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the ReGenX License, ReGenX granted us an exclusive, worldwide license under the licensed patent rights to make, have made, use, import, sell and offer for sale any products covered by the ReGenX
License, or ReGenX licensed products, in the field of the treatment of spinal muscular atrophy in humans by in vivo gene therapy using AAV9 subject to certain rights reserved by ReGenX and its
licensors. The patent rights exclusively in-licensed include an issued United States patent, which expires September 2024, not including 473 days of patent term adjustment (as well as issued
patents in Europe, Japan, Australia, Canada, New Zealand and China, which expire in 2024). These issued patents claim AAV9 vectors and viruses having an AAV9 capsid, as well as methods of use. In
addition, the in-licensed patent rights include pending patent applications in the United States, Canada, China, Europe and Japan, that if issued as patents, will expire in 2024. These pending
applications claim AAV9 vectors and viruses having an AAV9 capsid, as well as its use in treatment. We have the right to sublicense the licensed technology to third parties subject to certain
conditions as specified in the ReGenX License. Under the ReGenX License we grant a non-exclusive, worldwide, royalty-free, transferable, sublicenseable, irrevocable, perpetual license back to ReGenX
to (a) use any patentable modifications and improvements to the licensed technology that we or our affiliates or sublicensees develop, or licensed back improvements, and (b) to practice
the licensed back improvements in connection with AAV9 outside of our field of use.
the terms of the ReGenX License, we paid or are required to pay:
- an initial fee of $2.0 million;
- an annual maintenance fee;
- up to $12.25 million in milestone fees for all ReGenX licensed products;
- mid-single digit to teen royalty percentages on net sales of ReGenX licensed products, subject to reduction in specified
- lower mid-double digit percentages of any sublicense fees we receive from sublicensees for the licensed intellectual property rights.
of December 31, 2015, we have paid $2.3 million under the ReGenX License, which includes $0.3 million in aggregate milestone payments.
ReGenX License requires us to use commercially reasonable efforts to develop, commercialize, market, promote and sell products utilizing the licensed patent rights in our field of
use. We are obligated to achieve certain development milestones with respect to the licensed disease indication. We do not have the right to control prosecution of the in-licensed patent applications,
and our rights to enforce the in-licensed patents are subject to certain limitations. In addition, our rights under the ReGenX License are not assignable without the prior written consent of ReGenX.
license agreement with ReGenX will expire upon the expiration, lapse, abandonment or invalidation of the last claim of the licensed intellectual property to expire, lapse or become
abandoned or unenforceable in all the countries of the world. We have the right to terminate the ReGenX License upon a specified period of prior written notice. ReGenX may terminate the ReGenX License
if we or our affiliates become insolvent, if we are greater than a specified number of days late in paying money due under the ReGenX License, or, effective immediately, if we or our affiliates, or
sublicensees commence any action against ReGenX or its licensors to declare or render any claim of the licensed patent rights invalid or unenforceable. Either party may terminate the ReGenX License
for material breach if such breach is not cured within a specified number of days. Upon termination of the agreement, other than for ReGenX's material breach, we grant to ReGenX a non-exclusive,
perpetual, irrevocable, worldwide, royalty-free, transferable, sublicenseable license under patentable modifications
and improvements to any vector claimed by the licensed patents for use by ReGenX for the research, development and commercialization of products in any therapeutic indication.