Article 1 Definitions

1

Article 2 Licenses

25

Article 3 Governance

33

Article 4 Development

45

Article 5 Regulatory AND REIMBURSEMENT

58

Article 6 Commercialization

66

Article 7 MEDICAL AFFAIRS

70

Article 8 MANUFACTURING

72

Article 9 Payments

78

Article 10 Intellectual Property Matters

88

Article 11 Representations, Warranties, and Covenants

95

Article 12 Indemnification

103

Article 13 Confidentiality

106

Article 14 Term and Termination

110

Article 15 Effects of Termination

112

Article 16 Dispute Resolution

117

Article 17 Miscellaneous

119

1.1.

“Accounting Standards” means with respect to Apellis and its Affiliates and sub/licensees, GAAP, with respect to Sobi and its Affiliates, IFRS, and, with respect to Sublicensees and Functional Sublicensees, IFRS or GAAP, as applicable, in each case as generally and consistently applied throughout the Party’s, Affiliate’s, sub/licensees, Sublicensee’s, or Functional Sublicensee’s organization.  Each Party will promptly notify the other Party if such Party or any of its Affiliates, Sublicensees, Functional Sublicensees, or sub/licensees changes the Accounting Standards pursuant to which its records relating to this Agreement are maintained; provided, however, that each Party and its Affiliates and each Sublicensee and Functional Sublicensee and each sub/licensee may only use internationally recognized accounting principles (e.g., IFRS or GAAP).

1.2.

“Additional Global Development Activities” has the meaning set forth in Section 4.4.4(a)(i) (JEC Approval).

1.3.

“Additional Development” has the meaning set forth in Section 4.4.4 (Additional Development).

1.4.

“Additional Development Activities” has the meaning set forth in Section 4.4.4 (Additional Development).

1.5.

“Additional Development Proposal” has the meaning set forth in Section 4.4.4 (Additional Development).

1.6.

“Additional Third Party IP” has the meaning set forth Section 2.3 (New In-Licenses).

1.7.

“Adverse Event” has the meaning set forth in 21 C.F.R. § 312.32, or any equivalent Applicable Law in any relevant country or region, and generally means any untoward medical occurrence associated with the use of a product in human subjects, whether or not considered related to such product. An Adverse Event does not necessarily have a causal relationship with a product, but rather can be any unfavorable and unintended sign (including an abnormal laboratory finding), symptom, or disease temporally associated with the use of such product.

1.8.

“Affiliate” of a Person means any other Person that (directly or indirectly) is Controlled by, Controls, or is under common Control with such Person.  

1.9.

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

1.10.

“Alliance Manager” has the meaning set forth in Section 3.1.1 (Alliance Managers).

1.11.

“ALS” means amyotrophic lateral sclerosis.

1.12.

“Alternate Supplier” has the meaning set forth in Section 8.3.2(a) (Manufacturer Know-How).

1.13.

“[**]” means [**].

1.14.

“[**] APL-1 Agreement” means the [**] Agreement by and between Apellis US and [**], dated as of [**].

1.15.

“[**] APL-2 Agreement” means the [**] Agreement by and between Apellis US and [**], dated as of [**].

1.16.

“Apellis” has the meaning set forth in the Preamble.

1.17.

“Apellis Know-How” means any and all Know-How, including, for clarity, the Manufacturing Know-How, that is (a) Controlled by Apellis or any of its Affiliates as of the Effective Date or during the Term, including Apellis’ interest in the Joint Know-How, and (b) necessary or useful for the Exploitation of any Compound or Product in the Sobi Territory. Notwithstanding anything in this Agreement to the contrary, Apellis Know-How shall not include (x) any Know-How licensed by Apellis or any of its Affiliates from [**], including pursuant to the [**] Agreement, except to the extent that the Parties agree to incorporate any such Know-How into any Product Developed under the Global Development Plan, (y) any Additional Third Party IP in-licensed by Apellis or any of its Affiliates under an agreement that Sobi does not agree to make a Collaboration In-License pursuant to Section 2.3 (New In-Licenses), or (z) any Know-How to the extent Controlled by any Person that acquires all or any part of Apellis or an Affiliate of Apellis, or any Affiliate of such Person, except to the extent that, following such acquisition, the Parties specifically agree to incorporate such Know-How into any Product Developed under the Global Development Plan, in each case (i) that is Controlled, immediately prior to the effective date of the acquisition, by such Person or any of its Affiliates (other than Apellis or any of its Affiliates immediately prior to the effective date of the acquisition) or (ii) that is Controlled by such Person or any of its Affiliates (other than Apellis or any of its Affiliates immediately prior to the

effective date of the acquisition) on or after the effective date of acquisition but (A) is not Controlled by Apellis or any Person that was an Affiliate of Apellis immediately prior to the effective date of the acquisition, (B) is made, invented, created, designed, conceived, produced, or otherwise developed or obtained without the use of or reliance on any Apellis Confidential Information or Sobi Confidential Information, and (C) is not utilized by or on behalf of Apellis or its Affiliates in connection with the Exploitation of a Product. For clarity, subject to clauses (x)-(z) above, the Apellis Know-How shall include Know-How Controlled by Apellis or any of its Affiliates related to any Non-Systemic Ophthalmology Product to the extent such Know-How is necessary or useful to the Exploitation of any Compound or Product in the Sobi Territory.

1.18.

“Apellis’ Knowledge” means, for the purposes of Sections 11.3.10 (Additional Representations and Warranties of Apellis), 11.3.11 (Additional Representations and Warranties of Apellis), and 11.3.22 (Additional Representations and Warranties of Apellis) only, to the knowledge of any or all of [**] after making reasonable enquiries of such persons’ direct reports.

1.19.

“Apellis Patent Right” means any Patent Right that (a) is Controlled by Apellis or any of its Affiliates as of the Effective Date or during the Term, including Apellis’ interest in the Joint Patent Rights, and (b) Covers the Exploitation of any Compound or Product.  As of the Effective Date, the Apellis Patent Rights include those Patent Rights identified on Schedule 1.19 (Apellis Patent Rights), but any Patent Right that meets the definition of Apellis Patent Rights will constitute an Apellis Patent Right under this Agreement, notwithstanding any failure to identify such Patent Right on Schedule 1.19 (Apellis Patent Rights). Notwithstanding anything in this Agreement to the contrary, Apellis Patent Rights shall not include (x) any Patent Rights licensed by Apellis or any of its Affiliates from [**], including pursuant to the [**] Agreement, except to the extent that the Parties agree to incorporate any Know-How Covered by any such Patent Right into any Product Developed under the Global Development Plan, (y) any Additional Third Party IP in-licensed by Apellis or any of its Affiliates under an agreement that Sobi does not agree to make a Collaboration In-License pursuant to Section 2.3 (New In-Licenses), or (z) any Patent Right to the extent Controlled by any Person that acquires all or any part of Apellis or an Affiliate of Apellis, or any Affiliate of such Person, except to the extent that, following such acquisition, the Parties specifically agree to incorporate any technology or invention Covered or claimed by such Patent Right into any Product Developed under the Global Development Plan, in each case (i) that is Controlled, immediately prior to the effective date of the acquisition, by such Person or any of its Affiliates (other than Apellis or any of its Affiliates immediately prior to the effective date of the acquisition) or (ii) that is Controlled by such Person or any of its Affiliates (other than Apellis or any of its Affiliates immediately prior to the effective date of the acquisition) on or after the effective date of acquisition but is not Controlled by Apellis or any Person that was an Affiliate of Apellis immediately prior to the effective date of the acquisition and Covers or claims an invention that was invented without the use of or reliance on any Apellis Confidential Information or Sobi Confidential Information. For clarity, subject to clauses (x)-(z) above, the Apellis Patent Rights shall include Patent Rights Controlled by Apellis or any of its Affiliates related to any Non-Systemic Ophthalmology Product to the extent such Patent Rights Cover the Exploitation of a Compound or Product.

1.20.

“Apellis Readiness Activities” has the meaning set forth in Section 4.3.6 (Development Diligence Obligations).

1.21.

“Apellis Retained Rights” has the meaning set forth in Section 2.1.2(c) (No Implied Licenses; Retained Rights).

1.22.

“Apellis Supply Agreement(s)” means the Manufacture and supply agreement(s) entered into by Apellis (or its applicable Affiliate(s)) and a Third Party contract manufacturer(s), pursuant to which such manufacturer(s) will Manufacture and supply to Apellis commercial quantities of Compounds or Products.  

1.23.

“Apellis Technology” means all Apellis Patent Rights and Apellis Know-How.

1.24.

“Apellis Territory” means the U.S.

1.25.

“Apellis Territory Regional Development Activities” means all Development activities, other than the Global Development Activities, conducted by or on behalf of Apellis to support Regulatory Approval of any Product in the Apellis Territory.

1.26.

“Apellis Territory Regional Development Plan” has the meaning set forth in Section 4.4.2 (Apellis Territory Regional Development Plan).

1.27.

“APL-9” means any compound composed of two (2) symmetric pentadecapeptide, combining a cyclic tridecapeptide active C3-inhibiting moiety and a 2-amino acid linker, covalently bound to the ends of a linear PEG10 molecule, as further described in Schedule 1.27.  The average molecular weight of APL-9 is approximately 13.8kDa.

1.28.

“Applicable Law” means all applicable laws, statutes, rules, regulations, and other pronouncements having the effect of law of any Governmental Authority that may be in effect from time to time, including any applicable securities or market abuse rules or regulations or any applicable rules, regulations, guidances, and other requirements of any Regulatory Authority that may be in effect from time to time, including, for clarity, all applicable Data Protection Laws.

1.29.

“Assigned Manufacturer IP” means (a) under the [**] Agreement, all technology, Apellis Supplied Materials (as defined in the [**] Agreement), know-how, inventions, discoveries, ideas, concepts, trade-secrets, improvements, processes, process improvements, information, Specifications (as defined in the [**] Agreement), analytical test methods, CMC Documentation (as defined in the [**] Agreement), Drug Master Files (as defined in the [**] Agreement) or data, whether patentable or not, which is specifically related to the Drug Substance or Drug Product (each as defined in the [**] Agreement), or arise from the Services (as defined in the [**] Agreement), and is not generally applicable to the field of peptide manufacturing, and any Apellis intellectual property rights therein; (b) under the [**] Agreement, all technology, know-how, inventions, discoveries, ideas, concepts, trade-secrets, improvements, processes, process improvements, information, or data, whether patentable or not, which are related to the Drug Substance or Drug Product (each as defined in the [**] Agreement), including those that arise from the Services (as defined in the [**] Agreement), and any intellectual property rights therein; (c) under the [**] Agreement, any intellectual property discovered or developed by [**] or jointly with Apellis US in the performance of the Services (as defined in the [**] Agreement), that is specific to and not severable from the Product (as defined in the [**] Agreement); (d) under the [**] APL-1 Agreement, all technology, know-how, inventions, discoveries, ideas, concepts, trade secrets, improvements, processes, process improvements, information, or data, whether patentable or not, which are related to the API or Drug Product (each as defined in the [**] APL-1 Agreement), or arise from the Services (as defined in the [**] APL-1 Agreement); and (e) under the [**] APL-2 Agreement, all technology, know-how, inventions, discoveries, ideas, concepts, trade secrets, improvements, processes, process improvements, information, or data, whether patentable or not, which are related to the API or Drug Product (each as defined in the [**] APL-2 Agreement), provided by Apellis under the [**] APL-2 Agreement, and any intellectual property rights therein.

1.30.

“[**]” means [**].

1.31.

“[**] Agreement” means the [**] Agreement for APL-2 by and between Apellis US and [**], dated as of [**].

1.32.

“[**] IP” means all intellectual property (including trademarks), including all data, information, reports, manufacturing know-how and any and all related documentation, which are (a) developed, generated or derived, directly or indirectly by or on behalf of [**] prior to the effective date of the [**] Agreement or (b) any manufacturing know-how developed or generated by [**] during the term of the [**] Agreement that is generally applicable to the field of peptide manufacturing and not specific to the Drug Substance or Drug Product (each as defined in the [**] Agreement) or Apellis’ Confidential Information (as defined in the [**] Agreement).

1.33.

“Business Day” means any day other than a Saturday, Sunday, or bank or other public holiday in Boston, Massachusetts or in Stockholm, Sweden.

1.34.

“C3G” means C3 glomerulopathy and IC-MPGN (Immune complex Membranoproliferative glomerulonephritis).

1.35.

“CAD” means cold agglutinin disease.

1.36.

“Calendar Quarter” means the respective periods of three consecutive calendar months ending on March 31^st, June 30^th, September 30^th, or December 31^st in any Calendar Year; except that (a) the first Calendar Quarter shall begin on the Effective Date and end on December 31, 2020, and (b) the final Calendar Quarter shall end on the last day of the Term.

1.37.

“Calendar Year” means any calendar year beginning on January 1^st and ending on December 31^st; except that (a) the first Calendar Year shall begin on the Effective Date and end on December 31, 2020, and (b) the final Calendar Year shall end on the last day of the Term.

1.38.

“Change of Control” of a Party means any of the following, in a single transaction or a series of related transactions:  (a) the sale or disposition of all or substantially all of the assets of such Party to a Third Party, (b) the direct or indirect acquisition by a Third Party (other than an employee benefit plan (or related trust) sponsored or maintained by such Party or any of its Affiliates) of beneficial ownership of more than fifty percent (50%) of the then-outstanding common shares or voting power of such Party or any direct or indirect entity which holds, directly or indirectly, beneficial ownership of more than fifty percent (50%) of the then-outstanding common shares or voting power of such Party (a “Parent Entity”), (c) the merger or consolidation of such Party or any Parent Entity with or into a Third Party, unless, following such merger or consolidation, the stockholders of such Party or Parent Entity immediately prior to such merger or consolidation 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 merger or consolidation or (d) a change in the possession, directly or indirectly, of the power to direct, or cause the direction of, the management or policies of such Person, whether through the ownership of voting securities, by contract, or otherwise. With respect to a Change of Control of Apellis, a Change of Control shall refer to a Change of Control of any of Apellis US, Apellis GmbH or Apellis LLC.

1.39.

“Challenge” has the meaning set forth in Section 14.3 (No Patent Challenge).

1.40.

“Clinical Trial” means any clinical trial for a compound or product in humans that is designed to generate data in support or maintenance of a Drug Approval Application or Regulatory Approval,

including any post-approval clinical trial in humans, but excluding any investigator-sponsored clinical trial.

1.41.

“CMC” means Chemistry, Manufacturing, and Controls.

1.42.

“Collaboration In-License” has the meaning set forth in Section 2.3 (New In-Licenses).

1.43.

“Collaboration Know-How” means any Know-How that is made, invented, conceived, discovered, developed, or otherwise generated in the performance of activities under this Agreement during the Term, including, for clarity, activities under the Global Development Plan, the Apellis Territory Regional Development Plan, the Sobi Territory Regional Development Plan, or otherwise.

1.44.

“Collaboration Patent Right” means any Patent Right Covering or claiming any Collaboration Know-How.

1.45.

“Combination Product” means a Product that is regulated or sold in the form of a combination that contains or comprises a Compound together with one (1) or more other therapeutically active pharmaceutical agents (whether coformulated or copackaged or otherwise sold for a single price).

1.46.

“Combination Therapy Data” has the meaning set forth in Section 4.8.1(b)(ii) (Combination Therapy Data).

1.47.

“Combination Therapy Development” has the meaning set forth in Section 4.8.1 (Combination Therapy Proposal).

1.48.

“Combination Therapy Development Activities” has the meaning set forth in Section 4.8.1 (Combination Therapy Proposal).

1.49.

“Combination Therapy Development Proposal” has the meaning set forth in Section 4.8.1 (Combination Therapy Proposal).

1.50.

“Combination Therapy Global Development Activities” has the meaning set forth in Section 4.8.1(a)(i) (Combination Therapy Proposal).

1.51.

“Commercial Milestone Event” has the meaning set forth in Section 9.4 (Commercial Milestones).

1.52.

“Commercial Milestone Payment” has the meaning set forth in Section 9.4 (Commercial Milestones).

1.53.

“Commercialization,” means any and all activities directed to the launch, marketing, promotion, detailing, distribution, offering for sale, sale, having sold, importing, or exporting (including having imported or having exported) for purposes of commercialization, or other commercialization, of a pharmaceutical product, including interacting with Governmental Authorities regarding any of the foregoing and seeking Reimbursement Approval (as applicable); but excluding activities directed to Manufacturing, Development, or Medical Affairs (except that sponsorships may be conducted as Commercialization activities or Medical Affairs activities).  “Commercialize,” “Commercializing,” “Commercialization” and “Commercialized” will be construed accordingly.

1.54.

“Commercially Reasonable Efforts” means, with respect to efforts and resources to be expended by a Party to achieve an agreed objective, such reasonable, diligent, and good faith efforts and resources as such Party would normally use to accomplish a similar objective under similar circumstances taking into account the responsible allocation of such Party’s resources under the circumstances, including, with respect to a Party’s obligation to Develop or Commercialize a Product, those efforts and resources consistent with the exercise of prudent scientific and business judgment as applied by an entity of similar size and resources to such Party to the Development or Commercialization (as applicable) of its own products that are at a similar stage of Development or Commercialization and have similar market potential, taking into account performance of other products, competitiveness of Third Party products, efficacy, safety, patent and regulatory exclusivity, anticipated or approved labelling, present and future market potential, competitive market conditions and the profitability of the product in light of pricing and reimbursement issues. Commercially Reasonable Efforts shall be determined on a market-by-market and Indication-by-Indication basis, and it is anticipated that the level of efforts required may be different for different markets and Indications and may change over time, reflecting changes in the status of the Product and markets involved.

1.55.

“Committee” means the JEC and each subcommittee thereof, including the JDC, JMSC, JMC, and JCC.

1.56.

“Competitive Infringement” has the meaning set forth in Section 10.3.1 (Notice).

1.57.

“Compound” means the compound known as APL-2 (pegcetacoplan) or any compstatin analogue or derivative, in each case with systemic half-life (i.e., terminal half-life of a dose administered by IV) in humans greater than or equal to that of APL-2 as further described in Schedule 1.57.  For the avoidance of doubt, “Compound” excludes APL-9.

1.58.

“Confidential Information” has the meaning set forth in Section 13.1 (Confidential Information).

1.59.

“Control” or “Controlled” means: (I) with respect to any Intellectual Property, the possession by a Party or any of its Affiliates (whether by ownership, license, or otherwise, other than pursuant to this Agreement) of (a) with respect to any tangible Know-How, the legal authority or right to physical possession of such tangible Know-How, with the right to provide such tangible Know-How to the other Party on the terms set forth herein, or (b) with respect to Patent Rights, Regulatory Approvals, Reimbursement Approvals, Regulatory Submissions, Reimbursement Submissions, intangible Know-How, or other Intellectual Property, the legal authority or right to assign, or grant a license, sublicense, access, authorization, or right to use (as applicable) to the other Party under, such Patent Rights, Regulatory Approvals, Reimbursement Approvals, Regulatory Submissions, Reimbursement Submissions, intangible Know-How, or other Intellectual Property on the terms set forth herein, in each case ((a) and (b)), without breaching or otherwise violating the terms of any arrangement or agreement with a Third Party in existence as of the time such Party or its Affiliates would first be required hereunder to grant the other Party such assignment, access, authorization, right to use, license, or sublicense; and (II) (including, with correlative meanings, the terms “Controlled by” and “under common Control with”), as used with respect to a Person in the definitions of “Affiliate,” means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management or policies of such Person, whether through the ownership of voting securities, by contract, or otherwise, and “Control” will be presumed to exist if either of the following conditions is met: (a) in the case of a corporate entity, direct or indirect ownership of voting securities entitled to cast at least fifty percent (50%) of the votes in elections of directors, or (b) in the case of a non-corporate entity, direct or indirect ownership of at least fifty percent (50%) of the equity interests with the power to direct the management and policies of such entity.

1.60.

“Cover,” “Covering,” or “Covered” means, with respect to a product, technology, process, method, or mode of administration that, in the absence of ownership of, or a license granted under, a particular claim in a patent or patent application, the manufacture, use, offer for sale, sale, or importation of such product, or the practice of such technology, process, method, or mode of administration, would infringe such claim or, in the case of a claim that has not yet issued, would infringe such claim if it were to issue.

1.61.

“CTA” means a Clinical Trial Application in the countries that are officially recognized as member states of the European Union.

1.62.

“Data Protection Laws” means all Applicable Laws related to data protection and privacy, including the EU Data Protection Laws, the Health Insurance Portability and Accountability Act of 1996, and any supranational, federal, state, or national legislation relating to Personally Identifiable Information or privacy that is applicable to a Party relating to the processing of Personally Identifiable Information.

1.63.

“Debarred” has the meaning set forth in Section 11.1.6 (Mutual Representations and Warranties of the Parties).

1.64.

“Defending Party” has the meaning set forth in Section 10.2.2(c) (Defense of Patent Rights).

1.65.

“Deliverables” means any and all deliverables to be generated or provided by or on behalf of a Party in connection with the performance of any activities set forth in the Global Development Plan.

1.66.

“Develop” or “Development” means all internal and external research, development, and regulatory activities related to pharmaceutical products, including (a) research, toxicology, non-clinical, and preclinical testing and activities, Clinical Trials, drug substance and drug product process development, product and process characterization, product and process qualification and validation, qualification and validation and stability testing of product from development, qualification, or validation batches, quality assurance and quality control of development, qualification, or validation batches, clinical studies, statistical analysis, and report writing and (b) preparation, submission, review, and development of data or information for the purpose of submission to a Regulatory Authority to obtain authorization to conduct Clinical Trials or to obtain, support, or maintain Regulatory Approval of a pharmaceutical product, and interacting with Regulatory Authorities following receipt of Regulatory Approval in the applicable country or region for such pharmaceutical product regarding the foregoing, including all other activities necessary or reasonably useful or otherwise requested or required by a Regulatory Authority as a condition or in support of obtaining or maintaining a Regulatory Approval, but expressly excluding activities directed to Manufacturing, Medical Affairs, or Commercialization. Development will include any Clinical Trials to be conducted after receipt of Regulatory Approval (such as post-marketing studies and observational studies) and development and regulatory activities for additional forms, formulations, or Indications for a pharmaceutical product after receipt of Regulatory Approval of such product (including label expansion).  Further, Development will include importing or exporting (including having imported or having exported) pharmaceutical products for purposes of development. “Developing,” “Development” and “Developed” will be construed accordingly.

1.67.

“Development FTE Costs” means, for a given period, the Development FTE Rate multiplied by the number of FTEs actually expended to conduct Development activities under this Agreement during such period.  FTEs will be pro‑rated on a daily basis if necessary.

1.68.

“Development FTE Rate” means [**] dollars ($[**]) per FTE for the Calendar Year 2020. The Development FTE Rate shall be adjusted for each Calendar Year commencing with the Calendar Year 2021 and, unless otherwise agreed in writing by the Parties, shall be the prior year’s rate, increased or decreased by the relevant percentage increase or decrease based on the Employment Cost Index provided by the U.S. Department of Labor (Series ID: CIU 1010000000000A); except that the Development FTE Rate in any given Calendar Year may not increase by an amount more than [**] percent ([**]%) of the prior year’s Development FTE Rate.

1.69.

“Development Milestone Event” has the meaning set forth in Section 9.3 (Development Milestones).

1.70.

“Development Milestone Payment” has the meaning set forth in Section 9.3 (Development Milestones).

1.71.

“Development Reimbursement Payments” has the meaning set forth in Section 9.2 (Development Reimbursement Payments).

1.72.

“Disclosing Party” has the meaning set forth in Section 13.1 (Confidential Information).

1.73.

“Disputes” has the meaning set forth in Section 16.3 (Resolution by Executive Officers).

1.74.

“Dollar” means the U.S. dollar, and “$” or “USD” will be interpreted accordingly.

1.75.

“Drug Approval Application” means any marketing authorization application, in each case, filed with the applicable Regulatory Authority in a country or other regulatory jurisdiction, which application is required to market or sell a pharmaceutical product in such country or jurisdiction (and any amendments thereto), including all NDAs and any analogous application or submission with any Regulatory Authority outside of the U.S., including, with respect to the European Union, MAAs.

1.76.

“DTPA” means that certain Data Transfer and Processing Agreement entered into by the Parties on the Effective Date.

1.77.

“Effective Date” has the meaning set forth in the Preamble.

1.78.

“EMA” means the European Medicines Agency and any successor agency thereto and, with respect to any Regulatory Approval in the European Union, includes the European Commission.

1.79.

“EMA PNH Regulatory Approval” means the first Drug Approval Application (and associated orphan drug designation and pediatric investigation plan) filed with the EMA for the first Product in PNH.

1.80.

“[**]” means [**].

1.81.

“[**] Agreement” means the [**] Agreement by and between Apellis US and [**], dated as of [**].

1.82.

“[**]” means [**].

1.83.

“[**] Agreement” means that certain [**] Agreement, dated as of [**], by and between Apellis and [**], as amended from time to time.

1.84.

“[**]” means [**].

1.85.

“[**] Agreement” means the [**] Agreement for Activated PEG by and between Apellis US and [**] dated as of [**].

1.86.

“Executive Officer” has the meaning set forth in Section 3.7.2 (Escalation to JEC).

1.87.

“Existing Agreements” means (a) the SFJ Agreement and (b) the Penn Other Fields License Agreement.

1.88.

“Existing CDA” means the Confidentiality Agreement by and between Apellis Pharmaceuticals, Inc. and Sobi, dated as of [**], as amended by Amendment No. 1 to Confidentiality Agreement, dated as of [**].

1.89.

“Existing Manufacturing Agreement” means each of (a) the [**] Agreement, (b) the [**] Agreement, (c) the [**] Agreement, (d) the [**] Agreement, (e) the [**] APL-1 Agreement, and (f) the [**] APL-2 Agreement.

1.90.

“Exploit” means to Develop, have Developed, make, have made, use, have used, perform Medical Affairs, have performed Medical Affairs, offer for sale, have offered for sale, sell, have sold, export, have exported, import, have imported, Manufacture, have Manufactured, Commercialize, have Commercialized, or otherwise exploit.  “Exploitation” and “Exploiting” will be construed accordingly.

1.91.

“EU Data Protection Law” means the EU General Data Protection Regulation 2016/679 (“GDPR”) (and its derivatives), Directive 2002/58/EC (as transposed into domestic legislation of each European Union Member State or Member State of the EEA) and any other applicable data protection laws, regulations, codes of practice, codes of conduct, guidance issued by any relevant Supervisory Authority in the relevant European Union Member State or Member State of the EEA relating to the protection of natural persons with regard to Personal Data, privacy, or amending, implementing, replacing, or superseding any of the foregoing and including, for clarity, the UK Data Protection Act 2018 and any implementing, replacing or superseding laws of the United Kingdom as a result of the exit by the United Kingdom from the European Union, or, and to the extent applicable, the applicable data protection or privacy laws of any other country including, without limitation, Switzerland.

1.92.

“Failure to Supply” means  (a) Apellis’ (i) failure to deliver under the Supply Agreement at least [**] percent ([**]%) of Compound or Product in a Purchase Order on at least [**] occasions or (ii) delivery delays beyond the applicable Delivery Date(s) under the Supply Agreement for Purchase Orders of at least [**] in the aggregate, in each case ((i) and (ii)) in any consecutive [**] period in a Calendar Year or (b) an interruption in the supply of Compound or Product to Sobi under the Supply Agreement that directly results in an outage of Compound or Product in the Sobi Territory of at least [**] through no breach by Sobi of its obligations under the Supply Agreement that causes, or directly results in, such outage.

1.93.

“FD&C Act” means the U.S. Federal Food, Drug, and Cosmetic Act, 21 U.S.C. § 301 et seq., as amended from time to time, together with any rules, regulations, and requirements promulgated thereunder (including all additions, supplements, extensions, and modifications thereto).

1.94.

“FDA” means the U.S. Food and Drug Administration and any successor thereto.

1.95.

“Field” means any and all uses, applications, and Indications.

1.96.

“Finished Form” means a Product supplied in finished form, ready for distribution in an applicable country in compliance with all Applicable Law in such country at the relevant time, including all applicable primary, secondary, or tertiary packaging and labeling of such Product (in its commercial packaging presentation) for sale or use in the applicable country, including: (a) the Regulatory Authority-approved full prescribing information for such Product in the applicable country; (b) the Regulatory Authority-approved labels and other written, printed, or graphic materials on any container, wrapper, or any package insert that is used with or for such Product in such country; and (c) insertion of materials such as patient inserts, patient medication guides, and professional inserts, and any other written, printed, or graphic materials accompanying such Product, including any additional information and materials necessary to comply with serialization requirements in the applicable country, and any brand security or anti-counterfeiting measures included in the packaging elements for such Product considered to be part of the finished packaged Product, and all testing and release thereof.

1.97.

“First Commercial Sale” means, with respect to a Product in a country, the first sale of such Product by a Party, its Affiliates, sub/licensees, or Sublicensees to a Third Party (other than a sub/licensee or Sublicensee) for sale to, or use or consumption by, an end user in such country following Regulatory Approval and, to the extent required, Reimbursement Approval of such Product in such country, excluding any such sales of a Product to Third Parties for any expanded access program or compassionate sales or use program (including any named patient program or single patient program), and excluding any transfers of a Product to Third Parties for the performance of Clinical Trials.

1.98.

“FTE” means a qualified full time person, or more than one person working the equivalent of a full-time person, where “full time” is based upon a total of [**] working hours per Calendar Year of Development or Manufacturing work carried out by one (1) or more duly qualified employees of a Party.  Overtime, and work on weekends, holidays, and the like will not be counted with any multiplier (e.g., time-and-a-half or double time) toward the number of hours that are used to calculate the FTE contribution. The Parties may agree to utilize fractions of FTEs, if applicable.

1.99.

“Functional Sublicensee” means, on a Product-by-Product and country-by-country basis in the Sobi Territory, a Subcontractor appointed as distributor by Sobi or any of its Affiliates or Sublicensees of a Product in such country where (a) such Subcontractor is primarily responsible for Commercialization activities with respect to such Product in such country and (b) the gross amount invoiced to such Subcontractor by Sobi or any of its Affiliates or Sublicensees with respect to such Product in such country is less than [**] percent ([**]%) of the gross amount invoiced by such Subcontractor to Third Parties for such Product in such country (but, if such amount is not available to Sobi despite Sobi having used Commercially Reasonable Efforts to obtain it, and the Parties are unable to agree upon such amount, the Parties shall submit such dispute for resolution to a mutually agreed independent accounting expert, whose decision will be final and binding on the Parties).  

1.100.

“GAAP” means U.S. generally accepted accounting principles, which principles are used at the relevant time and consistently applied by the applicable Person.

1.101.

“GDPR” shall mean Regulation 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data.

1.102.

“Global Branding Strategy” means the global messaging and branding strategy established in accordance with this Agreement for each Product throughout the world for at least the following [**], including with respect to positioning, messaging, branding, packaging, and labeling (including logo, colors, and other visual branding elements).

1.103.

“Global Development Activities” means all Development activities conducted under the Global Development Plan. For clarity, Global Development Activities do not include the Apellis Territory Regional Development Activities or the Sobi Territory Regional Development Activities.

1.104.

“Global Development Budget” has the meaning set forth in Section 4.4.1 (Global Development Plan).

1.105.

“Global Development Plan” has the meaning set forth in Section 4.4.1 (Global Development Plan).

1.106.

“GLP Toxicology Study” means a toxicology study (a) that is conducted using applicable GLP, (b) that is conducted in a species that satisfies applicable regulatory requirements, and (c) the data and results from which are intended to meet the standards necessary for submission as part of, or otherwise to enable the submission of, an IND, CTA, or Drug Approval Application with an applicable Regulatory Authority.

1.107.

“Good Clinical Practices” or “GCP” means all applicable current good clinical practice standards for the design, conduct, performance, monitoring, auditing, recording, analyses, and reporting of Clinical Trials, including, as applicable, (a) as set forth in the International Conference on Harmonization of Technical Requirements for Registration of Pharmaceuticals for Human Use Harmonized Tripartite Guideline for Good Clinical Practice (CPMP/ICH/135/95) and any other applicable guidelines for good clinical practice for trials on medicinal products anywhere in the world, (b) the Declaration of Helsinki (2013) as last amended at the 64^th World Medical Association in October 2013 and any further amendments or clarifications thereto, (c) C.F.R. Title 21, Parts 50 (Protection of Human Subjects), 56 (Institutional Review Boards), and 312 (Investigational New Drug Application), as may be amended from time to time, and (d) any equivalent Applicable Law in any relevant country, each as may be amended and applicable from time to time, and, in each case, that provide for, among other things, assurance that the clinical data and reported results are credible and accurate, and protect the rights, integrity, and confidentiality of trial subjects.

1.108.

“Good Laboratory Practices” or “GLP” means all applicable current good laboratory practice standards, including, as applicable, as set forth in the then-current good laboratory practice standards promulgated or endorsed by the FDA, as defined in 21 C.F.R. Part 58, and any equivalent Applicable Law in any relevant country or region, each as may be amended and applicable from time to time.

1.109.

“Good Manufacturing Practices” or “GMP” means all applicable current good manufacturing practices, including, as applicable, the principles detailed in (a) the U.S. Current Good Manufacturing Practices, 21 C.F.R. Parts 4, 210, 211, 601, 610 and 820, (b) European Directive 2003/94/EC and Eudralex 4, (c) the International Conference on Harmonization’s Q7 guidelines, and (d) any equivalent Applicable Law in any relevant country or region, in each case, as may be amended and applicable from time to time.

1.110.

“Good Pharmacovigilance Practices” or “GVP” means all applicable current good pharmacovigilance practice practices promulgated or endorsed by any applicable Regulatory

Authority as set forth in the guidelines imposed by such Regulatory Authority, as may be amended and applicable from time to time.

1.111.

“Governmental Authority” means any court, tribunal, arbitrator, agency, commission, department, ministry, official, authority, or other instrumentality of any national, supra-national, federal, state, county, city, or other political subdivision.

1.112.

“Government Official” is broadly defined as, and includes, (a) any elected or appointed government official (e.g., a member of a ministry of health), (b) any employee or Person acting for or on behalf of a government official, agency, or enterprise performing a governmental function, (c) any non-U.S. political party officer, employee, or Person acting for or on behalf of a non-U.S. political party or candidate for public office, (d) any employee or Person acting for or on behalf of a public international organization, (e) all government employees and employees of state-owned enterprises, or (f) any Person otherwise categorized as a government official under local Applicable Laws, where “government” is meant to include all levels and subdivisions of non-U.S. governments (i.e., local, regional, or national, and administrative, legislative, or executive).

1.113.

“Gross Sales” has the meaning set forth in Section 1.149 (Net Sales).

1.114.

“ICH” means International Conference on Harmonization.

1.115.

“IFRS” means international financial reporting standards, which standards are used at the relevant time and consistently applied by the applicable Person.

1.116.

“IND” means an Investigational New Drug application required pursuant to 21 C.F.R. Part 312 or any comparable filings (other than any CTA) outside of the U.S. required to commence Clinical Trials in such country or region, and all supplements or amendments that may be filed with respect to the foregoing.

1.117.

“Indemnification Claim Notice” has the meaning set forth in Section 12.3.1 (Notice of Claim).

1.118.

“Indemnified Party” has the meaning set forth in Section 12.3.1 (Notice of Claim).

1.119.

“Indemnifying Party” has the meaning set forth in Section 12.3.1 (Notice of Claim).

1.120.

“Indemnitee” and “Indemnitees” have the meanings set forth in Section 12.3.1 (Notice of Claim).

1.121.

“Indication” means a separate and distinct disease or pathological condition for which a Product can be used to diagnose, treat, or prevent, which use is the subject of a separate Regulatory Approval for a distinct labelling supported by data from at least one (1) Clinical Trial not previously submitted to the applicable Regulatory Authority in a country for approval to use the Product to diagnose, treat, or prevent the disease or pathological condition. For clarity, subpopulations or patients with a primary disease, disorder, or condition, however stratified, shall not be deemed to be separate.

1.122.

“Initial Indications” means the following Indications:  PNH, CAD, C3G, TMA and ALS.

1.123.

“Intellectual Property” means all Patent Rights, copyrights, design rights, trademarks, trade secrets, Know-How, Patent Term Extensions, and all other intellectual property rights (whether registered or unregistered) and all applications and rights to apply for any of the foregoing, anywhere in the world.

1.124.

“JCC” or “Joint Commercialization Committee” has the meaning set forth in Section 3.2.4 (Subcommittees).

1.125.

“JDC” or “Joint Development Committee” has the meaning set forth in Section 3.2.4 (Subcommittees).

1.126.

“JEC” or “Joint Executive Committee” has the meaning set forth in Section 3.2.1 (Formation).

1.127.

“JMC” or “Joint Medical Committee” has the meaning set forth in Section 3.2.4 (Subcommittees).

1.128.

“JMSC” or “Joint Manufacturing and Supply Committee” has the meaning set forth in Section 3.2.4 (Subcommittees).

1.129.

“Joint Know-How” means any Collaboration Know-How made, invented, conceived, discovered, developed, or otherwise generated jointly by a Party’s or any of its Affiliates’, sub/licensees’, Sublicensees’, or Subcontractors’ employees, agents, or independent contractors, or any Person contractually required to assign or license such Collaboration Know-How to such Party or any Affiliate of such Party, on the one hand, and the other Party’s or any of its Affiliates’, sub/licensees’, Sublicensees’, or Subcontractors’ employees, agents, or independent contractors, or any Person contractually required to assign or license such Collaboration Know-How to such Party or any Affiliate of such Party, on the other hand.

1.130.

“Joint Patent Right” means any Patent Right that Covers or claims any Joint Know-How.

1.131.

“Joint Technology” means the Joint Know-How and the Joint Patent Rights.

1.132.

“Know-How” means (a) any commercial, technical, scientific, or other know-how or information, knowledge, practices, instructions, skills, procedures, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, records, improvements, modifications, techniques, assays, physical, chemical or biological materials, designs, protocols, formulas, data (including physical data, chemical data, toxicology data, animal data, raw data, clinical data, analytical and quality control data, Manufacturing data and know how, regulatory data, study designs, and protocols), dosage regimens, control assays, assay standards and references, cells, cell lines, animal models,  product specifications, marketing, pricing and distribution costs, inventions, processes, methods, utilities, formulations, compositions of matter, articles of Manufacture, creations, discoveries, findings, algorithms, technology, forecasts, profiles, strategies, plans, results in any form whatsoever, know-how, and trade secrets (in each case, whether or not patentable, copyrightable, or otherwise protectable), and (b) any physical embodiments of any of the foregoing.

1.133.

“License” has the meaning set forth in Section 2.1.1 (License Grants to Sobi).

1.134.

“Licensed Manufacturer IP” means (a) under the [**] Agreement, any [**] IP that [**] incorporates into the Services (as defined in the [**] Agreement) or any deliverable under the [**] Agreement; (b) under the [**] Agreement, any intellectual property discovered or developed by [**] or jointly with Apellis US in the performance of the Services (as defined in the [**] Agreement), that is not specific to or is severable from the Product; and (c) under the [**] APL-1 Agreement, any [**] Pre-Existing IP (as defined in the [**] APL-1 Agreement) that [**] incorporates into the Services (as defined in the [**] APL-1 Agreement) or deliverables under the [**] APL-1 Agreement.

1.135.

“Losses” has the meaning set forth in Section 12.1 (Indemnification by Apellis).

1.136.

“MAA” means, with respect to the European Union, a Marketing Authorization Application filed with the EMA pursuant to the Centralized Approval Procedure or with the applicable Regulatory Authority of a country in Europe pursuant to the mutual recognition, de-centralised, or any other national approval procedure.

1.137.

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

1.138.

“Major Market” means each of [**].

1.139.

“Manufacture” means activities directed to manufacturing, processing, packaging, labeling, filling, finishing, assembly, quality assurance, quality control, testing, release (according to Product specifications, Regulatory Approvals, and Applicable Law), shipping, or storage of any pharmaceutical product (or any components or process steps involving any pharmaceutical product or any companion diagnostic), placebo, or comparator agent, as the case may be, including stability testing, but excluding activities directed to Development, Medical Affairs, or Commercialization.  “Manufacturing” and “Manufactured” will be construed accordingly.

1.140.

“Manufacturing and Supply Chain Plan” has the meaning set forth in Section 8.1 (Manufacturing and Supply Chain Plan).

1.141.

“Manufacturing Costs” means (i) the actual price paid by Apellis to any Third Party manufacturer, on the terms of the applicable Apellis Supply Agreement, and (ii) fully allocated Manufacturing overhead and any reasonable internal and external costs or expenses incurred by Apellis in contracting with, managing, and overseeing such Third Party manufacturer, at the Manufacturing FTE Costs, in each case of subclauses (i) and (ii) to the extent attributable for Manufacturing and supply activities for Compounds and Products for supply to Sobi or its Affiliates or Sublicensees for Commercialization in the Sobi Territory or clinical Development pursuant to this Agreement (which, for clarity, with respect to the actual price paid by Apellis to any Third Party manufacturer, includes any discounts or cost reductions received by Apellis from such Third Party, including pro rata portions of such discounts or such cost reductions received with respect to Apellis’ general Manufacture and supply relationship with such Third Party that are attributable to such Compounds and Products in or for the Sobi Territory), and pro rata portions of costs of storage, packaging, and shipping of such Compounds and Products, including pro rata portions of the costs listed below to the extent related to Manufacturing and supply activities for Compounds and Products for supply to Sobi or its Affiliates or Sublicensees for Commercialization in the Sobi Territory or clinical Development pursuant to this Agreement:

(a)

any pass-through acquisition costs charged by such Third Party, together with any mark-up charged by such Third Party in relation thereto, for the purchase of raw materials;

(b)

costs of loss of Drug Substance or activated PEG resulting from any failed batches to the extent actually incurred or written off by Apellis;  

(c)

any fees charged by such Third Party for forfeited reservations for unused slots due to failed batches;

(d)

any fees charged by such Third Party relating to quality control (including stability), quality assurance, compliance, analytical, or other testing of such Product or any raw materials used in the Manufacture of such Product;

(e)

any fees charged by any Third Party relating to storage, packaging, handling, transportation, shipping, insurance, and disposal;

(f)

any fees charged by such Third Party relating to an allocation of idle or reserved capacity, but only to the extent such capacity was mutually agreed by the Parties;

(g)

the cost of validation batches produced in the course of Manufacturing process validation that are used in clinical or commercial supply by or on behalf of Sobi or any of its Affiliates or Sublicensees;

(h)

any costs of process development or capital investments in facilities or equipment that are incurred by an applicable Third Party manufacturer and passed through to Apellis or its Affiliates through an increase in the costs of Compounds or Products (or raw materials) purchased, directly or indirectly, by Apellis or its Affiliates from such Third Party manufacturer to the extent such costs are approved pursuant to Section 8.9.1 (Cost Sharing) or deemed approved by Sobi pursuant to Section 8.9.1(a)(i) (Cost Sharing);

(i)

importation and exportation duties, fees, VAT, and other taxes, net of refunds and other offsets; and

(j)

all fees charged by such Third Party relating to Product and raw material testing and yield loss costs (to the extent within typical yield loss, as agreed by the Parties and set forth in the Supply Agreement),

1.142.

“Manufacturing FTE Costs” means [**] dollars ($[**]) per FTE for the Calendar Year 2020 (the “Manufacturing FTE Rate”) (which shall be adjusted for each Calendar Year commencing with the Calendar Year 2021 and, unless otherwise agreed in writing by the Parties, shall be the prior year’s rate, increased or decreased by the relevant percentage increase or decrease based on the Employment Cost Index provided by the U.S. Department of Labor (Series ID: CIU 1010000000000A); except that the Manufacturing FTE Rate in any given Calendar Year may not increase by an amount more than [**] percent ([**]%) of the prior year’s Manufacturing FTE Rate) multiplied by the number of FTEs actually expended to conduct Manufacturing activities under this Agreement during such period.  FTEs will be pro‑rated on a daily basis if necessary

1.143.

“Manufacturing Know-How” has the meaning set forth in Section 8.3 (Manufacturing Technical Transfer).

1.144.

“Manufacturing Process Costs” has the meaning set forth in Section 8.9 (Manufacturing Process Costs).

1.145.

“Medical Affairs” means activities conducted by a Party’s medical affairs department (or, if a Party does not have a medical affairs department, the equivalent thereof), including communications with key opinion leaders and other healthcare providers, medical education, symposia, advisory boards (to the extent related to medical affairs or clinical guidance), activities performed in connection with patient registries, expanded access programs, including early access programs, named patient programs, and compassionate use, real world evidence generation (excluding Clinical Trials), health economics and outcomes research, medical information, publications, advocacy, and other medical programs and communications, including educational grants and sponsorships, research grants (including conducting investigator-initiated studies), and charitable donations, in each case to the extent related to medical affairs and not to other activities that involve the promotion, marketing, sale, or other Commercialization of pharmaceutical products and are not conducted by a Party’s medical affairs (or equivalent) departments; but excluding activities directed to Manufacturing, Development, or Commercialization (except that sponsorships may be conducted as Commercialization activities or Medical Affairs activities).

1.146.

“Medical Affairs Strategy” has the meaning set forth in Section 7.1 (Medical Affairs Strategy).

1.147.

“Medical Education Materials” means all written medical education materials relating to any condition treated with a Product, and other printed, graphic, electronic, audio, video, or other media and materials, in each case used to educate patients, healthcare professionals, payers, and the public regarding a Product or any Indication treated with a Product.

1.148.

“NDA” means a New Drug Application, as defined in the FD&C Act, submitted to the FDA in the U.S. in accordance with the FD&C Act with respect to a pharmaceutical product.

1.149.

“Net Sales” means, with respect to a Product and country, (x) the gross amount invoiced in a country by Sobi or any of its Affiliates or Sublicensees or (y) if such Product is sold by a Functional Sublicensee on behalf of Sobi or any of its Affiliates or Sublicensees, (i) in any of Canada, Japan, China, Australia, the United Kingdom, or any country in the European Union, the gross amount invoiced in such country by such Functional Sublicensee or (ii) in any country not listed in clause (i), the greater of (A) the gross amount invoiced to such Functional Sublicensee by Sobi or any of its Affiliates or Sublicensees or (B) [**] percent ([**]%) of the gross amount invoiced in such country by such Functional Sublicensee (but, if such amount is not available to Sobi despite Sobi having used Commercially Reasonable Efforts to obtain it, and the Parties are unable to agree upon such amount, the Parties shall submit such dispute for resolution to a mutually agreed independent accounting expert, whose decision will be final and binding on the Parties) (Sobi and each of its Affiliates, Sublicensees, and Functional Sublicensees, a “Selling Party,” as applicable) for the sale, use, lease, transfer, or other disposition of such Product in such country to Third Parties (excluding any milestones or payments not linked to the sale, use, lease, transfer, or other disposition of such Product) (“Gross Sales”), in each case ((x) and (y)) less the following accrued costs and expenses that are directly attributable to the applicable disposition, specifically identified on an invoice or other documentation, indefeasibly paid to a Third Party, net of any refunds or offsets specific to Products, and actually borne by the applicable Selling Party (collectively, “Sales Returns and Allowances”):

(a)

trade, cash, and quantity discounts (e.g., discounts for prompt or timely payment);

(b)

inventory management fees paid to wholesalers and distributors, not to exceed [**] percent ([**]%) of Net Sales;

(c)

credits, chargebacks, retroactive price reductions, rebates, refunds, returns that do not exceed the original invoice amount;

(d)

outbound transportation and insurance expenses;

(e)

sales and use taxes, tariffs, customs duties, excises, and other taxes and fees imposed by a Governmental Authority on the sale, transportation, or delivery of a Product (other than taxes on income);

(f)

negotiated payments made to private sector and government Third Party payors (e.g., PBMs, HMOs, PPOs) and purchasers or providers (e.g., staff model HMOs, hospitals, clinics), regardless of the payment mechanism, including rebate, chargeback, and credit mechanisms;

(g)

discounts under discount prescription drug programs and reductions for coupon and voucher programs; and

(h)

bad debts calculated in accordance with Accounting Standards, except that any reductions to bad debts previously deducted from Gross Sales will become an add back to Net Sales in the Calendar Quarter in which the reduction in bad debt is recognized.

1.150.

“Neutral Safety Committee” has the meaning set forth in Section 16.4 (Neutral Safety Committee).

1.151.

“[**]” means [**].

1.152.

“[**] Agreement” means the [**] Agreement by and between Apellis US and [**], dated as of [**].

1.153.

“Non-Proposing Party” has the meaning set forth in Section 4.4.4(b)(i) (Unilateral Development Activities) or Section 4.8.1 (Combination Therapy Development), as applicable.

1.154.

“Non-Systemic Ophthalmology Product” means any product in any form, formulation, or presentation containing, incorporating, consisting of, or comprising a Compound as an active ingredient that is (a) formulated, approved, or marketed for diseases that have, as their primary association, an association to the eye and (b) not administered systemically.

1.155.

“Out-of-Pocket Costs” means, with respect to activities conducted in accordance with this Agreement, direct bona fide costs, fees, or expenses paid by a Party or its Affiliates to Third Parties (or payable to Third Parties and accrued in accordance with Accounting Standards) and specifically identifiable and incurred to conduct such activities, including any such payments to Subcontractors.

1.156.

“Party” and “Parties” has the meaning set forth in the Preamble.

1.157.

“Party Vote” has the meaning set forth in Section 3.7.1 (Voting; Consensus).

1.158.

“Patent Rights” means any and all (a) patents, (b) patent applications, including all provisional and non-provisional applications, priority applications, patent cooperation treaty (PCT) applications, substitutions, continuations, continuations-in-part, divisions and renewals, and all patents granted thereon, (c) all patents-of-addition, confirmation patents or registration patents, reissues, re-examinations, utility models or designs, renewals, and extensions or restorations by existing or future extension or restoration mechanisms, including supplementary protection certificates and equivalents thereof, (d) inventor’s certificates or letters patent, or (e) other substantially equivalent forms of government-issued rights substantially similar to any of the foregoing described in subsections (a) through (d) above, anywhere in the world.

1.159.

“Patent Term Extension” means any patent term extension under 35 U.S.C. §156 or any non-U.S. counterpart or equivalent of the foregoing, including supplementary protection certificates and any other extensions that are available as of the Effective Date or become available during the Term.

1.160.

“Penn” means The Trustees of the University of Pennsylvania.

1.161.

“Penn Other Fields License Agreement” means that certain Patent License Agreement, dated as of March 28, 2008, by and between Apellis (as successor to Apellis AG) and Penn, as amended on September 11, 2009 and as further amended from time to time.

1.162.

“Person” means any individual, firm, corporation, partnership, limited liability company, trust, business trust, joint venture, Governmental Authority, association, or other entity.

1.163.

“Personally Identifiable Information” means any information relating to an identified or, in combination with other information, identifiable person or persons captured in an electronic or hardcopy format, including such information as it relates to clinical study or Clinical Trial subjects (including key-coded patient data), physicians, clinicians, healthcare professionals, consultants, or other persons participating in any clinical study or Clinical Trial, and any equivalent definition in any Applicable Law to the extent that such definition is broader than that provided here, including, solely with respect to individuals afforded protections under the EU Data Protection Laws, the definition of “personal data” under the GDPR.

1.164.

“Phase III Clinical Trial” means a human clinical trial of a pharmaceutical product in any country that would satisfy the requirements of 21 C.F.R. § 312.21(c), as amended (or the non-United States equivalent thereof).

1.165.

“PNH” means paroxysmal nocturnal hemoglobinuria.

1.166.

“PNH Phase III Clinical Trial” means each of the following Phase III Clinical Trials: (a) APL2-308: “A Phase III Study to Evaluate the Efficacy and Safety of APL-2 in Patients with PNH” (NCT04085601) and (b) APL2-302: “Study to Evaluate the Efficacy and Safety of APL-2 in Patients with PNH” (NCT03500549).

1.167.

“Product” means any pharmaceutical product in any form, formulation, or presentation containing, incorporating, consisting of, or comprising a Compound as an active ingredient; but excluding all Non-Systemic Ophthalmology Products.

1.168.

“Product Trademarks” has the meaning set forth in Section 6.9 (Product Trademarks).

1.169.

“Promotional Materials” means all marketing materials, grants, sponsorships, and all written, printed, graphic, electronic, audio or video media, or other materials, including journal advertisements, sales visual aids, leave‑behind items, formulary binders, reprints, direct mail, direct‑to‑consumer advertising, internet postings and sites, and broadcast advertisements intended for use or used by or on behalf of either Party or their Affiliates to market or promote any Product or educate the public regarding any Product or any Indication treated with any Product; but excluding all Medical Education Materials.

1.170.

“Proposing Party” has the meaning set forth in Section 4.4.4 (Additional Development) or Section 4.8.1 (Combination Therapy Development), as applicable.

1.171.

“Prosecute” has the meaning set forth in Section 10.2.1(b) (Prosecution Rights).

1.172.

“Prosecuting Party” has the meaning set forth in Section 10.2.1(d) (Prosecution Rights).

1.173.

“Qualified Safety Expert” means any scientist (a) with at least [**] of applicable pharmaceutical safety experience, (b) who has not worked for or been engaged by any Party or any of either Party’s Affiliates in the [**] period immediately prior to the formation of the applicable Neutral Safety Committee, and (c) who does not own more than [**] percent ([**]%) of the outstanding equity in any Party or any of either Party’s Affiliates.

1.174.

“Receiving Party” has the meaning set forth in Section 13.1 (Confidential Information).

1.175.

“Regional Development Activities” means, as applicable, the Apellis Territory Regional Development Activities and the Sobi Territory Regional Development Activities.

1.176.

“Regulatory Approval” means, with respect to a particular country or other regulatory jurisdiction, all approvals, product or establishment licenses, registrations, or authorizations (including approval of a Drug Approval Application or any label update or other modification to an existing Regulatory Approval) of all applicable Regulatory Authorities in such country or jurisdiction necessary for the commercial marketing or sale of a pharmaceutical product in such country or other regulatory jurisdiction for one (1) or more Indications, excluding Reimbursement Approval.

1.177.

“Regulatory Authority” means any applicable Governmental Authority with jurisdiction or authority over the Development, Manufacture, Commercialization, or other Exploitation (including Regulatory Approvals) of pharmaceutical products, and any corresponding national or regional regulatory authorities.

1.178.

“Regulatory Data” means any and all research data, pharmacology data, CMC data, preclinical and nonclinical data, and clinical data, and all other documentation submitted, or required to be submitted, to Regulatory Authorities to support, obtain, or maintain any Regulatory Approval for a pharmaceutical product or administration device, or otherwise included in any Regulatory Submissions for a pharmaceutical product or administration device, including clinical studies’ and Clinical Trials’ final protocols, final study reports, statistical analysis plans, and results thereof.

1.179.

“Regulatory Exclusivity” means, with respect to a Product in a country, any exclusive marketing right, data protection, or other exclusive right, other than a Patent Right, conferred by any Governmental Authority with respect to such Product in such country, including any new drug exclusivity, new indication or use exclusivity, pediatric exclusivity, or orphan drug exclusivity.

1.180.

“Regulatory/Reimbursement Responsible Party” means, with respect to a given Product in a given country or regulatory jurisdiction, the Party responsible for regulatory and reimbursement activities and obligations with respect to such Product in such country or regulatory jurisdiction, including, for clarity, applicable regulatory and reimbursement activities for a Product after receipt of Regulatory Approval or Reimbursement Approval for such Product.

1.181.

“Regulatory Submission” means any filing, application, or submission with any Regulatory Authority or other applicable Government Authority in support of the Development, Manufacture, Commercialization, or other Exploitation of a pharmaceutical product (including to obtain, support, or maintain Regulatory Approval from such Regulatory Authority or other Governmental Authority), and all formal and informal, written or electronic correspondence or communications with or from the relevant Regulatory Authority or other Governmental Authority, as well as minutes of any material meetings, telephone conferences, or discussions with the relevant Regulatory Authority or other Governmental Authority. Regulatory Submissions include all INDs, CTAs, Drug Approval Applications, other applications for Regulatory Approval.

1.182.

“Reimbursement Approval” means any approval, agreement, determination, or other decision by the applicable Governmental Authority in a given country or other regulatory jurisdiction that establishes prices charged to end-users for a given pharmaceutical product at which such pharmaceutical product will be reimbursed by the applicable Governmental Authorities in such country or regulatory jurisdiction.

1.183.

“Reimbursement Submission” means any filing, application, or submission with any applicable Government Authority to obtain, support, or maintain Reimbursement Approval from such Governmental Authority, and all formal and informal, written or electronic correspondence or communications with or from the relevant Governmental Authority, as well as minutes of any material meetings, telephone conferences, or discussions with the relevant Governmental Authority.

1.184.

“Results” means all (a) results, information, data, presentations, summaries, and analyses that are generated pursuant to, or prepared as a result of, or in connection with the performance of, the Global Development Activities and are required to be provided to the other Party pursuant to the Global Development Plan, and (b) Collaboration Know-How that relate to any of the foregoing.

1.185.

“Reversion Technology” has the meaning set forth in Section 15.2.2(a) (Reversion License).

1.186.

“Royalty Term” has the meaning set forth in Section 9.5.2 (Royalty Term).

1.187.

“Sales Returns and Allowances” has the meaning set forth in Section 1.149 (Net Sales).

1.188.

“SDEA” has the meaning set forth in Section 5.4.1 (SDEA; Responsibilities).

1.189.

“Second Source” has the meaning set forth in Section 8.2 (Sobi Right to Manufacture Drug Product).

1.190.

“Selling Party” has the meaning set forth in Section 1.149 (Net Sales).

1.191.

“Serious Adverse Event” has the meaning set forth in 21 C.F.R. § 312.32, and generally means any Adverse Event that (a) results in death, (b) is life-threatening, (c) requires inpatient hospitalization or prolongation of existing hospitalization, (d) results in persistent or significant disability or incapacity, (e) is a congenital anomaly or birth defect, or (f) based upon appropriate

medical judgment, is considered an important medical event that may jeopardize the patient or subject and may require medical or surgical intervention to prevent one of the outcomes listed in this definition.

1.192.

“SFJ” means SFJ Pharmaceuticals XI, L.P.

1.193.

“SFJ Agreement” means that certain Development Funding Agreement, dated as of February 28, 2019, by and between Apellis and SFJ, as amended on June 7, 2019 and further amended from time to time.

1.194.

“Shared Development Costs” has the meaning set forth in Section 4.6.3 (Shared Development Costs).

1.195.

“Sobi” has the meaning set forth in the Preamble.

1.196.

“Sobi Know-How” means any and all Collaboration Know-How that is (a) Controlled by Sobi or any of its Affiliates during the Term (for the avoidance of doubt, including Sobi’s interest in the Joint Know-How) and (b) necessary or useful for the Exploitation of any Compound or Product Developed under the Global Development Plan. Notwithstanding anything in this Agreement to the contrary, Sobi Know-How shall not include (x) any Additional Third Party IP in-licensed by Sobi or any of its Affiliates under an agreement that Apellis does not agree to make a Collaboration In-License pursuant to Section 2.3 (New In-Licenses) or (y) any Know-How to the extent Controlled by any Person that acquires all or any part of Sobi or an Affiliate of Sobi, or any Affiliate of such Person, except to the extent that, following such acquisition, the Parties specifically agree to incorporate such Know-How into any Product Developed under the Global Development Plan, in each case (i) that is Controlled, immediately prior to the effective date of the acquisition, by such Person or any of its Affiliates (other than Sobi or any of its Affiliates immediately prior to the effective date of the acquisition) or (ii) that is Controlled by such Person or any of its Affiliates (other than Sobi or any of its Affiliates immediately prior to the effective date of the acquisition) on or after the effective date of acquisition but (A) is not Controlled by Sobi or any Person that was an Affiliate of Sobi immediately prior to the effective date of the acquisition, (B) is made, invented, created, designed, conceived, produced, or otherwise developed or obtained without the use of or reliance on any Sobi Confidential Information or Apellis Confidential Information, and (C) is not utilized by or on behalf of Sobi or its Affiliates in connection with the Exploitation of a Product.

1.197.

“Sobi Patent Right” means any Collaboration Patent Right that is (a) Controlled by Sobi or any of its Affiliates during the Term (for the avoidance of doubt, including Sobi’s interest in any Joint Patent Right) and (b) Covers the Exploitation of any Compound or Product Developed under the Global Development Plan. Notwithstanding anything in this Agreement to the contrary, except to the extent necessary or useful for the Exploitation of any Compound or Product Developed under the Global Development Plan, Sobi Patent Right shall not include (x) any Additional Third Party IP in-licensed by Sobi or any of its Affiliates under an agreement that Apellis does not agree to make a Collaboration In-License pursuant to Section 2.3 (New In-Licenses) or (y) any Patent Right to the extent Controlled by any Person that acquires all or any part of Sobi or an Affiliate of Sobi, or any Affiliate of such Person, except to the extent that, following such acquisition, the Parties specifically agree to incorporate any technology or invention Covered or claimed by such Patent Right into any Product Developed under the Global Development Plan, in each case (i) that is Controlled, immediately prior to the effective date of the acquisition, by such Person or any of its Affiliates (other than Sobi or any of its Affiliates immediately prior to the effective date of the acquisition) or (ii) that is Controlled by such Person or any of its Affiliates (other than Sobi or any

of its Affiliates immediately prior to the effective date of the acquisition) on or after the effective date of acquisition but is not Controlled by Sobi or any Person that was an Affiliate of Sobi immediately prior to the effective date of the acquisition and Covers or claims an invention that was invented without the use of or reliance on any Sobi Confidential Information or Apellis Confidential Information.

1.198.

“Sobi Technology” means all Sobi Patent Rights and Sobi Know-How.

1.199.

“Sobi Territory” means the entire world except for the Apellis Territory.

1.200.

“Sobi Territory Regional Development Activities” means all Sobi activities, other than the Global Development Activities, conducted by or on behalf of Apellis to support Regulatory Approval of any Product in the Sobi Territory.

1.201.

“Sobi Territory Regional Development Plan” has the meaning set forth in Section 4.4.3 (Sobi Territory Regional Development Plan).

1.202.

“Subcontractor” means a Third Party engaged by a Party or its Affiliates to conduct certain activities of such Party under this Agreement, including (a) contract research organizations, (b) contract manufacturers, and (c) distributors (whether exclusive or non-exclusive), distribution service providers and wholesalers, in each case (a)-(c) whether or not granted a sublicense under the License to perform such activities (including in the case of (c), Commercialization activities).

1.203.

“Sublicensee” means, on a Product-by-Product and country-by-country basis, a Third Party to whom Sobi or any of its Affiliates or any Sublicensee grants a license or sublicense of Sobi’s rights to Exploit Products under the Apellis Technology, excluding all Subcontractors who are engaged on a fee-for-service basis and, solely for purposes of calculating Net Sales, excluding all Functional Sublicensees.

1.204.

“Supply Agreement” has the meaning set forth in Section 8.6 (Supply Agreement).

1.205.

“Term” has the meaning set forth in Section 14.1 (Term).

1.206.

“Third Party” means any Person other than Sobi or Apellis or their respective Affiliates.

1.207.

“Third Party Claim” has the meaning set forth in Section 12.1 (Indemnification by Apellis).

1.208.

“Third Party Payments” shall mean the pro rata portion reasonably attributable to the Exploitation of Products of all payments (including for royalties, lump sum payments, upfront payments, costs, damages, judgements and awards) which Sobi or its Affiliates or Sublicensees pay to a Third Party (directly or through Apellis under a Collaboration In-License to which Apellis or any of its Affiliates is a Party) for a license under Patent Rights or Know-How owned or controlled by such Third Party that are reasonably necessary or reasonably useful for the Exploitation of the Products in the Field in the Sobi Territory.

1.209.

“TMA” shall mean thrombotic microangiopathy.

1.210.

“Unilateral Combination Therapy Development Activities” has the meaning set forth in Section 4.8.1(b) (Unilateral Combination Therapy Development Activities).

1.211.

“Unilateral Additional Development Costs” has the meaning set forth in Section 4.4.4(b)(iii) (Buy-In).

1.212.

“Unilateral Development Activities” has the meaning set forth in Section 4.4.4(b)(i) (Unilateral Development Activities).

1.213.

“Unilateral Development Data” has the meaning set forth in Section 4.4.4(b)(ii) (Unilateral Development Data).

1.214.

“Unilateral Development Notice” has the meaning set forth in Section 4.4.4(b)(iii) (Buy-In).

1.215.

“Upstream Agreements” means the Existing Agreements and Collaboration In-Licenses.

1.216.

“U.S.” or “United States” means the United States of America and its possessions and territories.

1.217.

“Valid Claim” means a claim of (a) an issued, unexpired, and in-force patent, which claim has not been held invalid or unenforceable by a court or other government agency of competent jurisdiction from which holding no appeal can be taken, or for which the applicable time for appeal has expired, and has not been held or admitted to be invalid or unenforceable through re-examination, inter partes review, post grant review or disclaimer, opposition procedure, nullity suit, or otherwise, or (b) a pending patent application that has not been finally abandoned, finally rejected, or expired; but, if a claim of a pending patent application has not issued within [**] after the earliest filing date from which such claim takes priority, then such claim will cease to constitute a Valid Claim for the purposes of this Agreement unless and until such claim issues.

1.218.

“VAT” has the meaning set forth in Section 9.7.2 (VAT).

2.1

Licenses

2.1.1

License Grants to Sobi.  Subject to the terms and conditions of this Agreement and the Apellis Retained Rights, Apellis hereby grants to Sobi:

(a)

an exclusive, sublicensable (solely as set forth in Section 2.5.2 (Sublicenses)) license under the Apellis Technology (excluding all Unilateral Development Data with respect to which Sobi is the Non-Proposing Party) to:

(i)

Develop Products throughout the world in accordance with this Agreement for Commercialization in the Sobi Territory; and

(ii)

Commercialize Products in the Sobi Territory in accordance with this Agreement; and

(b)

a co-exclusive (with Apellis), sublicensable (solely as set forth in Section 2.5.2 (Sublicenses)) license under the Apellis Technology (excluding all Unilateral Development Data with respect to which Sobi is the Non-Proposing Party) to:

(i)

subject to, and solely as set forth in, Section 8.1 (Sobi Right to Manufacture Drug Substance), Section 8.2 (Sobi Right to Manufacture

Drug Product), and the Supply Agreement, Manufacture Compounds and Products throughout the world for Development and Commercialization in the Sobi Territory; and

(ii)

conduct Medical Affairs activities with respect to Products in accordance with this Agreement,

2.1.2

License Grants to Apellis.  Subject to the terms and conditions of this Agreement and the Sobi Retained Rights, Sobi hereby grants to Apellis:

(a)

an exclusive, sublicensable (solely as set forth in Section 2.5.2 (Sublicenses)), fully-paid, royalty-free license under the Sobi Technology (excluding all Unilateral Development Data with respect to which Apellis is the Non-Proposing Party), to:

(i)

Develop Products throughout the world in accordance with this Agreement for (A) Commercialization in the Apellis Territory or (B) sale to Selling Parties for Commercialization in the Sobi Territory in accordance with this Agreement; and

(ii)

Commercialize Products in the Apellis Territory in accordance with this Agreement;

(b)

a non-exclusive, sublicensable (solely as set forth in Section 2.5.2 (Sublicenses)), fully-paid, royalty-free license under the Sobi Technology (excluding all Unilateral Development Data with respect to which Apellis is the Non-Proposing Party) to:

(i)

Manufacture Products throughout the world in accordance with this Agreement, for (A) Commercialization in the Apellis Territory or (B) sale to Selling Parties for Commercialization in the Sobi Territory in accordance with this Agreement; and

(ii)

conduct Medical Affairs activities with respect to Products in accordance with this Agreement; and

(c)

solely to the extent necessary to Commercialize Non-Systemic Ophthalmology Products, a non-exclusive, sublicensable (solely as set forth in Section 2.5.2 (Sublicenses)), fully-paid, royalty-free license under the Sobi Technology to Develop, Manufacture, Commercialize, and conduct Medical Affairs activities with respect to Non-Systemic Ophthalmology Products anywhere in the world.

2.2

No Implied Licenses; Retained Rights.

2.2.1

Except as explicitly set forth in this Agreement, neither Party grants any rights or license under its Intellectual Property rights to the other Party, express or implied, whether by implication, estoppel, or otherwise.

2.2.2

Notwithstanding anything in this Agreement to the contrary, Apellis shall, as between the Parties, retain for itself (and its Affiliates and sub/licensees) the right under the Apellis Technology, with the right to grant licenses through multiple tiers, to:

(a)

Develop Products throughout the world in accordance with the terms and conditions of this Agreement for (i) Commercialization in the Apellis Territory or (ii) sale to Selling Parties for Commercialization in the Sobi Territory in accordance with this Agreement;

(b)

Manufacture Products throughout the world in accordance with the terms and conditions of this Agreement for Commercialization in the Apellis Territory;

(c)

Manufacture and supply the Products to the Selling Parties pursuant to the terms and conditions of this Agreement and the Supply Agreement for Commercialization by such party inside the Sobi Territory;

(d)

conduct Medical Affairs activities with respect to Products in accordance with the terms and conditions of this Agreement;

(e)

Exploit Non-Systemic Ophthalmology Products anywhere in the world; and

(f)

without limiting the foregoing, exercise its rights and conduct and perform its obligations under this Agreement, including as set out in the Global Development Plan.

2.2.3

Notwithstanding anything in this Agreement to the contrary, Sobi shall, as between the Parties, retain for itself (and its Affiliates and sub/licensees) the right under the Sobi Technology, with the right to grant licenses through multiple tiers, to:

(a)

Develop Products throughout the world in accordance with the terms and conditions of this Agreement for Commercialization in the Sobi Territory;

(b)

Manufacture Compounds and Products throughout the world for Development and Commercialization in the Sobi Territory;

(c)

conduct Medical Affairs activities with respect to Products in accordance with the terms and conditions of this Agreement; and

(d)

without limiting the foregoing, exercise its rights and conduct and perform its obligations under this Agreement, including as set out in the Global Development Plan.

2.3

New In-Licenses.   If a Party becomes aware of any Third Party Intellectual Property that such Party believes is necessary or useful for the Exploitation of any Products developed pursuant to the Global Development Plan (“Additional Third Party IP”), such Party shall notify the JEC, and the JEC shall discuss in good faith whether, and on what terms, either Party should obtain a sublicensable license to such Third Party Intellectual Property, but nothing in this Section 2.3 (New In-Licenses) shall prevent either Party from independently obtaining or negotiating the terms for a license to such Additional Third Party IP. The Party obtaining a license or other rights to any Additional Third Party IP shall use Commercially Reasonable Efforts to ensure that any and all such rights acquired are freely sublicenseable to the other Party to the extent of the licenses and rights granted to such other Party under this Agreement. No more than [**] after executing an agreement pursuant to which it has obtained a license or other rights to any Additional Third Party IP that are sublicensable to the other Party under this Agreement, the in-licensing Party shall provide to the other Party a copy of such agreement and a proposed apportionment of the costs of such license between the Parties, based upon the Parties’ proportional interest in the rights under such agreement, and such other Party shall, within [**] of receiving such copy, notify the in-licensing Party in writing whether such other Party agrees (a) to be responsible for the costs of such agreement in accordance with the terms of Section 9.6.2 (Collaboration In-Licenses) and (b) accept all other obligations under such agreement that are applicable to such Party’s Exploitation of Products under this Agreement. If such other Party agrees to be responsible for such costs, and accept such other obligations that are applicable to such Party’s Exploitation of Products under this Agreement, under such agreement, then such agreement shall be deemed a “Collaboration In-License,” and the Additional Third Party IP licensed under such Collaboration In-License shall be Apellis Know-How, Apellis Patent Rights, Sobi Know-How, or Sobi Patent Rights, as applicable.  If such other Party does not agree to be responsible for such costs, and accept such other obligations that are applicable to such Party’s Exploitation of Products under this Agreement, under such agreement, or if the rights licensed under such agreement are not sublicensable to the other Party under this Agreement, then such agreement shall not be a Collaboration In-License, and the Additional Third Party IP licensed under such agreement shall be deemed not to be Apellis Know-How, Apellis Patent Rights, Sobi Know-How, or Sobi Patent Rights.

2.4

Technology, Data, and Regulatory Transfer

2.4.1

Initial Transfer.  As soon as reasonably practicable, and in any event within [**] following the Effective Date, the Parties shall discuss in good faith and agree upon, and, following such agreement, shall perform their respective obligations set out in, a technology and data transfer plan governing the contents and mechanics of the transfer of Apellis Know-How (including Manufacturing Know-How, to the extent necessary or useful for Sobi to perform its obligations and exercise its rights under this Agreement or Applicable Law prior to the transfer of Manufacturing Know-How under Section 8.3 (Manufacturing Technical Transfer)), Regulatory Submissions, and Regulatory Data pursuant to this Section 2.4.1 (Initial Transfer). Without limiting the foregoing, for no additional consideration (including no reimbursement for any costs or expenses incurred by or on behalf of Apellis), Apellis shall transfer and deliver to Sobi in the original format (excel, word, powerpoint, etc.) in a method agreed to by the Parties’ IT departments (e.g., FTP, physical hard disk):

(a)

within [**] following the Effective Date, download access to the complete contents of the diligence data room;

(b)

within [**] following the Effective Date, to the extent not included in the diligence data room:

(i)

any formal and informal, written or electronic correspondence or communications with or from the relevant Regulatory Authority or other Governmental Authority, as well as minutes of any material meetings, telephone conferences, or discussions with the relevant Regulatory Authority or other Governmental Authority in relation to the PNH and CAD Initial Indications;

(ii)

any documents related to the CAD Initial Indication that are required by Sobi to perform the CAD Clinical Trials assigned to Sobi in the Global Development Plan, including those items set forth on Schedule 2.4.1(b) (Initial Transfer - CAD);

(iii)

any additional quality assurance related documents (audit reports, CAPAs, Plans) relating to the Initial Indications; and

(c)

within [**] following the Effective Date, copies of the following (including all eCTD sequences and source documents (if any) comprising or containing any of the following) to the extent not already provided:

(i)

copies of Apellis Know-How in reasonably sufficient detail in order for a reasonably skilled Person to practice such Know-How within the scope of the License; and

(ii)

copies of Regulatory Data,

2.4.2

Additional Transfers.  Pursuant to one (1) or more technology and data transfer plans established by unanimous agreement of the JDC in accordance with Section 3.3.2(b) (Specific Responsibilities of the JDC), and in any event within a reasonable period of time following any reasonable and specific request from the other Party (but any such request from Sobi regarding Manufacturing Know-How must comply with Section 8.3 (Manufacturing Technical Transfer)) (or, solely with respect to newly generated items created in any [**] that are necessary for the other Party or its relevant Affiliate(s) to conduct or perform its obligations and exercise its rights under this Agreement, within a reasonable period of time following the end of such [**] in which such newly generated items are created), each Party will transfer to the other Party copies (including all eCTD sequences and source documents (if any) comprising or containing any of the following) of all (w) Know-How, (x) Regulatory Submissions and Reimbursement Submissions, (y) Regulatory Data, and (z) other documents or information, in each case ((w)-(z)) that (i) are related to the Products, (ii) are in such Party’s (or its Affiliates’) possession and Control as of the relevant time, (iii) are (A) necessary or useful for such other Party to Exploit the Compound or Products in its territory in accordance with this Agreement or (B) necessary

to perform its obligations and exercise its rights under this Agreement, and (iv) have not previously been provided to such other Party. To the extent set forth in the applicable transfer plan(s) or otherwise requested or transferred pursuant to this Section 2.4.2 (Additional Transfers), the data transferred pursuant to this Section 2.4.2 (Additional Transfers) shall include Unilateral Development Data and Combination Therapy Data that meets the requirements of clauses (i) through (iv).  For clarity, a Party shall have no right to use or reference the foregoing items described in clauses (w)-(z) other than as permitted pursuant to this Agreement.

2.4.3

Regulatory Transition.  Except with respect to the EMA PNH Regulatory Approval (which shall remain owned by Apellis until assigned to Sobi in accordance with Section 5.2.6 (Assignment of EMA PNH Regulatory Approval)) and the existing Dossier for Clinical Development of a Product in [**], Apellis shall, in a manner and on a date to be mutually agreed by the Parties, but in any event within [**] after the Effective Date, assign to Sobi all of Apellis’ and its Affiliates’ rights, title, and interests in and to any Regulatory Approvals, INDs, Regulatory Submissions and orphan drug designations (or equivalent), other than CTAs with respect to which Apellis is the sponsor, Controlled by Apellis or any of its Affiliates with respect to Products and countries for which Sobi is the Regulatory/Reimbursement Responsible Party. With respect to any Regulatory Approvals, INDs, Regulatory Submissions and orphan drug designations (or equivalent) that Apellis assigns to Sobi, Apellis shall, at Sobi’s reasonable request therefor,promptly execute and deliver, or cause to be executed and delivered, to Sobi or any applicable Regulatory Authority such endorsements, assignments, and other documents as are necessary to assign, convey, transfer, and deliver, as applicable, to Sobi the same.

2.4.4

Support.  The Parties understand and agree that, in addition to the cooperation and assistance to be expressly provided under this Section 2.4 (Technology, Data, and Regulatory Transfer), from time to time it may be necessary for either Party to seek assistance and cooperation from the other Party in connection with the performance of such Party’s obligations and exercise of such Party’s rights under this Agreement. Each Party shall, at its own cost and expense, provide any such assistance and cooperation reasonably requested by the other Party.

2.5

Performance by Affiliates, Sublicensees, and Subcontractors

2.5.1

Performance by Affiliates.  Each Party may perform some or all of its obligations under this Agreement through its Affiliates; except that each Party will remain responsible for and be the guarantor of any such performance by its Affiliates and will cause its Affiliates to comply with the terms and conditions of this Agreement in connection with such performance.  Each Party hereby expressly waives any requirement that the other Party exhaust any right, power, or remedy, or proceed against any of such Party’s Affiliates, for any obligation or performance hereunder prior to proceeding directly against such Party.

2.5.2

Sublicenses.  Subject to the terms and conditions of section 1.5 of the Penn Other Fields License Agreement regarding sublicensing through multiple tiers (which provides that, if Sobi desires to sublicense any Commercialization rights under any rights licensed under the Penn Other Fields License Agreement to a further sublicensee that is not an Affiliate of Sobi, Sobi and Apellis shall notify Penn of the identity of such non-Affiliate further sublicensee within [**] after the grant of such further sublicense, and any such downstream sublicense must require the sub-sublicensee to comply with the terms of the Penn Other Fields License Agreement and prohibit further sublicensing of Commercialization rights):

(a)

Subject to Section 2.5.1 (Performance by Affiliates), each Party will have the right to sublicense (including through multiple tiers) any or all of the rights granted to it by the other Party under this Agreement to such Party’s Affiliates without the consent of the other Party.

(b)

Subject to Sections 2.5.2(c) (Sublicenses), 2.5.2(e) (Sublicenses), and 2.5.2(f) (Sublicenses), each Party will have the right to sublicense any or all of the rights granted to it by the other Party under this Agreement in connection with delegating any of such Party’s obligations to Subcontractors in connection with exercising such Party’s rights or performing such Party’s obligations under this Agreement, except that (i) other than with respect to any contract research organization engaged by Apellis as of the Effective Date, neither Party may engage any contract research organization to perform any Global Development Activities until such Party has consulted with the other Party with respect to the engagement of such contract research organization and (ii) no Subcontractor may grant any further sublicense. For clarity, clause (i) shall not apply to a Party using a contract research organization in respect of such Party’s Regional Development Activities.

(c)

Subject to Section 2.5.2(f) (Sublicenses), Sobi will have the right to sublicense any or all of the rights granted to it by Apellis under Section 2.1.1 (License Grants to Sobi) to Third Parties for the purpose of Developing, Manufacturing, Commercializing or conducting Medical Affairs with respect to any Product in the Sobi Territory, but:

(i)

Sobi may not sublicense any right to Commercialize any Product in any Major European Country without Apellis’ prior written approval (which may not be unreasonably withheld, conditioned, or delayed); and

(ii)

Sobi may not sublicense any right to Commercialize any Product in any Major Market or Russia without first giving Apellis opportunity to comment on Sobi’s proposed sublicensee.

(d)

Subject to Section 2.5.2(f) (Sublicenses), Apellis will have the right to sublicense any or all of the rights granted to it by Sobi under Section 2.1.2 (License Grants to Apellis) for the purpose of Commercializing any Product in the Apellis Territory or Developing, Manufacturing, Commercializing, or conducting Medical Affairs with respect to Non-Systemic Ophthalmology Products anywhere in the world.

(e)

If Sobi sublicenses to any Third Party any of the Commercialization rights granted to it by Apellis under this Agreement and such sublicense includes any rights licensed under the Penn Other Fields License, Apellis and Sobi shall jointly notify Penn of the identity of such Sublicensee within [**] after the grant of such sublicense.

(f)

A Party sublicensing any of the rights granted to it by the other Party under this Agreement shall ensure that each of its sublicensees is bound by a written agreement that is consistent with, and subject to the applicable terms and conditions of, this Agreement, and such sublicensing Party shall provide the other Party with a copy of such sublicense agreement within [**] after the execution of such sublicense agreement.  Any such copy may be reasonably redacted to the extent required to remove any confidential, proprietary, or competitive

information, but such copy shall not be redacted to the extent that it impairs the other Party’s ability to monitor compliance with this Agreement, unless such redaction is required to prevent breach of the terms of such sublicense or other confidentiality obligation to which the relevant Party or its Affiliates is subject. Such sublicense agreement shall be treated as Confidential Information of the sublicensing Party.  Each sublicensing Party will be responsible, and primarily liable, for the performance of each of its sublicensees with all relevant restrictions, limitations, and obligations in this Agreement, and the grant of any sublicense will not relieve either Party of its obligations under this Agreement. Without limiting the foregoing, unless otherwise agreed by the Parties in advance in writing:

(i)

the sublicensing Party shall require any Third Party to whom such Party discloses Confidential Information of the other Party to enter into an appropriate written agreement obligating such Third Party to be bound by obligations of confidentiality and restrictions on use of such Confidential Information that are at least as protective of such Confidential Information as are the obligations set forth in Article 13 (Confidentiality), including requiring such Third Party to agree in writing not to issue any publications concerning any Compound or Product except in compliance with the terms of this Agreement; and

(ii)

the sublicensing Party shall obligate its sublicensees to agree in writing to assign ownership to the sublicensing Party of, or grant an exclusive, royalty-free, worldwide, perpetual, and irrevocable license (with the right to freely grant sublicenses through multiple tiers) to, all Collaboration Know-How and Collaboration Patent Rights arising under its agreement with such Third Party to the extent related to the Exploitation of any Compound or Product, and such sublicensing Party shall structure each such assignment or exclusive license so as to enable such sublicensing Party to license or sublicense (as applicable) such Collaboration Know-How and Collaboration Patent Rights to the other Party in accordance with this Agreement.

2.6

Exclusivity

2.7

Promotional Activities

2.7.1

No Promotion. Except with respect to global congresses, meetings, or roundtables approved by the JMC, Apellis shall not market or promote any Product in the Sobi Territory, and Sobi shall not market or promote any Product in the Apellis Territory.  

2.7.2

Exports and Resale. Apellis shall use Commercially Reasonable Efforts to monitor and prevent exports or resale of Products from or outside the Apellis Territory for Commercialization in the Sobi Territory, and Sobi shall use Commercially Reasonable Efforts to monitor and prevent exports or resale of Products from or outside the Sobi Territory for Commercialization in the Apellis Territory, in each case to the extent consistent with Applicable Law and using methods commonly used in the industry for such purpose, and the Parties shall keep each other reasonably informed of any such exports or resales of which they become aware.

2.7.3

Sobi Territory Requests and Orders. If Apellis or any of its Affiliates or sub/licensees receives a request or order to Commercialize any Product in the Sobi Territory, Apellis shall notify Sobi thereof, shall not accept such request or order, and shall direct the relevant individual or entity to Sobi.  

2.7.4

Apellis Territory Requests and Orders. If Sobi or any of its Affiliates or Sublicensees receives a request or order to Commercialize any Product in the Apellis Territory, Sobi shall notify Apellis thereof, shall not accept such request or order, and shall direct the relevant individual or entity to Apellis.

2.8

Section 365(n) of the Bankruptcy Code

3.1

Alliance Management

3.1.1

Alliance Managers.  Within [**] after the Effective Date, each Party will appoint a single individual who possesses sufficient alliance management experience, is otherwise suitably qualified, and has the requisite decision-making authority to act as such Party’s alliance manager under this Agreement to support the Development, Manufacturing, Commercialization, and Medical Affairs of the Products worldwide (the “Alliance

Manager”). Each Party may change the person designated as such Party’s Alliance Manager upon written notice (including via email notification) to the other Party, but any such new Alliance Manager must possess sufficient alliance management experience and otherwise meets the requirements set forth in this Section 3.1.1 (Alliance Managers).  Each Party shall ensure that each of such Party’s Alliance Managers is bound by obligations of non-use and confidentiality that are at least as protective of the other Party’s Confidential Information as are those set forth in Article 13 (Confidentiality).

3.1.2

Roles and Responsibilities.  The Alliance Managers will be responsible for:

(a)

facilitating the flow of information and data and otherwise promoting communication and coordinating the Development, Manufacturing, Commercialization, and Medical Affairs of the Products worldwide, including for the applicable Committees;

(b)

providing a single point of communication for seeking consensus, both internally within the respective Party’s organization and between the Parties, and for fostering good collaboration, communication, and coordination;

(c)

managing Agreement governance and driving timely resolution of issues through informal and formal conflict resolution under this Agreement, including for the applicable Committees;

(d)

attending Committee meetings; and

(e)

performing such other functions as are requested by the JEC.

3.2

Joint Executive Committee

3.2.1

Formation.  As soon as practicable, but no later than [**] after the Effective Date, the Parties shall establish a Joint Executive Committee (the “JEC”) to review, discuss, and, as applicable, oversee activities under this Agreement. The JEC shall be comprised of an equal number of, and in any event at most [**], representatives from each of Sobi and Apellis, each of whom shall have the appropriate experience, expertise, and decision-making authority to perform his or her responsibilities on the JEC. Each Party shall provide written notice (including via email notification) to the other Party or the other Party’s Alliance Manager of its initial representatives to the JEC.  Each Party’s Chief Executive Officer shall be a representative on the JEC for at least [**] after the Effective Date.  Except with respect to each Party’s Chief Executive Officer during the first [**] after the Effective Date, either Party may replace its JEC representatives with similarly qualified individuals at any time upon prior written notice (including via email notification) to the other Party or the other Party’s Alliance Manager. Either Party may invite up to [**] (or such other number as agreed by the JEC or reasonably required by a Party to fulfill its obligations under this Agreement) of its employees to participate in the discussions and meetings of the JEC by providing written notice (including via email notification) to the other Party or the other Party’s Alliance Manager prior to such employee’s participation, but such participants will have no voting authority at the JEC.  If agreed by the JEC on a case-by-case basis, the JEC may invite other non-employee Third Parties to participate in the discussions and meetings of the JEC, but such participants will have no voting authority at the JEC. Each Party shall ensure that all of its JEC members, and all of its non-member employees and all non-employee Third Parties attending any JEC meeting, are bound by

obligations of non-use and confidentiality that are at least as protective of the other Party’s Confidential Information as are those set forth in Article 13 (Confidentiality).  The Alliance Managers shall be responsible, on behalf of the JEC, for setting the agenda for meetings of the JEC with input from the JEC members and will disseminate such agendas and presentations to be made at any meeting no later than [**] in advance of each JEC meeting unless otherwise agreed to by the Parties in writing.

3.2.2

Meetings.  The JEC shall meet in person (alternating between a site designated by each of Apellis and Sobi) or by videoconference or teleconference at least [**] until the earliest of (a) [**], (b) a Change of Control of either Party, or (c) [**], and thereafter shall meet [**] or with such other frequency as the Parties may agree. Specific meeting dates shall be determined by agreement of the Parties.  Either Party may also call a special meeting of the JEC (by videoconference or teleconference) upon prior written notice to the other Party if such Party reasonably believes that a significant matter must be addressed before the next regularly scheduled JEC meeting, and such Party shall provide the JEC with materials reasonably adequate to enable an informed discussion by its members before such special meeting. Apellis shall host the first meeting of the JEC at a mutually agreeable time and place no later than [**] after the Effective Date.  Each Party will be responsible for its own expenses relating to attendance at or participation in JEC meetings.  Each Party shall appoint one of its JEC representatives to act as a co-chairperson of the JEC.  The responsibility for running each JEC meeting will alternate between the JEC co-chairpersons from meeting-to-meeting, with Apellis’ co-chairperson running the first JEC meeting.  The JEC co-chairpersons (or, at the election of the JEC co-chairpersons, the Alliance Managers) shall jointly prepare and circulate agendas to JEC representatives at least [**] before each JEC meeting (other than a special meeting as described above) and shall direct the preparation of meeting minutes after each JEC meeting, which shall be approved by the JEC co-chairpersons and circulated to other JEC representatives within [**] after such meeting.  Except as expressly set forth in this Section 3.2.2 (Meetings), no JEC co-chairperson shall have any rights or powers greater than those of any other JEC member.

3.2.3

Responsibilities.  The JEC shall have the duties described below. Within such scope, the JEC shall, subject to Section 3.7 (Decisions of the Committees):

(a)

manage the overall strategic alignment between the Parties under this Agreement;

(b)

establish and delegate specifically-defined duties to subcommittees, such as the JDC, the JMC, the JCC, and the JMSC, and other operational or ad-hoc subcommittees, on an “as-needed” basis to review, discuss, and, as applicable, oversee particular projects or activities, and receive and discuss reports from such subcommittees and provide guidance to the respective subcommittees regarding the same, as described in Section 3.2.4 (Subcommittees);

(c)

review, discuss, and determine whether to amend or approve each Additional Development Proposal submitted by the JDC pursuant to Section 4.4.4(a) (JEC Decision Regarding Additional Development Activities);

(d)

attempt to resolve any issues or disputes, including those arising from the Parties, Alliance Managers, JDC, JMC, JCC, JMSC, or any other subcommittee, as described in Section 3.7.2 (Escalation to JEC);

(e)

review and discuss the Development, Manufacture, Commercialization, and Medical Affairs of the Products worldwide;

(f)

review, discuss, and determine whether to approve any updates to the Global Development Plan (including the associated Global Development Budget) that include Additional Global Development Activities, Combination Therapy Activities or are otherwise material, in each case, as submitted by the JDC, as described in Section 4.4 (Development Plans; Unilateral Development Activities; Amendments) and Section 4.8 (Combination Products, Combination Therapies);

(g)

review, discuss, and determine whether to approve the initial Global Branding Strategy, and approve any material updates thereof, in each case, submitted by the JCC as described in Section 6.3 (Global Branding Strategy and Information);

(h)

review and monitor the progress of the Parties under the Global Development Plan, including milestones therein;

(i)

determine whether to cease Developing or Commercializing any Product for any given Indication under this Agreement;

(j)

determine any activities required to be added to the Global Development Plan (and associated Global Development Budget) as a result of a conditional Regulatory Approval in PNH in the European Union and the United Kingdom (and all associated PNH Development Costs to be incurred by either Party in accordance with Section 4.6.2 (PNH Development Costs)), but, if the JEC is unable to determine such matter, such dispute shall be resolved in accordance with Section 16.5.1 (Baseball Arbitration);

(k)

determine whether any Shared Development Costs should be borne by the Parties in any ratio other than fifty percent (50%)/fifty percent (50%);

(l)

jointly establish and maintain, or establish a subcommittee to establish and maintain, as set forth in the SDEA, all necessary pharmacovigilance requirements for each Product in full compliance with all Applicable Laws and requirements of the Regulatory Authorities in each country in the world, in accordance with Section 5.4.1 (SDEA; Responsibilities);

(m)

discuss the licensing of Additional Third Party IP in accordance with Section 2.3 (New In-Licenses);

(n)

provide a forum for the Parties to share information on patent prosecution matters and other intellectual property matters, and to facilitate coordination between the Parties in accordance with Article 10 (Intellectual Property Matters); and

(o)

perform such other non-decision making functions as appropriate to further the purposes of this Agreement, as agreed upon by the Parties in writing.

3.2.4

Subcommittees.  

(a)

The JEC may, by unanimous agreement, establish and delegate specifically-defined duties to subcommittees and other operational committees or ad-hoc

subcommittees on an “as-needed” basis to review, discuss, and, as applicable, oversee particular projects or activities.  The initial subcommittees of the JEC will be the Joint Development Committee (“JDC”), the Joint Medical Committee (“JMC”), the Joint Commercialization Committee (“JCC”), and the Joint Manufacturing and Supply Committee (“JMSC”).  The JEC may, by unanimous agreement, disband such subcommittees as deemed necessary by the JEC.  Each such subcommittee shall consist of the same number of representatives designated by each Party, which number shall be agreed upon by the Parties.  Each Party will be free to change its subcommittee representatives upon written notice to the other Party or by sending a substitute representative to any subcommittee meeting, but each Party shall ensure that, at all times during the existence of any subcommittee, such Party has appropriate representatives on such subcommittee in terms of experience, expertise, and seniority for the then-current stage of Development or Commercialization of the Products and the authority to bind such Party with respect to matters within the purview of the relevant subcommittee.  Each Party shall ensure that its subcommittee representatives and any substitutes therefor, and any other individual attending any subcommittee meeting on such Party’s behalf, shall be bound by obligations of non-use and confidentiality that are at least as protective of the other Party’s Confidential Information as are those set forth in Article 13 (Confidentiality).  The Alliance Managers of each Party (or their designees) shall attend each meeting of each subcommittee as non-voting participants. Except as expressly provided in this Agreement, no subcommittee will have the authority to bind the Parties hereunder, and each subcommittee shall report to, and have any disputes in such committee resolved by, the JEC.  No subcommittee’s authority may exceed the authority specified for such subcommittee in this Article 3 (Governance). Any disagreement between the representatives of the Parties on a subcommittee shall be referred to the JEC for resolution in accordance with Section 3.7.2 (Escalation to JEC).

(b)

Unless otherwise previously agreed in writing by the Alliance Managers or otherwise set out in this Agreement, the JDC shall meet [**] until the earlier of (A) [**] or (B) [**], and otherwise each subcommittee shall meet at least [**] until the earliest of (i) [**], (ii) a Change of Control of either Party, or (iii) [**], and thereafter shall meet [**] at a time agreed by the Parties, spaced at regular intervals unless the Parties agree in writing to a different frequency, with the location for such meetings to be determined by such subcommittee.  Each subcommittee may meet in person, or alternatively, such subcommittee may meet by means of teleconference, videoconference, or other similar communications equipment.  Either Party may also call a special meeting of each subcommittee by prior written notice to the other Party in the event such requesting Party reasonably believes that a significant matter must be addressed prior to the next scheduled meeting, and such requesting Party shall provide such subcommittee, prior to the special meeting, with materials reasonably adequate to enable an informed decision on the relevant matter.  No later than [**] prior to any meeting of any subcommittee (other than a special meeting as described above), a designated member of such subcommittee or, if such subcommittee so agrees, one of the Alliance Managers shall prepare and circulate an agenda for such meeting to all members of such subcommittee, but either Party will be free to propose additional topics to be included on such agenda, either prior to or during the course of such meeting. Each Party will bear the expense of its respective subcommittee members’ participation in subcommittee meetings.  A designated member of each subcommittee or, if such

subcommittee so agrees, one of the Alliance Managers shall be responsible for keeping written minutes of all such subcommittee’s meetings that reflect all decisions made at such meetings.  Such designated subcommittee member or Alliance Manager shall send meeting minutes to each member of such subcommittee for review and approval within [**] after each meeting of such subcommittee.  Such minutes will be deemed approved unless, through communication of the Alliance Managers, one or more members of such subcommittee objects to the accuracy of such minutes within [**] after receipt. Except as expressly set forth in this Section 3.2.4(b) (Subcommittees), no designated member of any subcommittee shall have any rights or powers greater than those of any other member of such subcommittee.

3.2.5

Disbandment of the JEC.  The JEC will immediately dissolve upon the expiration (or earlier termination) of the Term.

3.3

Joint Development Committee

3.3.1

Formation and Purpose of the JDC.  Promptly, but not later than [**] after the Parties establish the JEC, the JEC shall establish a JDC, which will be a subcommittee of the JEC and will have the responsibilities set forth in this Section 3.3 (Joint Development Committee).  Each Party shall report to the JDC on all material issues relating to the Development of the Products worldwide at the next JDC meeting after such issues arise. Each Party will bear the expense of its respective JDC members’ participation in JDC meetings. The JDC will dissolve upon completion of all Global Development Activities with respect to the Products.

3.3.2

Specific Responsibilities of the JDC.  In addition to its general responsibilities, subject to the terms and conditions of this Agreement, the JDC shall, in particular:

(a)

facilitate the exchange of information between the Parties under this Agreement regarding the strategy for Developing the Products;

(b)

establish one (1) or more plans for data and technology transfers and coordinate and ensure successful completion of the Know-How transfers, as described in Section 2.4 (Technology, Data, and Regulatory Transfer);

(c)

review and discuss the conduct of all Clinical Trials set forth in the Global Development Plan, as described in Section 4.4 (Development Plans; Unilateral Development Activities; Amendments);

(d)

at least [**] during the Term (or more or less frequently as may be agreed upon in writing by the Alliance Managers), review, update, and determine whether to approve the updated Global Development Plan and, if applicable, the corresponding Global Development Budget, and submit to the JEC for review and approval any such update that includes Additional Global Development Activities or is otherwise material, as described in Section 4.4.6 (Updating the Global Development Plan);

(e)

review, discuss, and submit to the JEC to review, discuss, and determine whether to approve each Additional Development Proposal and Combination Therapy Development Proposal, and update the Global Development Plan with any such

approved Additional Global Development Activities and Combination Therapy Global Development Activities, as described in Section 4.4.4 (Additional Development) and Section 4.8 (Combination Products, Combination Therapies);

(f)

review and discuss each Party’s conduct of its respective Global Development Activities set forth in the Global Development Plan and review any [**] update reports thereof as described in Section 4.10.2 (Reports);

(g)

review and discuss the Apellis Territory Regional Development Plan and Sobi Territory Regional Development Plan, and the conduct and status of the Apellis Territory Regional Development Activities and Sobi Territory Regional Development Activities;

(h)

review, discuss, and approve protocols and statistical analysis plans for Clinical Trials conducted under the Global Development Plan pursuant to Section 4.7 (Clinical Trials);

(i)

review, discuss, and coordinate with each Party’s regulatory team all strategies, communications, and contents of all meetings, conferences, and discussions with Regulatory Authorities related to each Product, as described in Section 5.2.3 (Meetings with Governmental Authorities);

(j)

coordinate, review, and discuss the Parties’ Shared Development Costs;

(k)

review, discuss, approve, and coordinate the Apellis Readiness Activities and determine any activities additional to those set out in Schedule 4.3.6 (Apellis Readiness Activities) required to ensure inspection readiness for the PEGASUS and PRINCE Clinical Trials in PNH;

(l)

review and discuss any material decisions or actions with respect to the EMA PNH Regulatory Approval as described in Section 5.2.5(b) (Regulatory Strategy for EMA PNH Regulatory Approval) and Section 5.2.6(b) (Assignment of EMA PNH Regulatory Approval); and

(m)

perform such other non-decision making functions as appropriate to further the purposes of this Agreement, as directed by the JEC, or as specified in this Agreement.

3.4

Joint Medical Committee.

3.4.1

Formation and Purpose of the JMC. Promptly, but not later than [**] after the Parties establish the JEC, the JEC shall establish a JMC, which will be a subcommittee of the JEC and will have the responsibilities set forth in this Section 3.4 (Joint Medical Committee). Each Party shall report to the JMC on all material issues relating to Medical Affairs with respect to the Products worldwide at the next JMC meeting after such issues arise. Each Party will bear the expense of its respective JMC members’ participation in JMC meetings. The JMC will dissolve upon the completion or earlier termination of all Medical Affairs activities with respect to the Products.

3.4.2

Specific Responsibilities of the JMC.  In addition to its general responsibilities, subject to the terms and conditions of this Agreement, the JMC shall:

(a)

develop an initial Medical Affairs Strategy, as described in Section 7.1 (Medical Affairs Strategy);

(b)

at least [**] during the Term (or more frequently as may be required), review, update, and determine whether to approve each updated Medical Affairs Strategy and submit to the JEC for review and approval any such update that is material;

(c)

review and discuss Medical Education Materials in accordance with Section 7.4 (Medical Education Materials);

(d)

review and discuss reports and updates of Medical Affairs activities performed by or on behalf of each Party with respect to any Product and other [**] reports provided by either Party of Medical Affairs activities performed for any Product, as described in Section 7.7 (Reporting);

(e)

coordinate each Party’s participation at global symposia, congresses, and similar international meetings spanning both Parties’ territories concerning Products, and interactions with key opinion leaders concerning Products in the country(ies) in which the other Party has the right to Commercialize Products;

(f)

review and discuss Publications and the Publication Plan pursuant to Section 13.7 (Publication);

(g)

establish a Publication Plan in accordance with Section 13.7 (Publication); and

(h)

perform such other non-decision making functions as appropriate to further the purposes of this Agreement, as directed by the JEC or as specified in this Agreement.

3.5

Joint Commercialization Committee.

3.5.1

Formation and Purpose of the JCC. Promptly, but not later than [**] after the Parties establish the JEC, the JEC shall establish a JCC, which will be a subcommittee of the JEC and will have the responsibilities set forth in this Section 3.5 (Joint Commercialization Committee). Each Party shall report to the JCC on all material issues relating to the Commercialization of the Products worldwide at the next JCC meeting after such issues arise. Each Party will bear the expense of its respective JCC members’ participation in JCC meetings.   The JCC will dissolve upon the completion or earlier termination of all Commercialization activities with respect to the Products.

3.5.2

Specific Responsibilities of the JCC.  In addition to its general responsibilities, subject to the terms and conditions of this Agreement, the JCC shall:

(a)

develop and submit to the JEC to review,  discuss, and determine whether to approve the Global Branding Strategy, as described in Section 6.3.1 (Global Branding Strategy);

(b)

at least [**] during the Term (or more frequently as may be required), review,  update, and determine whether to approve the updated Global Branding Strategy, and submit to the JEC to review, discuss, and determine whether to approve any

update to the Global Branding Strategy, in each case, that is material, as described in Section 6.3.2 (Updating the Global Branding Strategy);

(c)

share information about geographical expansion plans and launch sequences for each Product in the Sobi Territory and the Apellis Territory;

(d)

share information and cooperate regarding any administration device developed or used or proposed to be developed or used by either Party in relation to the Products;

(e)

review and discuss the plans, status, reports, and progress of Commercialization activities, as described in Section 6.10.2 (Reports);

(f)

discuss Promotional Materials relating to each Product, as described in Section 6.8 (Promotional Materials);

(g)

perform such other non-decision making functions as appropriate to further the purposes of this Agreement, as directed by the JEC or as specified in this Agreement.

3.6

Joint Manufacturing and Supply Committee.  

3.6.1

Formation and Purpose of the JMSC. Promptly, but not later than [**] after the Parties establish the JEC, the JEC shall establish a JMSC, which will be a subcommittee of the JEC and will have the responsibilities set forth in this Section 3.5 (Joint Manufacturing and Supply Committee).  Each Party will bear the expense of its respective JMSC members’ participation in JMSC meetings.  The JMSC will dissolve upon the completion or earlier termination of all Manufacturing activities with respect to the Products.

3.6.2

Specific Responsibilities of the JMSC.  In addition to its general responsibilities, subject to the terms and conditions of this Agreement and the Parties’ rights and obligations under the Supply Agreement, the JMSC shall:

(a)

prepare a Manufacturing and Supply Chain Plan and updates thereto for the review and approval of the Parties in accordance with Section 8.4 (Manufacturing and Supply Chain Plan);

(b)

share information regarding capacity planning, supply plans, other supply chain matters, and supply continuity planning for the Products;

(c)

share information regarding the Manufacturing process for each Product and review, discuss, and determine any changes thereto (including the costs and timelines therefor);

(d)

review and share the results of regulatory, environmental, health, and safety inspections and audits related to the Manufacture of the Products;

(e)

determine whether and on what conditions Sobi, itself or through an Affiliate or Third Party reasonably acceptable to Apellis, shall Manufacture, in a particular country or region, the bulk substance form of any Product sold in such country or region as required by Applicable Law, in accordance with Section 8.1 (Sobi Right to Manufacture Drug Substance);

(f)

share and review performance of Third Party manufacturers and agree on any necessary actions with respect thereto;

(g)

at least [**] on a date agreed to by the Parties in good faith, review and determine the extent to which the Manufacturing Costs are required to be modified or adjusted with respect to any changes in Apellis’ actual Manufacturing Cost, subject to reasonable and appropriate limits on such modification or adjustment and any required true-up (the mechanics for which will be mutually agreed upon in the Supply Agreement); and

(h)

perform such other non-decision making functions as appropriate to further the purposes of this Agreement, as directed by the JEC or as specified in this Agreement.

3.7

Decisions of the Committees.

3.7.1

Voting; Consensus.  Each Party’s representatives on the JEC and each subcommittee will, collectively, have one vote (the “Party Vote”) on all matters brought before such Committee for a decision. The JEC and each subcommittee shall make decisions as to matters within its jurisdiction by unanimous Party Vote, which may be reflected in the minutes of the Committee meeting or by an action by written consent signed by a member appointed by each Party or his or her designee identified in writing. Except as otherwise expressly set forth in this Agreement, use of the phrases “determine,” “establish,” “delegate,” “approve,” “develop,” “update,” “submit,” “prepare,” “resolve,” or “determine whether to approve” (including any conjugates thereof) by the JEC, the JDC, the JMC, the JCC the JMSC, or any other subcommittee, will mean that the decision making provisions of this Section 3.7 (Decisions of the Committees) apply to such matter, including the escalation and tie‑breaking provisions herein. For the avoidance of doubt, matters that are specified in Section 3.2.3 (Responsibilities), Section 3.3.2 (Specific Responsibilities of the JDC), Section 3.4.2 (Specific Responsibilities of the JMC), 3.5.2 (Specific Responsibilities of the JCC), or 3.6.2 (Specific Responsibilities of the JMSC) to be “managed,” “reviewed,” “discussed,” “monitored,” “provided a forum,” “performed,” “facilitated,” “coordinated,” “cooperated,” or “shared” (including any conjugates thereof) 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 3.7 (Decisions of the Committees).

3.7.2

Escalation to JEC.  Any disagreement between the representatives of Apellis and Sobi with respect to matters within the scope of authority of the Alliance Managers, the JDC, the JMC, the JCC, the JMSC, or any other subcommittee that cannot be resolved after good faith efforts within [**] after such disagreement is first raised in writing, either via email or Committee meetings, by a Party representative shall, at the election of either Party, be submitted to the JEC for resolution.  If the JEC is unable to resolve any such disagreement referred to it by the JDC, JMC, JCC, JMSC, or any other subcommittee, or any disagreement with respect to the matters within the scope of the JEC’s authority or any other dispute between the Parties that may be referred to the JEC, in each case, using good faith efforts within a period of [**] from such referral or the start of such disagreement, as applicable, then either Party may immediately refer such matter for resolution to the Chief Executive Officer of Apellis and the Chief Executive Officer of Sobi, or their respective designees from senior management with decision-making authority over such matter (such executives or such designees, each, an “Executive Officer”).

3.7.3

Escalation to Executives.  In the event that the Executive Officers are unable to resolve any dispute referred to them pursuant to Section 3.7.2 (Escalation to JEC) within [**] after such dispute was referred to the Executive Officers, then the provisions of Section 3.7.4 (Final Decision-Making Authority) will apply.

3.7.4

Final Decision-Making Authority.  If the Executive Officers are unable to reach agreement on any disputed matter so referred to them within [**] after such matter was referred to them (or such longer period as the Executive Officers may agree upon), then, subject to Section 4.4.4 (Additional Development), Section 4.8 (Combination Products, Combination Therapies), and Section 3.7.5 (Limitations on Decision Making Authority):

(a)

No Change; Status Quo.  Neither Party will have final decision-making authority over the following matters, and all such matters must be decided by unanimous agreement in order to take any action or adopt any change from the then-current status quo: (i) any change or update to the Global Development Plan or Global Development Budget, (ii) adoption of, or any change or update to, the Global Branding Strategy, (iii) adoption of, or any change or update to, the Medical Affairs Strategy, or (iv) the approval or coordination of or any change or update to the Apellis Readiness Activities.

(b)

Other Decisions.  With respect to any matter not described in Section 3.7.4(a) (No Change; Status Quo), the Party specified below shall, subject to Section 3.7.5 (Limitations on Decision Making Authority), except to the extent otherwise specified in this Agreement, have final decision-making authority with respect to the matters specified below, but any such decision must be (to the extent applicable) (i) consistent with the then-current Global Development Plan and corresponding Global Development Budget (except that Apellis (but not Sobi) may spend more than is set forth in the Global Development Budget in conducting any activities set forth in the initial Global Development Plan attached to this Agreement) and the Medical Affairs Strategy, (ii) subject to Section 6.1 (Overview), in accordance with the then-current Global Branding Strategy (if any), and (iii) consistent with such Party’s obligations under this Agreement (including such Party’s obligation to use Commercially Reasonable Efforts):

(i)

Sobi, with respect to decisions which relate:

A.

solely to the Development, Commercialization or Medical Affairs of Products to be Commercialized in the Sobi Territory;

B.

except with respect to the EMA PNH Regulatory Approval prior to the date on which it is assigned to Sobi in accordance with this Agreement, to regulatory and reimbursement activities and obligations (other than decisions as to whether to seek, continue to seek, maintain, or abandon Regulatory Approval in the Apellis Territory), and applicable regulatory and reimbursement activities for a Product after receipt of Regulatory Approval or Reimbursement Approval for such Product, in any country in the Sobi Territory;

C.

to the EMA PNH Regulatory Approval, following the date on which it assigned to Sobi in accordance with this Agreement;

D.

with respect to operational matters relating to, and day-to-day conduct of, clinical studies and Clinical Trials sponsored by Sobi or its Affiliates or Sublicensees, in accordance with the approved protocol therefor and the Global Development Plan, in each case as applicable;

E.

the Sobi Territory Regional Development Activities; and

(ii)

Apellis, with respect to decisions which relate:

A.

solely to the Development, Commercialization, or Medical Affairs for Products to be Commercialized in the Apellis Territory;

B.

to regulatory and reimbursement activities and obligations (other than decisions as to whether to seek, continue to seek, maintain, or abandon Regulatory Approval in the Sobi Territory), and applicable regulatory and reimbursement activities for a Product after receipt of Regulatory Approval or Reimbursement Approval for such Product, in the Apellis Territory;

C.

to the EMA PNH Regulatory Approval, prior to the date on which it assigned to Sobi in accordance with this Agreement;

D.

with respect to operational matters relating to, and day-to-day conduct of, clinical studies and Clinical Trials sponsored by Apellis, its Affiliates, or sub/licensees, in accordance with the approved protocol therefor and Global Development Plan, in each case as applicable;; and

E.

the Apellis Territory Regional Development Activities.

3.7.5

Limitations on Decision Making Authority.  Notwithstanding the foregoing provisions of this Section 3.7 (Decisions of the Committees), neither Party may exercise its right to finally resolve a dispute:

(a)

in a manner that excuses such Party from any of its obligations specifically enumerated under this Agreement;

(b)

in a manner that conflicts with the any of the express terms or conditions of this Agreement (including any obligation to comply with Applicable Law);

(c)

in a manner that negates any consent rights or other rights specifically allocated to the other Party under this Agreement;

(d)

if the provisions of this Agreement specify that mutual agreement of the Parties is required for such matter;

(e)

involving the breach or alleged breach of this Agreement;

(f)

in a manner that would require the other Party to perform any act that would breach any obligation to any Third Party (including under any Existing Agreement or Collaboration In-License) or is inconsistent with any Applicable Law;

(g)

to determine whether or not a milestone event has been achieved;

(h)

to otherwise expand a Party’s rights or reduce a Party’s obligations under this Agreement; or

(i)

except as set forth in Section 3.7.4(b)(i)B (Other Decisions), Section 3.7.4(b)(i)C (Other Decisions), Section 3.7.4(b)(i)D(Other Decisions), Section 3.7.4(b)(i)E (Other Decisions), Section 3.7.4(b)(ii)B (Other Decisions), Section 3.7.4(b)(ii)C (Other Decisions), Section 3.7.4(b)(ii)D (Other Decisions), or Section 3.7.4(b)(ii)E (Other Decisions), in respect of matters specified in Section 3.7.4(b) (Other Decisions) if such matter would materially impact both the Exploitation of Products in or for the Sobi Territory and the Apellis Territory; and

3.7.6

No Authority to Amend or Modify.  Notwithstanding any provision of this Agreement to the contrary, (a) neither any Committee nor the Alliance Managers will have any authority to amend, modify, or waive compliance with this Agreement, (b) each Party will retain the rights, powers, and discretion granted to it under this Agreement, and (c) neither any Committee nor the Alliance Managers will be delegated or vested with rights, powers, or discretion unless such delegation or vesting is expressly provided herein, or the Parties expressly so agree in writing.  It is understood and agreed that issues to be formally decided by a particular Committee or the Alliance Managers are only those specific issues that are expressly provided in this Agreement to be decided by such Committee or the Alliance Managers, as applicable.

4.1

Overview

4.2

Performance of Development Activities

4.3

Development Diligence Obligations

4.3.1

each Party shall use Commercially Reasonable Efforts to perform all Development activities assigned to such Party in the Global Development Plan;

4.3.2

Apellis shall, unless and until the EMA PNH Regulatory Approval is assigned to Sobi in accordance with this Agreement use Commercially Reasonable Efforts to obtain Regulatory Approval from the EMA for a Product in PNH as soon as reasonably practicable following the Effective Date;

4.3.3

Apellis shall use Commercially Reasonable Efforts to obtain Regulatory Approval from the FDA for a Product in each of the Initial Indications;

4.3.4

Sobi shall use Commercially Reasonable Efforts to Develop and obtain Regulatory Approval and, where applicable, Reimbursement Approval for Products in each of the Initial Indications in each Major Market (except that, before the EMA PNH Regulatory Approval is assigned to Sobi in accordance with this Agreement, Apellis, and not Sobi, shall use its Commercially Reasonable Efforts to obtain Regulatory Approval from the EMA for a Product in PNH). Apellis acknowledges that, without prejudice to Section 6.5 (Expansion and Launch in the Sobi Territory), when Sobi determines the timing and order of Development activities and the level of efforts to obtain Regulatory Approval for each Product, Sobi may take into account current status of Development activities, status of Regulatory Approval with EMA, FDA and other Regulatory Authorities, requirements for local Manufacturing in the applicable country(ies), competitiveness of Third Party products, patent and regulatory exclusivity, anticipated or approved labelling, present and future market potential, competitive market conditions and the profitability of the Product

in light of pricing and reimbursement issues, reference Regulatory Approval strategy and reference pricing and reimbursement strategy; and

4.3.5

Apellis shall provide reasonable assistance to Sobi on Sobi’s reasonable request to obtain Regulatory Approval and, where applicable, Reimbursement Approval for Products in the Sobi Territory.

4.3.6

Apellis shall perform the Development activities set out in Schedule 4.3.6 (the “Apellis Readiness Activities”). Apellis shall provide Sobi with regular and timely updates on the status of such actions and shall consider all reasonable comments from Sobi regarding the performance of the Apellis Readiness Activities in good faith.

4.3.7

Each Party acknowledges that a Party shall not be in breach of its Development diligence obligations under this Agreement to the extent caused by the acts or omissions of the other Party or its Affiliates.

4.4

Development Plans; Unilateral Development Activities; Amendments

4.4.1

Global Development Plan.  

(a)

Except with respect to any Unilateral Development Activities or Unilateral Combination Therapy Development Activities, the global Development of the Products (including Clinical Trials and, when prepared and approved by unanimous agreement of the JDC or existing as of the date of this Agreement, the protocols and statistical analysis plans for such studies) will be governed by a comprehensive written development plan (as such plan may be updated pursuant to Section 4.4.6 (Updating the Global Development Plan), the “Global Development Plan”), which Global Development Plan will include a budget for all activities under such Global Development Plan (the “Global Development Budget”). The initial Global Development Plan (including the initial Global Development Budget) is attached hereto as Schedule 4.4.1 (Initial Global Development Plan and Initial Global Development Budget).

(b)

Except with respect to any Unilateral Development Activities or Unilateral Combination Therapy Development Activities, any updated Global Development Plan will at all times include:

(i)

all activities in furtherance of completing the PNH Phase III Clinical Trials (to the extent not already completed), including all activities to be performed under the current protocols therefor;

(ii)

an executive summary of the Development strategies for each then-existing Product for each Initial Indication in the Apellis Territory and each Major Market and each other Indication and country agreed upon by the JDC, including key objectives and expectations;

(iii)

dates of expected filing of each Drug Approval Application for each then-existing Product for each Initial Indication in the Apellis Territory and each Major Market and each other Indication and country agreed upon by the JDC;

(iv)

all Development activities that, if successful, the Parties reasonably believe are required to, within a reasonable timeframe, obtain, support, and maintain Regulatory Approval and, where required, Reimbursement Approval for each then-existing Product for each Initial Indication in the Apellis Territory, the European Union, and each Major Market and each other Indication and country agreed upon by the JDC;

(v)

any other Development activities recommended by the JDC for any Product for each Initial Indication in the Apellis Territory and each Major Market and each other Indication and country agreed upon by the JDC;

(vi)

any applicable required or, upon agreement of the Parties, optional post-Regulatory Approval Development activities for Products in the Indications and countries agreed upon by the JDC; and

(vii)

a timeline, and an allocation to the applicable Party of responsibility, for each of the activities described in the foregoing clauses.

(c)

The Parties shall collaborate in good faith to ensure that the Global Development Plan is at all times consistent with (i) the then-current Development Plan (as defined in the Penn Other Fields License Agreement) provided to Penn under the Penn Other Fields License Agreement and (ii) Apellis’ diligence obligations under the Penn Other Fields License Agreement and the SFJ Agreement.

4.4.2

Apellis Territory Regional Development Plan. The Development of the Products, outside of the Global Development Activities, to support Regulatory Approval of any Product in the Apellis Territory (including all Unilateral Development Activities and Unilateral Combination Therapy Development Activities conducted by or on behalf of Apellis) will be governed by a comprehensive written development plan (as such plan may be updated by Apellis in accordance with this Section 4.4.2 (Apellis Territory Regional Development Plan), the “Apellis Territory Regional Development Plan”). Apellis shall ensure that the Apellis Territory Regional Development Plan does not conflict with the Global Development Plan. Apellis shall ensure that Apellis Territory Regional Development Plan will at all times include all Unilateral Development Activities and Unilateral Combination Therapy Development Activities conducted by or on behalf of Apellis. Apellis shall keep the JDC reasonably informed of the contents of the Apellis Territory Regional Development Plan.

4.4.3

Sobi Territory Regional Development Plan. The Development of the Products, outside of the Global Development Activities, to support Regulatory Approval of any Product in the Sobi Territory (including all Unilateral Development Activities and Unilateral Combination Therapy Development Activities conducted by or on behalf of Sobi) will be governed by a comprehensive written development plan (as such plan may be updated by Sobi in accordance with this Section 4.4.3 (Sobi Territory Regional Development Plan), the “Sobi Territory Regional Development Plan”). Sobi shall ensure that the Sobi Territory Regional Development Plan does not conflict with the Global Development Plan. Sobi shall ensure that Sobi Territory Regional Development Plan will at all times include all Unilateral Development Activities and Unilateral Combination Therapy Development Activities conducted by or on behalf of Sobi. Sobi shall keep the JDC reasonably informed of the contents of the Sobi Territory Regional Development Plan.

4.4.4

Additional Development.  If either Party (a “Proposing Party” for the purposes of this Section 4.4.4 (Additional Development)) desires to perform, for any Product, any Clinical Trial that is not already set forth in the then-current Global Development Plan (“Additional Development”), then such Proposing Party shall present to the JDC to review, discuss, and determine whether to approve a proposal to add such Additional Development to the Global Development Plan (each such proposal, an “Additional Development Proposal”). Each Additional Development Proposal shall describe in reasonable detail the proposed additional Development activities (the “Additional Development Activities”), including, as applicable, any non-clinical studies, GLP Toxicology Studies, clinical studies, and Clinical Trials, that the Proposing Party desires to conduct or have conducted as part of such Additional Development, including a synopsis of the Clinical Trials or activities, the proposed enrollment criteria, the number of patients to be included, the endpoints to be measured, and the statistical design and powering, as well as a proposed timeline and budget and an analysis of the business opportunity and revenue potential for such Additional Development Activities.  

(a)

JEC Decision Regarding Additional Development Activities. The JDC shall review, discuss, and submit to the JEC to review, discuss, and determine whether to approve each Additional Development Proposal within [**] after receipt thereof from the Proposing Party.

(i)