Common use of Royalty Rates Clause in Contracts

Royalty Rates. Subject to the treatment of Combination Products as provided in the definition of Net Sales in Section 1.186, for each Product or Other Licensed Product, AstraZeneca shall pay Targacept a royalty based on AZ Net Sales of such Product or Other Licensed Product in each Calendar Year (or partial Calendar Year) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] [********] [********] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] (3) For each product that contains one or more Other Licensed Compounds, the Exploitation of which would infringe one or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration). For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided that nothing in this Section 6.6.1(a)(3) shall be deemed to permit the Exploitation of any Other Licensed Product where such Exploitation would constitute a breach of Section 8.6.3 or any other provision of this Agreement. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject In partial consideration of the licenses granted by argenx to the treatment Xxxxxxx in accordance with Section 3.1 of Combination Products as provided in the definition of Net Sales in Section 1.186this Agreement, for each Product or Other Licensed Product, AstraZeneca Xxxxxxx shall pay Targacept a royalty based to argenx royalties on AZ the aggregate Net Sales of such Product or Other Licensed Products by Xxxxxxx, its Affiliates and sublicensees in the OUS Territory during each Calendar Year at the rates set forth in the table below. For clarity, Net Sales of all Licensed Products that contain a given Licensed Compound shall be aggregated for purposes of calculation of royalties pursuant to this Section 8.6; provided, however, that Net Sales of a particular Licensed Product in each Calendar Year (or partial Calendar Year) at a particular country occurring after expiration of the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: Royalty Term for such Licensed Product in such country shall be disregarded in the calculation of royalties pursuant to this Section 8.6. For that portion of AZ annual Net Sales of Licensed Products in the OUS Territory in such Product Calendar Year less than [...***...] [...***...]% For that are less portion of annual Net Sales of Licensed Products in the OUS Territory in such Calendar Year greater than or equal to [...***...] and less than [...*****...] [...********] [********] [********] ...]% For that portion of AZ annual Net Sales of Licensed Products in the OUS Territory in such Product that exceed [********] and are less Calendar Year greater than or equal to [...***...] and less than [...*****...] [...********] [********] [********] ...]% For that portion of AZ annual Net Sales of Licensed Products in the OUS Territory in such Product that exceed [********] and are less Calendar Year greater than or equal to [...***...] and less than [...*****...] [...********] [********] [********] ...]% For that portion of AZ annual Net Sales of Licensed Products in the OUS Territory in such Product that exceed [********] and are less Calendar Year greater than or equal to [...***...] [...*****] ...]% By way of example, if annual Net Sales of Licensed Products in the OUS Territory during such Calendar Year were [...********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] [********] [********...] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] (3) For each product that contains one or more Other Licensed Compounds, the Exploitation of which would infringe one or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 royalties due with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration). For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided that nothing in this Section 6.6.1(a)(3) shall be deemed to permit the Exploitation of any Other Licensed Product where such Exploitation would constitute a breach equal the sum of Section 8.6.3 or any other provision of this Agreement[...***...]. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject to the treatment of Combination Products as provided in the definition of Net Sales in Section 1.186Sections 11.3.2, for each Product or Other 11.3.3, 11.3.4, 11.3.6, 11.3.7 and 11.3.8, on a Collaboration Target-by-Collaboration Target, Licensed Product-by-Licensed Product and country-by-country basis, AstraZeneca shall Sanofi will pay Targacept a royalty Kymera royalties based on AZ the aggregate Net Sales of such Product or Other the applicable Licensed Product sold by Sanofi, its Affiliates or Sublicensees in each the applicable Field during a Calendar Year (or partial Calendar Year) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: For that portion rates set forth in the applicable table below. The obligation to pay royalties will be imposed only once with respect to the same unit of AZ a Licensed Product. Portion of Calendar Year Net Sales of such Product that are less than or equal up to and including [********] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [*****] Portion of Calendar Year Net Sales that exceeds [***] For that portion of AZ Net Sales of such Product that exceed up to and including [********] and are less than or equal to [********] [*****] Portion of Calendar Year Net Sales that exceeds [***] [*****] Portion of Calendar Year Net Sales up to and including [***] [*****] Portion of Calendar Year Net Sales that exceeds [***] For that portion of AZ Net Sales of such Product that exceed up to and including [********] and are less than or equal to [********] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [********] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [********] and are less than or equal to [********] [***] The applicable royalty rate set forth in the applicable table above will apply only to that portion of the Net Sales of a given Licensed Product during a given Calendar Year that falls within the indicated range. By way of example and without limitation of this Section 11.3.1, if Calendar Year Net Sales by Sanofi, its Affiliates and Sublicensees of a given Licensed Product Directed Against Collaboration Target 2 were [***], then the royalties payable with respect to such Calendar Year Net Sales for such Licensed Product for such Calendar Year, subject to adjustment as set forth in this Section 11.3.1, would be: [***]. Notwithstanding the foregoing, on a Collaboration Target-by-Collaboration Target basis, in the event that Kymera exercised the Kymera Opt-In Right and later exercises the Kymera Opt-Out Right, the royalty rates will be as follows: Calendar Year Net Sales (in U.S. Dollars) for such Licensed Products Royalty Rates as a Percentage (%) of Net Sales if Kymera has borne U.S. Development Expenses at least equal to [***] but less than [***] Royalty Rates as a Percentage (%) of Net Sales if Kymera has borne U.S. Development Expenses at least equal to [***] Portion of Calendar Year Net Sales up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [*****] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] [***] [*****] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ ] Calendar Year Net Sales (in U.S. Dollars) for such Licensed Products Royalty Rates as a Percentage (%) of such Product that are less than or Net Sales if Kymera has borne U.S. Development Expenses at least equal to [***] but less than [***] Royalty Rates as a Percentage (%) of Net Sales if Kymera has borne U.S. Development Expenses at least equal to [***] Portion of Calendar Year Net Sales up to and including [***] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [********] up to and are less than or equal to including [********] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [*****] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] [***] [***] [***] (3) For each product that contains one or more Other Licensed Compounds, the Exploitation of which would infringe one or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration). For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided that nothing in this Section 6.6.1(a)(3) shall be deemed to permit the Exploitation of any Other Licensed Product where such Exploitation would constitute a breach of Section 8.6.3 or any other provision of this Agreement. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject to the treatment of Combination Products as provided in the definition of Net Sales in Section 1.186Sections 11.3.2, for each Product or Other 11.3.3, 11.3.4, 11.3.6, 11.3.7 and 11.3.8, on a Collaboration Target-by-Collaboration Target, Licensed Product-by-Licensed Product and country-by-country basis, AstraZeneca shall Sanofi will pay Targacept a royalty Kymera royalties based on AZ the aggregate Net Sales of such Product or Other the applicable Licensed Product sold by Sanofi, its Affiliates or Sublicensees in each the applicable Field during a Calendar Year (or partial Calendar Year) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: For that portion rates set forth in the applicable table below. The obligation to pay royalties will be imposed only once with respect to the same unit of AZ a Licensed Product. Portion of Calendar Year Net Sales of such Product that are less than or equal up to and including [********] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [*****] Portion of Calendar Year Net Sales that exceeds [***] For that portion of AZ Net Sales of such Product that exceed up to and including [********] and are less than or equal to [********] [*****] Portion of Calendar Year Net Sales that exceeds [***] [*****] Portion of Calendar Year Net Sales up to and including [***] [*****] Portion of Calendar Year Net Sales that exceeds [***] For that portion of AZ Net Sales of such Product that exceed up to and including [********] and are less than or equal to [********] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [********] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [********] and are less than or equal to [********] [***] The applicable royalty rate set forth in the applicable table above will apply only to that portion of the Net Sales of a given Licensed Product during a given Calendar Year that falls within the indicated range. By way of example and without limitation of this Section 11.3.1, if Calendar Year Net Sales by Sanofi, its Affiliates and Sublicensees of a given Licensed Product Directed Against Collaboration Target 2 were [***], then the royalties payable with respect to such Calendar Year Net Sales for such Licensed Product for such Calendar Year, subject to adjustment as set forth in this Section 11.3.1, would be: [***]. Notwithstanding the foregoing, on a Collaboration-by-Collaboration Target basis, in the event that Kymera exercised the Kymera Opt-In Right and later exercises the Kymera Opt-Out Right, the royalty rates will be as follows: Portion of Calendar Year Net Sales up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***]up to and including [***] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [*****] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] [********] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ Net Sales of such Product that are less than or equal to ] [*****] Portion of Calendar Year Net Sales up to and including [***] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [********] up to and are less than or equal to including [********] [*****] [***] For that portion Portion of AZ Calendar Year Net Sales of such Product that exceed exceeds [*****] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] up to and including [***] [***] [***] Portion of Calendar Year Net Sales that exceeds [***] [***] [***] [***] (3) For each product that contains one or more Other Licensed Compounds, the Exploitation of which would infringe one or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration). For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided that nothing in this Section 6.6.1(a)(3) shall be deemed to permit the Exploitation of any Other Licensed Product where such Exploitation would constitute a breach of Section 8.6.3 or any other provision of this Agreement. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject Instead of the royalties payable as specified in Clause 7(d)(ii) of the R&L Agreement, and subject to Section 2.2 below, the treatment royalties payable to Yeda by XTL in consideration of Combination Products the Licence granted under the R&L Agreement, shall be as provided in the definition follows: 2.1.1. percent) of Net Sales (as hereinafter defined) from sales by XTL of pharmaceutical products developed and/or made under and/or using the Licensed Patents and/or the Licensed Technology. “Net Sales” as used herein shall have the meaning ascribed to the term in the R&L Agreement, references therein to “the Products” being read as references to the pharmaceutical products referred to hereinbefore. 2.1.2. percent) of all amounts received by XTL from third parties (except the amounts governed by Section 1.1862.1.4 below) under or pursuant to agreements allowing such third parties the use of results, for each Product or Other including products, developed and/or made by XTL under and/or using the Licensed ProductPatents and/or the Licensed Technology, AstraZeneca provided that if XTL shall be obliged to pay Targacept a royalty based on AZ Net Sales of such Product or Other Licensed Product in each Calendar Year (or partial Calendar Year) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: For that portion of AZ Net Sales of such Product that are less more than or equal to [***** per cent) on any such amounts to a third party pursuant to a bona fide arms-length agreement with such third party (“a third party royalty”), then the rate of royalty payable to Yeda pursuant to this Section 2.1.2 on amounts subject to a third party royalty shall be reduced by the percentage - up to a maximum ****] [* per cent) - by which the third party royalty rate exceeds ***** per cent), so that if, for example, the third party royalty rate is ****] [* per cent) the rate of royalty payable to Yeda pursuant to this Section 2.1.2 shall be ***** per cent), and if, as a further example, the third party royalty rate is ****] [* per cent), the rate of royalty payable to Yeda pursuant to this Section 2.1.2 shall be reduced by ********] For that portion * per cent). 2.1.3. percent) of AZ Net Sales all amounts received by XTL from a third party payable upon XTL reaching milestones specified in an agreement with such third party providing for performance of development activities by XTL for such Product that exceed [********] third party under and/or using the Licensed Patents and/or the Licensed Technology. 2.1.4. percent) of all amounts received by XTL under or pursuant to agreements with third parties granting such third parties the right to use chimeric mammals or other animal models (collectively, “Models”) made and/or developed by XTL under and/or using the Licensed Patents and/or the Licensed Technology or granting such third parties the right to produce Models under and/or using the Licensed Patents and/or the Licensed Technology. 2.1.5. percent) of all amounts received by XTL as a result of any activities under and/or using the Licensed Patents and/or the Licensed Technology (including the grant of sublicences to third parties to carry out activities under and/or using the Licensed Patents and/or the Licensed Technology),, other than those specified in Sections 2.1.1, 2.1.2, 2.1.3 or 2.1.4 above. Where the amounts received by XTL are the result of activities not involving the grant of sublicences to third parties (“Direct Activities”) and are less amounts received in a transaction other than at arms length, the royalty due to Yeda shall be calculated on the amount that would have been received by XTL in a transaction at arms length. 2.1.6. For the avoidance of doubt, it is expressly stated that royalties shall not be due pursuant to Sections 2.1.2, 2.1.4 or equal 2.1.5 above on funds received by XTL which are paid by a third party in order to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] cover, and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] [********] [********] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [********] (3) For each product that contains one or more Other Licensed Compoundsactually applied by XTL in covering, the Exploitation cost of research and development by XTL for such third party of products generating any of the amounts in respect of which would infringe one royalties are payable pursuant to Sections 2.1.2, 2.1.4 or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration)2.1.5 above. 2.1.7. For purposes the avoidance of claritydoubt, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided it is expressly stated, that nothing in this Section 6.6.1(a)(3) 2.1 above or elsewhere in this letter shall be deemed to permit derogate from the Exploitation provisions of any Other Licensed Product where such Exploitation would constitute a breach Clause 7(c) of Section 8.6.3 or any other provision the R&L Agreement governing the grant of this Agreementsublicences. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject to the treatment of Combination Products as provided in the definition of Net Sales in Section 1.186, for each Product or Other Licensed Product, AstraZeneca shall pay Targacept a royalty based on AZ Net Sales of such Product or Other Licensed Product in each Calendar Year (or partial Calendar Year) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products[********]: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] [********] [********] (2) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs[********]: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [********] (3) For each product that contains one or more Other Licensed Compounds, the Exploitation of which would infringe one or more Other Licensed Product Royalty-Bearing Claims in the absence of the license grants under the Targacept Patent Rights set forth in Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 with respect to such Targacept Patent Right(s) based on such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and to the extent that such Targacept Patent Rights provide exclusivity with respect to such Other Licensed Product, the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration). For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided that nothing in this Section 6.6.1(a)(3) shall be deemed to permit the Exploitation of any Other Licensed Product where such Exploitation would constitute a breach of Section 8.6.3 or any other provision of this Agreement. (4) Notwithstanding anything in the contrary in this Section 6.6.1(a), with respect to each Product that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, the Parties shall negotiate in good faith an appropriate royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that in the event the Parties are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration).

Royalty Rates. Subject In consideration for the licenses granted to the treatment of Combination Products as provided in the definition of Wyeth under Section 2.1 hereof, Wyeth, on a Product by Product and calendar year by calendar year basis, will pay to ViroPharma royalties based on Net Sales in Section 1.186, for each Product obtained by Wyeth or Other Licensed Product, AstraZeneca shall pay Targacept a royalty based on AZ Net Sales its Affiliates from the sale of such Product or Other Licensed Product in each Calendar Year the Wyeth Territory, which royalties shall be calculated as follows: royalty = A + B + C, where: A = either (or partial Calendar Yeari) at the following rates: (1) Ispronicline Products, IND-Ready Option Products and POC Option Products: For that portion of AZ Net Sales of such Product that are less than or equal to [for ********] [******* of the portion of Wyeth's and its Affiliates' Net Sales obtained from the sale of such ********] [** in the Wyeth Territory (excluding Net Sales obtained from the sale of such Product in any countries where the obligation to pay royalties under this Section 7.4.1 has expired in accordance with Section 7.4.3 with respect to such Product), which, during the calendar year in question are less than or equal ********] [********] For that portion of AZ Net Sales of such Product that exceed [****, or (ii) for ********] and are less than or equal to [********] [********] [** of the portion of Wyeth's and its Affiliates' Net Sales obtained from the sale of such ********] [********] For that portion of AZ *** in the Wyeth Territory (excluding Net Sales obtained from the sale of such Product that exceed [in any countries where the obligation to pay royalties with under this Section 7.4.1 has expired in accordance with Section 7.4.3 with respect to such Product) which, during the calendar year in question are less than or equal to ********] and are less than or equal to [********] [********] [********] [******; B = either (i) for ********] For that portion of AZ Net Sales of such Product that exceed [********] and are less than or equal to [********] [***** of the portion of Wyeth's and its Affiliates' Net Sales obtained from the sale of such ********] [**** in the Wyeth Territory (excluding Net Sales obtained from the sale of such Product in any countries where the obligation to pay royalties with under this Section 7.4.1 has expired in accordance with Section 7.4.3 with respect to such Product), which, during the calendar year in question are greater than ********] [********] For that portion of AZ Net Sales of such Product that exceed [********] [***** and less than or equal to ********] [********] [********] ****, or (2ii) All other Products (other than Products that only contain Other Licensed Compounds), including, for clarity, Products containing any Licensed Derivatives with respect to Ispronicline, IND-Ready Option Candidate Drugs and POC Option Candidate Drugs: For that portion of AZ Net Sales of such Product that are less than or equal to [********] [********] For that portion of AZ Net Sales of such Product that exceed [********] * of the portion of Wyeth's and are less than or equal to [its Affiliates' Net Sales obtained from the sale of such ********] [********] For that portion of AZ ****** in the Wyeth Territory (excluding Net Sales obtained from the sale of such Product that exceed [in any countries where the obligation to pay royalties with under this Section 7.4.1 has expired in accordance with Section 7.4.3 with respect to such Product), which, during the calendar year in question are greater ********] [********] *********************; and C = either (3i) For each product that contains one or more Other Licensed Compounds, for ************************************ of the Exploitation portion of which would infringe one or more Other Licensed Product Royalty-Bearing Claims Wyeth's and its Affiliates' Net Sales obtained from the sale of such ****************** in the absence Wyeth Territory (excluding Net Sales obtained from the sale of such Product in any countries where the license grants obligation to pay royalties with under the Targacept Patent Rights set forth this Section 7.4.1 has expired in accordance with Section 8.1 (each, an “Other Licensed Product”), the Parties shall negotiate in good faith an appropriate royalty rate for the licenses granted under Section 8.1 7.4.3 with respect to such Targacept Patent Right(sProduct), which, during the calendar year in question are greater than ************************ or (ii) based on for ***************************** of the portion of Wyeth's and its Affiliates' Net Sales obtained from the sale of such rates as are then customary for unblocking patent licenses for comparable Patent Rights and, if and *************************** in the Wyeth Territory (excluding Net Sales obtained from the sale of such Product in any countries where the obligation to the extent that such Targacept Patent Rights provide exclusivity pay royalties with under this Section 7.4.1 has expired in accordance with Section 7.4.3 with respect to such Other Licensed Product), which, during the value of such exclusivity; provided that calendar year in the event the Parties question are unable to agree, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitration)greater than *************************************. For purposes of clarity, no royalties shall be owed to Targacept with respect to any Other Licensed Compounds other than an Other Licensed Product; provided ViroPharma acknowledges and agrees that nothing in this Section 6.6.1(a)(3Agreement (including, without limitation, any exhibits or attachments hereto) shall be deemed to permit construed as representing an estimate or projection of either (i) the Exploitation number of any Other Licensed Product where such Exploitation would constitute a breach Class A Products and/or Class B Products that will or may be successfully developed and/or commercialized or (ii) anticipated sales or the actual value of Section 8.6.3 the ViroPharma Technology, and Compound or any other provision of this Agreement. (4) Notwithstanding anything in Product and that the contrary figures set forth in this Section 6.6.1(a), with respect to each Product 7.4 or elsewhere in this Agreement or that is (i) labeled for one or more diagnostic uses, veterinary uses and any other uses other than as a prophylactic or therapeutic pharmaceutical product in humans and (ii) not labeled for use as a prophylactic or therapeutic pharmaceutical product in humans, have otherwise been discussed by the Parties shall negotiate in good faith an appropriate are merely intended to define Wyeth's royalty rate for sales thereof based on such rates as are then customary for products for such use(s) and, if and obligations to the extent that Targacept Patent Rights provide exclusivity with respect to such use(s), the value of such exclusivity; provided that ViroPharma in the event the Parties are unable to agreesuch sales performance is achieved. Wyeth MAKES NO REPRESENTATION OR WARRANTY, such matter shall be referred to an Expert for resolution in accordance with Section 14.4 (expedited arbitrationEITHER EXPRESS OR IMPLIED, THAT IT WILL BE ABLE TO SUCCESSFULLY DEVELOP AND/OR COMMERCIALIZE ANY PRODUCT OR, IF COMMERCIALIZED THAT ANY IT WILL ACHIEVE ANY PARTICULAR SALES LEVEL OF SUCH PRODUCT(S).