change in unrealized losses, net of tax		—			—		—			5,029			—			5,029
Foreign currency translation		—			—		—			(153	)		—			(153	)
Issuance of common stock in connection with employee stock plans		226			—		3,729			—			—			3,729
Stock-based compensation expense		—			—		25,964			—			—			25,964
Balance at September 30, 2023		143,393		$	143	$	2,148,002		$	(46,037	)	$	(1,786,648	)	$	315,460

	September 30, 2023		December 31, 2022
Raw materials:
Raw materials - clinical	$	18,427	$	17,061
Raw materials - commercial		4,380		2,699
Total raw materials		22,807		19,760
Work in process		2,651		2,109
Finished goods		176		164
Total inventory	$	25,634	$	22,033

	September 30, 2023		December 31, 2022
Clinical development expenses	$	89,217	$	116,460
In-licensing expenses		7,560		7,945
Commercial expenses		8,575		3,498
Other miscellaneous expenses		13,616		12,198
Total accrued liabilities	$	118,968	$	140,101

One year or less	72	%
After one year but within two years	20	%
After two years but within three and a half years	8	%
Total	100	%

	Amortized		Gross Unrealized						Estimated
September 30, 2023	Cost		Gains			Losses			Fair Value
Available-for-sale debt securities:
Corporate debt securities (1)	$	535,408	$	13		$	(4,492	)	$	530,929
Debt securities issued by U.S. government agencies		267,503		—			(1,429	)		266,074
Debt securities issued by the U.S. Treasury (1)		520,013		1			(3,027	)		516,987
Debt securities issued by states of the U.S. and political subdivisions of the states		23,906		—			(242	)		23,664
Total debt securities with a maturity of one year or less		1,346,830		14			(9,190	)		1,337,654
Corporate debt securities		195,674		183			(3,160	)		192,697
Debt securities issued by U.S. government agencies		56,365		—			(507	)		55,858
Debt securities issued by the U.S. Treasury		297,501		—			(3,364	)		294,137
Debt securities issued by states of the U.S. and political subdivisions of the states		4,164		53			(51	)		4,166
Total debt securities with a maturity of more than one year		553,704		236			(7,082	)		546,858
Total available-for-sale debt securities	$	1,900,534	$	250		$	(16,272	)	$	1,884,512
Equity securities:
Publicly traded equity securities included in other current assets (2)	$	11,897	$	(1,252	)	$	(4,083	)	$	6,562
Privately held equity securities included in deposits and other assets (3)		23,115		25,001			(5,125	)		42,991
Total equity securities		35,012		23,749			(9,208	)		49,553
Total available-for-sale debt and equity securities	$	1,935,546	$	23,999		$	(25,480	)	$	1,934,065

			Less than 12 Months of Temporary Impairment					More than 12 Months of Temporary Impairment					Total Temporary Impairment
	Number of Investments		Estimated Fair Value		Unrealized Losses			Estimated Fair Value		Unrealized Losses			Estimated Fair Value		Unrealized Losses
Corporate debt securities		370	$	469,095	$	(2,390	)	$	207,073	$	(5,262	)	$	676,168	$	(7,652	)
Debt securities issued by U.S. government agencies		98		293,408		(1,242	)		24,531		(694	)		317,939		(1,936	)
Debt securities issued by the U.S. Treasury		68		557,489		(3,420	)		225,634		(2,971	)		783,123		(6,391	)
Debt securities issued by states of the U.S. and political subdivisions of the states		85		11,644		(73	)		12,973		(220	)		24,617		(293	)
Total temporarily impaired securities		621	$	1,331,636	$	(7,125	)	$	470,211	$	(9,147	)	$	1,801,847	$	(16,272	)

	At September 30, 2023		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)
Cash equivalents (1)	$	269,255	$	269,255	$	—
Corporate debt securities (2)		723,626		—		723,626
Debt securities issued by U.S. government agencies (3)		321,932		—		321,932
Debt securities issued by the U.S. Treasury (2)		811,124		811,124		—
Debt securities issued by states of the U.S. and political subdivisions of the states (2)		27,830		—		27,830
Publicly traded equity securities included in other current assets (4)		6,562		6,562		—
Total	$	2,160,329	$	1,086,941	$	1,073,388

	At December 31, 2022		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)
Cash equivalents (1)	$	211,655	$	211,655	$	—
Corporate debt securities (5)		726,950		—		726,950
Debt securities issued by U.S. government agencies (2)		165,055		—		165,055
Debt securities issued by the U.S. Treasury (2)		748,475		748,475		—
Debt securities issued by states of the U.S. and political subdivisions of the states (2)		74,917		—		74,917
Other municipal debt securities (2)		5,994		—		5,994
Publicly traded equity securities included in other current assets (4)		10,539		10,539		—
Total	$	1,943,585	$	970,669	$	972,916

Proceeds from sale of future royalties	$	500,000
Royalty payments to Royalty Pharma		(27,814	)
Interest expense related to sale of future royalties		50,541
Liability related to sale of future royalties as of September 30, 2023		522,727
Issuance costs related to sale of future royalties		(10,434	)
Amortization of issuance costs related to sale of future royalties as of September 30, 2023		407
Net liability related to sale of future royalties as of September 30, 2023	$	512,700

	1.75% Notes
Outstanding principal balance	$	575.0
Unamortized debt issuance costs	$	13.4
Maturity date	June 2028
Interest rate	1.75 percent
Effective interest rate	2.3 percent
Conversion price per share	$	53.73
Total shares of common stock subject to conversion		10.7

	0% Notes
Outstanding principal balance	$	632.5
Unamortized debt issuance costs	$	7.9
Maturity date	April 2026
Interest rate	0 percent
Effective interest rate	0.5 percent
Conversion price per share	$	57.84
Effective conversion price per share with call spread	$	76.39
Total shares of common stock subject to conversion		10.9

	0.125% Notes
Outstanding principal balance	$	44.5
Unamortized debt issuance costs	$	0.2
Maturity date	December 2024
Interest rate	0.125 percent
Effective interest rate	0.5 percent
Conversion price per share	$	83.28
Effective conversion price per share with call spread	$	123.38
Total shares of common stock subject to conversion		0.5

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2023			2022			2023			2022
Total revenue	$	144.2		$	159.8		$	463.1		$	435.5
Total operating expenses	$	287.5		$	218.9		$	810.7		$	637.7
Loss from operations	$	(143.3	)	$	(59.2	)	$	(347.6	)	$	(202.2	)
Net loss	$	(147.4	)	$	(47.0	)	$	(357.0	)	$	(217.3	)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Investment income	$	23.9	$	7.5	$	63.4	$	13.4

	Payments Due by Period (in millions)
(selected balances described below)	Total		Less than 1 year		More than 1 year
1.75% Notes (principal and interest payable)	$	625.4	$	10.1	$	615.3
0% Notes (principal payable)		632.5		—		632.5
0.125% Notes (principal and interest payable)		44.7		0.1		44.6
Operating leases		284.6		20.3		264.3
Building mortgage payments (principal and interest payable)		10.3		0.5		9.8
Other obligations (principal and interest payable)		0.8		0.1		0.7
Total	$	1,598.3	$	31.1	$	1,567.2

Exhibit Number		Description of Document
10.1		Collaboration and License Agreement by and between the Registrant and Novartis Pharma AG dated as of August 2, 2023. Portions of this exhibit have been omitted because they are both (i) not material and (ii) the type that the Registrant treats as private or confidential.

10.2		Amended and Restated Lease Agreement between the Registrant and Lots 21 & 22 Owner (DE) LLC dated as of August 21, 2023. Portions of this exhibit have been omitted because they are both (i) not material and (ii) the type that the Registrant treats as private or confidential.

10.3		Research, Development, and License Agreement by and among the Registrant, F. Hoffmann-La Roche Ltd., and Hoffmann-La Roche Inc. dated as of September 26, 2023. Portions of this exhibit have been omitted because they are both (i) not material and (ii) the type that the Registrant treats as private or confidential.

31.1		Certification by Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended.

31.2		Certification by Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as amended.

32.1*		Certification Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101		The following financial statements from the Ionis Pharmaceuticals, Inc. Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) condensed consolidated balance sheets, (ii) condensed consolidated statements of operations, (iii) condensed consolidated statements of comprehensive income (loss), (iv) condensed consolidated statements of stockholders’ equity, (v) condensed consolidated statements of cash flows and (vi) notes to condensed consolidated financial statements (detail tagged).

104		Cover Page Interactive Data File (formatted in iXBRL and included in exhibit 101).

Signatures	Title	Date

/s/ BRETT P. MONIA	Director and Chief Executive Officer
Brett P. Monia, Ph.D.	(Principal executive officer)	November 2, 2023

/s/ ELIZABETH L. HOUGEN	Executive Vice President, Finance and Chief Financial Officer
Elizabeth L. Hougen	(Principal financial and accounting officer)	November 2, 2023

TERMS OF LEASE	DESCRIPTION

“Commencement Date”:	The date that is the earlier of: (i) ten (10) months after the Delivery Date, as defined in the Work Letter, or (ii) the date Tenant begins operating in the Premises for business purposes.

“Premises”:	That certain Land described on Exhibit A attached hereto and the Building and other improvements to be constructed thereon, located on Lots 21 & 22, Whiptail Loop W in Carlsbad, 92010 California consisting of approximately 164,757 gross square feet, and the appurtenances thereto, as defined and further described in the Work Letter. The square footage of the Premises set forth above is deemed conclusive and shall not be subject to remeasurement

“Companion Lease”:	That certain lease to be executed between Landlord or its affiliate and Tenant pursuant to the PSA for certain real property located at 2850, 2855 & 2859 Gazelle Court, Carlsbad, 92010 California (the “Companion Premises”) and the buildings consisting of approximately 246,699 square feet and other improvements located thereon and appurtenances thereto, as described therein.

“Term”: (Article 1)	The period commencing on the Commencement Date and ending on the Expiration Date.

“Expiration Date”	The date that is one hundred eighty (180) months after the Commencement Date, together with any Extension Period as to which an Extension Option is exercised under Section 1.4.

“Escalation”: (Article 2)	The percentage of increase, if any, shown by the Consumer Price Index for All Urban Consumers U.S. City Average, All Items (base years 1982-1984 = 100) (“Index”), published by the United States Department of Labor, Bureau of Labor Statistics, for the month immediately preceding the Adjustment Date as compared with the Index for the month immediately preceding the Commencement Date (with respect to the first Adjustment Date), or the month immediately preceding the prior Adjustment Date (for all subsequent Adjustment Dates), but the percentage of increase shall not be less than 2.5% nor greater than 5.5%.

TERMS OF LEASE	DESCRIPTION

“Option to Renew”: (Article 1)	Tenant shall have two (2), five year (5) options at ninety-five percent (95%) of Fair Market Rent.

“Base Rent”: (Article 2)	For the period beginning on the Commencement Date until the first Adjustment Date, a fixed annual amount (payable in monthly installments) determined by multiplying six and thirty-five hundredths percent (6.35%) by the Construction Costs, as defined in the Work Letter, and thereafter the amount calculated pursuant to Section 2.1.3. A hypothetical example of the calculation of Base Rent is shown on Schedule 1, which shall be for illustrative purposes only and shall not be deemed a representation of the actual amounts or categories to be used in the calculation of Base Rent.

“Net Lease”: (Article 2)	Landlord and Tenant acknowledge and agree that this is an “absolute net lease” and that Landlord shall receive the Base Rent during the Term, free from all charges, assessments, impositions, expenses and deductions of any and every kind or nature whatsoever relating to the Premises. Landlord shall have no obligations relating to the repair, maintenance or operation of the Premises, or any part thereof. Tenant shall be solely responsible for same.

“Purchase Option”: (Article 11)	Tenant shall have a right of first offer to purchase the entire Premises.

“Security Deposit/Letter of Credit”: (Article 2)	Tenant shall provide a Letter of Credit equal to the sum of (a) ten (10) months of the initial Base Rent, plus (b) $6,458,200, subject to adjustment as provided in Section 2.5.1. The amount referenced in clause (b) above is referred to as the “Day 2 Improvements Security”.

“Permitted Use”: (Article 3)	Premises may be used solely for biotechnology and other life sciences uses, including research and development, laboratory, manufacturing, assembly, storage, warehousing, office and administrative uses, all of which must be ancillary to biotechnology and other life sciences uses and, in each such case, to the extent Tenant remains in compliance with current zoning for the Premises and all Applicable Laws.

TERMS OF LEASE	DESCRIPTION

“Work Letter”: (Exhibit B)	The “Work Letter” attached hereto as Exhibit B.
“Address of Tenant”: (Article 10)	Ionis Pharmaceuticals, Inc. 2855 Gazelle Ct. Attention: General Counsel Email: [*] With a copy to: Cooley LLP 11951 Freedom Drive Suite 1400 Reston, VA 20190 Attn: Michelle Garcia Schulman, Esq. Email: [*]

TERMS OF LEASE	DESCRIPTION

“Address of Landlord”: (Article 10)	c/o Oxford Property Group 125 Summer Street, 12^th Floor Boston, MA 02110 United States Attn: Kristin Binck, Esq., Vice President, Legal Email: [*] With a copy to: c/o Oxford Property Group 101 Second St, Suite 300 San Francisco, CA 94105 Attn: Abby Mondani and DLA Piper LLP (US) 33 Arch Street, 26^th floor Boston, MA 02110 United States Attn: John L. Sullivan, Esq. Email: [] and all legal notices shall also be sent to: [**]

ARTICLE 1 LEASE OF PREMISES; TERM			1

	1.1	Lease	1
	1.2	As Is; No Representations	1
	1.3	Holdover	2
	1.4	Extension Option	3

ARTICLE 2 RENT			4

	2.1	Base Rent and Additional Rent	4
	2.2	Expenses; Taxes; Insurance Expenses	6
	2.3	Net Lease	8
	2.4	Interest and Late Charge	9
	2.5	Security Deposit	10

ARTICLE 3 USE, COMPLIANCE WITH LAWS, HAZARDOUS MATERIALS, DOGS			13

	3.1	Use	13
	3.2	Compliance with Applicable Laws	13
	3.3	Hazardous Materials	14
	3.4	Alterations	18
	3.5	Jeopardy of Insurance	21
	3.6	Dogs	22
	3.7	LEED Standards	22

ARTICLE 4 REPAIR AND MAINTENANCE; SERVICES			22

	4.1	Tenant Repair and Maintenance Obligations	22
	4.2	Condition of Premises on Surrender	23
	4.3	Services	24

ARTICLE 5 ASSIGNMENT AND SUBLETTING			25

	5.1	General Prohibition on Transfers	25
	5.2	Other Permitted Transfers	27
	5.3	Non-Transfers	27
	5.4	Conditions to Effectiveness	28
	5.5	Miscellaneous	28

ARTICLE 6 INDEMNIFICATION; RELEASE; INSURANCE			30

	6.1	Indemnification and Release	30

	6.2	Insurance	30

ARTICLE 7 THIRD PARTIES			33

	7.1	Subordination, Attornment and Non-Disturbance	33
	7.2	Mortgagee’s Right to Cure	34
	7.3	Sale of the Premises	34
	7.4	Estoppel Certificates	34
	7.5	Liens	35

ARTICLE 8 EVENTS OF DEFAULT & REMEDIES			35

	8.1	Events of Default	35
	8.2	Remedies	37
	8.3	Landlord Default	40
	8.4	Non-Waiver	40

ARTICLE 9 CASUALTY & CONDEMNATION			41

	9.1	Casualty	41
	9.2	Waiver	42
	9.3	Total Condemnation	43
	9.4	Partial Condemnation	43

ARTICLE 10 MISCELLANEOUS			43

	10.1	Notices	43
	10.2	Certain Representations	44
	10.3	Brokers	45
	10.4	No Waivers	45
	10.5	Future Development	45
	10.6	Other Provisions	46
	10.7	Interpretation	48
	10.8	Tenant’s Signage	49
	10.9	Choice of Law	49
	10.10	CASp Inspection	50
	10.11	Landlord Access	50

ARTICLE 11 TENANT’S RIGHT OF FIRST OFFER			51

	11.1	Right of First Offer	51
	11.2	Tenant’s Competitors	52
	11.3	Transfers	52
	11.4	Termination	53
	11.5	Confidentiality	53

ARTICLE 12 LIMITATION OF LIABILITY			54

Schedule 1	Example Showing Calculation of Base Rent

Exhibit A	Legal Description of the Premises

Exhibit B	Work Letter

Exhibit C	Form of Tenant Estoppel Certificate

Exhibit D	Form of Memorandum of Lease

Exhibit E	Form of SNDA

Exhibit F	Form of Non-Disclosure and Confidentiality Agreement

Exhibit G	Landlord Signage

Exhibit H	Commencement and Termination Date Agreement

Exhibit I	Tenant Construction Manual

Exhibit J	Tenant Standard Operating Procedures

LANDLORD:

LOTS 21 & 22 OWNER (DE) LLC, a Delaware limited liability company

By: /s/ Tycho Suter
Name: Tycho Suter
Title: Vice President

By: /s/ Kristen Binck
Name: Kristen Binck
Title: Vice President

TENANT:

IONIS PHARMACEUTICALS, INC., a Delaware corporation

By: /s/ Elizabeth L. Hougen
Name: Elizabeth L. Hougen
Title: CFO

	CFM/SF (Supply)	CFM/SF (Exhaust)	Heating Loads (MBH)	Cooling Tons
Typical 40/60 Lab Office Ratio	1.52	0.93	5357	1040
Typical 50/50 Lab Office Ratio	1.6	1.15	5830	1163

If to Tenant:
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If to Landlord:
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