<<27-Mar-2006
Entry into a Material Definitive Agreement, Other Events
Item 1.01 Entry into a Material Definitive Agreement.
On March 27, 2006, Kosan Biosciences Incorporated (the "Company") and Hoffmann-La Roche Inc. and F. Hoffmann-La Roche Ltd. (collectively, "Roche") entered into a letter agreement relating to their Collaborative Research, Development and Commercialization Agreement dated September 19, 2002, as amended (the "Collaboration Agreement"). In the letter agreement, the Company and Roche have agreed to the division between them of royalties payable to and from Bristol-Myers Squibb Company ("BMS") in the cancer field under the Cross License Agreement discussed below. The Company and Roche also agreed to replace a particular at risk milestone payment obligation in the Collaboration Agreement with an obligation by Roche to reimburse the Company for the Company's out of pocket expenses, up to specified dollar amount, associated with the interference proceeding before the United States Patent and Trademark Office involving patent rights covered by the Cross License Agreement following the final resolution of the interference proceeding.
Item 8.01. Other Events.
CROSS LICENSE AGREEMENT
On March 24, 2006, the Company entered into a Cross License Agreement (the "Cross License Agreement") with BMS. Pursuant to the Cross License Agreement, each of the Company and BMS agreed to grant to the other party a co-exclusive, worldwide license under certain patents and patent applications relating to the compound known as Epothilone D, or KOS-862, including patent rights that are currently the subject of an interference proceeding before the United States Patent and Trademark Office, as previously disclosed. Each of the Company and BMS agreed to pay royalties to the other on sales of Epothilone D or other compounds made using isolated and/or purified Epothilone D ("Licensed Product"). The Company has the right, within two years after the effective date of the Cross License Agreement, to convert its co-exclusive license rights to an exclusive license in the cancer field in exchange for increased royalties on sales of Licensed Product in the cancer field. BMS has the right, within two years after the effective date of the Cross License Agreement, to convert its co-exclusive license rights to an exclusive license in all fields other than cancer and the treatment or prevention of restenosis using a drug coated stent or catheter in exchange for increased royalties on sales of Licensed Product in the exclusive fields. The term of the Cross License Agreement, unless sooner terminated, expires upon the last to expire valid claim within the licensed patent rights. Either party may terminate the Cross License Agreement in the event of an uncured material breach by the other party.
OTHER COMPANY INFORMATION <snip>>
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