Question
From:
(Redacted)
Sent:
Tuesday, January 12, 2010 3:35 PM
To:
Verne, B. Michael
Cc:
(Redacted)
Subject: HSRAnalysis Confirmation
Mike: Thank youfor taking the time to discuss an HSR question with me last Friday afternoon. Thisemail is to confirm the content of our prior discussion and your analysis.Informal Staff Opinion 0803005 states that where Company A grants an exclusivelicense to Company B, but retains the right to manufacture the product that iscovered by the license, the license is not considered exclusive under the HSRAct and Rules, and therefore is not treated as the sale of an asset.
In the transactionwe discussed, Seller is conveying exclusive rights to one of its pharmaceuticalproduct lines to Purchaser. These rights include intellectual property(patents, trademarks, clinical and other data, and know-how), regulatoryfilings and approvals, contracts, promotional materials, and books and records.The intellectual property will be conveyed to Purchaser through a combinationof outright sale (transfer via assignment) and exclusive licenses. However,Seller will maintain the right to manufacture the product, and will supplyPurchaser with product after the closing pursuant to a supply agreement.
Seller will alsosell shares of its common stock to Purchaser, valued at approximately $12million.
Your initial viewwas that tills transaction should not be treated any differently from thetransaction described in Informal Staff Opinion 0803005. Because Seller wouldstill have the right to manufacture the product that was subject to thetransfer of intellectual property, regardless of the proportion of intellectualproperty to be transferred from Seller to Purchaser through each of the meansdescribed above, we believe that the entire transfer of intellectual propertyto Seller in this transaction would not be considered tile transfer of an assetunder the HSR Act and Rules.