MEDICINES CO /DE (Form: 10-Q, Received: 11/09/2011 17:19:54)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)



R	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: September 30, 2011



o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)

For the transition period from to

Commission file number 000-31191

THE MEDICINES COMPANY

(Exact name of registrant as specified in its charter)



Delaware (State or other jurisdiction of incorporation or organization)		04-3324394 (I.R.S. Employer Identification No.)

8 Sylvan Way Parsippany, New Jersey (Address of principal executive offices)		07054 (Zip Code)

Registrant's telephone number, including area code: (973) 290-6000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):



Large accelerated filer o	Accelerated filer þ	Non-accelerated filer o	Smaller reporting company o
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

As of November 7, 2011 there were 54,200,472 shares of Common Stock, $0.001 par value per share, outstanding.

THE MEDICINES COMPANY

TABLE OF CONTENTS



Part I. Financial Information
Item 1 - Financial Statements	1
Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3 - Quantitative and Qualitative Disclosures about Market Risk	35
Item 4 - Controls and Procedures	35
Part II. Other Information	36
Item 1 - Legal Proceedings	36
Item 1A - Risk Factors	39
Item 6 - Exhibits	60
Signatures	61
Exhibit Index	62
EX-10.1
EX-10.2
EX-10.3
EX-10.4
EX-10.5
EX-10.6
EX-31.1
EX-31.2
EX-32.1
EX-32.2

Part I. Financial Information

Item 1. Financial Statements

THE MEDICINES COMPANY

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share amounts)



	September 30, 2011			December 31, 2010
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	258,035		$	126,364
Available for sale securities	49,739			120,280
Accrued interest receivable	443			1,279
Accounts receivable, net of allowances of approximately $15.8 million and $15.5 million at September 30, 2011 and December 31, 2010, respectively	72,725			46,551
Inventory	30,426			25,343
Prepaid expenses and other current assets	7,452			4,804
Total current assets	418,820			324,621
Fixed assets, net	18,528			20,662
Intangible assets, net	86,147			82,925
Goodwill	14,671			14,671
Restricted cash	4,626			5,778
Deferred tax assets, net	93,582			25,197
Other assets	289			270
Total assets	$	636,663		$	474,124
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	10,432		$	8,594
Accrued expenses	113,655			76,242
Deferred revenue	1,183			534
Total current liabilities	125,270			85,370
Contingent purchase price	28,204			25,387
Other liabilities	5,896			5,769
Total liabilities	159,370			116,526
Stockholders' equity:
Preferred stock, $1.00 par value per share, 5,000,000 shares authorized; no shares issued and outstanding	—			—
Common stock, $0.001 par value per share, 125,000,000 shares authorized; 54,093,961 and 53,464,145 issued and outstanding at September 30, 2011 and December 31, 2010, respectively	54			53
Additional paid-in capital	609,013			596,667
Accumulated deficit	(131,247		)	(239,542		)
Accumulated other comprehensive income	(527		)	420
Total stockholders' equity	477,293			357,598
Total liabilities and stockholders' equity	$	636,663		$	474,124

See accompanying notes to unaudited condensed consolidated financial statements.

THE MEDICINES COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)



	Three Months Ended September 30,					Nine Months Ended September 30,
	2011		2010			2011		2010
Net revenue	$	120,773	$	105,743		$	352,501	$	317,966
Operating expenses:
Cost of revenue	39,459		31,568			112,859		93,905
Research and development	26,550		16,676			76,878		54,128
Selling, general and administrative	45,353		35,788			124,701		121,318
Total operating expenses	111,362		84,032			314,438		269,351
Income from operations	9,411		21,711			38,063		48,615
Legal settlement	—		—			17,984		—
Other income	578		483			1,450		55
Income before income taxes	9,989		22,194			57,497		48,670
Benefit (provision) for income taxes	62,625		(989		)	50,798		(2,607		)
Net income	$	72,614	$	21,205		$	108,295	$	46,063
Basic earnings per common share	$	1.36	$	0.40		$	2.03	$	0.87
Diluted earnings per common share	$	1.34	$	0.40		$	2.00	$	0.87
Weighted average number of common shares outstanding:
Basic	53,534		52,991			53,414		52,773
Diluted	54,260		53,359			54,242		53,005

See accompanying notes to unaudited condensed consolidated financial statements .

THE MEDICINES COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)



	Nine Months Ended September 30,
	2011			2010
Cash flows from operating activities:
Net income	$	108,295		$	46,063
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	4,514			5,085
Amortization of net premiums and discounts on available for sale securities	2,021			2,432
Unrealized foreign currency transaction losses (gain), net	596			(596		)
Non-cash stock compensation expense	8,376			6,855
Loss on disposal of fixed assets	310			6
Deferred tax (benefit) provision	(68,385		)	710
Adjustment to contingent purchase price	2,817			2,265
Changes in operating assets and liabilities:
Accrued interest receivable	836			—
Accounts receivable	(26,011		)	(4,214		)
Inventory	(4,973		)	(3,656		)
Prepaid expenses and other current assets	(2,602		)	2,450
Accounts payable	1,805			4,275
Accrued expenses	32,264			(12,481		)
Deferred revenue	618			(691		)
Other liabilities	128			122
Net cash provided by operating activities	60,609			48,625
Cash flows from investing activities:
Purchases of available for sale securities	(33,835		)	(100,830		)
Proceeds from maturities and sales of available for sale securities	102,356			80,140
Purchases of fixed assets	(879		)	(151		)

Adjustment to goodwill	—			263
Decrease in restricted cash	1,143			1,285
Net cash provided by (used in) investing activities	68,785			(19,293		)
Cash flows from financing activities:
Proceeds from issuances of common stock, net	3,972			2,764
Net cash provided by financing activities	3,972			2,764
Effect of exchange rate changes on cash	(1,695		)	848
Increase in cash and cash equivalents	131,671			32,944
Cash and cash equivalents at beginning of period	126,364			72,225
Cash and cash equivalents at end of period	$	258,035		$	105,169
Supplemental disclosure of cash flow information:
Taxes paid	$	6,783		$	229

See accompanying notes to unaudited condensed consolidated financial statements .

THE MEDICINES COMPANY

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Medicines Company ^® name and logo, Angiomax ^® , Angiox ^® and Cleviprex ^® are either registered trademarks or trademarks of The Medicines Company in the United States and/or other countries. All other trademarks, service marks or other tradenames appearing in this quarterly report on Form 10-Q are the property of their respective owners. Except where otherwise indicated, or where the context may otherwise require, references to “Angiomax” in this quarterly report on Form 10-Q mean Angiomax and Angiox collectively. References to “the Company,” “we,” “us” or “our” mean The Medicines Company, a Delaware corporation, and its subsidiaries.

1. Nature of Business

The Medicines Company (the Company) is a global pharmaceutical company focused on advancing the treatment of critical care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace. The Company has three marketed products, Angiomax ^® (bivalirudin), Cleviprex ^® (clevidipine butyrate) injectable emulsion and a ready-to-use formulation of Argatroban. The Company also has a pipeline of acute and intensive care hospital products in development, including three late-stage development product candidates, cangrelor, oritavancin and MDCO-157, a novel intravenous formulation of clopidogrel bisulfate, and two early stage development product candidates, MDCO-2010 and MDCO-216. The Company believes that its marketed products and its products in development possess favorable attributes that competitive products do not provide, can satisfy unmet medical needs in the acute and intensive care hospital product market and offer, or, in the case of the Company's products in development, have the potential to offer, improved performance to hospital businesses.

2. Significant Accounting Policies

The Company's significant accounting policies are described in note 2 of the notes to the consolidated financial statements included in the annual report on Form 10-K for the year ended December 31, 2010 filed with the Securities and Exchange Commission (SEC).

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying financial statements include all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation of the Company's financial position, results of operations, and cash flows for the periods presented.

The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. The Company has no unconsolidated subsidiaries or significant investments accounted for under the equity method.

The results of operations for the three months and nine months ended September 30, 2011 are not necessarily indicative of the results that may be expected for the entire fiscal year or any other quarter of the fiscal year ending December 31, 2011 . These condensed consolidated financial statements should be read in conjunction with the audited financial statements included in the Company's annual report on Form 10-K for the year ended December 31, 2010 , filed with the SEC.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs, expenses and accumulated other comprehensive income that are reported in the consolidated financial statements and accompanying disclosures. Actual results may be different. See note 2 of the notes to the consolidated financial statements in the Company's annual report on Form 10-K for the year ended December 31, 2010 for a discussion of the Company's critical accounting estimates.

Contingencies

The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The

Company continually assesses litigation to determine if an unfavorable outcome would lead to a probable loss or reasonably possible loss which could be estimated. In accordance with the guidance of the Financial Accounting Standards Board (FASB) on accounting for contingencies, the Company accrues for all contingencies at the earliest date at which it is deemed probable that a liability has been incurred and the amount of such liability can be reasonably estimated. If the estimate of a probable loss is a range and no amount within the range is more likely than another, the Company accrues the minimum of the range. In the cases where the Company believes that a reasonably possible loss exists, the Company discloses the facts and circumstances of the litigation, including an estimable range, if possible.

Recent Accounting Pronouncements

In May 2011, the FASB issued Accounting Standards Update (ASU) 2011-04, "Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRS (ASU 2011-04) that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. ASU 2011-04 will be effective for interim and annual periods beginning on or after December 15, 2011 and therefore is effective for the Company in its first quarter of fiscal 2012 and will be applied prospectively. The Company does not expect its adoption of ASU 2011-04 to have a material impact on its financial statements.

In June 2011, the FASB issued ASU 2011-05, "Presentation of Comprehensive Income" (ASU 2011-05) that requires the presentation of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 also requires presentation of adjustments for items that are reclassified from other comprehensive income to net income in the statement where the components of net income and the components of other comprehensive income are presented. ASU 2011-05 requires retrospective application, and it is effective for fiscal years, and interim periods within those years, beginning after December 15, 2011 and therefore will be effective for the Company in its first quarter of fiscal 2012. Early adoption of ASU 2011-05 is permitted; however, the Company does not expect that it will do so. The Company believes the adoption of ASU 2011-05 will change the order in which certain financial statements are presented and provide additional detail on those financial statements when applicable, but will not have any other impact on its financial statements.

In September 2011, the FASB issued ASU 2011-08, "Testing Goodwill for Impairment" (ASU 2011-08) that allows entities to first assess qualitatively whether it is necessary to perform the two-step goodwill impairment test. If an entity believes, as a result of its qualitative assessment, that it is more likely than not that the fair value of an asset in a reporting period is less than its carrying amount, the quantitative two-step goodwill impairment test is required. An entity has the unconditional option to bypass the qualitative assessment and proceed directly to performing the first step of the goodwill impairment test. ASU 2011-08 will be effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011 and therefore will be effective for the Company in its first quarter of 2012. Early adoption of ASU 2011-08 is permitted; however, the Company does not expect that it will do so. The Company anticipates that the adoption of this standard will not have a material impact on its consolidated financial statements and footnote disclosures.

3. Stock-Based Compensation

The Company recorded approximately $2.9 million and $8.4 million of stock-based compensation expense for the three and nine months ended September 30, 2011 , respectively. The Company recorded approximately $1.8 million and $6.9 million of stock-based compensation expense for the three and nine months ended September 30, 2010 , respectively. As of September 30, 2011 , there was approximately $13.3 million of total unrecognized compensation costs related to non-vested share-based employee compensation arrangements granted under the Company's equity compensation plans. The Company expects to recognize this cost over a weighted average period of 1.35 years.

During the nine months ended September 30, 2011 , the Company issued a total of 629,816 shares of its common stock upon the exercise of stock options, pursuant to restricted stock grants and pursuant to purchases under its 2010 employee stock purchase plan (the 2010 ESPP). During the nine months ended September 30, 2010 , the Company issued a total of 543,460 shares of its common stock upon the exercise of stock options, pursuant to restricted stock grants and pursuant to purchases under its 2000 employee stock purchase plan (the 2000 ESPP). Cash received from the exercise of stock options and purchases through the 2010 ESPP during the nine months ended September 30, 2011 and the exercise of stock options and purchases through the 2000 ESPP during the nine months ended September 30, 2010 was approximately $4.0 million and $2.8 million , respectively, and is included within the financing activities section of the consolidated statements of cash flows.

At September 30, 2011 , there were no shares reserved for future issuance under the 2000 ESPP and 5,171,643 shares of common

stock reserved for future issuance under the 2010 ESPP and for future grants under the Company's amended and restated 2004 stock incentive plan.

4. Earnings per Share

The following table sets forth the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2011 and 2010 :



	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
	(in thousands, except per share amounts)
Basic and diluted
Net income	$	72,614	$	21,205	$	108,295	$	46,063

Weighted average common shares outstanding, basic	53,534		52,991		53,414		52,773
Plus: net effect of dilutive stock options and restricted common shares	726		368		828		232
Weighted average common shares outstanding, diluted	54,260		53,359		54,242		53,005

Earnings per share, basic	$	1.36	$	0.40	$	2.03	$	0.87
Earnings per share, diluted	$	1.34	$	0.40	$	2.00	$	0.87

Basic earnings per share is computed using the weighted average number of shares of common stock outstanding during the period, reduced where applicable for outstanding yet unvested shares of restricted common stock. The number of dilutive common stock equivalents was calculated using the treasury stock method. For the three months ended September 30, 2011 and 2010 , options to purchase 7,618,529 shares and 7,150,519 shares, respectively, of common stock that could potentially dilute basic earnings per share in the future were excluded from the calculation of diluted earnings per share as their effect would have been anti-dilutive. For the nine months ended September 30, 2011 and 2010 , options to purchase 7,351,738 shares and 8,684,283 shares, respectively, of common stock that could potentially dilute basic earnings per share in the future were excluded from the calculation of diluted earnings per share as their effect would have been anti-dilutive.

For the three months ended September 30, 2011 and 2010 , 0 and 6,750 shares, respectively, of unvested restricted stock that could potentially dilute basic earnings per share in the future were excluded from the calculation of diluted earnings per common share as their effect would have been anti-dilutive. For the nine months ended September 30, 2011 and 2010 , 83,297 and 8,500 shares, respectively, of unvested restricted stock that could potentially dilute basic earnings per share in the future were excluded from the calculation of diluted earnings per common share as their effect would have been anti-dilutive.

5. Comprehensive Income

Comprehensive income includes net income, unrealized gain (loss) on available for sale securities and foreign currency translation adjustments. Comprehensive income for the three and nine months ended September 30, 2011 and 2010 is detailed below.



	Three Months Ended September 30,					Nine Months Ended September 30,
	2011			2010		2011			2010
	(in thousands)
Net income	$	72,614		$	21,205	$	108,295		$	46,063
Unrealized gain (loss) on available for sale securities	(20		)	80		—			61
Foreign currency translation adjustment	(817		)	79		(947		)	126
Comprehensive income	$	71,777		$	21,364	$	107,348		$	46,250

6. Income Taxes

For the three months ended September 30, 2011 and 2010 , the Company recorded a $ 62.6 million net benefit and a $1.0 million provision for income taxes, respectively. During the third quarter of 2011, after considering both the positive and negative evidence, including the enactment of Leahy-Smith America Invents Act (see Part I, Item 2 of this quarterly report under the caption Overview - Angiomax Patent Litigation), the settlement of the Company's patent infringement litigation against Teva Pharmaceuticals USA, Inc. and its affiliates (Teva) (see Part I, Item 2 of this quarterly report under the caption Overview - Legal Settlements), continued U.S. taxable income, the launch of ready-to-use Argatroban and an increased ability to forecast future taxable income due to these legislative, business and legal developments, the Company concluded that it was more likely than not that substantially all of its deferred tax assets would be realizable in future periods. The Company reduced its valuation allowance against its deferred tax assets by $66.5 million and recorded a corresponding tax benefit. At September 30, 2011 , the remaining valuation allowance is $4.2 million against $116.4 million of deferred tax assets. The income tax provision for the 2010 period reflected the utilization of U.S. net operating loss carryforwards against projected taxable income and a liability for alternative minimum tax. Both the 2011 and 2010 periods include a non-cash tax expense arising from purchase accounting for in-process research and development acquired in the Company's acquisition of Targanta Therapeutics Corporation (Targanta).

For the nine months ended September 30, 2011 and 2010 , the Company recorded a $50.8 million benefit and a $2.6 million provision for income taxes, respectively. In addition to the $66.5 million reduction in the valuation allowance discussed above, the Company's income tax benefit for the nine months ended September 30, 2011 includes the effects of a one-time $2.5 million income tax benefit resulting from a prospective change in the New Jersey income tax law enacted in the second quarter of 2011and the tax impact of the settlement from the law firm Wilmer Cutler Pickering Hale and Dorr LLP (WilmerHale) (see note 12) as discrete events. The provision for income taxes is based on federal, state and foreign income taxes.

The Company continues to evaluate the realizability of its deferred tax assets and liabilities on a periodic basis and will adjust such amounts in light of changing facts and circumstances including, but not limited to, future projections of taxable income, tax legislation, rulings by relevant tax authorities, the progress of ongoing tax audits, the regulatory approval of products currently under development and the extension of the patent rights relating to Angiomax. Any changes to the valuation allowance or deferred tax assets in the future would impact the Company's income taxes.

7. Cash, Cash Equivalents and Available for Sale Securities

The Company considers all highly liquid investments purchased with original maturities at the date of purchase of three months or less to be cash equivalents. Cash and cash equivalents included cash of $241.5 million and $114.1 million at September 30, 2011 and December 31, 2010 , respectively. Cash and cash equivalents at September 30, 2011 and December 31, 2010 also included investments of $16.5 million and $12.2 million , respectively, in money market funds and commercial paper with original maturities of less than three months.

At September 30, 2011 and December 31, 2010 , the Company held available for sale securities with a fair value totaling $49.7 million and $120.3 million , respectively. These available for sale securities included various U.S. government agency notes, U.S. treasury notes and corporate debt securities. At September 30, 2011 , all of the $49.7 million of available for sale securities were due within one year. At December 31, 2010 , approximately $115.2 million of available for sale securities were due within one year. The remaining $5.1 million were due within two years.

Available for sale securities, including carrying value and estimated fair values, are summarized as follows:



	As of September 30, 2011									As of December 31, 2010
	Cost		Fair Value		Carrying Value		Unrealized Gain			Cost		Fair Value		Carrying Value		Unrealized Gain
	(in thousands)
U.S. government agency notes	$	14,917	$	14,919	$	14,919	$	2		$	55,222	$	55,222	$	55,222	$	—
U.S. treasury notes	3,054		3,056		3,056		2			—		—		—		—
Corporate debt securities	31,765		31,764		31,764		(1		)	65,055		65,058		65,058		3
Total	$	49,736	$	49,739	$	49,739	$	3		$	120,277	$	120,280	$	120,280	$	3

Restricted Cash

The Company had restricted cash of $4.6 million and $5.8 million at September 30, 2011 and December 31, 2010 , respectively, which is included in restricted cash on the consolidated balance sheets. On October 11, 2007, the Company entered into a lease for new office space in Parsippany, New Jersey. The Company relocated its principal executive offices to the new space in the first quarter of 2009. Restricted cash of $4.1 million and $5.5 million at September 30, 2011 and December 31, 2010 , respectively, collateralized outstanding letters of credit associated with this lease. The funds are invested in certificates of deposit. The letter of credit permits draws by the landlord to cure defaults by the Company. The amount of the letter of credit is subject to reduction upon the achievement of certain regulatory and operational milestones relating to the Company's products. However, in no event will the amount of the letter of credit be reduced below approximately $1.0 million . In addition, as a result of the acquisition of Targanta in 2009, the Company had at September 30, 2011 and December 31, 2010 restricted cash of $0.2 million and $0.3 million , respectively, in the form of a guaranteed investment certificate collateralizing an available credit facility. The Company also had at September 30, 2011 restricted cash of $0.3 million related to certain foreign tender requirements.

8. Fair Value Measurements

FASB Accounting Standards Codification (ASC) 820-10 “Fair Value Measurements and Disclosures” (ASC 820-10) provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value:


Level 1	Quoted prices in active markets for identical assets or liabilities. The Company's Level 1 assets and liabilities consist of money market investments and U.S. treasury notes.

Level 2

Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. The Company's Level 2 assets and liabilities consist of U.S. government agency notes and corporate debt securities.

Level 3

Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company's Level 3 assets and liabilities consist of the contingent purchase price associated with the Targanta acquisition. The fair value of the contingent purchase price was determined utilizing a probability weighted discounted financial model based on management's assessment of the likelihood of achievement of certain development and net sales milestones.

The following table sets forth the Company's assets and liabilities that were measured at fair value on a recurring basis at September 30, 2011 by level within the fair value hierarchy. As required by ASC 820-10, assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability:



Assets and Liabilities	Quoted Prices In Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance at September 30, 2011
	(in thousands)
Assets:
Money market	$	16,540	$	—	$	—	$	16,540
U.S. treasury notes	3,056		—		—		3,056
U.S. government agency notes	—		14,919		—		14,919
Corporate debt securities	—		31,764		—		31,764
Total assets at fair value	$	19,596	$	46,683	$	—	$	66,279
Liabilities:
Contingent purchase price	$	—	$	—	$	28,204	$	28,204
Total liabilities at fair value	$	—	$	—	$	28,204	$	28,204

The changes in fair value of the Company's Level 3 contingent purchase price during the nine months ended September 30, 2011 were as follows:



	Level 3
	(in thousands)
Balance at December 31, 2010	$	25,387
Fair value adjustment to contingent purchase price included in net income	2,817
Balance at September 30, 2011	$	28,204

For the nine months ended September 30, 2011 , the changes in the fair value of the contingent purchase price obligations resulted from an adjustment to the discount rates used in the probability weighted discounted financial model. No changes in valuation techniques or inputs occurred during the nine months ended September 30, 2011 . No transfers of assets between Level 1 and Level 2 of the fair value measurement hierarchy occurred during the nine months ended September 30, 2011 .

9. Inventory

To date, the Company has obtained all of its Angiomax bulk drug substance from Lonza Braine, S.A. (Lonza Braine). On September 30, 2011, the Company entered into a supply agreement with Plantex USA Inc., an affiliate of Teva Pharmaceuticals USA, Inc., under which the Company will obtain Angiomax bulk drug substance. The Company also has separate agreements with Ben Venue Laboratories, Inc. and Patheon Italia S.p.A for the fill-finish of Angiomax drug product. As of September 30, 2011 , the Company had inventory-related purchase commitments totaling $23.9 million during 2011, $57.2 million during 2012, $30.1 million during 2013, $7.5 million during 2014 and $7.5 million during 2015 for Angiomax and ready-to-use Argatroban bulk drug substance.

The major classes of inventory were as follows:



Inventory	September 30, 2011		December 31, 2010
	(in thousands)
Raw materials	$	8,079	$	9,801
Work-in-progress	16,217		7,183
Finished goods	6,130		8,359
Total	$	30,426	$	25,343

The Company reviews inventory, including inventory purchase commitments, for slow moving or obsolete amounts based on expected volume. If annual volume is less than expected, the Company may be required to make additional allowances for excess or obsolete inventory in the future.

10. Intangible Assets and Goodwill

The following information details the carrying amounts and accumulated amortization of the Company's amortizing intangible assets:



		As of September 30, 2011							As of December 31, 2010
	Weighted Average Useful Life	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
		(in thousands)
Identifiable intangible assets
Customer relationships ⁽¹⁾	8 years	$	7,457	$	(2,576	)	$	4,881	$	7,457	$	(1,715	)	$	5,742
Distribution agreement ⁽¹⁾	8 years	4,448		(1,536		)	2,912		4,448		(1,023		)	3,425
Trademarks ⁽¹⁾	8 years	3,024		(1,045		)	1,979		3,024		(695		)	2,329
Product license ⁽²⁾	5 years	5,000		—			5,000		—		—			—
Cleviprex milestones ⁽³⁾	13 years	2,000		(125		)	1,875		2,000		(71		)	1,929
Total	9 years	$	21,929	$	(5,282	)	$	16,647	$	16,929	$	(3,504	)	$	13,425


(1)	The Company amortizes intangible assets related to Angiox based on the ratio of annual forecasted revenue compared to total forecasted revenue from the sale of Angiox through the end of its patent life.


(2)	The Company amortizes intangible assets related to the product license over the life of the agreement.


(3)	The Company amortizes intangible assets related to the Cleviprex approval over the remaining life of the patent.

The Company expects amortization expense related to these intangible assets to be $0.8 million for the remainder of 2011 . The Company expects annual amortization expense related to these intangible assets to be $3.4 million , $4.0 million , $4.6 million , $1.8 million and $1.0 million for the years ending December 31, 2012, 2013, 2014, 2015 and 2016, respectively, with the balance of $1.0 million being amortized thereafter. Amortization of customer relationships, distribution agreements and trademarks will be recorded in selling, general and administrative expense on the consolidated statements of operations. Amortization of Cleviprex milestones and product license will be recorded in cost of revenue on the consolidated statements of operations.

The following information details the carrying amounts of the Company's intangible assets not subject to amortization:



	As of September 30, 2011					As of December 31, 2010
	Gross Carrying Amount		Accumulated Amortization	Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization	Net Carrying Amount
	(in thousands)
Intangible assets not subject to amortization:
In-process research and development	$	69,500	—	$	69,500	$	69,500	—	$	69,500
Total	$	69,500	—	$	69,500	$	69,500	—	$	69,500

The changes in goodwill for the nine months ended September 30, 2011 and for the year ended December 31, 2010 are as follows:



	September 30, 2011		December 31, 2010
	(in thousands)
Balance at beginning of period	$	14,671	$	14,934
Adjustment to goodwill	—		(263		)
Balance at end of period	$	14,671	$	14,671

The goodwill is solely attributable to the Targanta acquisition.

11. Restructuring Costs and Other, Net

On September 22, 2011, the Company commenced the closure of its drug discovery research and development facility and operations in Leipzig, Germany and terminated ten employees at its Leipzig facility. The Company transferred active pre-clinical projects from Leipzig to its research and development facility in Montreal, Canada and the MDCO-2010 back-up compound to the clinical team in Parsippany, NJ. Upon signing release agreements, the terminated employees received severance and other benefits. The Company recorded, in the aggregate, charges of $2.1 million in the three and nine months ended September 30, 2011 associated with the 2011 Leipzig closure. These charges were recorded in research and development expenses in the Company's financial statements. Of the $2.1 million of charges related to the 2011 Leipzig closure, $0.3 million related to asset write-offs were noncash charges. The Company expects to pay out $1.0 million during the fourth quarter of 2011 and to pay out $0.8 million during 2012. The Company no longer has any research employees or research capabilities in Leipzig.

During the nine months ended September 30, 2011 , the Company recorded a $0.1 million favorable adjustment to selling, general and administrative costs due to a reversal of costs associated with the 2010 workforce reductions, primarily due to the charges for employee severance and other employee-related termination costs being slightly lower than originally estimated. The 2010 workforce reductions were effected in two separate actions, which were designed to improve efficiencies and better align the Company's costs and structure for the future. The 2010 workforce reductions reduced office based personnel by 30 and field based personnel by 42 . The Company did not record any adjustment to selling, general and administrative costs for the three months ended September 30, 2011 .

For the nine months ended September 30, 2010 , the Company recorded charges of $6.9 million associated with the 2010 workforce reductions. See note 13 "Restructuring Costs and Other, Net" of the notes to the consolidated financial statements in the Company's annual report on Form 10-K for the year ended December 31, 2010. The Company recorded a $0.2 million favorable adjustment to selling, general and administrative costs for the three months ended September 30, 2010 primarily due to the charges for employee severance and other employee-related termination costs being slightly lower than originally estimated.

Details of the activities described above and the movement in the accrual during the nine -month period ended September 30, 2011 are as follows:



	Balance as of January 1, 2011		Expenses (Income), Net			Cash			Noncash			Balance as of September 30, 2011
	(in thousands)
Employee severance and other personnel benefits:
2011 Leipzig closure	$	—	$	849		$	—		—			$	849
2010 workforce reductions	134		(119		)	(15		)	—			—
Leases and equipment write-offs	10		304			(10		)	(304		)	—
Other associated costs	—		918			—			—			918
Total	$	144	$	1,952		$	(25	)	$	(304	)	$	1,767

12. Legal Settlements

WilmerHale Settlement

During the nine months ended September 30, 2011 , the Company recorded approximately $18.0 million in legal settlement income in connection with the settlement agreement and release the Company entered into with WilmerHale in February 2011. Pursuant to the settlement agreement, WilmerHale agreed to pay approximately $18.0 million from its professional liability insurance providers to the Company within 60 days after the date of the settlement agreement and delivered such amount in two equal payments in March 2011 and April 2011. The Company did not record any legal settlement income for the three months ended September 30, 2011 .

Teva Settlement

On September 30, 2011, the Company entered into a settlement agreement and a license agreement with Teva with respect to the Company's patent infringement suits against Teva, which includes the Company's suit against Pliva Hrvatska d.o.o., et al . Under the settlement agreement, Teva admitted that U.S. Patent No. 7,582,727 ('727 patent) and U.S. Patent No. 7,598,343 ('343 patent), which cover a more consistent and improved Angiomax drug product and the processes by which it is made, are valid and enforceable and that they would be infringed by the manufacture and sale of Teva's generic bivalirudin for injection products. On October 13, 2011, the district court for the Eastern District of Pennsylvania entered a judgment and order of permanent injunction concluding the Company's patent infringement suits against Teva. Under the settlement agreement, the Company made a one-time payment to Teva in recognition of the savings inuring to the Company in terms of the avoidance of costs and burden associated with prosecuting the patent infringement suits. The settlement agreement terminates upon the earlier of the expiration of the '727 patent and '343 patent and the termination of the license agreement. The '727 patent and the '343 patent are currently due to expire on July 27, 2028. Under the license agreement, the Company granted Teva a non-exclusive license under the '727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019, or earlier under certain conditions. Under the license agreement, Teva will be required to pay the Company royalties on gross profits of its sales of its bivalirudin product under certain circumstances. The license agreement also contains a grant by Teva to the Company of an exclusive (except as to Teva) license under Teva's bivalirudin patents and right to enforce Teva's bivalirudin patents, in consideration of which the Company made a one-time payment to Teva. The license to Teva will remain in effect until the expiration of all of the Company's patents covering Angiomax except for the '404 patent. The Company and Teva may terminate the license agreement in the event of a material breach by the other party, unless the material breach is cured within 60 days of a written notice. The Company may terminate the license agreement, effectively immediately, for certain breaches of the license agreement. On October 13, 2011, the Company and Teva submitted the settlement agreement and license agreement to the U.S. Federal Trade Commission and the U.S. Department of Justice. The Company's patent infringement suits with Teva are described in more detail in Part II, Item 1 of this quarterly report.

13. Segment and Geographic Information

The Company is focused on advancing the treatment of acute and intensive care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace and manages its business and operations as one segment. Revenues reported to date are derived primarily from the sales of Angiomax in the United States.

The geographic segment information provided below is classified based on the major geographic regions in which the Company operates.



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011				2010				2011				2010
	(in thousands)								(in thousands)
Net revenue:
United States	$	111,561	92.4	%	$	100,234	94.8	%	$	328,849	93.3	%	$	301,065	94.7	%
Europe	6,060		5.0	%	4,018		3.8	%	18,429		5.2	%	13,613		4.3	%
Rest of world	3,152		2.6	%	1,491		1.4	%	5,223		1.5	%	3,288		1.0	%
Total net revenue	$	120,773			$	105,743			$	352,501			$	317,966



	September 30, 2011				December 31, 2010
	(in thousands)
Long-lived assets:
United States	$	118,451	99.0	%	$	117,095	98.8	%
Europe	1,121		0.9	%	1,213		1.0	%
Rest of world	63		0.1	%	220		0.2	%
Total long-lived assets	$	119,635			$	118,528

14. Relocation of Principal Offices

On January 12, 2009, the Company moved its principal executive offices to new office space in Parsippany, New Jersey. The lease for the Company's previous office facility expires in January 2013. As a result of vacating the previous facility, the Company triggered a cease-use date on January 12, 2009 and incurred estimated lease termination costs. Estimated lease termination costs include the net present value of future minimum lease payments from the cease-use date to the end of the remaining lease term net of estimated sublease rental income. As of September 30, 2011 , the Company has accrued approximately $1.2 million for its estimate of the net present value of these estimated lease termination costs. Additionally, certain other costs such as leasing commissions and legal fees will be expensed as incurred in conjunction with the sublease of the vacated office space.

15. Contingencies

The Company may be, from time to time, a party to various disputes and claims arising from normal business activities. The Company accrues for loss contingencies when information available indicates that it is probable that a liability has been incurred and the amount of such loss can be reasonably estimated.

Currently, the Company is party to the legal proceedings described in Part II, Item I of this quarterly report, which are principally patent litigation matters. The Company has assessed such legal proceedings and does not believe that it is probable that a liability has been incurred or that the amount of any potential liability can be reasonably estimated. As a result, the Company did not record any loss contingencies. While it is not possible to determine the outcome of the matters described in Part II, Item 1 of this quarterly report, the Company believes that, the resolution of all such matters will not have a material adverse effect on its consolidated financial position or liquidity, but could possibly be material to the Company's consolidated results of operations in any one accounting period.

16. Subsequent Events

Eagle Pharmaceuticals Arbitration

The Company has received a Demand for Arbitration filed by Eagle Pharmaceuticals, Inc. (Eagle), dated October 25, 2011 . In the Demand for Arbitration, Eagle claims that the Company failed to meet its obligations under the license and development agreement between the Company, Eagle and certain other parties relating to the development of a new formulation of the Company's product, Angiomax, and to the Company's efforts to seek and obtain regulatory approval, market and sell that new formulation. As a result, Eagle alleges that it has been damaged in an amount it believes exceeds $200 million . The Company believes that it has valid defenses to Eagle's claims and intends to defend itself vigorously. The Company believes that any potential liability is not estimable at this time.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and accompanying notes included elsewhere in this quarterly report. In addition to the historical information, the discussion in this quarterly report contains certain forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated by the forward-looking statements due to our critical accounting estimates discussed below and important factors set forth in this quarterly report, including under “Risk Factors” in Part II, Item 1A of this quarterly report.

Overview

Our Business

We are a global pharmaceutical company focused on advancing the treatment of critical care patients through the delivery of innovative, cost-effective medicines to the worldwide hospital marketplace. We have three marketed products, Angiomax ^® (bivalirudin), Cleviprex ^® (clevidipine butyrate) injectable emulsion and our ready-to-use formulation of Argatroban. We also have a pipeline of acute and intensive care hospital products in development, including three late-stage development product candidates, cangrelor, oritavancin and MDCO-157, a novel intravenous formulation of clopidogrel bisulfate, and two early stage development product candidates, MDCO-2010 and MDCO-216. We believe that our marketed products and products in development possess favorable attributes that competitive products do not provide, can satisfy unmet medical needs in the acute and intensive care hospital product market and offer, or, in the case of our products in development, have the potential to offer, improved performance to hospital businesses.

The following chart identifies each of our marketed products and our products in development, their stage of development, their mechanism of action and the indications which they have been approved for use or which they are intended to address. Each of our marketed products and products in development is administered intravenously.



Product or Product in Development	Development Stage	Mechanism/Target	Clinical Indication(s)
Angiomax	Marketed	Direct thrombin inhibitor	U.S. - for use as an anticoagulant in combination with aspirin in patients with unstable angina undergoing percutaneous transluminal coronary angioplasty, or PTCA, and for use in patients undergoing percutaneous coronary intervention, or PCI, including patients with or at risk of heparin induced thrombocytopenia and thrombosis syndrome, or HIT/HITTS
			Europe - for use as an anticoagulant in patients undergoing PCI, adult patients with acute coronary syndrome, or ACS, and for the treatment of patients with ST-segment elevation myocardial infarction, or STEMI, undergoing primary PCI
Cleviprex	Marketed in the United States; Marketing Authorization Application, or MAA, submitted in European Union countries	Calcium channel blocker	Blood pressure reduction when oral therapy is not feasible or not desirable
Ready-to-Use Argatroban	Marketed in the United States	Direct thrombin inhibitor	Approved for prophylaxis or treatment of thrombosis in adult patients with HIT and for use as an anticoagulant in adult patients with or at risk for HIT undergoing PCI.
Cangrelor	Phase 3	Antiplatelet agent	Prevention of platelet activation and aggregation when oral therapy is not feasible or not desirable
Oritavancin	Phase 3	Antibiotic	Treatment of serious gram-positive bacterial infections, including acute bacterial skin and skin structure infections, or ABSSSI and including infections that are resistant to conventional treatment
MDCO-157 (IV clopidogrel)	Pre-registration stage	Platelet inhibitor	Platelet inhibition in patients suffering from ACS or patients recently experiencing myocardial infarction, stroke, or peripheral arterial disease when oral therapy is not feasible or not desirable
MDCO-2010	Phase 2	Serine protease inhibitor	Reduction of blood loss during surgery
MDCO-216	Phase 1	Naturally occurring variant of a protein found in high-density lipoprotein, or HDL	Reversal cholesterol transport agent to reduce atherosclerotic plaque burden development and thereby reduce the risk of adverse thrombotic events

Our revenues to date have been generated primarily from sales of Angiomax in the United States, but we continue to expand our sales and marketing efforts outside the United States. We believe that by establishing operations outside the United States for Angiomax, we will be positioned to better market and sell Angiomax where approved, to commercialize our acute and intensive care products and product candidates from our pipeline if and when they are approved outside the United States and to potentially in-license marketed products outside the United States.

Research and development expenses represent costs incurred for licenses of rights to products, clinical trials, nonclinical and preclinical studies, activities relating to regulatory filings and manufacturing development efforts. We outsource much of our clinical trials, nonclinical and preclinical studies and all of our manufacturing development activities to third parties to maximize efficiency and minimize our internal overhead. We expense our research and development costs as they are incurred. Selling, general and administrative expenses consist primarily of salaries and related expenses, costs associated with general corporate activities and costs associated with marketing and promotional activities. Research and development expense, selling, general and administrative expense and cost of revenue also include stock-based compensation expense, which we allocate based on the responsibilities of the recipients of the stock-based compensation.

As of September 30, 2011 , we had an accumulated deficit of approximately $131.2 million . We expect to make substantial expenditures to further develop and commercialize our products and to develop our product candidates, including costs and expenses associated with clinical trials, nonclinical and preclinical studies, regulatory approvals and commercialization.

Angiomax Patent Litigation

The principal U.S. patent covering Angiomax, U.S. patent No. 5,196,404, or the '404 patent, was set to expire in March 2010, but has been extended under the Hatch-Waxman Act following our litigation against the U.S. Patent and Trademark Office, or PTO, the FDA and the U.S. Department of Health and Human Services, or HHS. We had applied, under the Hatch-Waxman Act, for an extension of the term of the '404 patent. However, the PTO rejected our application because in its view the application was not timely filed. As a result, we filed suit against the PTO, the FDA and HHS seeking to set aside the denial of our application to extend the term of the '404 patent. On August 3, 2010, the U.S. Federal District Court for the Eastern District of Virginia granted our motion for summary judgment and ordered the PTO to consider our patent term extension application timely filed. Following the expiration of the government's appeal period, the FDA determined the applicable regulatory review period for Angiomax. Based on the FDA's determination, we believe that the term of the '404 patent should be extended until December 15, 2014. However, to date the PTO has not yet communicated a final determination concerning the length of any patent term extension for the '404 patent. At this time, we do not know when the PTO will make or communicate such a determination. On July 28, 2011, the PTO granted us a one-year interim extension of the '404 patent until August 13, 2012. As a result of our study of Angiomax in the pediatric setting, we are entitled to a six-month period of pediatric exclusivity following expiration of the '404 patent. If the patent term of the '404 patent is extended to December 15, 2014, we currently believe that this pediatric exclusivity would extend until June 15, 2015.

The period for the government to appeal the court's August 3, 2010 decision expired without government appeal. However, on August 19, 2010, APP Pharmaceuticals, LLC, or APP, filed a motion to intervene for the purpose of appeal in our case against the PTO, the FDA and HHS. On September 13, 2010, the federal district court denied APP's motion. APP has appealed the denial of its motion, as well as the federal district court's August 3, 2010 order (and all related and underlying orders). This appeal is pending in the U.S. Court of Appeals for the Federal Circuit.

On September 16, 2011, President Obama signed into law the Leahy-Smith America Invents Act, or the America Invents Act. Section 37 of the America Invents Act clarifies the filing timeline for patent term extension applications under the Hatch-Waxman Act. This clarification confirms the interpretation of the Hatch-Waxman Act adopted by the federal district court's August 3, 2010 decision in our suit against the PTO, the FDA and HHS, which ordered the PTO to consider our patent term extension application timely filed. We and APP have filed supplemental briefs concerning the America Invents Act. In its appeal, APP is contending that Section 37 of the America Invents Act does not govern our matter and is challenging the constitutionality of the America Invents Act. In addition, on September 27, 2011, APP filed a Motion for Stay Pending Appeal in order to attempt to prevent the PTO from issuing a final certificate of extension for the '404 patent. The United States has intervened to defend the constitutionality of the America Invents Act. On October 25, 2011 the U.S. Department of Justice, or DOJ, filed a brief with the Federal Circuit taking the position that Section 37 of the America Invents Act applies to our matter and is constitutional. Oral argument before the Federal Circuit on APP's appeal is scheduled for November 15, 2011.

unconstitutional or not to apply to the '404 patent, Angiomax could be subject to generic competition in the United States earlier than we anticipate. In such event, a court or the FDA could determine that the '404 patent expired in March 2010. In such case, the pediatric exclusivity period for Angiomax would have expired in September 2010. It is also possible that a court or the FDA could determine that the '404 patent expired on a later date, in which case the pediatric exclusivity for Angiomax would run from that later date. In Europe, the principal patent covering Angiox expires in 2015.

In addition, in October 2011, a legislative proposal was filed in the United States Senate to deny the PTO funding to implement Section 37 of the America Invents Act. This proposal was not brought up for a vote by the Senate, but could be brought up in the future. It is difficult to predict whether this proposal or other legislation amending or otherwise preventing the application of Section 37 of the America Invents Act might be proposed and enacted, or, if so enacted, the legal effect of such legislation.

In the second half of 2009, the PTO issued to us U.S. Patent No. 7,582,727, or the '727 patent, and U.S. Patent No. 7,598,343, or the '343 patent, covering a more consistent and improved Angiomax drug product and the processes by which it is made. The '727 patent and the '343 patent are set to expire in July 2028. In response to Paragraph IV Certification Notice letters we received with respect to abbreviated new drug applications, or ANDAs, filed with the FDA seeking approval to market generic versions of Angiomax, we have filed lawsuits against the ANDA filers alleging patent infringement of the '727 patent and '343 patent. On September 30, 2011, we settled our patent infringement litigation with Teva Pharmaceuticals USA, Inc. and its affiliates, which we refer collectively as Teva, which is described in more detail below. In connection with the settlement, we entered into a license agreement with Teva under which we granted Teva a non-exclusive license under the '727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019 or earlier under certain conditions. We remain in infringement litigation involving the '727 patent and '343 patent with the other ANDA filers. If we are unable to maintain our market exclusivity for Angiomax in the United States through enforcement of our U.S. patents covering Angiomax, Angiomax could be subject to generic competition earlier than June 30, 2019.

Our litigation with the PTO, the FDA and HHS, APP's efforts to appeal the August 3, 2010 decision and the patent infringement suits are described in more detail in Part II, Item 1 of this quarterly report.

Legal Settlements

Teva Settlement . On September 30, 2011, we entered into a settlement agreement and a license agreement with Teva, with respect to our patent infringement suits against Teva, which includes our suit against Pliva Hrvatska d.o.o., et al. Under the settlement agreement, Teva admitted that the '727 patent and '343 patent are valid and enforceable and that they would be infringed by the manufacture and sale of Teva's generic bivalirudin for injection products. On October 13, 2011, the district court for the Eastern District of Pennsylvania entered a judgment and order of permanent injunction concluding our patent infringement suits against Teva. Under the settlement agreement, we made a one-time payment to Teva in recognition of the savings inuring to us in terms of the avoidance of costs and burden associated with prosecuting the patent infringement suits. The settlement agreement terminates upon the earlier of the expiration of the '727 patent and '343 patent and the termination of the license agreement. The '727 patent and '343 patent are currently due to expire on July 27, 2028. Under the license agreement, we granted Teva a non-exclusive license under the '727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019, or earlier under certain conditions. Under the license agreement, Teva will be required to pay us royalties on gross profits of its sales of its bivalirudin product under certain circumstances. The license agreement also contains a grant by Teva to us of an exclusive (except as to Teva) license under Teva's bivalirudin patents and right to enforce Teva's bivalirudin patents, in consideration of which we made a one-time payment to Teva. The license to Teva will remain in effect until the expiration of all of our patents covering Angiomax except for the '404 patent. We and Teva may terminate the license agreement in the event of a material breach by the other party, unless the material breach is cured within 60 days of a written notice. We may terminate the license agreement, effectively immediately, for certain breaches of the license agreement. On October 13, 2011, we and Teva submitted the settlement agreement and license agreement to the U.S. Federal Trade Commission, or FTC, and the DOJ. Our patent infringement suits with Teva are described in more detail in Part II, Item 1 of this quarterly report.

Supply Agreement with Teva . Contemporaneously with entering into the settlement and license agreements with Teva, we and Plantex USA Inc., or Plantex, a Teva affiliate, entered into a supply agreement under which we agree to purchase from Plantex certain minimum quantities of the active pharmaceutical ingredient bivalirudin for our commercial supply. The initial term of the supply agreement ends December 31, 2015 and will automatically be renewed for up to two successive three-year periods unless terminated by us with at least six-month written notice or by Teva with at least 24-months written notice prior to the expiration of the initial term or either renewal term. We have the right to terminate the supply agreement, effectively immediately, if a generic form of bivalirudin is launched after January 1, 2013. We and Teva may terminate the supply agreement in the event of a material breach by the other party, unless the material breach is cured within 30 days of a written notice, and we may terminate the supply agreement upon breach of the settlement agreement and certain breaches of the license agreement.

WilmerHale Settlement . In February 2011, we entered into a settlement agreement and release with the law firm Wilmer Cutler Pickering Hale and Dorr LLP, or WilmerHale, with respect to all potential claims and causes of action between the parties related to the '404 patent. Under the settlement agreement, WilmerHale agreed to make available to us up to approximately $232 million, consisting of approximately $117 million from the proceeds of professional liability insurance policies and $115 million of payments from WilmerHale itself. WilmerHale agreed to pay approximately $18 million from its professional liability insurance providers to us within 60 days after the date of the settlement agreement and delivered such amount in two equal payments in March 2011 and April 2011. The balance of the approximately $232 million aggregate amount provided in the settlement agreement remains available to pay future expenses incurred by us in continuing to defend the extension of the '404 patent, and any damages that may be suffered by us in the event that a generic version of Angiomax is sold in the United States before June 15, 2015 because the extension of the '404 patent is held invalid on the basis that the application for the extension was not timely filed. Payments by WilmerHale itself would be made only after payments from its insurance policies are exhausted and cannot exceed $2.875 million for any calendar quarter.

Cleviprex Resupply, Re-launch and Formulation

In December 2009 and March 2010, we conducted voluntary recalls of manufactured lots of Cleviprex due to the presence of visible particulate matter at the bottom of some vials. As a result, we were not able to supply the market with Cleviprex and sell Cleviprex from the first quarter of 2010 through the first quarter of 2011. We cooperated with the FDA and our contract manufacturer to remedy the problem at the manufacturing site that resulted in the recalls. Our contract manufacturer made manufacturing process improvements, including enhanced filtration and equipment maintenance, to assure product quality. We began to resupply existing customers with Cleviprex in April 2011. In June 2011, the FDA approved our supplemental New Drug Application, or sNDA, for an improved formulation of Cleviprex. The new formulation triples the maximum allowable infusion time per vial, commonly referred to in hospitals as "hang time", to 12 hours compared to the original 4-hour hang time vial approved by the FDA in 2008. We re-launched Cleviprex in October 2011 with the new formulation, targeting neurocritical care patients, including intracranial bleeding and acute ischemic stroke patients requiring blood pressure control, and cardiac surgery patients, including patients undergoing coronary artery bypass graft surgery, heart valve replacement or repair, and surgery for the repair of aortic dissection.

Distribution and Sales

We market and sell Angiomax, Cleviprex and ready-to-use Argatroban in the United States with a sales force that, as of September 30, 2011 , consisted of 101 representatives, who we refer to as engagement partners and engagement managers, experienced in selling to hospital customers. We distribute our products in the United States through a sole source distribution model. Under this model, we currently sell Angiomax, Cleviprex and ready-to-use Argatroban to our sole source distributor, Integrated Commercialization Solutions, Inc., or ICS, which then sells the products to a limited number of national medical and pharmaceutical wholesalers with distribution centers located throughout the United States and in certain cases, directly to hospitals. Our agreement with ICS, which we initially entered into February 2007, provides that ICS will be our exclusive distributor of Angiomax, Cleviprex and ready-to-use Argatroban in the United States. Under the terms of this fee-for-service agreement, ICS places orders with us for sufficient quantities of Angiomax, Cleviprex and ready-to-use Argatroban to maintain an appropriate level of inventory based on our customers' historical purchase volumes. ICS assumes all credit and inventory risks, is subject to our standard return policy and has sole responsibility for determining the prices at which it sells Angiomax, Cleviprex and ready-to-use Argatroban, subject to specified limitations in the agreement. The agreement terminates on September 30, 2013, but will automatically renew for additional one-year periods unless either party gives notice at least 90 days prior to the automatic extension. Either party may terminate the agreement at any time and for any reason upon 180 days prior written notice to the other party. In addition, either party may terminate the agreement upon an uncured default of a material obligation by the other party and other specified conditions.

In Europe, we market and sell Angiox with a sales force that, as of September 30, 2011 , consisted of 44 engagement partners and engagement managers experienced in selling to hospital customers. Our European sales force targets hospitals with cardiac catheterization laboratories that perform approximately 200 or more coronary angioplasties per year. In October 2011, we entered into a local sales support agreement with Daiichi Sankyo, Inc. under which they have agreed to provide supplemental sales force coverage to approximately 480 hospitals in Germany treating ACS patients and call upon most interventional cardiologists in Germany. We also market and sell Angiomax outside the United States through distributors, including Sunovion Pharmaceuticals Inc., which distributes Angiomax in Canada, and affiliates of Grupo Ferrer Internacional, which distribute Angiox in Greece, Portugal and Spain and in a number of countries in Central America and South America. We also have agreements with other third parties for other countries outside of the United States and Europe, including Israel and Australia. We are developing a global commercialization strategy for Cleviprex in anticipation of its further approval outside of the United States.

To support the commercialization and distribution efforts of Angiomax, we have developed, and continue to develop, our

business infrastructure outside the United States, including forming subsidiaries, obtaining licenses and authorizations necessary to distribute Angiomax, hiring personnel and entering into arrangements for services from third parties, such as importation, packaging, quality control and distribution. We currently have operations in Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, India, Italy, the Netherlands, New Zealand, Norway, Poland, Spain, Sweden, Switzerland and the United Kingdom and are developing our business infrastructure and capabilities in Brazil, China, Eastern Europe, Russia and Turkey. We believe that by establishing operations outside the United States for Angiomax, we will be positioned to commercialize Cleviprex and our products in development, if and when they are approved outside the United States.

Workforce Reductions

2010 Reductions . On January 7, 2010 and February 9, 2010, we commenced two separate workforce reductions to improve efficiencies and better align our costs and structure for the future. As a result of the first workforce reduction, we reduced our office-based personnel by 30 employees. The second workforce reduction resulted in a reduction of 42 primarily field-based employees. In the year ended December 31, 2010, we recorded, in the aggregate, charges of $6.8 million associated with these workforce reductions. During the nine months ended September 30, 2011 , we recorded a $0.1 million favorable adjustment to selling, general and administrative costs due to a reversal of costs associated with these workforce reductions, primarily due to the charges for employee severance and other employee-related termination costs being slightly lower than originally estimated. We did not record any adjustment to selling, general and administrative costs for the three months ended September 30, 2011 .

Leipzig Reduction . On September 22, 2011, we commenced the closure of our drug discovery research and development facility and operations in Leipzig, Germany and terminated ten employees at our Leipzig facility, which we refer to herein as the 2011 Leipzig closure. We transferred active pre-clinical projects to our research and development facility in Montreal, Canada and the MDCO-2010 back-up compound to the clinical team in Parsippany, NJ. Upon signing release agreements, the terminated employees received severance and other benefits. We recorded, in aggregate, charges of $2.1 million in the three and nine months ended September 30, 2011 associated with the 2011 Leipzig closure. These charges were recorded in research and development expenses in our financial statements. Of the $2.1 million of charges related to the 2011 Leipzig closure, $0.3 million related to asset write-offs were noncash charges. We expect to pay out $1.0 million during the fourth quarter of 2011 and to pay out $0.8 million during 2012. We no longer have any research employees or research capabilities in Leipzig.

Licensing Agreement with Ligand Pharmaceuticals Incorporated

In May 2011, we entered into a licensing agreement with Ligand Pharmaceuticals Incorporated, or Ligand, through its subsidiary CyDex Pharmaceuticals, Inc., under which we acquired an exclusive, worldwide license to patents claiming a Captisol ^® -enabled intravenous formulation of clopidogrel bisulfate, which we refer to as MDCO-157, and to related know-how. Under the license agreement, we paid Ligand an upfront payment of approximately $1.8 million in June 2011 and agreed to make additional payments of up to $22 million upon the achievement of certain clinical, regulatory and commercial milestones. We also agreed to pay to Ligand tiered royalties from high single digits up to low double digits on annual worldwide net sales. The license obligates us to use commercially reasonable efforts to develop a licensed product, and to make $2.5 million per year in development expenditures until we submit a new drug application, or NDA. The licenses and rights under the agreement remain in force on a country-by-country basis until the expiration of our obligations to pay royalties under the license agreement or the license agreement is otherwise terminated. Either party may terminate the agreement for material breach upon 30 days' prior written notice for breaches involving non-payment of amounts due under the license agreement or 120 days for all other material breaches (which can be extended for up to 90 days if the breaching party submits a reasonable plan to cure the breach), if the breach is not cured within the applicable period. We may terminate the agreement for any reason upon specified written notice. Ligand may terminate the agreement if we do not meet certain timelines or fulfill certain obligations under the license agreement. Finally, the license agreement will terminate if we terminate the supply agreement (described below) without cause or Ligand terminates it due to our material breach.

Under a separate supply agreement entered in May 2011, Ligand has agreed to supply us with clinical materials of Captisol, an excipient in MDCO-157, for the MDCO-157 development program. If the intravenous formulation is approved for commercialization, we have agreed that Ligand will be the exclusive supplier of Captisol for the product. This agreement will expire or automatically terminate simultaneously with the expiration or termination, respectively, of the licensing agreement, and either party may terminate it for the other's material breach on the same terms as those of the licensing agreement.

We expect to seek an FDA marketing approval for MDCO-157 pursuant to the Section 505(b)(2) NDA process. This process would enable us to rely, in part, on the safety and efficacy data of an existing product, or published literature, in support of an application for marketing approval. In connection with the Section 505(b)(2) NDA process, we plan to conduct a pharmacodynamic equivalence study of MDCO-157.

U.S. Health Care Reform

In March 2010, President Obama signed into law the Patient Protection and Affordable Care Act, or PPACA, which was amended by the Health Care and Education Reconciliation Act of 2010. The PPACA, as amended, contains numerous provisions that impact the pharmaceutical and healthcare industries that are expected to be implemented over the next several years. We are continually evaluating the impact of the PPACA on our business. Presently, we have not identified any provisions that currently materially impact our business and results of operations. However, the potential impact of the PPACA on our business and results of operations is inherently difficult to predict as many of the details regarding the implementation of this legislation have not been determined and the impact on our business and results of operations may change as and if our business evolves.

Results of Operations

Net Revenue:

Net revenue increased 14% to $120.8 million for the three months ended September 30, 2011 as compared to $105.7 million for the three months ended September 30, 2010 .

Net revenue increased 11% to $352.5 million for the nine months ended September 30, 2011 as compared to $318.0 million for the nine months ended September 30, 2010 .

The following tables reflect the components of net revenue for the three and nine months ended September 30, 2011 and 2010 :

Net Revenue



	Three Months Ended September 30,
	2011		2010		Change $		Change %
			(in thousands)
U.S. sales	$	111,561	$	100,234	$	11,327	11.3	%
International net revenue	9,212		5,509		3,703		67.2	%
Total net revenue	$	120,773	$	105,743	$	15,030	14.2	%



	Nine Months Ended September 30,
	2011		2010		Change $		Change %
			(in thousands)
U.S. sales	$	328,849	$	301,065	$	27,784	9.2	%
International net revenue	23,652		16,901		6,751		39.9	%
Total net revenue	$	352,501	$	317,966	$	34,535	10.9	%

Net revenue during the three months ended September 30, 2011 increased by $15.0 million compared to the three months ended September 30, 2010 primarily due to increases in sales of Angiomax in the United States and Angiox in Europe. The increase in net revenue was a result of a price increase we implemented in January 2011 in the United States, increased demand globally by existing hospital customers and the addition of new hospital customers internationally. Net sales in the United States in both the three months ended September 30, 2011 and September 30, 2010 reflects the chargebacks related to the 340B Drug Pricing Program under the Public Health Services Act. Under this program, we offer qualifying entities a discount off the commercial price of Angiomax for patients undergoing PCI on an outpatient basis. These chargebacks increased by $1.0 million to $11.1 million in the three months ended September 30, 2011 compared to $10.1 million in the three months ended September 30, 2010 . In addition, we recognized a reduction in product net sales of approximately $0.1 million in both the three months ended September 30, 2011 and September 30, 2010 for rebates related to the PPACA. U.S. sales also included net sales of our ready-to-use Argatroban of $0.2 million and Cleviprex of $0.2 million in the three months ended September 30, 2011 . We recognized

no revenue from sales of ready-to-use Argatroban and Cleviprex in the three months ended September 30, 2010 , as our formulation of ready-to-use Argatroban was not approved until July 2011 and we did not sell Cleviprex from the first quarter of 2010 through the first quarter of 2011 as a result of the voluntary recalls of manufactured lots of Cleviprex. We began to resupply existing customers with Cleviprex in April 2011. We re-launched Cleviprex in October 2011 with a new formulation, targeting neurocritical care patients, including intracranial bleeding and acute ischemic stroke patients requiring blood pressure control, and cardiac surgery patients, including patients undergoing coronary artery bypass graft surgery, heart valve replacement or repair, and surgery for the repair of aortic dissection.

Net revenue during the nine months ended September 30, 2011 increased by $34.5 million compared to the nine months ended September 30, 2010 primarily due to increases in sales of Angiomax in the United States and Angiox in Europe. The net revenue increase was a result of a price increase we implemented in January 2011 in the United States and increased demand by existing hospital customers and the addition of new hospital customers internationally. Net sales in the United States in both the nine months ended September 30, 2011 and September 30, 2010 reflect the chargebacks related to the 340B Drug Pricing Program under the Public Health Services Act. These chargebacks increased by $1.8 million to $30.3 million in the nine months ended September 30, 2011 compared to $28.5 million in the nine months ended September 30, 2010 . In addition, in the nine months ended September 30, 2011 , we recognized a reduction in product net sales of approximately $0.5 million, a $0.2 million increase when compared to the nine months ended September 30, 2010 for rebates related to the PPACA. U.S. sales included net sales of Cleviprex of $0.5 million in the nine months ended September 30, 2011 compared to $0.8 million of revenue from sales of Cleviprex in the nine months ended September 30, 2010 . The $0.8 million in sales of Cleviprex in the nine months ended September 30, 2010 reflects an offset of $0.7 million due to returns related to the Cleviprex recall. U.S. sales also included net sales of ready-to-use Argatroban of $0.2 million in the nine months ended September 30, 2011 . We recognized no revenue from sales of ready-to-use Argatroban in the nine months ended September 30, 2010 .

International net revenue increased by $3.7 million during the three months ended September 30, 2011 compared to the three months ended September 30, 2010 primarily as a result of increased demand for Angiomax in Canada, Italy, the United Kingdom, Sweden, South America, Denmark, Belgium and the Netherlands.

International net revenue increased by $6.8 million during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 primarily as a result of increased demand for Angiomax in Canada, Italy, the United Kingdom, Sweden, Denmark, Belgium and the Netherlands, which was partially offset by decreased sales of Angiomax in France, Spain, Israel and South America.

If we are unable to maintain our market exclusivity for Angiomax in the United States as a result of an adverse court decision or adverse legislation relating to the '404 patent or our inability to enforce our other U.S. patents covering Angiomax, Angiomax could be subject to generic competition in the United States earlier than we anticipate. Competition from generic equivalents sold at a price that is less than the price at which we currently sell Angiomax would reduce our revenues, possibly materially.

Cost of Revenue:

Cost of revenue in the three months ended September 30, 2011 was $39.5 million , or 33% of net revenue, compared to $31.6 million , or 30% of net revenue, in the three months ended September 30, 2010 .

Cost of revenue in the nine months ended September 30, 2011 was $112.9 million , or 32% of net revenue, compared to $93.9 million , or 30% of net revenue, in the nine months ended September 30, 2010 .

Cost of revenue during both periods consisted of expenses in connection with the manufacture of Angiomax, Cleviprex and ready-to-use Argatroban sold, royalty expenses under our agreements with Biogen Idec and Health Research Inc., or HRI, related to Angiomax and our agreement with AstraZeneca AB, or AstraZeneca, related to Cleviprex and the logistics costs related to Angiomax, Cleviprex and ready-to-use Argatroban, including distribution, storage, and handling costs.

Cost of Revenue



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011		% of Total		2010		% of Total		2011		% of Total		2010		% of Total
	(in thousands)				(in thousands)				(in thousands)						(in thousands)
Manufacturing	$	6,737	17	%	$	7,277	23	%	$	22,413	20	%	$	21,645	23	%
Royalty	27,958		71	%	21,129		67	%	$	79,196	70	%	$	63,004	67	%
Logistics	4,764		12	%	3,162		10	%	$	11,250	10	%	$	9,256	10	%
Total cost of revenue	$	39,459	100	%	$	31,568	100	%	$	112,859	100	%	$	93,905	100	%

Cost of revenue increased by $7.9 million during the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . The increase in cost of revenue was primarily related to an increase in royalty expense to Biogen Idec due to a higher effective royalty rate under our agreement with Biogen Idec as a result of increased net sales of Angiomax as well as a corresponding increase in royalty expense associated with the higher sales of Angiomax. This increase in cost of revenue was also related to an increase in manufacturing expense due to costs associated with obtaining an additional supplier for the fill-finish of Angiomax drug product.

Cost of revenue increased by $19.0 million during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . The increase in cost of revenue was primarily related to an increase in royalty expense to Biogen Idec due to a higher effective royalty rate under our agreement with Biogen Idec as well as a corresponding increase in royalty expense associated with the higher sales of Angiomax. This increase in cost of revenue was also related to an increase in manufacturing expense due to costs associated with obtaining an additional supplier for the manufacture of Angiomax. In addition, this increase in manufacturing expense reflects a $0.9 million reduction in manufacturing costs in the nine months ended September 30, 2010 related to the reversal in nine months ended September 30, 2010 of certain charges which were originally recorded in the fourth quarter of 2009 in connection with production failures at the third-party manufacturer for Angiomax.

Research and Development Expenses:

Research and development expenses increased by 59% to $26.6 million for the three months ended September 30, 2011 , compared to $16.7 million for the three months ended September 30, 2010 . The increase primarily reflects an increase in costs incurred in connection with our ongoing Phase 3 clinical trials of cangrelor and oritavancin, both of which were commenced in the fourth quarter of 2010. The increase also reflects charges of approximately $2.1 million associated with the 2011 Leipzig closure in the third quarter of 2011. These increases were offset by a decrease in clinical trial costs related to Angiomax and a decrease in manufacturing development expenses related to product lifecycle management activities of Angiomax.

Research and development expenses increased by 42% to $76.9 million for the nine months ended September 30, 2011 , compared to $54.1 million for the nine months ended September 30, 2010 . The increase primarily reflects an increase in costs incurred in connection with our ongoing Phase 3 clinical trials of cangrelor and oritavancin. The increase also reflects costs incurred in connection with the commencement of a Phase 1 clinical trial of MDCO-216, the manufacturing of product for the Phase 1 trial, the licensing fee paid in connection with obtaining the licensing rights to MDCO-157 and charges of approximately $2.1 million associated with the 2011 Leipzig closure in the third quarter of 2011. These increases were offset by a decrease in manufacturing development expenses related to product lifecycle management activities of Angiomax, charges recorded in the nine months ended September 30, 2010 associated with a payment made to AstraZeneca in connection with the June 2010 amendment to our cangrelor license agreement with AstraZeneca and by charges recorded in the nine months ended September 30, 2010 of approximately $1.7 million associated with our workforce reductions in the first quarter of 2010. Under the June 2010 amendment to our cangrelor license agreement with AstraZeneca, we agreed to conduct certain clinical studies of cangrelor, that the specific development time lines set forth in the license agreement would be eliminated and that certain regulatory assistance obligations of AstraZeneca in the license agreement would be terminated.

We expect to continue to invest in the development of Angiomax, Cleviprex, cangrelor, oritavancin, MDCO-2010, MDCO-216 and MDCO-157 during the fourth quarter of 2011 and that our research and development expenses will increase in 2011 as compared to 2010. We expect research and development expenses in 2011 to be approximately 20% of net revenues in 2011, excluding any transaction costs, and to reflect costs associated with our Phase 3 clinical trials of oritavancin and cangrelor, manufacturing development activities for Angiomax, Cleviprex, cangrelor and MDCO-216, our Phase 2 clinical trial program for MDCO-2010, our Phase 1 clinical trial of MDCO-216, product lifecycle management activities and the development of MDCO-157. We plan to evaluate, and make changes to, our budget allocation for such projects throughout the year based on net revenue amounts actually achieved.

The following tables identify, for each of our major research and development projects, our spending for the three and nine months ended September 30, 2011 and 2010 . Spending for past periods is not necessarily indicative of spending in future periods.

Research and Development Spending



	Three Months Ended September 30,
	2011			% of Total R&D		2010			% of Total R&D
	(In thousands)					(In thousands)
Angiomax
Clinical trials	$	1,116		4	%	$	1,781		11	%
Manufacturing development	34			—	%	622			4	%
Administrative and headcount costs	768			3	%	417			2	%
Total Angiomax	1,918			7	%	2,820			17	%
Cleviprex
Clinical trials	659			2	%	229			1	%
Manufacturing development	109			—	%	488			3	%
Administrative and headcount costs	450			2	%	521			3	%
Total Cleviprex	1,218			4	%	1,238			7	%
Cangrelor
Clinical trials	6,622			25	%	1,611			10	%
Manufacturing development	320			1	%	763			5	%
Administrative and headcount costs	1,466			6	%	1,082			6	%
Milestone	—			—	%	—			—	%
Total Cangrelor	8,408			32	%	3,456			21	%
Oritavancin
Clinical trials	6,038			23	%	1,186			7	%
Manufacturing development	925			3	%	383			3	%
Administrative and headcount costs	1,153			4	%	2,034			12	%
Total Oritavancin	8,116			30	%	3,603			22	%
MDCO-2010
Clinical trials	73			—	%	861			5	%
Manufacturing development	97			—	%	575			3	%
Administrative and headcount costs	2,081			8	%	1,077			7	%
Government subsidy	—			—	%	(530		)	(3	)%
Total MDCO-2010	2,251			8	%	1,983			12	%
MDCO-216
Clinical trials	102			—	%	86			—	%
Manufacturing development	612			2	%	655			4	%
Administrative and headcount costs	267			1	%	121			1	%
Total MDCO-216	981			3	%	862			5	%
Ready-to-Use Argatroban
Manufacturing development	—			—	%	139			1	%
Administrative and headcount costs	(147		)	(1	)%	—			—	%
Total Ready-to-Use Argatroban	(147		)	(1	)%	139			1	%
MDCO-157
Administrative and headcount costs	35			—	%	—			—	%
Acquisition license fee	—			—	%	—			—	%
Total MDCO-157	35			—	%	—			—	%
Other	3,770			14	%	2,575			15	%
Total	$	26,550		97	%	$	16,676		100	%



	Nine Months Ended September 30,
	2011			% of Total R&D		2010			% of Total R&D
	(In thousands)					(In thousands)
Angiomax
Clinical trials	$	4,763		6	%	$	5,080		9	%
Manufacturing development	206			—	%	4,596			9	%
Administrative and headcount costs	2,194			3	%	1,824			3	%
Total Angiomax	7,163			9	%	11,500			21	%
Cleviprex
Clinical trials	1,332			2	%	1,316			3	%
Manufacturing development	300			1	%	1,209			2	%
Administrative and headcount costs	1,095			1	%	1,610			3	%
Total Cleviprex	2,727			4	%	4,135			8	%
Cangrelor
Clinical trials	17,648			23	%	4,964			9	%
Manufacturing development	868			1	%	1,724			3	%
Administrative and headcount costs	4,741			6	%	3,094			6	%
Milestone	—			—	%	3,000			6	%
Total Cangrelor	23,257			30	%	12,782			24	%
Oritavancin
Clinical trials	17,678			23	%	2,250			4	%
Manufacturing development	1,825			2	%	2,833			5	%
Administrative and headcount costs	3,860			5	%	5,728			11	%
Total Oritavancin	23,363			30	%	10,811			20	%
MDCO-2010
Clinical trials	531			1	%	1,516			3	%
Manufacturing development	199			—	%	946			2	%
Administrative and headcount costs	3,867			5	%	3,151			6	%
Government subsidy	(222		)	—	%	(1,038		)	(2	)%
Total MDCO-2010	4,375			6	%	4,575			9	%
MDCO-216
Clinical trials	588			1	%	126			—	%
Manufacturing development	2,025			3	%	1,246			2	%
Administrative and headcount costs	749			1	%	430			1	%
Total MDCO-216	3,362			5	%	1,802			3	%
Ready-to-Use Argatroban
Manufacturing development	—			—	%	616			1	%
Administrative and headcount costs	544			1	%	169			—	%
Total Ready-to-Use Argatroban	544			1	%	785			1	%
MDCO-157
Administrative and headcount costs	35			—	%	—			—	%
Acquisition license fee	1,750			2	%	—			—	%
Total MDCO-157	1,785			2	%	—			—	%
Other	10,302			13	%	7,738			14	%
Total	$	76,878		100	%	$	54,128		100	%

Angiomax

Research and development spending related to Angiomax during the three months ended September 30, 2011 decreased by approximately $0.9 million compared to the three months ended September 30, 2010 , primarily due to decreases of $0.7 million

in clinical trial costs in connection with the reduction of the number of clinical sites for our Phase 4 EUROMAX clinical trial and of $0.6 million in manufacturing development expenses related to product lifecycle management activities. These decreases were partially offset by an increase of $0.4 million in administrative and headcount expenses related to our efforts to further develop Angiomax for use in additional patient populations. We are conducting the EUROMAX trial at sites in six European countries to assess whether the early administration of Angiox in STEMI patients intended for primary PCI presenting either via ambulance or to referral centers where PCI is not performed improves 30-day outcomes when compared to the current standard of care, heparin plus an optional GP IIb/IIIa inhibitor. We commenced enrollment in our EUROMAX clinical trial in March 2010. We expect to enroll approximately 3,680 patients in the EUROMAX trial.

Research and development spending related to Angiomax during the nine months ended September 30, 2011 decreased by approximately $4.3 million compared to the nine months ended September 30, 2010 , primarily due to a decrease of $4.4 million in manufacturing development expenses related to product lifecycle management activities and a decrease of $0.3 million in clinical trial costs, primarily due to decreased expenditures in connection with our Phase 4 EUROMAX clinical trial. These decreases were partially offset by an increase of $0.4 million in administrative and headcount expenses related to our efforts to further develop Angiomax for use in additional patient populations.

We expect that our research and development expenses relating to Angiomax will decrease in 2011 as compared to 2010 due to the completion of enrollment of our Phase 4 EUROVISION trial in 2010, which we designed to study utilization patterns of patients receiving Angiox and collect descriptive outcome and safety data of patients, and decreased manufacturing and regulatory expenses. We expect that this decrease will be partially offset by increased expenses in connection with our efforts to further develop Angiomax for use in additional patient populations such as the EUROMAX trial, as well as continued research and development expenses related to our product lifecycle management activities.

Cleviprex

Research and development expenditures for Cleviprex were relatively unchanged during the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . Increases in clinical trial costs were offset by decreases in manufacturing development expenses. The increases in clinical trial costs reflect that during the second quarter of 2011, hospitals and third-party researchers restarted clinical studies that we support that were discontinued in late 2009 as a result of the supply issues and we resumed our efforts to obtain marketing approval of Cleviprex outside the United States, which had ceased after the recall of Cleviprex in 2009.

Research and development expenditures for Cleviprex decreased by approximately $1.4 million during the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . The decrease was primarily due to the recalls of Cleviprex and the related supply issues and the resulting discontinuation in late 2009 of clinical studies of Cleviprex being conducted by hospitals and third-party researchers that we were supporting.

We expect total research and development expenses relating to Cleviprex in 2011 to remain similar to 2010 levels. We expect we will incur increased research and development expenses in 2011 in connection with our efforts to obtain marketing approval of Cleviprex outside the United States and the clinical studies being conducted by hospitals and third-party researchers. We expect these increased costs to be offset by decreased manufacturing development expenses related to an improved formulation of Cleviprex which provides a longer infusion time that the FDA approved in June 2011.

Cangrelor

Research and development expenditures related to cangrelor increased by approximately $5.0 million in the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . The increase primarily reflects increased clinical trial expenses related to our Phase 3 PHOENIX clinical trial program, which we commenced in October 2010 to evaluate cangrelor in patients undergoing PCI, as well as an increase in the related administrative and headcount expenses. These increases were partially offset by a decrease in drug product manufacturing development expenses.

Research and development expenditures related to cangrelor increased by approximately $10.5 million in the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . The increase primarily reflects increased clinical trial expenses related to our Phase 3 PHOENIX clinical trial program, as well as an increase in the related administrative and headcount expenses. The 2010 period also included charges recorded in the nine months ended September 30, 2010 , associated with a $3.0 million payment made to AstraZeneca in connection with the June 2010 amendment to our agreement with AstraZeneca.

We expect to incur increased research and development expenses relating to cangrelor in 2011 as compared to 2010 in connection with the PHOENIX clinical trial. We initially expect to enroll approximately 10,900 patients, and we may enroll additional patients,

in this double-blind parallel group randomized study which compares cangrelor to clopidogrel given according to institutional practice. We currently have enrolled approximately 3,500 patients in the PHOENIX clinical trial.

Oritavancin

Research and development expenditures related to oritavancin increased by approximately $4.5 million in the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . The increase primarily reflects increased costs incurred in the three months ended September 30, 2011 related to our SOLO I and SOLO II Phase 3 clinical trials, which are two identical Phase 3 clinical trials of oritavancin for the treatment of ABSSSI, which we commenced in the fourth quarter of 2010. This increase in expenditures in the third quarter of 2011 was partially offset by decreases in headcount expenses in 2011.

Research and development expenditures related to oritavancin increased by approximately $12.6 million in the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . The increase primarily reflects increased costs incurred in the nine months ended September 30, 2011 related to our SOLO I and SOLO II Phase 3 clinical trials. This increase in expenditures in the first nine months of 2011 was partially offset by decreased manufacturing costs as we had manufactured product in 2010 for use in the SOLO I and SOLO II trials and decreased headcount expenses in 2011. Oritavancin research and development costs for the nine months ended September 30, 2010 also included approximately $1.3 million of severance payments related to the workforce reductions initiated in the first quarter of 2010.

We expect to incur increased research and development expenses relating to oritavancin in 2011 as compared to 2010 due to the SOLO I and SOLO II clinical trials. We plan to enroll a total of approximately 2,000 patients in the SOLO I and SOLO II clinical trials and to test the use of a simplified dosing regimen involving a single dose of oritavancin as compared to multiple doses of vancomycin for the treatment of ABSSSI. We currently have enrolled approximately 400 patients in the SOLO I and SOLO II clinical trials.

MDCO-2010

Research and development expenditures related to MDCO-2010 increased by approximately $0.3 million in the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . Costs incurred during the three months ended September 30, 2011 primarily related to the 2011 Leipzig closure, our ongoing Phase 2 clinical trial program of MDCO-2010. Costs incurred during the three months ended September 30, 2010 primarily related to our Phase 1 clinical trial of MDCO-2010, which we commenced in July 2009 and which we completed in 2010 in healthy volunteers that demonstrated safety and tolerability at low doses. Costs related to our Phase 2 clinical trial program include headcount related costs and manufacturing expenses related to the production of drug product for the trial. Costs related to MDCO-2010 in the three months ended September 30, 2010 were partially offset by a German government research and development subsidy paid during that period . We commenced our Phase 2 clinical trial program in November 2010 with a Phase 2a clinical trial conducted in Switzerland to study the safety, tolerability, pharmacokinetics and pharmacodynamics of MDCO-2010 in patients undergoing elective CABG surgery. We completed this trial in the third quarter of 2011 and presented the data at the American Society of Anesthesiologist conference in October 2011. Based on the Phase 2a results, we plan to commence a Phase 2b clinical trial of MDCO-2010 in the first quarter of 2012. We initially plan to conduct this trial in Germany, Canada and Switzerland, to determine dose response relationship regarding blood loss, pharmacokinetics and pharmacodynamics, and clinical outcomes of MDCO-2010 versus placebo and tranexamic acid in patients undergoing primary CABG surgery or combined primary CABG and aortic valve replacement. We further expect to submit an investigational new drug application, or IND, for MDCO-2010 to the FDA in the first quarter of 2012 and subject to the IND becoming effective, we plan to add the United States as a location for our Phase 2b clinical trial of MDCO-2010.

Research and development expenditures related to MDCO-2010 decreased by $0.2 million in the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . Costs incurred during the nine months ended September 30, 2011 primarily related to our ongoing Phase 2 clinical trial program of MDCO-2010 and the 2011 Leipzig closure. Costs incurred during the nine months ended September 30, 2010 primarily related to our Phase 1 clinical trial of MDCO-2010, which we commenced in July 2009. Costs related to our Phase 2 clinical trial program include headcount related costs and manufacturing expenses related to the production of drug product for the trial. Costs related to MDCO-2010 were partially offset by a German government research and development subsidy paid in both the nine months ended September 30, 2011 and September 30, 2010 .

We expect that our research and development expenses relating to MDCO-2010 will decrease in 2011 as compared to 2010, as we incurred an expense of $4.3 million for achieving a clinical milestone in 2010. We expect that these decreased expenses will be partially offset by an increase in the clinical trial expense related to our Phase 2b clinical trial of MDCO-2010.

MDCO-216

Research and development expenditures related to MDCO-216 increased by approximately $0.1 million in the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . Costs incurred during the three months ended September 30, 2011 primarily related to manufacturing development related to preclinical activities and clinical trial costs in connection with preparation for the commencement of a Phase 1 study of MDCO-216. Costs incurred during the three months ended September 30, 2010 primarily related to manufacturing development related to preclinical activities, administrative and headcount expenses and our preparation for a Phase 1 study.

Research and development expenditures related to MDCO-216 increased by approximately $1.6 million in the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . Costs incurred during the nine months ended September 30, 2011 primarily related to manufacturing development related to preclinical activities, clinical trial costs in connection with preparation for the commencement of a Phase 1 study of MDCO-216 and administrative and headcount expenses. Costs incurred during the nine months ended September 30, 2010 primarily related to manufacturing development, administrative and headcount expenses and clinical trial costs.

We expect to incur increased research and development expenses relating to MDCO-216 in 2011 as compared to 2010 in connection with our planned Phase 1 study of MDCO-216. In 2010, we completed a technology transfer program with Pfizer related to improved manufacturing methodologies developed by Pfizer since the Phase 1/2 trial of MDCO-216 conducted by Pfizer prior to the time that we obtained our license for MDCO-216. Using these new methodologies, we manufactured MDCO-216 on a small scale for use in preclinical studies of MDCO-216 in 2010. We plan to commence a Phase 1 study of MDCO-216 in the first half of 2012 and to use the same new methodologies to produce product for the Phase 1 study.

Ready-to-Use Argatroban

Research and development expenditures related to ready-to-use Argatroban decreased by $0.3 million in the three months ended September 30, 2011 compared to the three months ended September 30, 2010 . Costs incurred during the three months ended September 30, 2011 primarily related to administrative and headcount related expenses and costs incurred during the three months ended September 30, 2010 primarily related to manufacturing development expenses.

Research and development expenditures related to ready-to-use Argatroban decreased by $0.2 million in the nine months ended September 30, 2011 compared to the nine months ended September 30, 2010 . Costs incurred during the nine months ended September 30, 2011 primarily related to administrative and headcount related expenses and costs incurred during the nine months ended September 30, 2010 primarily related to manufacturing development activities and administrative and headcount related expenses.

We expect total research and development expenses relating to ready-to-use Argatroban in 2011 to remain similar to 2010 levels.

MDCO-157

In May 2011, we entered into a licensing agreement with Ligand under which we acquired exclusive, worldwide license rights to MDCO-157, a novel intravenous formulation of clopidogrel bisulfate. Costs incurred during the three months ended September 30, 2011 primarily related to administrative and headcount related expenses. Costs incurred during the nine months ended September 30, 2011 primarily related to the acquisition of the licensing agreement. Under the license agreement, we agreed to spend at least $2.5 million annually on the development of MDCO-157 and therefore will be obligated to spend the pro rata amount of approximately $1.5 million in 2011 on MDCO-157.

Other Research and Development Expense

Research and development expenditures in this category includes infrastructure costs in support of our product development efforts, which includes expenses for data management, statistical analysis, analysis of pre-clinical data, analysis of pharmacokinetic-pharmacodynamic data, or PK/PD data, and product safety as well as expenses related to business development activities in connection with our efforts to evaluate early stage and late stage compounds for development and commercialization and other strategic opportunities. Spending in this category increased by approximately $1.2 million during the three months ended September 30, 2011 compared to the three months ended September 30, 2010 , primarily due to an increase in administrative and headcount expenses.

Spending in this category increased by approximately $2.6 million during the nine months ended September 30, 2011 compared

to the nine months ended September 30, 2010 , primarily due to an increase in administrative and headcount expenses.

Our success in further developing Angiomax and obtaining marketing approvals for Angiomax in additional countries and for additional patient populations, developing and obtaining marketing approvals for Cleviprex outside the United States, and developing and obtaining marketing approvals for our products in development, is highly uncertain. We cannot predict expenses associated with ongoing data analysis or regulatory submissions, if any. Nor can we reasonably estimate or know the nature, timing and estimated costs of the efforts necessary to continue the development of Angiomax, Cleviprex and our products in development, or the period in which material net cash inflows are expected to commence from further developing Angiomax and Cleviprex, obtaining marketing approvals for Angiomax in additional countries and additional patient populations and for Cleviprex outside the United States or developing and obtaining marketing approvals for our products in development, due to the numerous risks and uncertainties associated with developing and commercializing drugs, including the uncertainty of:


•	the scope, rate of progress and cost of our clinical trials and other research and development activities;


•	future clinical trial results;


•	the terms and timing of any collaborative, licensing and other arrangements that we may establish;


•	the cost and timing of regulatory approvals;


•	the cost and timing of establishing and maintaining sales, marketing and distribution capabilities;


•	the cost of establishing and maintaining clinical and commercial supplies of our products and product candidates;


•	the effect of competing technological and market developments; and


•	the cost of filing, prosecuting, defending and enforcing any patent claims and other intellectual property rights.

Selling, General and Administrative Expenses:



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011		2010		Change $		Change %		2011		2010		Change $		Change %
	(in thousands)								(in thousands)
Selling, general and administrative expenses	$	45,353	$	35,788	$	9,565	26.7	%	$	124,701	$	121,318	$	3,383	2.8	%

The increase in selling, general and administrative expenses of $9.6 million in the three months ended September 30, 2011 as compared to the three months ended September 30, 2010 reflects a $0.5 million increase in selling, marketing and promotional expense primarily from an increase in our efforts to expand global sales and marketing activities in the third quarter of 2011, $6.9 million of higher general corporate and administrative spending in the third quarter of 2011, largely associated with our efforts with respect to the patent term extension of the '404 patent and settlement of our patent infringement litigation with Teva, increased site costs of $1.2 million which includes lease termination costs as a result of vacating our previous office facility in New Jersey, and a $1.0 million increase in stock-based compensation expense in the third quarter of 2011 as compared to the third quarter of 2010.

The increase in selling, general and administrative expenses of $3.4 million in the nine months ended September 30, 2011 as compared to the nine months ended September 30, 2010 reflects a $7.5 million increase in general corporate and administrative spending largely in connection with our efforts with respect to the patent term extension of the '404 patent and settlement of our patent infringement litigation with Teva, higher intangible amortization costs of $1.0 million, increased site costs of $0.7 million which includes lease termination costs as a result of vacating our previous office facility, and higher stock-based compensation costs of $1.6 million. These increases were partially offset by $2.1 million decrease in selling, marketing, and promotional expenses primarily related to Angiomax and $5.3 million of lower corporate and administrative spending resulting from a reduction in personnel costs due to the first quarter 2010 reduction in force and the closure of our Indianapolis site.

Legal settlement:



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011		2010		Change $		Change %		2011		2010		Change $		Change %
	(in thousands)								(in thousands)
Legal settlement	$	—	$	—	$	—	100.0	%	$	17,984	$	—	$	17,984	100.0	%

During the nine months ended September 30, 2011 , we recorded approximately $18.0 million in legal settlement income in connection with the settlement agreement we entered into with WilmerHale in February 2011. Pursuant to the settlement agreement, WilmerHale agreed to pay approximately $18.0 million from its professional liability insurance providers to us within 60 days after the date of the settlement agreement and delivered such amount in two equal payments in March 2011 and April 2011. We did not record any legal settlement income for the three months ended September 30, 2011 .

Other income (expense):



	Three Months Ended September 30,								Nine Months Ended September 30,
	2011		2010		Change $		Change %		2011		2010		Change $		Change %
	(in thousands)								(in thousands)
Other income	$	578	$	483	$	95	19.7	%	$	1,450	$	55	$	1,395	2,536.4	%

Other income, which is comprised of interest income, gains and losses on foreign currency transactions and impairment of investment, increased by $0.1 million to $0.6 million of income for the three months ended September 30, 2011 , from $0.5 million for the three months ended September 30, 2010 . This increase was primarily due to higher gains on foreign currency transactions in the three months ended September 30, 2011 .

Other income increased by $1.4 million to $1.5 million of income for the nine months ended September 30, 2011 , from $0.1 million for the nine months ended September 30, 2010 . This increase was primarily due to higher gains on foreign currency transactions in the nine months ended September 30, 2011 and increased interest due to higher levels of cash to invest.

Provision for Income Tax:



	Three Months Ended September 30,									Nine Months Ended September 30,
	2011		2010			Change $		Change %		2011		2010			Change $		Change %
	(in thousands)
Provision for income tax	$	62,625	$	(989	)	$	63,614	(6,432.2	)%	$	50,798	$	(2,607	)	$	53,405	(2,048.5	)%

On a periodic basis, we evaluate the realizability of our deferred tax assets net of deferred tax liabilities and adjust such amounts in light of changing facts and circumstances, including but not limited to our level of past and future taxable income, the current and future expected utilization of tax benefit carryforwards, any regulatory or legislative actions by relevant authorities with respect to the Angiomax patents, and the status of litigation with respect to those patents. We consider all available evidence, both positive and negative, to determine whether, based on the weight of that evidence, a valuation allowance is required to reduce the net deferred tax assets to the amount that is more likely than not to be realized in future periods. During the third quarter of 2011, based on review of the following positive and negative evidence, we reduced our valuation allowance against our deferred tax assets by $66.5 million and recorded a corresponding tax benefit.

Positive:


•	on September 16, 2011, President Obama signed the Leahy-Smith America Invents Act, which clarified the filing timeline for patent term extension applications under the Hatch-Waxman Act. This clarification confirmed the interpretation of the Hatch-Waxman Act adopted by the federal district court's August 3, 2010 decision in our suit against the PTO, the

FDA and HHS, which ordered the PTO to consider our patent term extension application for the '404 patent timely filed. Based on the FDA's determination of the applicable regulatory review period for Angiomax, we believe that the term of the '404 patent should be extended until December 15, 2014. However, to date the PTO has not yet communicated a final determination concerning the length of any patent term extension for the '404 patent. At this time, we do not know when the PTO will make or communicate such a determination. On July 28, 2011, the PTO granted us a one-year interim extension of the '404 patent until August 13, 2012. As a result of our study of Angiomax in the pediatric setting, we are entitled to a six-month period of pediatric exclusivity following expiration of the '404 patent. If the patent term of the '404 patent is extended to December 15, 2014, we currently believe that this pediatric exclusivity would extend until June 15, 2015;

•

on September 30, 2011, we entered into a settlement agreement and a license agreement with Teva, with respect to our patent infringement suits against Teva, which includes our suit against Pliva Hrvatska d.o.o., et al. As part of the settlement agreement, Teva admitted that the '727 patent and '343 patent are valid and enforceable and that they would be infringed by the manufacture and sale of Teva's generic bivalirudin for injection products. Under the license agreement, we granted Teva a non-exclusive license under the'727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019 or earlier under certain conditions. The '727 patent and '343 patent are listed in the Orange Book and expire on July 27, 2028;


•	for 2010 and the nine months ended September 30, 2011, our reported U.S. income before income taxes totaled approximately $80.8 million and $57.9 million, respectively; and


•	we launched our third product, ready-to-use Argatroban, in the United States in September 2011.

Negative:

•

APP filed a motion to intervene for the purpose of appeal in our case against the PTO, the FDA and HHS. On September 13, 2010, the federal district court denied APP's motion. APP has appealed the denial of its motion, as well as the federal district court's August 3, 2010 order (and all related and underlying orders). This appeal is pending in the U.S. Court of Appeals for the Federal Circuit. In its appeal, APP is contending that Section 37 of the America Invents Act does not govern our matter and is challenging the constitutionality of the America Invents Act. On September 27, 2011, APP filed for a Motion for Stay Pending Appeal in order to prevent the PTO from issuing a final certificate of extension for the '404 patent.


•	we were, and currently are, involved in patent infringement litigation with four generic manufacturers with respect to our '343 and '727 patents, the negative outcomes of which may have a material impact on our future operations and profitability.

In the third quarter of 2011, we recorded a $66.5 million income tax benefit by reducing our valuation allowance to $4.2 million against $116.4 million of deferred tax assets compared to a $104.3 million valuation allowance against all of our deferred tax assets at December 31, 2010 . Any changes to the valuation allowance or deferred tax assets in the future would impact our income taxes.

We recorded a $62.6 million net benefit and a $1.0 million provision for income taxes for the three months ended September 30, 2011 and 2010, respectively, based on income before taxes for such periods of $10.0 million and $22.2 million .

We recorded a $50.8 million benefit and a $2.6 million provision for income taxes for the nine months ended September 30, 2011 and 2010, respectively, based on income before taxes of $57.5 million and $48.7 million . In addition to the $66.5 million tax benefit discussed above, our income tax benefit for the nine months ended September 30, 2011 also reflects a one-time $2.5 million benefit resulting from a prospective change in the New Jersey income tax law enacted in the second quarter of 2011 and the tax treatment of the entire WilmerHale settlement as cumulative discrete events in this period. The income tax provision for 2010 reflected the utilization of U.S. net operating loss carryforwards against projected taxable income and a liability for alternative minimum tax. Both the 2011 and 2010 periods include a non-cash tax expense arising from purchase accounting for in-process research and development acquired in the Targanta acquisition. It is possible that our full-year effective tax rate used in our income tax expense calculation could change because of discrete events, specific transactions or actual results that differ from our current projections.

Liquidity and Capital Resources

Sources of Liquidity

Since our inception, we have financed our operations principally through revenues from sales of Angiomax, the sale of common stock, sales of convertible promissory notes and warrants and interest income. Except for 2004, 2006 and 2010, we have incurred losses on an annual basis since our inception. We had $307.8 million in cash, cash equivalents and available for sale securities as of September 30, 2011 .

Cash Flows

As of September 30, 2011 , we had $258.0 million in cash and cash equivalents, as compared to $126.4 million as of December 31, 2010 . Our primary sources of cash during the nine months ended September 30, 2011 included $60.6 million of net cash provided by operating activities, which includes the impact of the approximately $18.0 million received from the legal settlement with WilmerHale in March and April 2011, $68.8 million in net cash provided by investing activities and $4.0 million in net cash provided by financing activities.

Net cash provided by operating activities was $60.6 million in the nine months ended September 30, 2011 , compared to net cash provided by operating activities of $48.6 million in the nine months ended September 30, 2010 . The cash provided by operating activities in the nine months ended September 30, 2011 included net income of $108.3 million offset by non-cash items of $49.8 million consisting primarily of deferred tax benefit, stock-based compensation expense and depreciation and amortization. Cash provided by operating activities in the nine months ended September 30, 2011 also included $2.1 million due to changes in working capital items. These changes in working capital items reflect an increase in inventory of $5.0 million due to purchases under our supply agreement with Plantex of certain minimum quantities of the active pharmaceutical ingredient bivalirudin for our commercial supply, an increase in accrued expenses of $32.3 million primarily due to our efforts with respect to the patent term extension of the '404 patent and settlement of our patent litigation with Teva, and an increase in accounts receivable of $26.0 million . This increase in accounts receivable is due in part to increased volume of our sales of Angiomax and to an extension of ICS' payment terms under our distribution agreement with them from 30 days to 45 days, which can be further extended to 49 days if ICS pays by wire transfer. We agreed to this extension in connection with a reduction in marketing, sales and distribution fees payable to ICS. The adjusted payment terms began to be implemented midway through the first quarter of 2011.

The cash provided by operating activities in the nine months ended September 30, 2010 included net income of $46.1 million . Cash provided by operating activities in the nine months ended September 30, 2010 also included a decrease of $14.2 million due to changes in working capital items.

During the nine months ended September 30, 2011 , $68.8 million in net cash was provided by investing activities, which reflected $102.4 million in proceeds from the maturity and sale of available for sale securities and a $1.1 million decrease in restricted cash resulting from a reduction of our outstanding letter of credit associated with the lease of our principal executive offices, offset by $33.8 million used to purchase available for sale securities and $0.9 million used to purchase fixed assets.

During the nine months ended September 30, 2010 , $19.3 million in net cash was used in investing activities, which reflected $100.8 million used to purchase available for sale securities, offset by $80.1 million in proceeds from the maturity and sale of available for sale securities and a $1.3 million decrease in restricted cash resulting from a reduction of our outstanding letter of credit associated with the lease of our principal executive offices.

We received $4.0 million in the nine months ended September 30, 2011 and $2.8 million in the nine months ended September 30, 2010 in net cash provided by financing activities, which consisted of proceeds to us from option exercises and purchases of stock under our employee stock purchase plan.

Funding Requirements

We expect to devote substantial resources to our research and development efforts and to our sales, marketing and manufacturing programs associated with our products and products in development. Our funding requirements to support these efforts and programs depend upon many factors, including:


•	the extent to which Angiomax is commercially successful globally;


•	our ability to maintain market exclusivity for Angiomax in the United States through at least June 2015, which could be adversely affected as a result of an adverse court decision or adverse legislation relating to the '404 patent;


•	our ability to maintain market exclusivity for Angiomax in the United States through June 30, 2019, the date on which we agreed Teva may sell a generic version of Angiomax, through the enforcement of our other U.S. patents covering

Angiomax;


•	the terms of any settlements with Biogen Idec, HRI or the law firm with which we have not settled our claims with respect to the '404 patent and the PTO's initial denial of our application to extend the term of the patent;


•	the extent to which Cleviprex and ready-to-use Argatroban are commercially successful in the United States;


•	the extent to which we can successfully establish a commercial infrastructure outside the United States;


•	the consideration paid by us in connection with acquisitions and licenses of development-stage compounds, clinical stage product candidates, approved products, or businesses, and in connection with other strategic arrangements;


•	the progress, level, timing and cost of our research and development activities related to our clinical trials and non-clinical studies with respect to Angiomax and Cleviprex, as well as cangrelor, oritavancin and MDCO-157 and our other products in development;


•	the cost and outcomes of regulatory submissions and reviews for approval of Angiomax in additional countries and for additional indications, of Cleviprex outside the United States, Australia, New Zealand and Switzerland and of our products in development globally;


•	the continuation or termination of third-party manufacturing, distribution and sales and marketing arrangements;


•	the size, cost and effectiveness of our sales and marketing programs globally;


•	the amounts of our payment obligations to third parties as to our products and products in development; and


•	our ability to defend and enforce our intellectual property rights.

If our existing cash resources, together with revenues that we generate from sales of our products and other sources, are insufficient to satisfy our funding requirements due to slower than anticipated sales of Angiomax, Cleviprex and ready-to-use Argatroban, or higher than anticipated costs globally, we may need to sell equity or debt securities or seek additional financing through other arrangements. Any sale of additional equity or debt securities may result in dilution to our stockholders. Debt financing may involve covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or making capital expenditures. We cannot be certain that public or private financing will be available in amounts or on terms acceptable to us, if at all.

If we seek to raise funds through collaboration or licensing arrangements with third parties, we may be required to relinquish rights to products, product candidates or technologies that we would not otherwise relinquish or grant licenses on terms that may not be favorable to us. If we are unable to obtain additional financing, we may be required to delay, reduce the scope of, or eliminate one or more of our planned research, development and commercialization activities, which could harm our financial condition and operating results.

Certain Contingencies:

We may be, from time to time, a party to various disputes and claims arising from normal business activities. We accrue for loss contingencies when information available indicates that it is probable that a liability has been incurred and the amount of such loss can be reasonably estimated. We believe that the ultimate resolution of these matters will not have a material adverse effect on our financial condition or liquidity. However, adjustments, if any, to our estimates could be material to operating results for the periods in which adjustments to the liability are recorded.

Currently, we are party to the legal proceedings described in Part II, Item I of this quarterly report, We have assessed such legal proceedings and do not believe that it is probable that a liability has been incurred and the amount of such liability can be reasonably estimated so no loss contingency was recorded related to these legal proceedings.

Contractual Obligations

Our long-term contractual obligations include commitments and estimated purchase obligations entered into in the normal course of business. These include commitments related to purchase of inventory of our products, research and development service agreements, milestone payments due under our license agreements, income tax contingencies, operating leases, and selling, general and administrative obligations as of December 31, 2010. During the quarter ended September 30, 2011 , there were no material changes outside the ordinary course of business to the specified contractual obligations set forth in the contractual obligations table included in our annual report on Form 10-K for the year ended December 31, 2010 , other than with respect to inventory

related commitments. Our inventory related commitments increased in connection with our supply agreement with Plantex that we entered into on September 30, 2011. Under the agreement with Plantex, we agreed to purchase certain minimum quantities of the active pharmaceutical ingredient bivalirudin for our commercial supply. These obligations are reflected in the table below.



Contractual Obligations (in thousands)	Total		2011 Q4		2012-2013		2014-2015		After 2015
	(in thousands)
Inventory related commitments	$	126,161	$	23,884	$	87,277	$	15,000	$	—

In addition to the amounts shown in the above table, we are contractually obligated to make potential future success-based development, regulatory and commercial milestone payments and royalty payments in conjunction with collaborative agreements or acquisitions we have entered into with third parties. In June 2011, we entered into a licensing agreement with Ligand under which we acquired an exclusive, worldwide license to MDCO-157. Under the license agreement, we paid Ligand an upfront payment of approximately $1.8 million in June 2011 and agreed to make additional payments of up to $22 million upon the achievement of certain clinical, regulatory and commercial milestones. These payments are contingent upon the occurrence of certain future events and, given the nature of these events, it is unclear when, if ever, we may be required to pay such amounts. These contingent payments have not been included in the table above. Further, the timing of any future payment is not reasonably estimable.

Application of Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations is based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles, or GAAP, for interim financial information and with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by GAAP for complete financial statements. The preparation of these financial statements requires us to make estimates and judgments that affect our reported assets and liabilities, revenues and expenses, and other financial information. Actual results may differ significantly from these estimates under different assumptions and conditions. In addition, our reported financial condition and results of operations could vary due to a change in the application of a particular accounting standard.

We regard an accounting estimate or assumption underlying our financial statements as a “critical accounting estimate” where:


•	the nature of the estimate or assumption is material due to the level of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change; and


•	the impact of the estimates and assumptions on financial condition or operating performance is material.

Our significant accounting policies are more fully described in note 2 of our unaudited condensed consolidated financial statements in this quarterly report and note 2 of our consolidated financial statements in our annual report on Form 10-K for the year ended December 31, 2010 . Not all of these significant accounting policies, however, require that we make estimates and assumptions that we believe are “critical accounting estimates.” We have discussed our accounting policies with the audit committee of our board of directors, and we believe that our estimates relating to revenue recognition, inventory, income taxes and stock-based compensation described under the caption “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Application of Critical Accounting Estimates” in our annual report on Form 10-K for the year ended December 31, 2010 are “critical accounting estimates.”

Forward-Looking Information

This quarterly report on Form 10-Q includes forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. For this purpose, any statements contained herein regarding our strategy, future operations, financial position, future revenue, projected costs, prospects, plans and objectives of management, other than statements of historical facts, are forward-looking statements. The words “anticipates,” “believes,” “estimates,” “expects,” “intends,” “may,” “plans,” “projects,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We cannot guarantee that we actually will achieve the plans, intentions or expectations expressed or implied in our forward-looking statements. There are a number of important factors that could cause actual results, levels of activity, performance or events to differ materially from those expressed or implied in the forward-looking statements we make. These important factors include our “critical accounting estimates” described in Part

I, Item 2 of this quarterly report on Form 10-Q and the factors set forth under the caption “Risk Factors” in Part II, Item 1A of this quarterly report on Form 10-Q. Although we may elect to update forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our estimates change, and readers should not rely on those forward-looking statements as representing our views as of any date subsequent to the date of this quarterly report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Market risk is the risk of change in fair value of a financial instrument due to changes in interest rates, equity prices, creditworthiness, financing, exchange rates or other factors. Our primary market risk exposure relates to changes in interest rates in our cash, cash equivalents and available for sale securities. We place our investments in high-quality financial instruments, primarily money market funds, corporate debt securities, asset backed securities and U.S. government agency notes with maturities of less than two years, which we believe are subject to limited interest rate and credit risk. We currently do not hedge interest rate exposure. At September 30, 2011 we held $307.8 million in cash, cash equivalents and available for sale securities which had an average interest rate of approximately 0.45%. A 10 basis point change in such average interest rate would have had an approximate $0.1 million impact on our interest income. At September 30, 2011 , all cash, cash equivalents and available for sale securities were due on demand or within one year.

Most of our transactions are conducted in U.S. dollars. We do have certain agreements with parties located outside the United States. Transactions under certain of these agreements are conducted in U.S. dollars, subject to adjustment based on significant fluctuations in currency exchange rates. Transactions under certain other of these agreements are conducted in the local foreign currency. As of September 30, 2011 , we had receivables denominated in currencies other than the U.S. dollar. A 10% change in foreign exchange rates would have had an approximate $0.9 million impact on our other income and cash.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Our management, with the participation of our chief executive officer and chief financial officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2011 . The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company's management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of September 30, 2011 , our chief executive officer and chief financial officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during the quarter ended September 30, 2011 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

From time to time we are party to legal proceedings in the course of our business in addition to those described below. We do not, however, expect such other legal proceedings to have a material adverse effect on our business, financial condition or results of operations.

'727 Patent and '343 Patent Litigations

Teva Parenteral Medicines, Inc.

In September 2009, we were notified that Teva Parenteral Medicines, Inc. had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 patent. The '727 patent was issued on September 1, 2009 and relates to a more consistent and improved Angiomax drug product. The '727 patent expires on July 27, 2028. On October 8, 2009, we filed suit against Teva Parenteral Medicines, Inc., Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries, Ltd., which we refer to collectively as Teva Pharmaceuticals, in the U.S. District Court for the District of Delaware for infringement of the '727 patent. On October 29, 2009, Teva Pharmaceuticals filed an answer denying infringement and alleging affirmative defenses of non-infringement and invalidity. On October 21, 2009, the case was reassigned in lieu of a vacant judgeship to the U.S. District Court for the Eastern District of Pennsylvania.

On October 6, 2009, we were issued U.S. Patent No. 7,598,343, or the '343 patent, which relates to a more consistent and improved Angiomax drug product made by processes described in the patent. On January 4, 2010, we filed suit against Teva Pharmaceuticals in the U.S. District Court for the District of Delaware for infringement of the '343 patent. The case was assigned to the same judge in the Eastern District of Pennsylvania as the Teva Pharmaceuticals '727 patent case above.

The judge in the Eastern District of Pennsylvania has consolidated the Teva Pharmaceuticals '727 patent and '343 patent cases with the Pliva '727 patent and '343 patent cases (discussed below), the APP '727 patent and '343 patent cases (discussed below) and the Hospira '727 patent and '343 patent cases (discussed below).

On September 30, 2011, we entered into a settlement agreement and a license agreement with Teva, which included Pliva Hrvatska d.o.o., with respect to the patent infringement suits. Under the settlement agreement, Teva admitted that the '727 patent and '343 patent are valid and enforceable and that they would be infringed by the manufacture and sale of Teva's generic bivalirudin for injection products. Under the license agreement, we granted Teva a non-exclusive license under the '727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019 or earlier under certain conditions. On October 13, 2011, the district court entered a judgment and order of permanent injunction concluding our patent infringement suits against Teva. On October 13, 2011, we and Teva submitted the settlement agreement and license agreement to the FTC and the DOJ.

Pliva Hrvatska d.o.o.

In September 2009, we were notified that Pliva Hrvatska d.o.o. had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 patent. On October 8, 2009, we filed suit against Pliva Hrvatska d.o.o., Pliva d.d., Barr Laboratories, Inc., Barr Pharmaceuticals, Inc., Barr Pharmaceuticals, LLC, Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries, Ltd., which we refer to collectively as Pliva, in the U.S. District Court for the District of Delaware for infringement of the '727 patent. On October 28, 2009, Pliva filed an answer denying infringement and alleging affirmative defenses of non-infringement and invalidity. On October 21, 2009, the case was reassigned in lieu of a vacant judgeship to the U.S. District Court for the Eastern District of Pennsylvania.

On October 6, 2009, we were issued the '343 patent, which relates to a more consistent and improved Angiomax drug product made by processes described in the patent. On January 4, 2010, we filed suit against Pliva in the U.S. District Court for the District of Delaware for infringement of the '343 patent. The case was assigned to the same judge in the Eastern District of Pennsylvania as the '727 patent case above.

On September 30, 2011, we entered into a settlement agreement and a license agreement with Teva, which included Pliva, with respect to the patent infringement suits, as described above.

APP Pharmaceuticals, LLC

In September 2009, we were notified that APP Pharmaceuticals, LLC had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 patent. On October 8, 2009, we filed suit against APP Pharmaceuticals, LLC and APP Pharmaceuticals, Inc., which we refer to collectively as APP, in the U.S. District Court for the District of Delaware for infringement of the '727 patent. On October 21, 2009, the case was reassigned in lieu of a vacant judgeship to the U.S. District Court for the Eastern District of Pennsylvania. An amended complaint was filed on February 5, 2010. APP's answer denied infringement and raised counterclaims of invalidity, non-infringement and a request to delist the '727 patent from the Orange Book. On March 1, 2010, we filed a reply denying the counterclaims raised by APP. The court has set a pre-trial schedule in the case and fact discovery is ongoing. No trial date has been set by the court.

On October 6, 2009, we were issued the '343 patent, which relates to a more consistent and improved Angiomax drug product made by processes described in the patent. In April 2010, we were notified by APP that it is seeking permission to market its generic version of Angiomax prior to the expiration of the '343 patent. On June 1, 2010, we filed suit against APP in the U.S. District Court for the District of Delaware for infringement of the '343 patent. On June 28, 2010, APP filed an answer denying infringement and raised counterclaims of invalidity, non-infringement and a request to delist the '343 patent from the Orange Book. On July 16, 2010, we filed a reply denying the counterclaims raised by APP. The case has been assigned to a judge in the U.S. District Court for the District of Delaware. On October 14, 2010, the case was reassigned to the same judge in the Eastern District of Pennsylvania who was then presiding over the above APP '727 patent case and the Teva Pharmaceuticals '727 patent and '343 patent cases and the Pliva '727 patent and '343 patent cases. On the same day, the APP '343 patent case was consolidated with these other cases.

On February 25, 2011, APP filed a motion to amend its answer and add counterclaims of inequitable conduct and unclean hands. The motion was referred to a special master. Our opposition papers were filed on March 14, 2011 and APP filed a reply on March 24, 2011. The special master heard oral argument on April 13, 2011 and issued a report and recommendations on April 26, 2011. The parties briefed the issues raised to the judge. Following recent federal circuit decisions, the judge sent APP's motion back to the special master for further review. A second report and recommendation was issued on June 23, 2011. The issues were again briefed to the judge and the court issued an order adopting the special master's report and granting APP's motion. APP filed its amended answers and counterclaims on July 25, 2011.

On October 8, 2011, we filed a motion to dismiss, strike or alternatively bifurcate APP's allegations of inequitable conduct and unclean hands. The motion was referred to the special master. APP filed an answering brief on August 19, 2011. We filed a reply on August 24, 2011. On September 22, 2011 the special master issued a report and recommendation. The parties briefed the issues raised to the judge and the court issued an order adopting the special master's report and denying our motion. On October 21, 2011 we filed replies answering APP's counterclaims.

The special master also directed the parties to file supplemental briefing for a pretrial hearing known as a Markman hearing. Opening briefs were filed on October 7, 2011 and responding briefs on October 20, 2011. A Markman hearing date has not been set.

Hospira, Inc.

In July 2010, we were notified that Hospira, Inc., or Hospira, had submitted two ANDAs seeking permission to market its generic version of Angiomax prior to the expiration of the '727 patent and '343 patent. On August 19, 2010, we filed suit against Hospira in the U.S. District Court for the District of Delaware for infringement of the '727 patent and '343 patent. On August 25, 2010, the case was reassigned in lieu of a vacant judgeship to the U.S. District Court for the Eastern District of Pennsylvania. Hospira's answer denied infringement of the '727 patent and '343 patent and raised counterclaims of non-infringement and invalidity of the '727 patent and '343 patent. On September 24, 2010, we filed a reply denying the counterclaims raised by Hospira.

On September 17, 2010, Hospira filed a motion to be consolidated with the Teva Pharmaceuticals, Pliva and APP cases. On October 13, 2010 the Court denied Hospira's motion to consolidate. As part of setting the schedule in this case, the Hospira '727 patent and '343 patent cases were consolidated with the above Teva Pharmaceuticals, Pliva and APP cases. No trial date has been set.

Mylan Pharmaceuticals, Inc.

In January 2011, we were notified that Mylan Pharmaceuticals, Inc. had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 patent and '343 patent. On February 23, 2011, we filed suit against Mylan Inc., Mylan Pharmaceuticals Inc. and Bioniche Pharma USA, LLC, which we refer to collectively as Mylan, in the U.S. District Court for the Northern District of Illinois for infringement of the '727 patent and '343 patent. Mylan's answer denied

infringement of the '727 patent and '343 patent and raised counterclaims of non-infringement and invalidity of the '727 patent and '343 patent. On April 13, 2011, we filed a reply denying the counterclaims raised by Mylan. On May 4, 2011 the Court set a pretrial schedule. Following a joint request, the Court issued an amended scheduling order on September 22, 2011. No trial date has been set.

Dr. Reddy's Laboratories, Inc.

In March 2011, we were notified that Dr. Reddy's Laboratories, Ltd. and Dr. Reddy's Laboratories, Inc. had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 and '343 patents. On April 28, 2011, we filed suit against Dr. Reddy's Laboratories, Ltd., Dr. Reddy's Laboratories, Inc. and Gland Pharma, Inc., which we refer to collectively as Dr. Reddy's, in the U.S. District Court for the District of New Jersey for infringement of the '727 patent and '343 patent. Dr. Reddy's answer denied infringement of the '727 patent and '343 patent and raised counterclaims of non-infringement and invalidity of the '727 patent and '343 patent. An initial case scheduling conference was conducted before the Magistrate Judge on August 25, 2011. Following the conference, a pretrial scheduling order was issued setting dates following the New Jersey Local Patent Rules. The Court did not set a Markman hearing date or trial date.

Sun Pharmaceutical Industries LTD

In October 2011, we were notified that Sun Pharmaceutical Industries LTD had submitted an ANDA seeking permission to market its generic version of Angiomax prior to the expiration of the '727 and '343 patents. We are in the process of reviewing this correspondence and determining what further action we may take.

'404 Patent Litigation

PTO, FDA and HHS, et al.

On January 27, 2010, we filed a complaint in the U.S. District Court for the Eastern District of Virginia against the PTO, the FDA, and HHS et al. seeking to set aside the denial of our application pursuant to the Hatch-Waxman Act to extend the term of the '404 patent. In our complaint, we primarily alleged that the PTO and the FDA each misinterpreted the filing deadlines in the Hatch-Waxman Act when they rendered their respective determinations that our application for extension of the term of the '404 patent was not timely filed. We asked the court to grant relief including to vacate and set aside the PTO's and the FDA's determinations regarding the timeliness of our application for patent term extension and to order the PTO to extend the term of the '404 patent for the full period required under the Hatch-Waxman Act. On March 10, 2010, the court conducted a hearing on the parties' cross motions for summary judgment. On March 16, 2010, the court set aside the PTO's denial of our patent term extension application and sent the matter back to the PTO for reconsideration. The court further ordered that the PTO take the actions necessary to ensure that the '404 patent did not expire pending resolution of the court proceedings. On March 18, 2010, the PTO issued an interim extension of the '404 patent to May 23, 2010. On March 19, 2010, the PTO issued a decision again denying our application for patent term extension for the '404 patent.

On March 25, 2010, we filed a complaint in the U.S. District Court for the Eastern District of Virginia against the PTO, the FDA, and HHS, et al. asking the court to set aside the PTO's March 19, 2010 decision, to instruct the PTO to accept our patent term extension application as timely filed and to order the PTO to extend the term of the '404 patent for the full period required under the Hatch-Waxman Act. On May 6, 2010, the court conducted a hearing on the parties' cross motions for summary judgment. On May 21, 2010, the court issued an order instructing the PTO to take the actions necessary to ensure that the '404 patent did not expire until at least 10 days after the court issued an order deciding the case. On August 3, 2010, the court granted our motion for summary judgment and ordered the PTO to consider our patent term extension application timely filed. The period for the government to appeal the court's August 3, 2010 decision expired on October 4, 2010 without government appeal and the PTO sent our patent term extension application to the FDA for a determination on the length of the extension of the '404 patent. On December 16, 2010, the FDA published its determination of the applicable regulatory review period for Angiomax. The PTO uses the regulatory review period determined by the FDA with several statutory limitations to calculate the length of a patent extension. Based on the FDA's determination, we believe that the term of the '404 patent should be extended until December 15, 2014. However, to date the PTO has not yet communicated a final determination concerning the length of any patent term extension for the '404 patent. At this time we do not know when the PTO will make or communicate such a determination.

On August 19, 2010, APP filed a motion to intervene in the U.S. District Court for the Eastern District of Virginia for purpose of appeal in our case against the PTO, FDA and HHS, et al. On September 13, 2010, the court issued an order denying APP's motion to intervene. On September 1, 2010, as amended on September 17, 2010, APP filed a notice of appeal to the United States Court of Appeals for the Federal Circuit of the district court's August 3, 2010 and September 13, 2010 orders (and all related and

underlying orders). On October 5, 2010, we filed a motion to dismiss APP's appeal. On February 2, 2011, the federal circuit court issued an order denying our motion to dismiss and requesting additional briefings by both parties in connection with APP's appeal. The court expressed no opinion on the merits of APP's appeal. The parties have fully briefed the issues in connection with APP's appeal.

Eagle Pharmaceuticals Arbitration

We have received a Demand for Arbitration filed by Eagle Pharmaceuticals, Inc., or Eagle, dated October 25, 2011. In the Demand for Arbitration, Eagle claims that we failed to meet our obligations under the license and development agreement between us, Eagle and certain other parties relating to the development of a new formulation of our product, Angiomax, and to our efforts to seek and obtain regulatory approval, market and sell that new formulation. As a result, Eagle alleges that it has been damaged in an amount it believes exceeds $200 million. We believe we have valid defenses to Eagle's claims and intend to defend ourselves vigorously.

Item 1A. Risk Factors

Investing in our common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described below in addition to the other information included or incorporated by reference in this annual report. If any of the following risks actually occur, our business, financial condition or results of operations would likely suffer. In that case, the trading price of our common stock could fall. Updated risk factors associated with our business, which include a risk factor regarding the Eagle arbitration and updates regarding the Angiomax patent litigation, are set forth below.

Risks Related to Our Financial Results

We have a history of net losses and may not achieve profitability in future periods or maintain profitability on an annual basis

Except for 2004, 2006, and 2010, we have incurred net losses on an annual basis since our inception. As of September 30, 2011, we had an accumulated deficit of approximately $131.2 million. We expect to make substantial expenditures to further develop and commercialize our products, including costs and expenses associated with research and development, clinical trials, nonclinical and preclinical studies, regulatory approvals and commercialization. We anticipate needing to generate greater revenue in future periods from our existing products and from our products in development in order to achieve and maintain profitability in light of our planned expenditures. If we are unable to generate greater revenue, we may not achieve profitability in future periods or at all, and may not be able to maintain any profitability we do achieve. Our ability to generate future revenue will be substantially dependent on our ability to maintain market exclusivity for Angiomax. If we fail to achieve profitability or maintain profitability on a quarterly or annual basis within the time frame expected by investors or securities analysts, the market price of our common stock may decline.

Our business is very dependent on the commercial success of Angiomax. If Angiomax does not generate the revenues we anticipate, our business may be materially harmed

Angiomax has accounted for substantially all of our revenue since we began selling this product in 2001. Until the approval of Cleviprex by the FDA in August 2008 and the ready-to-use formulation of Argatroban in July 2011, Angiomax was our only commercial product. We expect revenue from Angiomax to account for substantially all of our revenue in 2011. The commercial

success of Angiomax depends upon:


•	our ability to maintain market exclusivity for Angiomax in the United States through at least June 2015, which could be adversely affected as a result of an adverse court decision or adverse legislation relating to the '404 patent;


•	our ability to maintain market exclusivity for Angiomax in the United States through June 30, 2019, the date on which we agreed Teva may sell a generic version of Angiomax, through the enforcement of our other U.S. patents covering Angiomax;


•	the continued acceptance by regulators, physicians, patients and other key decision-makers of Angiomax as a safe, therapeutic and cost-effective alternative to heparin and other products used in current practice or currently being developed;


•	our ability to further develop Angiomax and obtain marketing approval of Angiomax for use in additional patient populations and the clinical data we generate to support expansion of the product label;


•	the overall number of PCI procedures performed;


•	the ability of our third-party supply and manufacturing partners to provide us with sufficient quantities of Angiomax;


•	the impact of competition from existing competitive products and from competitive products that may be approved in the future;


•	the continued safety and efficacy of Angiomax;


•	to what extent and in what amount government and third-party payors cover or reimburse for the costs of Angiomax; and


•	our success and the success of our international distributors in selling and marketing Angiomax in Europe and in other countries outside the United States.

We continue to develop Angiomax and intend to seek market approval of Angiomax for use in additional patient populations, including in patients with structural heart disease, patients undergoing peripheral angioplasty, carotid angioplasty and cardiovascular surgery and patients with or at risk of HIT/HITTS. Even if we are successful in obtaining approval of an expanded Angiomax label, the expanded label may not result in higher revenue or income on a continuing basis.

As of September 30, 2011, our inventory of Angiomax was $29.1 million and we had inventory-related purchase commitments totaling $23.9 million for 2011, $57.2 million for 2012 and $30.1 million for 2013 for Angiomax bulk drug substance. If sales of Angiomax were to decline, we could be required to make an allowance for excess or obsolete inventory or increase our accrual for product returns.

If we are unable to meet our funding requirements, we may need to raise additional capital. If we are unable to obtain such capital on favorable terms or at all, we may not be able to execute on our business plans and our business, financial condition and results of operations may be adversely affected

We expect to devote substantial financial resources to our research and development efforts, clinical trials, nonclinical and preclinical studies and regulatory approvals and to our commercialization and manufacturing programs associated with our approved products and our products in development. Our funding requirements to support these efforts and programs depend upon many factors, including:


•	the extent to which Angiomax is commercially successful globally;


•	our ability to maintain market exclusivity for Angiomax in the United States through at least June 2015, which could be adversely affected as a result of an adverse court decision or adverse legislation relating to the '404 patent;


•	our ability to maintain market exclusivity for Angiomax in the United States through June 30, 2019, the date on which we agreed Teva may sell a generic version of Angiomax, through the enforcement of our other U.S. patents covering Angiomax;


•	the terms of any settlements with Biogen Idec, HRI or the law firm with which we have not settled our claims with respect to the '404 patent and the PTO's initial denial of our application to extend the term of the patent;


•	the extent to which Cleviprex and ready-to-use Argatroban are commercially successful in the United States;


•	the extent to which we can successfully establish a commercial infrastructure outside the United States;


•	the consideration paid by us in connection with acquisitions and licenses of development-stage compounds, clinical-stage product candidates, approved products, or businesses, and in connection with other strategic arrangements;


•	the progress, level, timing and cost of our research and development activities related to our clinical trials and non-clinical studies with respect to Angiomax, Cleviprex, as well as cangrelor, oritavancin and MDCO-157 and our other products in development;


•	the cost and outcomes of regulatory submissions and reviews for approval of Angiomax in additional countries and for additional indications, of Cleviprex outside the United States, Australia, New Zealand and Switzerland and of our products in development globally;


•	the continuation or termination of third-party manufacturing, distribution and sales and marketing arrangements;


•	the size, cost and effectiveness of our sales and marketing programs globally;


•	the amounts of our payment obligations to third parties as to our products and products in development; and


•	our ability to defend and enforce our intellectual property rights.

If our existing resources, together with revenues that we generate from sales of our products and other sources, are insufficient to satisfy our funding requirements, we may need to sell equity or debt securities or seek additional financing through other arrangements. Public or private financing may not be available in amounts or on terms acceptable to us, if at all. If we seek to raise funds through collaboration or licensing arrangements with third parties, we may be required to relinquish rights to products, products in development or technologies that we would not otherwise relinquish or grant licenses on terms that may not be favorable to us. If we are unable to obtain additional financing, we may be required to delay, reduce the scope of, or eliminate one or more of our planned research, development and commercialization activities, which could adversely affect our business, financial condition and operating results.

If we seek to raise capital to fund acquisitions of development-stage compounds, clinical-stage product candidates, approved products, or businesses or for other reasons by selling equity or debt securities or through other arrangements, our stockholders could be subject to dilution and we may become subject to financial restrictions and covenants, which may limit our activities

If we seek to acquire any development-stage compounds, clinical-stage product candidates, approved products, or businesses or determine that raising additional capital would be in our interest and in the interest of our stockholders, we may seek to sell equity or debt securities or seek additional financings through other arrangements. Any sale of additional equity or debt securities may result in dilution to our stockholders. Debt financing may involve covenants limiting or restricting our ability to take specific actions, such as incurring additional debt or making capital expenditures. Our ability to comply with these financial restrictions and covenants could be dependent on our future performance, which is subject to prevailing economic conditions and other factors, including factors that are beyond our control such as foreign exchange rates, interest rates and changes in the level of competition. Failure to comply with the financial restrictions and covenants would adversely affect our business, financial condition and operating results.

Our revenue in the United States is completely dependent on our sole source distributor, ICS, and our revenue outside the United States is substantially dependent on a limited number of international distributors. If the buying patterns of ICS or these international distributors for our products are not consistent with underlying hospital demand, then our revenue will be subject to fluctuation from quarter to quarter based on these buying patterns and not underlying demand for the products. Any change in these buying patterns could adversely affect our financial results and our stock price.

We distribute Angiomax, Cleviprex and ready-to-use Argatroban in the United States through a sole source distribution model. Under this model, we currently sell Angiomax, Cleviprex and ready-to-use Argatroban to our sole source distributor, ICS. ICS then sells Angiomax, Cleviprex and ready-to-use Argatroban to a limited number of national medical and pharmaceutical

wholesalers with distribution centers located throughout the United States and, in certain cases, directly to hospitals. Our revenue from sales of Angiomax in the United States is exclusively from sales to ICS pursuant to our agreement with them. We anticipate that our revenue from sales of Cleviprex and ready-to-use Argatroban in the United States will be exclusively from sales to ICS. In connection with a reduction in marketing, sales and distribution fees payable to ICS, we extended the ICS' payment terms under our distribution agreement with them from 30 days to 45 days, which can be further extended to 49 days if ICS pays by wire transfer. The amendment has caused, and we expect to continue to cause, an increase in accounts receivable. As a result of our relationship with ICS, we expect that our revenue will continue to be subject to fluctuation from quarter to quarter based on the buying patterns of ICS, which may be independent of underlying hospital demand.

In some countries outside the European Union and in a few countries in the European Union, we sell Angiomax to international distributors and these distributors then sell Angiomax to hospitals. Our reliance on a small number of distributors for international sales of Angiomax could cause our revenue to fluctuate from quarter to quarter based on the buying patterns of these distributors, independent of underlying hospital demand.

If inventory levels at ICS or at our international distributors become too high, these distributors may seek to reduce their inventory levels by reducing purchases from us, which could have a materially adverse effect on our revenue in periods in which such purchase reductions occur.

Risks Related to Commercialization

Angiomax faces significant competition from all categories of anticoagulant drugs, which may limit the use of Angiomax and adversely affect our revenue

Due to the incidence and severity of cardiovascular diseases, the market for anticoagulant therapies is large and competition is intense. There are a number of anticoagulant drugs currently on the market, awaiting regulatory approval or in development, including orally administered agents. Angiomax competes with, or may compete with in the future, these anticoagulant drugs to the extent Angiomax and any of these anticoagulant drugs are approved for the same or similar indications.

We have positioned Angiomax to compete primarily with heparin, platelet inhibitors such as GP IIb/IIIa inhibitors, and treatment regimens combining heparin and GP IIb/IIIa inhibitors. Because heparin is generic and inexpensive and has been widely used for many years, physicians and medical decision-makers may be hesitant to adopt Angiomax instead of heparin. GP IIb/IIIa inhibitors that Angiomax competes with include ReoPro from Eli Lilly and Johnson & Johnson/Centocor, Inc., Integrilin from Merck & Co., Inc., and Aggrastat from Iroko Pharmaceuticals, LLC and MediCure Inc. GP IIb/IIIa inhibitors are widely used and some physicians believe they offer superior efficacy to Angiomax in high risk patients. Physicians may choose to use heparin combined with GP IIb/IIIa inhibitors due to their years of experience with this combination therapy and reluctance to change existing hospital protocols and pathways. Physician resistance to the use of Angiomax due to either custom or efficacy could adversely affect our revenue.

In some circumstances, Angiomax competes with other anticoagulant drugs for the use of hospital financial resources. For example, many U.S. hospitals receive a fixed reimbursement amount per procedure for the angioplasties and other treatment therapies they perform. As this amount is not based on the actual expenses the hospital incurs, hospitals may choose to use either Angiomax or other anticoagulant drugs or a GP IIb/IIIa inhibitor but not necessarily more than one of these drugs. If hospitals do not choose Angiomax in these instances, our revenue will be adversely affected.

If we are unable to maintain our market exclusivity for Angiomax in the United States as a result of an adverse court decision or adverse legislation relating to the '404 patent or our inability to enforce our other U.S. patents covering Angiomax, Angiomax could become subject to generic competition in the United States earlier than we anticipate. We have agreed that Teva may sell a generic version of Angiomax beginning June 30, 2019 or earlier under certain conditions. Competition from generic equivalents that would be sold at a price that is less than the price at which we currently sell Angiomax could have a material adverse impact on our business, financial condition and operating results.

Cleviprex faces significant competition from all categories of intravenous antihypertensive, or IV-AHT, drugs, which may limit the use of Cleviprex and adversely affect our revenue

Because different IV-AHT drugs act in different ways on the factors contributing to elevated blood pressure, physicians have several therapeutic options to reduce acutely elevated blood pressure.

We have positioned Cleviprex as an improved alternative drug for selected patient types with acute, severe hypertension. Because all other drug options for this use are available as generics, Cleviprex must demonstrate compelling advantages in delivering value to the hospital. In addition to advancements in efficacy, convenience, tolerability and/or safety, we may need to demonstrate that

Cleviprex will save the hospital resources in other areas such as length of stay and other resource utilization in order to become commercially successful. Because generic therapies are inexpensive and have been widely used for many years, physicians and decision-makers for hospital resource allocation may be hesitant to adopt Cleviprex and fail to recognize the value delivered through a newer agent that offers precise blood pressure control. Physician resistance to the use of Cleviprex due to either custom or efficacy would adversely affect our revenue.

We face substantial competition, which may result in others discovering, developing or commercializing competing products before or more successfully than we do

Our industry is highly competitive. Competitors in the United States and other countries include major pharmaceutical companies, specialized pharmaceutical companies and biotechnology firms, universities and other research institutions. Many of our competitors have substantially greater research and development capabilities and experience, and greater manufacturing, marketing and financial resources, than we do.

Our competitors may develop, market or license products or other novel technologies that are more effective, safer, more convenient or less costly than any that have been or are being developed by us, or may obtain marketing approval for their products from the FDA or equivalent foreign regulatory bodies more rapidly than we may obtain approval for ours. There are well established products, including generic products, that are approved and marketed for the indications for which Angiomax, Cleviprex and ready-to-use Argatroban are approved and the indications for which we are developing our products in development. In addition, competitors are developing products for such indications. In the case of the ready-to-use Argatroban, GlaxoSmithKline currently markets and has marketed for a number of years a formulation of Argatroban that competes with our ready-to-use formulation of Argatroban. We compete, in the case of Angiomax, Cleviprex and ready-to-use Argatroban, and expect to compete, in the cases of our products in development, on the basis of product efficacy, safety, ease of administration, price and economic value compared to drugs used in current practice or currently being developed. If we are not successful in demonstrating these attributes, physicians and other key healthcare decision makers may choose other products over our products, switch from our products to new products or choose to use our products only in limited circumstances, which could adversely affect our business, financial condition and results of operations.

If we are unable to successfully identify and acquire or license development stage compounds, clinical stage product candidates or approved products and develop or commercialize those compounds and products, our business, financial condition and results of operations may be adversely affected.

Our business strategy is based on us selectively licensing or acquiring and then successfully developing and commercializing development stage compounds, clinical stage product candidates and approved products. Our success will be based in part on our ability to build and actively manage a portfolio of drugs that addresses unmet medical needs and creates value in patient therapy. However, the acquisition and licensing of pharmaceutical products is a competitive area. A number of more established companies, which have acknowledged strategies to license and acquire products, may have competitive advantages over us due to their size, cash flows and institutional experience. In addition, we may compete with emerging companies taking similar or different approaches to product acquisition.

Because of the intense competition for these types of product candidates and approved products, the cost of acquiring, in-licensing or otherwise obtaining rights to such candidates and products has grown dramatically in recent years and are often at levels that we cannot afford or that we believe are not justified by market potential. Any acquisition or license of product candidates or approved products that we pursue may not result in any short or long term benefit to us. We may incorrectly judge the value or worth of an acquired or licensed product candidate or approved product. Even if we succeed in acquiring product candidates, we may not be successful in developing them and obtaining marketing approval for them, manufacturing them economically or commercializing them successfully. We have previously acquired or licensed rights to clinical or development stage compounds and, after having conducted development activities, determined not to devote further resources to those compounds. In addition, our future success would depend in part on our ability to manage any required growth associated with some of these acquisitions and licenses. Any acquisition might distract resources from the development of our existing product candidates and could otherwise negatively impact sales of our other marketed products. Furthermore, the development or expansion of any licensed or acquired product candidate or approved product may require a substantial capital investment by us, and we may not have these necessary funds to do so.

If we are unable to identify and acquire additional promising candidates or to develop and commercialize successfully those candidates we have, we will not be able to implement our business strategy and our business, operating results and financial condition may be materially and adversely affected.

If we are not able to convince hospitals to include our products on their approved formulary lists, our revenues may not meet expectations and our business, results of operations and financial condition may be adversely affected

Hospitals establish formularies, which are lists of drugs approved for use in the hospital. If a drug is not included on the formulary, the ability of our engagement partners and engagement managers to promote the drug may be limited or denied. In connection with the launch of Cleviprex, we experienced difficulties in getting Cleviprex included on hospitals' formulary lists, in part because hospital formularies may limit the number of IV-AHT drugs in each drug class, and revenues from Cleviprex were adversely affected. If we fail to secure and maintain formulary inclusion for our products on favorable terms or are significantly delayed in doing so, we may have difficulty achieving market acceptance of our products and our business, results of operations and financial condition could be materially adversely affected.

If we are unable to negotiate and maintain satisfactory arrangements with group purchasing organizations with respect to the purchase of our products, our sales, results of operations and financial condition could be adversely affected

Our ability to sell our products to hospitals in the United States depends in part on our relationships with group purchasing organizations, or GPOs. Many existing and potential customers for our products become members of GPOs. GPOs negotiate pricing arrangements and contracts, sometimes on an exclusive basis, with medical supply manufacturers and distributors. These negotiated prices are then made available to a GPO's affiliated hospitals and other members. If we are not one of the providers selected by a GPO, affiliated hospitals and other members may be less likely to purchase our products, and if the GPO has negotiated a strict sole source, market share compliance or bundling contract for another manufacturer's products, we may be precluded from making sales to members of the GPO for the duration of the contractual arrangement. Our failure to renew contracts with GPOs may cause us to lose market share and could have a material adverse effect on our sales, financial condition and results of operations. We cannot assure you that we will be able to renew these contracts at the current or substantially similar terms. If we are unable to keep our relationships and develop new relationships with GPOs, our competitive position may suffer.

If physicians, patients and other key healthcare decision-makers do not accept clinical data from trials of Angiomax and Cleviprex, then sales of Angiomax and Cleviprex may be adversely affected

We believe that the near-term commercial success of Angiomax and Cleviprex will depend in part upon the extent to which physicians, patients and other key healthcare decision-makers accept the results of clinical trials of Angiomax and Cleviprex. For example, following the announcement of the original results of the REPLACE-2 clinical trial of Angiomax in 2002, additional hospitals granted Angiomax formulary approval and hospital demand for the product increased. However, some commentators have challenged various aspects of the trial design of the REPLACE-2 trial of Angiomax, the conduct of the clinical trial and the analysis and interpretation of the results from the clinical trial. Similarly, physicians, patients and other key decision-makers may not accept the results of the ACUITY and HORIZONS AMI clinical trials of Angiomax. The FDA, in denying our sNDA for an additional Angiomax dosing regimen in the treatment of ACS initiated in the emergency department, indicated that the basis of its decision involved the appropriate use and interpretation of non-inferiority trials such as our ACUITY trial. If physicians, patients and other key decision-makers do not accept clinical trial results, adoption and continued use of Angiomax and Cleviprex may suffer, and our business will be materially adversely affected.

If the number of PCI procedures performed decreases, sales of Angiomax may be negatively impacted

The number of PCI procedures performed in the United States declined in 2007 due in part to the reaction to data from a clinical trial that was published in March 2007 in the New England Journal of Medicine entitled “Clinical Outcomes Utilizing Revascularization and Aggressive Drug Evaluation,” or “COURAGE”, and to the controversy regarding the use of drug-eluting stents. While PCI procedure volume has increased from 2007 levels, it has not returned to the level of PCI procedures performed prior to the 2007 decline. With ongoing economic pressures on our hospital customers, PCI procedure volume might further decline and might not return to its previous levels. Because PCI procedures are the primary procedures during which Angiomax is used, a decline in the number of procedures may negatively impact sales of Angiomax, possibly materially.

Because we did not sell Cleviprex from the first quarter of 2010 through the first quarter of 2011, as a result of product recalls and related supply issues, market acceptance of Cleviprex may be adversely affected

decision makers who had not used Cleviprex may be reluctant to begin using Cleviprex because of the recalls and the related supply issues. Physicians and healthcare decision makers who had adopted Cleviprex as their preferred antihypertensive therapy when it was available may also have adopted other antihypertensive therapies during the period when Cleviprex was not available and may be reluctant to change. In addition, in the re-launch of Cleviprex, we are focusing our marketing of Cleviprex on neurocritical care and cardiac surgery patients. We have not focused our marketing of Cleviprex in these areas previously and may not be successful in this change in marketing focus.

If we are unable to successfully expand our business infrastructure and develop our global operations, our ability to generate future product revenue will be adversely affected and our business, results of operations and financial condition may be adversely affected

To support the global sales and marketing of Angiomax, Cleviprex and our product candidates in development, if and when they are approved for sale and marketed outside the United States, we are developing our business infrastructure globally. Our ability to do this successfully will depend on our ability to expand our internal organization and infrastructure to accommodate additional anticipated growth. To manage the existing and planned future growth and the increasing breadth and complexity of our activities, we will need to continue building our organization and making significant additional investments in personnel, infrastructure, information management systems and other operational resources. If we are unable to expand our global operations successfully and in a timely manner, the growth of our business may be limited. Such expansion may be more difficult, more expensive or take longer than we anticipate. If we are not able to successfully market and sell our products globally, our business, results of operations and financial condition may be adversely affected.

Future rapid expansion could strain our operational, human and financial resources. For instance, we may be required to allocate additional resources to the expanded business, which we would have otherwise allocated to another part of our business. In order to manage expansion, we must:


•	continue to improve operating, administrative, and information systems;


•	accurately predict future personnel and resource needs to meet contract commitments;


•	track the progress of ongoing projects; and


•	attract and retain qualified management, sales, professional, scientific and technical operating personnel.

If we do not take these actions and are not able to manage our global business, then our global operations may be less successful than anticipated.

The success of our global operations may be adversely affected by international risks and uncertainties. If these operations are not successful, our business, results of operations and financial condition could be adversely affected

Our future profitability will depend in part on our ability to grow and ultimately maintain our product sales in foreign markets, particularly in Europe. For the nine months ended September 30, 2011 we had $23.7 million in sales outside of the United States and we have historically encountered difficulty in selling Angiomax outside of the United States. Our foreign operations subject us to additional risks and uncertainties, particularly because we have limited experience in marketing, servicing and distributing our products or otherwise operating our business outside of the United States. These risks and uncertainties include:


•	political and economic determinations that adversely impact pricing or reimbursement policies;


•	our customers' ability to obtain reimbursement for procedures using our products in foreign markets;


•	compliance with complex and changing foreign legal, tax, accounting and regulatory requirements;


•	language barriers and other difficulties in providing long-range customer support and service;


•	longer accounts receivable collection times;


•	significant foreign currency fluctuations, which could result in increased operating expenses and reduced revenues;


•	trade restrictions and restrictions on direct investment by foreign entities;


•	reduced protection of intellectual property rights in some foreign countries; and


•	the interpretation of contractual provisions governed by foreign laws in the event of a contract dispute.

Our foreign operations could also be adversely affected by export license requirements, the imposition of governmental controls, political and economic instability, trade restrictions, changes in tariffs and difficulties in staffing and managing foreign operations.

If reimbursement by government payors or other third-party payors is not available or limited for our products, drug pricing is delayed or set at unfavorable levels or access to our products is reduced or terminated by governmental and other third-party payors, our ability to generate revenue would be adversely affected

Acceptable levels of coverage and reimbursement of drug treatments by government payors, such as Medicare and Medicaid programs, private health insurers and other organizations, have a significant effect on our ability to successfully commercialize our products. Reimbursement in the United States, Europe or elsewhere may not be available for any products we may develop or, if already available, may be decreased in the future. We may not get reimbursement or reimbursement may be limited if government payors, private health insurers and other organizations are influenced by the prices of existing drugs in determining whether our products will be reimbursed and at what levels. For example, the availability of numerous generic antibiotics at lower prices than branded antibiotics, such as oritavancin, if it were approved for commercial sale, could substantially affect the likelihood of reimbursement and the level of reimbursement for oritavancin. If reimbursement is not available or is available only at limited levels, we may not be able to commercialize our products, or may not be able to obtain a satisfactory financial return on our products.

In certain countries, particularly the countries of the European Union, the pricing of prescription pharmaceuticals and the level of reimbursement are subject to governmental control. In some countries, pricing and reimbursement are set with limited, if any, participation in the process by the marketing authorization holder. In addition, it can take an extended period of time after the receipt of initial approval of a product to establish and obtain reimbursement or pricing approval. Reimbursement approval also may be required at the individual patient level, which can lead to further delays. In addition, in some countries, it may take an extended period of time to collect payment even after reimbursement has been established. If prices are set at unsatisfactory levels, such prices may negatively impact our revenues from sales in those countries. An increasing number of countries are taking initiatives to attempt to reduce large budget deficits by focusing cost-cutting efforts on pharmaceuticals for their state-run health care systems. These international price control efforts have impacted all regions of the world, but have been most drastic in the European Union. Further, a number of European Union countries use drug prices from other countries of the European Union as “reference prices” to help determine pricing in their own countries. Consequently, a downward trend in drug prices for some countries could contribute to similar occurrences elsewhere. If reimbursement of our future products is unavailable or limited in scope or amount, or if pricing is set at unsatisfactory levels, we may be unable to achieve or sustain profitability.

Third-party payors, including Medicare and Medicaid increasingly are challenging prices charged for and the cost-effectiveness of medical products and services and they increasingly are limiting both coverage and the level of reimbursement for drugs. Also, the trend toward managed health care in the United States and the changes in health insurance programs may result in lower prices for pharmaceutical products and health care reform. The recently enacted Patient Protection and Affordable Care Act of 2010, or the PPACA, may also have a significant impact on pricing as the legislation contains a number of provisions that are intended to reduce or limit the growth of healthcare costs. The provisions of the PPACA could, among other things, increase pressure on drug pricing and, as a result, the number of procedures that are performed. In addition to federal legislation, state legislatures and foreign governments have also shown significant interest in implementing cost-containment programs, including price controls, restrictions on reimbursement and requirements for substitution of generic products. The establishment of limitations on patient access to our drugs, adoption of price controls and cost-containment measures in new jurisdictions or programs, and adoption of more restrictive policies in jurisdictions with existing controls and measures could adversely impact our business and future results. If governmental organizations and third-party payors do not consider our products to be cost-effective compared to other available therapies, they may not reimburse providers or consumers of our products or, if they do, the level of reimbursement may not be sufficient to allow us to sell our products on a profitable basis.

Use or misuse of our products may result in serious injuries or even death to patients and may subjects us to significant claims for product liability. If we are unable to obtain insurance at acceptable costs and adequate levels or otherwise protect ourselves against potential product liability claims, we could be exposed to significant liability

Our business exposes us to potential significant product liability risks which are inherent in the testing, manufacturing, marketing and sale of human healthcare products. Product liability claims might be made by patients in clinical trials, consumers, health care providers or pharmaceutical companies or others that sell our products. These claims may be made even with respect to those products that are manufactured in licensed and regulated facilities or otherwise possess regulatory approval for commercial sale.

These claims could expose us to significant liabilities that could prevent or interfere with the development or commercialization of our products. Product liability claims could require us to spend significant time and money in litigation or pay significant damages. With respect to our commercial sales and our clinical trials, we are covered by product liability insurance in the amount of $20.0 million per occurrence and $20.0 million annually in the aggregate on a claims-made basis. This coverage may not be adequate to cover all or any product liability claims that we face

As we continue to commercialize our products, we may wish to increase our product liability insurance. Product liability coverage is expensive. In the future, we may not be able to maintain or obtain such product liability insurance on reasonable terms, at a reasonable cost or in sufficient amounts to protect us against losses due to product liability claims.

An adverse decision in the arbitration between us and Eagle could have a material adverse effect on our financial condition

We have received a Demand for Arbitration filed by Eagle, dated October 25, 2011. In the Demand for Arbitration, Eagle claims that we failed to meet our obligations under the license and development agreement between us, Eagle and certain other parties relating to the development of a new formulation of our product, Angiomax, and to our efforts to seek and obtain regulatory approval, market and sell that new formulation. As a result, Eagle alleges that it has been damaged in an amount Eagle believes exceeds $200 million. We believe we have valid defenses to Eagle's claims and intend to defend ourselves vigorously. Arbitration, like litigation, is inherently uncertain. An adverse decision in this arbitration could have a material adverse effect on our financial condition.

Risks Related to our Dependence on Third Parties for Manufacturing, Research and Development, and Distribution Activities

We have no manufacturing or supply capabilities and are completely dependent on third parties for the manufacture and supply of our products. We depend on a limited number of suppliers for the production of bulk drug substance for our products and products in development and to carry out fill-finish activities. If any of these suppliers does not or cannot fulfill its manufacturing or supply obligations to us, our ability to meet commercial demands for our products and to conduct clinical trials of our products and products in development could be impaired and our business could be harmed.

We do not manufacture any of our products and do not plan to develop any capacity to manufacture them. We currently rely on a limited number of manufacturers for bulk substance and to carry out fill-finish activities for our products and products in development. We expect to continue this manufacturing arrangement for the foreseeable future.

In the event that any of our third-party manufacturers is unable or unwilling to carry out its respective manufacturing or supply obligations or terminates or refuses to renew its arrangements with us, we may be unable to obtain alternative manufacturing or supply on commercially reasonable terms on a timely basis or at all. In addition, we purchase finished drug product from a number of our third-party manufacturers under purchase orders. In such cases, the third-party manufacturers have made no commitment to supply the drug product to us on a long-term basis and could reject our purchase orders. Only a limited number of manufacturers are capable of manufacturing our products and products in development. Consolidation within the pharmaceutical manufacturing industry could further reduce the number of manufacturers capable of producing our products, or otherwise affect our existing contractual relationships.

If we were required to transfer manufacturing processes to other third-party manufacturers and we were able to identify an alternative manufacturer, we would still need to satisfy various regulatory requirements. Satisfaction of these requirements could cause us to experience significant delays in receiving an adequate supply of our products and products in development and could be costly. Moreover, we may not be able to transfer processes that are proprietary to the manufacturer. Any delays in the manufacturing process may adversely impact our ability to meet commercial demands for our products on a timely basis, which could reduce our revenue, and to supply product for clinical trials of Angiomax, Cleviprex and our products in development, which could affect our ability to complete clinical trials on a timely basis.

If third parties on whom we rely to manufacture and support the development and commercialization of our products do not fulfill their obligations or we are unable to establish or maintain such arrangements, the development and commercialization of our products may be terminated or delayed, and the costs of development and commercialization may increase

Our development and commercialization strategy involves entering into arrangements with corporate and academic collaborators, contract research organizations, distributors, third-party manufacturers, licensors, licensees and others to conduct development work, manage or conduct our clinical trials, manufacture our products and market and sell our products outside of

the United States. We do not have the expertise or the resources to conduct many of these activities on our own and, as a result, are particularly dependent on third parties in many areas.

We may not be able to maintain our existing arrangements with respect to the commercialization or manufacture of our products or establish and maintain arrangements to develop, manufacture and commercialize our products in development or any additional product candidates or products we may acquire on terms that are acceptable to us. Any current or future arrangements for development and commercialization may not be successful. If we are not able to establish or maintain agreements relating to our products, our products in development or any additional products or product candidates we may acquire, our results of operations would be materially adversely affected.

Third parties may not perform their obligations as expected. The amount and timing of resources that third parties devote to developing, manufacturing and commercializing our products are not within our control. Our collaborators may develop, manufacture or commercialize, either alone or with others, products and services that are similar to or competitive with the products that are the subject of the collaboration with us. Furthermore, our interests may differ from those of third parties that manufacture or commercialize our products. Our collaborators may reevaluate their priorities from time to time, including following mergers and consolidations, and change the focus of their development, manufacturing or commercialization efforts. Disagreements that may arise with these third parties could delay or lead to the termination of the development or commercialization of our product candidates, or result in litigation or arbitration, which would be time consuming and expensive.

If any third party that manufactures or supports the development or commercialization of our products breaches or terminates its agreement with us, or fails to commit sufficient resources to our collaboration or conduct its activities in a timely manner, or fails to comply with regulatory requirements, such breach, termination or failure could:


•	delay or otherwise adversely impact the manufacturing, development or commercialization of our products, our products in development or any additional products or product candidates that we may acquire or develop;


•	require us to seek a new collaborator or undertake unforeseen additional responsibilities or devote unforeseen additional resources to the manufacturing, development or commercialization of our products; or


•	result in the termination of the development or commercialization of our products.

Our reliance on third-party manufacturers to supply our products and product candidates may increase the risk that we will not have appropriate supplies of our products or our product candidates, which could adversely affect our business, results of operations and financial condition

Reliance on third-party manufacturers entails risks to which we would not be subject if we manufactured products or products candidates ourselves, including:


•	reliance on the third party for regulatory compliance and quality assurance;


•	the possible breach of the manufacturing agreement by the third party; and


•	the possible termination or nonrenewal of the agreement by the third party, based on its own business priorities, at a time that is costly or inconvenient for us.

For example, in December 2009 and March 2010 we conducted voluntary recalls of manufactured lots of Cleviprex due to the presence of visible particulate matter at the bottom of some vials that were manufactured for us by a third party. As a result, we were not able to supply the market with Cleviprex or sell Cleviprex from the first quarter of 2010 until April 2011.

Our products and products in development may compete with products and product candidates of third parties for access to manufacturing facilities. If we are not able to obtain adequate supplies of our products and products in development, it will be more difficult for us to compete effectively, market and sell our approved products and develop our products in development.

Our contract manufacturers are subject to ongoing, periodic, unannounced inspection by the FDA and corresponding state and foreign agencies or their designees to evaluate compliance with the FDA's cGMP, regulations and other governmental regulations and corresponding foreign standards. We cannot be certain that our present or future manufacturers will be able to comply with cGMP regulations and other FDA regulatory requirements or similar regulatory requirements outside the United States. We do not control compliance by our contract manufacturers with these regulations and standards. Failure of our third-party manufacturers or us to comply with applicable regulations could result in sanctions being imposed on us, including fines and other monetary

penalties, injunctions, civil penalties, failure of regulatory authorities to grant marketing approval of our product candidates, delays, suspension or withdrawal of approvals, suspension of clinical trials, license revocation, seizures or recalls of product candidates or products, interruption of production, warning letters, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect supplies of our products and products in development.

In order to satisfy some non-U.S. regulatory authorities, we may need to reformulate the way in which our oritavancin bulk drug substance is created to remove porcine source product, which may delay marketing approval of oritavancin and increase our costs

Oritavancin bulk drug substance is manufactured using porcine-sourced products. Some non-U.S. regulatory authorities have historically objected to the use of animal-sourced products, particularly bovine-sourced products, during the preparation of finished drug product. As a result and in order to better position oritavancin for approval in foreign jurisdictions, under our agreement with Abbott, we and Abbott are seeking to develop a manufacturing process for oritavancin bulk drug substance that does not rely on the use of any animal-sourced products.

If we are unable to develop a manufacturing process for oritavancin bulk drug substance that does not rely on the use of animal-sourced product, we may be unable to receive regulatory approval for oritavancin in some foreign jurisdictions, which would likely have a negative impact on our ability to achieve our business objectives as to oritavancin.

If we use hazardous and biological materials in a manner that causes injury or violates applicable law, we may be liable for damages

We conduct research and development activities that involve the controlled use of potentially hazardous substances, including chemical, biological and radioactive materials and viruses. In addition, our operations produce hazardous waste products. Federal, state and local laws and regulations in the United States and Canada govern the use, manufacture, storage, handling and disposal of hazardous materials. We may incur significant additional costs to comply with applicable laws in the future. Also, we cannot completely eliminate the risk of contamination or injury resulting from hazardous materials and we may incur liability as a result of any such contamination or injury. In the event of an accident, we could be held liable for damages or penalized with fines, and the liability could exceed our resources. We have only limited insurance for liabilities arising from hazardous materials. Compliance with applicable environmental laws and regulations is expensive, and current or future environmental regulations may restrict our research, development and production efforts, which could harm our business, operating results and financial condition.

If we fail to acquire and develop additional development-stage compounds, clinical-stage product candidates or approved products, it will impair our ability to grow our business

We have sold and generated revenue from two products, Angiomax and Cleviprex. In order to generate additional revenue, our business plan is to acquire or license, and then develop and market, additional development-stage compounds, clinical-stage product candidates and approved products. From 2008 through 2011, for instance, we acquired Curacyte Discovery and Targanta, licensed marketing rights to the ready-to-use formulation of Argatroban and licensed development and commercialization rights to MDCO-216 and MDCO-157. The success of this growth strategy depends upon our ability to identify, select and acquire or license pharmaceutical products that meet the criteria we have established. Because we have only the limited internal scientific research capabilities that we acquired in our acquisitions of Curacyte Discovery and Targanta, and we do not anticipate establishing additional scientific research capabilities, we are dependent upon pharmaceutical and biotechnology companies and other researchers to sell or license product candidates to us. In addition, proposing, negotiating and implementing an economically viable acquisition or license is a lengthy and complex process. Other companies, including those with substantially greater financial, marketing and sales resources, may compete with us for the acquisition or license of development-stage compounds, clinical-stage product candidates and approved products. We may not be able to acquire or license the rights to additional product candidates and approved products on terms that we find acceptable, or at all.

We may not be able to manage our business effectively if we are unable to attract and retain key personnel and consultants

Our industry has experienced a high rate of turnover of management personnel in recent years. We are highly dependent on our ability to attract and retain qualified personnel for the acquisition, development and commercialization activities we conduct or sponsor. If we lose one or more of the members of our senior management, including our Chairman and Chief Executive Officer, Clive A. Meanwell, our Executive Vice President and Chief Financial Officer, Glenn P. Sblendorio, or other key employees or consultants, our ability to implement successfully our business strategy could be seriously harmed. Our ability to replace these key employees may be difficult and may take an extended period of time because of the limited number of individuals in our industry with the breadth of skills and experience required to acquire, develop and commercialize products successfully. Competition to hire from this limited pool is intense, and we may be unable to hire, train, retain or motivate such additional

personnel.

Risks Related to Regulatory Matters

If we do not obtain regulatory approvals for our product candidates in any jurisdiction or for our products in any additional jurisdictions, we will not be able to market our products and product candidates in those jurisdictions and our ability to generate additional revenue could be materially impaired

We must obtain approval from the FDA in order to sell our product candidates in the United States and from foreign regulatory authorities in order to sell our product candidates in other countries. In addition, we must obtain approval from foreign regulatory authorities in order to sell our U.S.-approved products in other countries. Except for Angiomax in the United States, Europe, India and other countries, Cleviprex in the United States, Australia, New Zealand and Switzerland and the ready-to-use formulation of Argatroban in the United States, we do not have any other product approved for sale in the United States or any foreign market. Obtaining regulatory approval is uncertain, time-consuming and expensive. Any regulatory approval we ultimately obtain may limit the indicated uses for the product or subject the product to restrictions or post-approval commitments that render the product commercially non-viable. Securing regulatory approval requires the submission of extensive pre-clinical and clinical data, information about product manufacturing processes and inspection of facilities and supporting information to the regulatory authorities for each therapeutic indication to establish the product's safety and efficacy. If we are unable to submit the necessary data and information, for example, because the results of clinical trials are not favorable, or if the applicable regulatory authority delays reviewing or does not approve our applications, we will be unable to obtain regulatory approval. Delays in obtaining or failure to obtain regulatory approvals may:


•	delay or prevent the successful commercialization of any of the products or product candidates in the jurisdiction for which approval is sought;


•	diminish our competitive advantage; and


•	defer or decrease our receipt of revenue.

The regulatory review and approval process to obtain marketing approval takes many years and requires the expenditure of substantial resources. This process can vary substantially based on the type, complexity, novelty and indication of the product involved. Regulatory authorities have substantial discretion in the approval process and may refuse to accept any application or may decide that data are insufficient for approval and require additional pre-clinical, clinical or other studies. In addition, varying interpretations of the data obtained from pre-clinical and clinical testing could delay, limit or prevent regulatory approval of a product. For example, the FDA issued a complete response letter to Targanta in December 2008 before it was acquired by us with respect to the oritavancin NDA indicating that the FDA could not approve the NDA in its present form and that it would be necessary for Targanta to perform an additional adequate and well-controlled study to demonstrate the safety and efficacy of oritavancin in patients with ABSSSI before the application could be approved. Moreover, recent events, including complications experienced by patients taking FDA-approved drugs, have raised questions about the safety of marketed drugs and may result in new legislation by the U.S. Congress or foreign legislatures and increased caution by the FDA and comparable foreign regulatory authorities in reviewing applications for marketing approval.

In the fourth quarter of 2010, we initiated our SOLO I and SOLO II clinical trials of oritavancin pursuant to a Special Protocol Assessment, or SPA, with the FDA. Many companies which have been granted SPAs have ultimately failed to obtain final approval to market their drugs. Since we are developing oritavancin under an SPA, based on protocol designs negotiated with the FDA, we may be subject to enhanced scrutiny. Additionally, even if the primary endpoints in the SOLO trials are achieved, a SPA does not guarantee approval. An SPA is not binding on the FDA if public health concerns unrecognized at the time the SPA was entered into become evident; the data, assumptions or information underlying the SPA request change or are called into question; other new scientific concerns regarding product safety or efficacy arise; or if we fail to comply with the agreed upon trial protocols. The FDA may raise issues of safety, study conduct, bias, deviation from the protocol, statistical power, patient completion rates, changes in scientific or medical parameters or internal inconsistencies in the data prior to making its final decision. The FDA may also seek the guidance of an outside advisory committee prior to making its final decision.

The procedures to obtain marketing approvals vary among countries and can involve additional clinical trials or other pre-filing requirements. The time required to obtain foreign regulatory approval may differ from that required to obtain FDA approval. The foreign regulatory approval process may include all the risks associated with obtaining FDA approval, or different or additional risks. We may not obtain foreign regulatory approvals on a timely basis, if at all. Approval by the FDA does not ensure approval by the regulatory authorities in other countries, and approval by one foreign regulatory authority does not ensure approval by the

FDA or regulatory authorities in other foreign countries. We may not be able to file for regulatory approvals and may not receive necessary approvals to commercialize our products and products in development in any market.

We cannot expand the indications for which we are marketing Angiomax unless we receive regulatory approval for each additional indication. Failure to expand these indications will limit the size of the commercial market for Angiomax

In order to market Angiomax for expanded indications, we will need to conduct appropriate clinical trials, obtain positive results from those trials and obtain regulatory approval for such proposed indications. Obtaining regulatory approval is uncertain, time-consuming and expensive. The regulatory review and approval process to obtain marketing approval for a new indication can take many years and require the expenditure of substantial resources. This process can vary substantially based on the type, complexity, novelty and indication of the product involved. The regulatory authorities have substantial discretion in the approval process and may refuse to accept any application. Alternatively, they may decide that any data submitted is insufficient for approval and require additional pre-clinical, clinical or other studies. In addition, varying interpretations of the data obtained from pre-clinical and clinical testing could delay, limit or prevent regulatory approval of a new indication for a product.

For example, in 2006 we received a non-approvable letter from the FDA in connection with our application to market Angiomax for patients with or at risk of HIT/HITTS undergoing cardiac surgery. In addition, in May 2008, we received a non-approvable letter from the FDA with respect to an sNDA that we submitted to the FDA seeking approval of an additional indication for Angiomax for the treatment of patients with ACS in the emergency department. In its May 2008 letter, the FDA indicated that the basis of their decision involved the appropriate use and interpretation of non-inferiority trials, including the ACUITY trial. If we determine to pursue these indications, the FDA may require that we conduct additional studies of Angiomax, which studies could require the expenditure of substantial resources. Even if we undertook such studies, we might not be successful in obtaining regulatory approval for these indications or any other indications in a timely manner or at all. If we are unsuccessful in expanding the Angiomax product label, the size of the commercial market for Angiomax will be limited.

Clinical trials of product candidates are expensive and time-consuming, and the results of these trials are uncertain. If we are unable to conduct clinical trials that demonstrate the safety and efficacy of our product candidates on a timely basis, then our costs of developing the product candidates may increase and we may not be able to obtain regulatory approval for our product candidates on a timely basis or at all.

Before we can obtain regulatory approvals to market any product for a particular indication, we will be required to complete pre-clinical studies and extensive clinical trials in humans to demonstrate the safety and efficacy of such product for such indication.

Clinical testing is expensive, difficult to design and implement, can take many years to complete and is uncertain as to outcome. Success in pre-clinical testing or early clinical trials does not ensure that later clinical trials will be successful, and interim results of a clinical trial do not necessarily predict final results. An unexpected result in one or more of our clinical trials can occur at any stage of testing. For example, in May 2009 we discontinued enrollment in our Phase 3 CHAMPION clinical trial program of cangrelor in patients undergoing PCI after receiving a letter from the clinical program's independent Interim Analysis Review Committee that reported that the efficacy endpoints of the trial program would not be achieved.

We may experience numerous unforeseen events during, or as a result of, the clinical trial process that could delay or prevent us from receiving regulatory approval or commercializing our products, including:


•	our clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional clinical trials which even if undertaken cannot ensure we will gain approval;


•	data obtained from pre-clinical testing and clinical trials may be subject to varying interpretations, which could result in the FDA or other regulatory authorities deciding not to approve a product in a timely fashion, or at all;


•	the cost of clinical trials may be greater than we currently anticipate;


•	regulators or institutional review boards may not authorize us to commence a clinical trial or conduct a clinical trial at a prospective trial site;


•	we, or the FDA or other regulatory authorities, might suspend or terminate a clinical trial at any time on various grounds, including a finding that participating patients are being exposed to unacceptable health risks. For example, we have in the past voluntarily suspended enrollment in one of our clinical trials to review an interim analysis of safety data from the trial; and


•	the effects of our product candidates may not be the desired effects or may include undesirable side effects or the product candidates may have other unexpected characteristics.

The rate of completion of clinical trials depends in part upon the rate of enrollment of patients. Patient enrollment is a function of many factors, including the size of the patient population, the proximity of patients to clinical sites, the eligibility criteria for the trial, the existence of competing clinical trials and the availability of alternative or new treatments. In particular, the patient population targeted by some of our clinical trials may be small. Delays in patient enrollment in any of our current or future clinical trials may result in increased costs and program delays.

If we or our contract manufacturers fail to comply with the extensive regulatory requirements to which we, our contract manufacturers and our products and product candidates are subject, our products could be subject to restrictions or withdrawal from the market, the development of our product candidates could be jeopardized, and we could be subject to penalties

The testing, manufacturing, labeling, safety, advertising, promotion, storage, sales, distribution, import, export and marketing, among other things, of our products, both before and after approval, are subject to extensive regulation by governmental authorities in the United States, Europe and elsewhere throughout the world. Both before and after approval of a product, quality control and manufacturing procedures must conform to current good manufacturing practice, or cGMP. Regulatory authorities, including the FDA, periodically inspect manufacturing facilities to assess compliance with cGMP. Our failure or the failure of our contract manufacturers to comply with the laws administered by the FDA, the EMA or other governmental authorities could result in, among other things, any of the following:


•	delay in approving or refusal to approve a product;


•	product recall or seizure;


•	suspension or withdrawal of an approved product from the market;


•	delays in, suspension of or prohibition of commencing, clinical trials of products in development;


•	interruption of production;


•	operating restrictions;


•	untitled or warning letters;


•	injunctions;


•	fines and other monetary penalties;


•	the imposition of civil or criminal penalties;


•	disruption of importing and exporting activities; and


•	unanticipated expenditures.

We may incur significant liability if it is determined that we are promoting the “off-label” use of any of our products

Physicians may prescribe drug products for uses that are not described in the product's labeling and that differ from those approved by the FDA or other applicable regulatory agencies. Off-label uses are common across medical specialties. Although the FDA and other regulatory agencies do not regulate a physician's choice of treatments, the FDA and other regulatory agencies do restrict communications on the subject of off-label use. Companies may not promote drugs for off-label uses. The FDA and other regulatory and enforcement authorities actively enforce laws and regulations prohibiting promotion of off-label uses and the promotion of products for which marketing approval has not been obtained. A company that is found to have improperly promoted off-label uses may be subject to significant liability, including civil and administrative remedies as well as criminal sanctions.

Notwithstanding the regulatory restrictions on off-label promotion, the FDA and other regulatory authorities allow companies to engage in truthful, non-misleading, and non-promotional scientific exchange concerning their products. We engage in medical education activities and communicate with investigators and potential investigators regarding our clinical trials. If the

FDA or another regulatory or enforcement authority determines that our communications regarding our marketed products are not in compliance with the relevant regulatory requirements and that we have improperly promoted off-label uses, we may be subject to significant liability, including civil and administrative remedies as well as criminal sanctions.

If we do not comply with federal, state and foreign laws and regulations relating to the health care business, we could face substantial penalties

We and our customers are subject to extensive regulation by the federal government, and the governments of the states and foreign countries in which we may conduct our business. In the United States, the laws that directly or indirectly affect our ability to operate our business include the following:


•	the Federal Anti-Kickback Law, which prohibits persons from knowingly and willfully soliciting, offering, receiving or providing remuneration, directly or indirectly, in cash or in kind, to induce either the referral of an individual or furnishing or arranging for a good or service for which payment may be made under federal health care programs such as Medicare and Medicaid;


•	other Medicare laws and regulations that prescribe the requirements for coverage and payment for services performed by our customers, including the amount of such payment;


•	the Federal False Claims Act, which imposes civil and criminal liability on individuals and entities who submit, or cause to be submitted, false or fraudulent claims for payment to the government;


•	the Federal False Statements Act, which prohibits knowingly and willfully falsifying, concealing or covering up a material fact or making any materially false statement in connection with delivery of or payment for health care benefits, items or services; and


•	various state laws that impose similar requirements and liability with respect to state healthcare reimbursement and other programs.

If our operations are found to be in violation of any of the laws and regulations described above or any other law or governmental regulation to which we or our customers are or will be subject, we may be subject to civil and criminal penalties, damages, fines, exclusion from the Medicare and Medicaid programs and the curtailment or restructuring of our operations. Similarly, if our customers are found to be non-compliant with applicable laws, they may be subject to sanctions, which could also have a negative impact on us. Any penalties, damages, fines, curtailment or restructuring of our operations would adversely affect our ability to operate our business and our financial results. Any action against us for violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses, divert our management's attention from the operation of our business and damage our reputation.

Failure to comply with the U.S. Foreign Corrupt Practices Act, or FCPA, as well as the anti-bribery laws of the nations in which we conduct business, could subject us to penalties and other adverse consequences

We are subject to the FCPA, which generally prohibits U.S. companies from engaging in bribery or other prohibited payments to foreign officials for the purpose of obtaining or retaining business and requires companies to maintain accurate books and records and internal controls, including at foreign-controlled subsidiaries. In addition, we are subject to other anti-bribery laws of the nations in which we conduct business that apply similar prohibitions as the FCPA. Our employees or other agents may engage in prohibited conduct without our knowledge under our policies and procedures and the Foreign Corrupt Practices Act and other anti-bribery laws that we may be subject to for which we may be held responsible. If our employees or other agents are found to have engaged in such practices, we could suffer severe penalties and other consequences that may have a material adverse effect on our business, financial condition and results of operations.

Risks Related to Our Intellectual Property

The principal U.S. patent covering Angiomax, the '404 patent, was set to expire in March 2010, but has been extended under the Hatch-Waxman Act following our litigation against the PTO, the FDA and HHS. We had applied, under the Hatch-Waxman

Act, for an extension of the term of the '404 patent, but the PTO rejected our application because in its view the application was not timely filed. As a result, we filed suit against the PTO, the FDA and HHS seeking to set aside the denial of our application to extend the term of the '404 patent. On August 3, 2010, the federal district court granted our motion for summary judgment and ordered the PTO to consider our patent term extension application timely filed. The period for the government to appeal the federal district court's August 3, 2010 decision expired without government appeal. However, on August 19, 2010, APP filed a motion to intervene for the purpose of appeal in our case against the PTO, the FDA and HHS. On September 13, 2010, the federal district court denied APP's motion. APP has appealed the denial of its motion, as well as the federal district court's August 3, 2010 order (and all related and underlying orders). This appeal is pending in the U.S. Court of Appeals for the Federal Circuit.

On September 16, 2011, President Obama signed into law the America Invents Act. Section 37 of the America Invents Act clarifies the filing timeline for patent term extension applications under the Hatch-Waxman Act. This timeline clarification confirms the interpretation of the Hatch-Waxman Act adopted by the federal district court's August 3, 2010 decision in our suit against the PTO, the FDA and HHS, which ordered the PTO to consider our patent term extension application timely filed. In its appeal, APP is challenging the applicability of the America Invents Act to our matter and the constitutionality of the America Invents Act. We have filed briefs with the Federal Circuit responding to these challenges by APP. In addition, on October 25, 2011, the DOJ filed a brief with the Federal Circuit in opposition to APP's challenges of the applicability of the America Invents Act to our matter and to the constitutionality of the America Invents Act. Oral argument before the Federal Circuit on APP's appeal is scheduled for November 15, 2011. If (1) the pre-America Invents Act interpretation of the Hatch-Waxman Act set forth in the August 3, 2010 court order requiring the PTO to consider our application to extend the term of the '404 patent timely filed is successfully challenged, either by APP in its pending appeal or by APP or a third party in a separate challenge and (2) Section 37 of the America Invents Act is found to be unconstitutional or not to apply to the '404 patent, Angiomax could be subject to generic competition in the United States earlier than we anticipate. Competition from generic equivalents that would be sold at a price that is less than the price at which we currently sell Angiomax could have a material adverse impact on our business, financial condition and operating results.

In the second half of 2009, the PTO issued to us U.S. Patent No. 7,582,727, or the '727 patent, and U.S. Patent No. 7,598,343, or the '343 patent, covering a more consistent and improved Angiomax drug product and the processes by which it is made. The '727 patent and the '343 patent are set to expire in July 2028. In response to Paragraph IV Certification Notice letters we received with respect to abbreviated new drug applications, or ANDAs, filed with the FDA seeking approval to market generic versions of Angiomax, we have filed lawsuits against the ANDA filers alleging patent infringement of the '727 patent and '343 patent. On September 30, 2011, we settled our patent infringement litigation with Teva Pharmaceuticals USA, Inc. and its affiliates, which we refer collectively as Teva. In connection with the settlement, we entered into a license agreement with Teva under which we granted Teva a non-exclusive license under the'727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019 or earlier under certain conditions. We remain in infringement litigation involving the '727 patent and '343 patent with the other ANDA filers. If we are unable to maintain our market exclusivity for Angiomax in the United States through enforcement of our U.S. patents covering Angiomax, Angiomax could be subject to generic competition earlier than June 30, 2019.

If we breach any of the agreements under which we license rights to products or technology from others, we could lose license rights that are material to our business or be subject to claims by our licensors

We license rights to products and technology that are important to our business, and we expect to enter into additional licenses in the future. For instance, we have exclusively licensed patents and patent applications relating to each of our products and products in development other than MDCO-2010. Under these agreements, we are subject to a range of commercialization and development, sublicensing, royalty, patent prosecution and maintenance, insurance and other obligations.

Any failure by us to comply with any of these obligations or any other breach by us of our license agreements could give the licensor the right to terminate the license in whole, terminate the exclusive nature of the license or bring a claim against us for damages. Any such termination or claim, particularly relating to our agreements with respect to Angiomax, could have a material

adverse effect on our financial condition, results of operations, liquidity or business. Even if we contest any such termination or claim and are ultimately successful, such dispute could lead to delays in the development or commercialization of potential products and result in time-consuming and expensive litigation or arbitration. In addition, on termination we may be required to license to the licensor any related intellectual property that we developed.

We have entered into an agreement with Biogen Idec, one of our licensors of Angiomax, that suspends the statute of limitations relating to any claims, including claims for damages and/or license termination, that Biogen Idec may bring relating to the PTO's initial denial of the application under the Hatch-Waxman Act for an extension of the term of the '404 patent on the grounds that it was filed late. We are also in discussions with Biogen Idec and HRI with respect to the possible resolution of any potential claims among the parties with respect to this matter. We may not reach any agreement with the parties on terms acceptable to us or at all.

If we are unable to obtain or maintain patent protection for the intellectual property relating to our products, the value of our products will be adversely affected

The patent positions of pharmaceutical companies like us are generally uncertain and involve complex legal, scientific and factual issues. We cannot be certain that our patents and patent applications, including our own and those that we have rights through licenses from third parties will adequately protect our intellectual property. Our success in protection our intellectual property depends significantly on our ability to:


•	obtain and maintain U.S. and foreign patents, including defending those patents against adverse claims;


•	secure patent term extension for the patents covering our approved products;


•	protect trade secrets;


•	operate without infringing the proprietary rights of others; and


•	prevent others from infringing our proprietary rights.

We may not have any additional patents issued from any patent applications that we own or license. If additional patents are granted, the claims allowed may not be sufficiently broad to protect our technology. In addition, issued patents that we own or license may be challenged, narrowed, invalidated or circumvented, which could limit our ability to stop competitors from marketing similar products or limit the length of term of patent protection we may have for our products, and we may not be able to obtain patent term extension to prolong the terms of the principal patents covering our approved products. Changes in patent laws or in interpretations of patent laws in the United States and other countries may diminish the value of our intellectual property or narrow the scope of our patent protection.

In addition, the U.S. Supreme Court has ruled on several patent cases in recent years, either narrowing the scope of patent protection available in certain circumstances or weakening the rights of patent owners in certain situations. This combination of events has created uncertainty with respect to the value of patents, once obtained, and with regard to our ability to obtain patents in the future. Depending on decisions by the U.S. Congress, the federal courts, and the PTO, the laws and regulations governing patents could change in unpredictable ways that would weaken our ability to obtain new patents or to enforce our existing patents and patents that we might obtain in the future.

Our patents also may not afford us protection against competitors with similar technology. Because patent applications in the United States and many foreign jurisdictions are typically not published until eighteen months after filing, or in some cases not at all, and because publications of discoveries in the scientific literature often lag behind actual discoveries, neither we nor our licensors can be certain that others have not filed or maintained patent applications for technology used by us or covered by our pending patent applications without our being aware of these applications.

We exclusively license patents and patent applications for each of our products and products in development other than MDCO-2010 for which we own the patents and patent applications. The patents covering our approved products and our product candidates are currently set to expire at various dates:

Angiomax. The principal U.S. patents covering Angiomax include the '404 patent, the '727 patent and the '343 patent. The '404 patent was set to expire in March 2010, but has been extended under the Hatch-Waxman Act following our litigation against the PTO, the FDA and HHS. Following the expiration of the government's appeal period in the litigation, the FDA determined the applicable regulatory review period for Angiomax. Based on the FDA's determination, we believe that the term of the '404 patent

should be extended until December 15, 2014. However, to date the PTO has not yet communicated a final determination concerning the length of any patent term extension for the '404 patent. At this time, we do not know when the PTO will make or communicate such a determination. On July 28, 2011, the PTO granted us a one-year interim extension of the '404 patent until August 13, 2012. As a result of our study of Angiomax in the pediatric setting, we are entitled to a six-month period of pediatric exclusivity following expiration of the '404 patent. If the patent term of the '404 is extended to December 15, 2014, we currently believe that this pediatric exclusivity would extend until June 15, 2015.

If (1) the pre-America Invents Act interpretation of the Hatch-Waxman Act set forth in the August 3, 2010 court order requiring the PTO to consider our application to extend the term of the '404 patent timely filed is successfully challenged, either by APP in its pending appeal or by APP or a third party in a separate challenge and (2) Section 37 of the America Invents Act is found to be unconstitutional or not to apply to the '404 patent, Angiomax could be subject to generic competition in the United States earlier than we anticipate. In such event, a court or the FDA could determine that the '404 patent expired in March 2010. In such case, the pediatric exclusivity period for Angiomax would have expired in September 2010. It is also possible that a court or the FDA could determine that the '404 patent expired on a later date, in which case the pediatric exclusivity for Angiomax would run from that later date. In Europe, the principal patent covering Angiox expires in 2015.

In the second half of 2009, the PTO issued to us the '727 patent and the '343 patent, covering a more consistent and improved Angiomax drug product and the processes by which it is made. The '727 patent and the '343 patent are set to expire in July 2028. In response to Paragraph IV Certification Notice letters we received with respect to ANDAs filed with the FDA seeking approval to market generic versions of Angiomax, we have filed lawsuits against the ANDA filers alleging patent infringement of the '727 patent and '343 patent. On September 30, 2011, we settled our patent infringement litigation with Teva. In connection with the settlement, we entered into a license agreement with Teva under which we granted Teva a non-exclusive license under the'727 patent and '343 patent to sell a generic bivalirudin for injection product under a Teva ANDA in the United States beginning June 30, 2019 or earlier under certain conditions. We remain in infringement litigation involving the '727 patent and '343 patent with the other ANDA filers.

Our litigation with the PTO, the FDA and HHS, APP's efforts to appeal the August 3, 2010 decision in that litigation, our patent infringement suits relating to the '727 patent and '343 patent and the Teva settlement are described in more detail in Part I, Item 2 under the caption Overview - Angiomax Patent Litigation and Part I, Item 2 of this quarterly report.

Cleviprex . The principal U.S. patent for Cleviprex is U.S. Patent No. 5,856,346, or the '346 patent, which is set to expire in January 2016. Following receipt of marketing approval from the FDA, we submitted an application under the Hatch-Waxman Act to extend the term of the '346 patent. This application is currently pending. In addition, we have filed and are currently prosecuting a number of patent applications relating to Cleviprex covering compositions of matter and uses in the United States, Europe and other foreign countries. In Europe, the principal patent covering Cleviprex expires in November 2014 if no patent term extension is obtained.

Cangrelor . The principal U.S. and European patents for cangrelor are set to expire in February 2014 if no patent term extension is obtained. In addition, we have also filed and are currently prosecuting a number of patent applications related to cangrelor.

Oritavancin . The principal patent for oritavancin is set to expire in November 2015 in both the United States and Europe if no patent term extension is obtained. We have also filed and are prosecuting a number of patent applications relating to oritavancin and its uses.

MDCO-2010 . The principal patent application for MDCO-2010, if issued, would expire in October 2027 in both the United States and Europe.

MDCO-216 . We are maintaining a number of U.S. patents with respect to MDCO-216, including patents that claim the use of MDCO-216 in certain disease indications. One of these U.S. patents is directed to the use of MDCO-216 for the treatment of ACS and is set to expire in October 2024. We have also filed and are prosecuting a number of patent applications related to MDCO-216's use and production in the United States, Europe and other foreign countries. In addition, as a biologic, we expect MDCO-216 to receive 12 years of regulatory exclusivity in the United States and 10 years of regulatory exclusivity in Europe from the date of the initial marketing approval if MDCO-216 is approved.

MDCO-157 . The principal patent application for MDCO-157, if issued, would expire in April 2028 in both the United States and Europe.

Ready-to-Use Argatroban . Eagle, the licensor of ready-to-use Argatroban, is prosecuting a patent application in the United States that, if issued, would expire in September 2027.

We plan to file applications for patent term extension for our products in development upon their approval. If we do not receive patent term extensions for the periods requested by us or at all, our patent protection for our products in development could be limited.

We are a party to a number of lawsuits that we brought against pharmaceutical companies that have notified us that they have filed ANDAs seeking approval to market generic versions of Angiomax. We cannot predict the outcome of these lawsuits. Involvement in litigation, regardless of its outcome, is time-consuming and expensive and may divert our management's time and attention. During the period in which these matters are pending, the uncertainty of their outcome may cause our stock price to decline. An adverse result in these matters whether appealable or not, will likely cause our stock price to decline. Any final, unappealable, adverse result in these matters will likely have a material adverse effect on our results of operations and financial conditions and cause our stock price to decline.

If upon expiration our agreement with Lonza Braine, Lonza Braine breaches our agreement and fails to transfer the technology that was used to develop the Chemilog process, we would be unable to employ the Chemilog process to manufacture Angiomax bulk drug substance, which could cause us to experience delays in the manufacturing process and increase our manufacturing costs in the future.

Our agreement with Lonza Braine for the supply of Angiomax bulk drug substance requires that Lonza Braine transfer the technology that was used to develop the Chemilog process to a secondary supplier of Angiomax bulk drug substance or to us or an alternate supplier at the expiration of the agreement, which is currently scheduled to occur in September 2013, but is subject to automatic renewals of consecutive three-year periods unless either party provides notice of non-renewal at least one year prior to the expiration of the initial term or any renewal term. If Lonza Braine fails or is unable to transfer successfully this technology, we would be unable to employ the Chemilog process to manufacture our Angiomax bulk drug substance, which could cause us to experience delays in the manufacturing process and increase our manufacturing costs in the future.

If we are not able to keep our trade secrets confidential, our technology and information may be used by others to compete against us

We rely significantly upon unpatented proprietary technology, information, processes and know-how. We seek to protect this information by confidentiality agreements and invention assignment agreements with our employees, consultants and other third-party contractors, as well as through other security measures. We may not have adequate remedies for any breach by a party to these confidentiality agreements or invention assignment agreements. In addition, our competitors may learn or independently develop our trade secrets. If our confidential information or trade secrets become publicly known, they may lose their value to us.

If we infringe or are alleged to infringe intellectual property rights of third parties, our business may be adversely affected

Our research, development and commercialization activities, as well as any product candidates or products resulting from these activities, may infringe or be claimed to infringe patents or patent applications under which we do not hold licenses or other rights. Third parties may own or control these patents and patent applications in the United States and abroad. These third parties could bring claims against us or our collaborators that would cause us to incur substantial expenses and, if successful against us, could cause us to pay substantial damages. Further, if a patent infringement suit were brought against us or our collaborators, we or they could be forced to stop or delay research, development, manufacturing or sales of the product or product candidate that is the subject of the suit.

As a result of patent infringement claims, or in order to avoid potential claims, we or our collaborators may choose or be required to seek a license from the third party and be required to pay license fees or royalties or both. These licenses may not be available on acceptable terms, or at all. Even if we or our collaborators were able to obtain a license, the rights may be nonexclusive, which could result in our competitors gaining access to the same intellectual property. Ultimately, we could be prevented from commercializing a product, or be forced to cease some aspect of our business operations, if, as a result of actual or threatened patent infringement claims, we or our collaborators are unable to enter into licenses on acceptable terms. This could harm our business significantly.

There has been substantial litigation and other proceedings regarding patent and other intellectual property rights in the pharmaceutical and biotechnology industries. In addition to infringement claims against us, we may become a party to other patent litigation and other proceedings, including interference proceedings declared by the PTO and opposition proceedings in the European Patent Office, regarding intellectual property rights with respect to our products and technology. Patent litigation and other proceedings may also absorb significant management time. The cost to us of any patent litigation or other proceeding, even if resolved in our favor, could be substantial. Some of our competitors may be able to sustain the costs of such litigation or

proceedings more effectively than we can because of their substantially greater financial resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace. Patent litigation and other proceedings may also absorb significant management time.

Risks Related to Our Common Stock

Fluctuations in our operating results could affect the price of our common stock

Our operating results may vary from period to period based on factors including the amount and timing of sales of Angiomax and Cleviprex, underlying hospital demand for Angiomax and Cleviprex, our customers' buying patterns, the timing, expenses and results of clinical trials, announcements regarding clinical trial results and product introductions by us or our competitors, the availability and timing of third-party reimbursement, including in Europe, sales and marketing expenses and the timing of regulatory approvals. If our operating results do not meet the expectations of securities analysts and investors as a result of these or other factors, the trading price of our common stock will likely decrease.

Our stock price has been and may in the future be volatile. This volatility may make it difficult for you to sell common stock when you want or at attractive prices

Our common stock has been and in the future may be subject to substantial price volatility. From January 1, 2008 to November 7, 2011, the last reported sale price of our common stock ranged from a high of $27.68 per share to a low of $6.47 per share. The value of your investment could decline due to the effect upon the market price of our common stock of any of the following factors, many of which are beyond our control:


•	achievement or rejection of regulatory approvals of our product candidates and our products;


•	regulatory actions by the FDA or a foreign jurisdiction limiting or revoking the use of our products;


•	changes in securities analysts' estimates of our financial performance;


•	changes in valuations of similar companies;


•	variations in our operating results;


•	acquisitions and strategic partnerships;


•	announcements of technological innovations or new commercial products by us or our competitors or the filing of ANDAs or NDAs for products competitive with ours;


•	disclosure of results of clinical testing or regulatory proceedings by us or our competitors;


•	the timing, amount and receipt of revenue from sales of our products and margins on sales of our products;


•	changes in governmental regulations;


•	developments in patent rights or other proprietary rights, particularly with respect to our U.S. Angiomax patents;


•	the extent to which Angiomax is commercially successful globally;


•	our ability to maintain market exclusivity for Angiomax in the United States through at least June 2015, which could be adversely affected as a result of an adverse court decision or adverse legislation relating to the '404 patent;


•	our ability to maintain market exclusivity for Angiomax in the United States through June 30, 2019, the date on which we agreed Teva may sell a generic version of Angiomax, through the enforcement of our U.S. patents covering Angiomax;


•	our ability to maintain our market exclusivity for Angiomax in the United States, which would be adversely affected as a result of an adverse court decision or adverse legislation relating to the '404 patent or our inability to enforcement of our other U.S. patents covering Angiomax;


•	significant new litigation;


•	developments or issues with our contract manufacturers;


•	changes in our management; and


•	general market conditions.

We believe that period-to-period comparisons of our financial results will not necessarily be indicative of our future performance. If our revenues in any particular period do not meet expectations, we may not be able to adjust our expenditures in that period, which could cause our operating results to suffer. If our operating results in any future period fall below the expectations of securities analysts or investors, our stock price may fall by a significant amount.

The stock markets in general, and the Nasdaq Global Market and the market for biopharmaceutical companies in particular, have experienced extreme price and volume fluctuations recently. These fluctuations often have been unrelated or disproportionate to the operating performance of these companies. These broad market and industry factors may adversely affect the market price of our common stock, regardless of our actual operating performance.

Our corporate governance structure, including provisions in our certificate of incorporation and by-laws and Delaware law, may prevent a change in control or management that security holders may consider desirable

The General Corporation Law of the State of Delaware and our certificate of incorporation and by-laws contain provisions that might enable our management to resist a takeover of our company or discourage a third party from attempting to take over our company. These provisions include


•	Section 203 of the Delaware General Corporation Law, which provides that we may not enter into a business combination with an interested stockholder for a period of three years after the date of the transaction in which the person became an interested stockholder, unless the business combination is approved in the manner prescribed in Section 203;


•	our board of directors has the authority to issue, without a vote or action of stockholders, up to 5,000,000 shares of a new series of preferred stock and to fix the price, rights, preferences and privileges of those shares, each of which could be superior to the rights of holders of our common stock;


•	our directors are elected to staggered terms, which prevents our entire board of directors from being replaced in any single year;


•	our directors may be removed only for cause and then only by the affirmative vote of the holders of at least 75% of the votes which all stockholders would be entitled to cast in any annual election of directors;


•	the size of our board of directors is determined by resolution of the board of directors;


•	any vacancy on our board of directors, however occurring, including a vacancy resulting from an enlargement of our board, may only be filled by vote of a majority of our directors then in office, even if less than a quorum;


•	only our board of directors, the chairman of the board or our president may call special meetings of stockholders;


•	our by-laws may be amended, altered or repealed by (i) the affirmative vote of a majority of our directors, subject to any limitations set forth in the by-laws, or (ii) the affirmative vote of the holders of at least 75% of the votes which all the stockholders would be entitled to cast in any annual election of directors;


•	stockholders must provide us with advance notice, and certain information specified in our by-laws, in connection with nominations or proposals by such stockholder for consideration at an annual meeting;


•	stockholders may not take any action by written consent in lieu of a meeting; and

•

our certificate of incorporation may only be amended or repealed by the affirmative vote of a majority of our directors and the affirmative vote of the holders of at least 75% of the votes which all the stockholders would be entitled to cast in any annual election of directors (and plus any separate class vote that might in the future be required pursuant to the terms of any series of preferred stock that might be outstanding at the time any of these amendments are submitted to stockholders).

These provisions could have the effect of delaying, deferring, or preventing a change in control of us or a change in our management that stockholders may consider favorable or beneficial. These provisions could also discourage proxy contests and make it more difficult for stockholders to elect directors and take other corporate actions. These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock or our other securities.

Our business could be negatively affected as a result of the actions of activist shareholders.

Proxy contests have been waged against many companies in the biopharmaceutical industry over the last few years. If faced with a proxy contest, we may not be able to successfully defend against the contest, which would be disruptive to our business. Even if we are successful, our business could be adversely affected by a proxy contest because:


•	responding to proxy contests and other actions by activist shareholders may be costly and time-consuming and may disrupt our operations and divert the attention of management and our employees;


•	perceived uncertainties as to our future direction may result in our inability to consummate potential acquisitions, collaborations or in-licensing opportunities and may make it more difficult to attract and retain qualified personnel and business partners; and


•	if individuals are elected to our board of directors with a specific agenda different from ours, it may adversely affect our ability to effectively and timely implement our strategic plan and create additional value for our stockholders.

Item 6. Exhibits

Exhibits

See the Exhibit Index on the page immediately preceding the exhibits for a list of exhibits filed as part of this quarterly report, which Exhibit Index is incorporated herein by this reference.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

THE MEDICINES COMPANY



Date:	November 9, 2011	By:	/s/ Glenn P. Sblendorio
			Glenn P. Sblendorio
			Executive Vice President and Chief Financial
			Officer (Principal Financial and Accounting Officer)

EXHIBIT INDEX



Exhibit Number		Description
10.1*		Manufacturing Services Agreement, dated March 30, 2011, between registrant and Patheon International A.G.

10.2*		Settlement Agreement, dated September 30, 2011, between registrant and Teva Pharmaceuticals USA, Inc.

10.3*		License Agreement, dated September 30, 2011, between registrant and Teva Pharmaceuticals USA, Inc.

10.4*		Supply Agreement, dated September 30, 2011, between registrant and Plantex USA Inc.

10.5*		First Amendment to the Second Amended and Restated Distribution Agreement, dated July 1, 2011, between registrant and Integrated Commercial Solutions, Inc.

10.6*		Second Amendment to the Second Amended and Restated Distribution Agreement, dated July 1, 2011, between registrant and Integrated Commercial Solutions, Inc.

31.1		Chairman and Chief Executive Officer Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2		Chief Financial Officer Certification pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1		Chairman and Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2		Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101		The following materials from The Medicines Company Quarterly Report on Form 10-Q for the quarter ended September 30, 2011, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheet, (ii) the Consolidated Statement of Operations, (iii) the Consolidated Statement of Cash Flow, and (iv) Notes to Consolidated Financial Statements.

* Confidential treatment requested as to certain portions, which portions have been omitted and filed separately with the Securities and Exchange Commission.

Exhibit 10.1

Confidential Materials omitted and filed separately with the

Securities and Exchange Commissions. Asterisks denote omissions.

Manufacturing Services Agreement

March 30, 2011


ARTICLE 1	INTERPRETATION 1


1.1	Definitions. 1


1.2	Currency. 5


1.3	Sections and Headings. 5


1.4	Singular Terms. 5


1.5	Schedules. 5


ARTICLE 2	PATHEON’S MANUFACTURING SERVICES 6


2.1	Technology Transfer and Feasibility Activities. 6


2.2	Manufacturing Services. 6


2.3	Standard of Performance. 7


2.4	Subcontractors. 7


ARTICLE 3	MDCO’S OBLIGATIONS 7


3.1	Payment. 7


3.2	Active Materials. 8


ARTICLE 4	CONVERSION FEES AND COMPONENT COSTS 8


4.1	First Year Pricing. 8


4.2	Price Adjustments. 8


4.2.1 Adjustment due to Volume Changes from Yearly Binding Volumes	9


4.3	Adjustments Due to Technical Changes. 10


ARTICLE 5	ORDERS, SHIPMENT, INVOICING, PAYMENT 10


5.1	Orders and Forecasts. 10


5.2	Reliance by Patheon. 11


5.3	Minimum Orders. 12


5.4	Shipments. 12


5.5	Invoices and Payment. 12


ARTICLE 6	PRODUCT CLAIMS AND RECALLS 12


6.1	Product Claims. 12


6.2	Patheon’s Responsibility for Defective and Recalled Products. 13


6.3	Disposition of Defective or Recalled Products. 14


6.4	Healthcare Provider or Patient Questions and Complaints. 14


6.5	Sole Remedy. 14


ARTICLE 7	CO-OPERATION 14


7.1	Quarterly Review. 14


7.2	Access & Audits. 14


7.3	Reports. 15


7.4	Regulatory Authority Filings. 15


ARTICLE 8	TERM AND TERMINATION 15


8.1	Initial Term. 15


8.2	Termination for Cause. 15


8.3	Product Discontinuation. 16


8.4	Obligations on Termination. 16


ARTICLE 9	REPRESENTATIONS, WARRANTIES AND COVENANTS 17


9.1	Authority. 17


9.2	MDCO Warranties. 17


9.3	Patheon Warranties. 17


9.4	Debarred Persons. 18


9.5	No Warranty. 19


ARTICLE 10	REMEDIES AND INDEMNITIES 19


10.1	Consequential Damages. 19


10.2	Limitation of Liability-Active Materials. 19


10.3	Patheon. 19


10.4	MDCO. 19


10.5	Reasonable Allocation of Risk. 20


ARTICLE 11	CONFIDENTIALITY 20


11.1	Confidential Information - Disclosing Party’s Property. 20


11.2	Receiving Party’s Obligations. 20


11.3	Allowable Disclosures. 21


11.4	Exclusions. 21


11.5	Continuing Obligations of Confidentiality. 21


ARTICLE 12	DISPUTE RESOLUTION 22


12.1	Commercial Disputes. 22


12.2	Technical Dispute Resolution. 22


ARTICLE 13	MISCELLANEOUS 22


13.1	Inventions. 22


13.2	Intellectual Property. 23


13.3	Insurance. 23


13.4	Independent Contractors. 23


13.5	No Waiver. 24


13.6	Assignment and Subcontracting. 24


13.7	Force Majeure. 24


13.8	Additional Product. 24


13.9	Notices. 24


13.10	Severability. 25


13.11	Entire Agreement. 25


13.12	Other Terms. 26


13.13	No Third Party Benefit or Right. 26


13.14	Execution in Counterparts. 26


13.15	Use of MDCO Name. 26


13.16	Governing Law. 26

MANUFACTURING SERVICES AGREEMENT

THIS MANUFACTURING SERVICES AGREEMENT (the “ Agreement ”) made as of the 30th day of March, 2011 (“ Effective Date ”)

BETWEEN:

PATHEON INTERNATIONAL A.G.,

Lindenstrasse 14, 6340 Baar, (Switzerland)
a corporation existing under the laws of Switzerland,
(hereinafter referred to as “ Patheon ”),

- and -

THE MEDICINES COMPANY

8 Sylvan Way, Parsippany, NJ 07054 (U.S.A)
a Delaware corporation, with its principal place of business in Parsippany, New Jersey, United States of America
(hereinafter referred to as “ MDCO ”).

RECITALS:

WHEREAS, Patheon and MDCO are Parties to that certain Preliminary Agreement dated as of October 29, 2010 (the “Preliminary Agreement”), pursuant to which MDCO is transferring the technology necessary to enable Patheon to manufacture the Products at Patheon’s Manufacturing Site; and

WHEREAS, MDCO wishes to have the Products manufactured, tested and supplied to it by Patheon for commercial sales, and Patheon wishes to manufacture, test and supply to MDCO the Products for commercial sales, in accordance with the terms and conditions of this Agreement;

WHEREAS, the Parties have agreed to enter into this Agreement to provide the terms and conditions governing the manufacture, testing and supply of the Products by Patheon.

NOW, THEREFORE, MDCO and Patheon agree as follows:

ARTICLE 1
INTERPRETATION

1.1 Definitions .

The following terms shall, unless the context otherwise requires, have the respective meanings set out below and grammatical variations of such terms shall have corresponding meanings:

“ Active Materials ”, “ Active Pharmaceutical Ingredients ” or “ API ” means the materials listed on Schedule D hereto;

“Active Materials Credit Value” means the value to be attributed to the Active Materials for certain purposes of this Agreement, as set forth on Schedule D;

“ Affiliate ” means:

a business entity which owns, directly or indirectly, a controlling interest in a party to this

Agreement, by stock ownership or otherwise; or

a business entity which is controlled by a party to this Agreement, either directly or indirectly, by stock ownership or otherwise; or

a business entity, the controlling interest of which is directly or indirectly common to the majority ownership of a party to this Agreement;

For the purposes of this definition, “control” means the ownership of shares carrying at least a majority of the votes in respect of the election of the directors of a corporation.

“ Annual Report ” means the annual report as described in Title 21 of the United States Code of Federal Regulations, Section 314.81 (b)(2);

“ Annual Product Review Report ” means the annual product review report as described in Title 21 of the United States Code of Federal Regulations, Section 211.180(e);

“ Applicable Laws ” means any statute, law, treaty, rule, code, ordinance, regulation, that applies, as the context requires to: (i) the Agreement; (ii) the performance of obligations or other activities related to the Agreement; and (iii) a party’s Subcontractors (if any).

“ Authority ” means any governmental or regulatory authority department, body or agency or any court, tribunal, bureau, commission or other similar body, whether federal, state, provincial, county or municipal;

“ Batch Size ” means the estimated batch size of a Product (measured in number of units of such Product) as set forth in Schedule B;

“ Bill Back Items ” means the expenses in respect of all third party supplier fees for the purchase of columns, standards, tooling and supporting equipment and other project specific items necessary for Patheon to perform the Manufacturing Services, and which are not included as Components;

“ Business Day ” means a day other than a Saturday, Sunday or a day that is a statutory holiday in the Italy, USA and /or Switzerland;

“ cGMPs ” means current good manufacturing practices as described in:


•	Parts 210 and 211 of Title 21 of the United Slates’ Code of Federal Regulations; and


•	EC Directive 2003/94/EC;

together with the latest FDA and EMA guidance documents pertaining to manufacturing and quality control practice, all as updated, amended and revised from time to time;

“ Components ” means, collectively, primary packaging components, raw materials and ingredients, required to be used in order to produce the Products in accordance with the Specifications, other than the Active Materials;

“ Confidential Information ” means all information whether commercial, financial, technical, operational or otherwise in any format, disclosed by one Party or any of its Affiliates to the other Party or any of its Affiliates in connection with this Agreement or the Preliminary Agreement which by its nature is clearly confidential or proprietary (whether

or not that information is marked or designated as confidential or proprietary) whether disclosed orally, in documentary form, electronically or otherwise and including the terms of this Agreement;

“ Deficiency Notice ” shall have the meaning ascribed thereto in Section 6.1 (a);

“ Delivery Date ” means the date of delivery of Products at the Manufacturing Site, as stated in the acceptance of the Firm Order by Patheon;

“ Disclosing Party ” means the Party disclosing Confidential Information;

“ Equipment ” means the equipment required to be purchased and installed at the Manufacturing Site in order to manufacture the Product, as detailed in the Preliminary Agreement;

“ Effective Date ” means the date set forth in the introductory paragraph that is the commencement date of this Agreement after execution by both Parties;

“ EMA ” means the European Medicines Agency;

“ FDA ” means the United States government agency known as the Food and Drug Administration;

“ Firm Order ” means a firm written order in the form of a purchase order or otherwise that has been accepted by Patheon;

“ Intellectual Property ” means rights under patent, trademark, copyright, and trade secret Laws, and any other intellectual property or proprietary rights recognized in any country or jurisdiction worldwide, including, without limitation, rights in patents, patent applications, formulae, trade-marks, trade-mark applications, trade-names, Inventions, copyright, industrial designs, trade secrets and know-how;

“ Invention ” means any innovation, improvement, development, discovery, computer program, device, trade secret, method, know-how, process, technique or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which it is contained and whether or not patentable or copyrightable;

“ Inventory ” means all inventories of Components and work-in-process produced or held by Patheon in connection with the manufacture of the Products but, for greater certainty, does not include the Active Materials;

“ Law(s) ” means all laws, statutes, ordinances, regulations, rules, by-laws, judgments, decrees or orders of any Authority;

“ MA ” means Marketing Authorization pursuant to Directive 65/65 EEC (as amended) or any implementation of it under the laws of a relevant Member State, which for the Products means the authorisation referred to in the Quality Agreement;

“ ML ” means Manufacturing License pursuant to Directive 75/319 EEC (as amended) or any implementation of it under the laws of a relevant Member State, which for this Agreement means the authorisation referred to in the Quality Agreement;

“ Manufacturing Requirements ” shall have the meaning ascribed thereto in Section 2.3;

“ Manufacturing Services ” means the manufacturing, quality control, quality assurance

and stability testing, and related services, as contemplated in this Agreement, required to produce Products from Active Materials and Components;

“ Manufacturing Services Based Intellectual Property ” means Intellectual Property generated or derived by Patheon or its Affiliate in the course of performing any Manufacturing Services or otherwise generated or derived by Patheon or its Affiliate in connection with the conduct of its business which Intellectual Property is not specific to, or dependent upon, MDCO’s Active Material or Product including, without limitation, Inventions and Intellectual Property which may have application to manufacturing processes or the formulation or development of drug products, drug product dosage forms or drug delivery systems beyond the specific requirements of the Product(s);

“ Manufacturing Site ” means the Patheon’s Affiliate facility, owned and operated by Patheon Italia S.p.A, that is located at viale G.B. Stucchi n. 110, Monza - Italy;

“ Maximum Credit Value ” means the maximum value of Active Materials that may be credited by Patheon under this Agreement, as set forth on Schedule D;

“ Minimum Run Quantity ” means !he minimum number of batches of a Product to be produced during the same cycle of manufacturing as set forth in Schedule B hereto;

“ Party(ies) ” means either Patheon or MDCO, or both, as the case may be;

“ Price ” means the price to be charged by Patheon regarding Product manufactured and supplied hereunder as delivered to MDCO, and is comprised of the fees for the Manufacturing Services, and the costs for Components; which Price is fully described in Schedule B.

“ Product(s) ” means the product(s) listed on Schedule A hereto;

“ Product Quality Review ” means the annual product review report as described in Eudralex Vol. 4 GMP chapter I Quality Management;

“ Promptly ” means within three (3) business days;

“ Quality Agreement ” means the agreement to be entered into between the Parties hereto, required under the laws of the European Union and setting out the respective liabilities of the Parties and the quality assurance standards in respect of the Manufacturing Services, which agreement shall be substantially in the form attached hereto as Schedule F;

“ Receiving Party ” means the Party to whom Confidential Information is disclosed;

“ Regulatory Authority ” means the FDA, EMA and any other foreign regulatory agencies competent lo grant marketing approvals for pharmaceutical products including the Products in the Territory;

“ Specifications ” means the file, for each Product, which is provided by MDCO to Patheon in accordance with the procedures listed in the Quality Agreement hereto and which contains documents relating to such Product, including, without limitation:

a) specifications for Active Materials and Components;

b) manufacturing specifications, directions and processes;

c) storage requirements;

d) all environmental, health and safety information relating to the Product including material safety data sheets; and

e) the finished Product specifications, packaging specifications and shipping requirements for each Product;

all as updated, amended and revised from time to time by MDCO in accordance with the terms of this Agreement;

“ Subcontractor ” means Patheon’s Affiliate named Patheon Italia S.p.A.;

“ Technical Dispute” has the meaning specified in Section 12.2;

“ Territory ” means the geographic areas listed in Schedule G, and any other territories that may be agreed to in writing between the Parties during the Term of the Agreement;

“ Third-Party Rights ” means the Intellectual Properly of any third party;

“ Year ” means, in the first year of this Agreement, the period from the Effective Date up to and including December 31 of the same calendar year, and thereafter shall mean a calendar year;

“ Yearly Binding Volume ” or “ YBV ” means the minimum volume of Product to be manufactured in any Year of this Agreement as set forth in Schedule B hereto.

1.2 Currency .

Unless otherwise indicated, all monetary amounts are expressed in this Agreement in Euros.

1.3 Sections and Headings .

The division of this Agreement into Articles, sections, subsections and Schedules and the insertion of headings are for convenience of reference only and shall not affect the interpretation of this Agreement. Unless otherwise indicated, any reference in this Agreement to a Section or Schedule refers to the specified Section or Schedule to this Agreement. In this Agreement, the terms “ this Agreement ”, “ hereof” , “ herein ”, “ hereunder ” and similar expressions refer to this Agreement and not to any particular part, Section, Schedule or the provision hereof.

1.4 Singular Terms .

Except as otherwise expressly provided herein or unless the context otherwise requires, all references to the singular shall include the plural and vice versa.

1.5 Schedules .

The following Schedules are attached to, incorporated in and form part of this Agreement:

Schedule A - Product List

Schedule B - Minimum Run Quantity, Yearly Binding Volume & Price

Schedule C - Stability Testing Activities

Schedule D - Active Materials, Active Materials Credit Value & Maximum Credit Value

Schedule E - Batch Numbering

Schedule F - Quality Agreement

Schedule G - Territory

ARTICLE 2
PATHEON’S MANUFACTURING SERVICES

2.1 Technology Transfer and Feasibility Activities .

By the Preliminary Agreement, MDCO authorized Patheon to purchase the Equipment and to begin the Technology Transfer and Feasibility Activities, prior to commencing the manufacturing of the Product pursuant to Section 2.2. The Parties hereby agree that the Technology Transfer and Feasibility Activities currently ongoing shall continue to be controlled by the terms and conditions of the Preliminary Agreement. Anything not expressly provided therein, shall be governed by the terms of this Agreement.

2.2 Manufacturing Services .

Patheon shall provide the Manufacturing Services for the Territory for the fees specified in Schedules B and C in order to produce Products for MDCO. Schedule B sets forth in detail cost items that are included in the Price for Products and those cost items excluded from the Price that are subject to additional fees to be paid by MDCO. Patheon may change the Manufacturing Site for the Products only with the prior written consent of MDCO, such consent not to be unreasonably withheld. Patheon will pay, at its own expense, for any Patheon or MDCO regulatory fees and technical transfer costs from a Patheon-requested change in Manufacturing Site. Patheon shall be an authorized manufacturer of Products offered for sale by MDCO in the Territory. In providing the Manufacturing Services, Patheon and MDCO agree that:


a)	Conversion of Active Materials and Components . Patheon shall convert Active Materials and Components into Products.


b)	Quality Control and Quality Assurance . Patheon shall perform the quality control and quality assurance testing specified in the Quality Agreement.


c)	Components . Patheon shall purchase and test all Components (with the exception of those that are supplied by MDCO) as specified by the Specifications and per the Quality Agreement.


d)	Stability Testing . Patheon shall conduct stability testing on the Products in accordance with the protocols set out in the Specifications for the separate fees and during the time periods specified in Schedule C.

Product Rejection for Finished Product Specification Failure . If Patheon performs the Manufacturing Services in accordance with the Manufacturing Requirements and, notwithstanding the foregoing, a batch or portion of batch of Product does not meet Specification, MDCO shall be obligated to pay Patheon the applicable fee per unit for such non-conforming Product. However, if the non-conforming Product results from Patheon’s failure to perform the Manufacturing Services in accordance with the Manufacturing Requirements, then MDCO shall not be required to pay Patheon the applicable fee per unit for such non-conforming product. This absolution of MDCO’s obligation to pay Patheon’s production fees shall be in addition to Patheon’s compensation to MDCO provided in section 10.2 for the loss of Active Materials.


f)	Active Materials and MDCO Supplied Components Importing . At least thirty (30) days prior to the scheduled production date, MDC shall furnish to Patheon, DDP

(Incoterms 2010) at Manufacturing Site, viale G.B. Stucchi n.110, Monza - Italy, the Active Materials in such quantities as are necessary to enable Patheon to manufacture the desired quantities of Product on the requested delivery date. If such Active Materials are not received thirty (30) days in advance, Patheon will be entitled to delay shipments of Product caused by the re-scheduling of production by the same number of days as the delay in receipt of such Active Materials; provided, however, that in the event Patheon is unable to meet such scheduling deadline due to prior third party production commitments, Patheon shall be entitled to delay shipments until such later date as agreed to by the Parties. All shipment of Active Material shall be accompanied by certificate(s) of analysis from the Active Material manufacturer confirming the identity, purity and compliance with the Active Material specifications.


g)	Bill Back Items . Bill Back Items (if any) shall be charged to MDCO at Patheon’s cost plus the agreed upon handling fee of []% subject to a maximum handling fee of €[] per item. Should the handling fees exceed the amount of €[**] per item, the Parties will jointly determine, in good faith, the revised aggregate amount payable by MDCO.

2.3 Standard of Performance .

Patheon shall provide the Manufacturing Services in accordance with (i) the Specifications; (ii) any other terms and conditions provided in the Quality Agreement; (iii) the cGMPs (US/EU) and any other applicable legal requirements as specified by the Regulatory Authorities. Patheon’s responsibilities and obligations with respect to the manufacture of the Product as set forth in this Section 2.3 are hereinafter referred to as the “ Manufacturing Requirements ”. The Parties agree that, for the purposes of Article 6 and Section 10.2 of this Agreement, the Manufacturing Requirements do not include any obligations related to the cosmetic defects of the Products for the Japanese market (should the Product be commercialized in such market by MDCO).

2.4 Subcontractors .

MDCO hereby agrees that Patheon will subcontract to its Affiliate, Patheon Italia S.p.A (“Subcontractor”), any Manufacturing Services under this Agreement. It is understood that Patheon shall enter into an agreement with its Affiliate that contains confidentiality and non-use terms similar to and at least as strict as those set forth in Section 11 of this Agreement, as well as any other terms necessary to ensure that Patheon meets its obligations under this Agreement. For the avoidance of doubt, the subcontracting of any Services hereunder to the Subcontractor by Patheon shall not relieve Patheon of, and Patheon shall remain solely liable for, its obligations under this Agreement.

ARTICLE 3

MDCO’S OBLIGATIONS

3.1 Payment .

Pursuant to the terms of this Agreement, MDCO shall pay Patheon for the provision of the Manufacturing Services and related Components according to the Prices specified in Schedules B and C hereto (such fees being subject to adjustment in accordance with the terms hereof).

3.2 Active Materials .

MDCO shall at its sole cost and expense, deliver the Active Materials to Patheon (in

accordance with Section 2.2(f)) in sufficient quantities and at such times to facilitate the provision of the Manufacturing Services by Patheon. The Active Materials shall be held by Patheon on behalf of MDCO in accordance with the Specifications, with any other label and invoice instructions given by MDCO from time to time in accordance with this Agreement and with the current GMPs. Title to the Active Materials shall at all times belong to and remain the property of MDCO. Any Active Materials received by Patheon shall only be used by Patheon to provide the Manufacturing Services. Patheon’s liability with respect to any lost or damaged Active Materials shall be as set forth in Section 10.2.

ARTICLE 4

CONVERSION FEES AND COMPONENT COSTS

4.1 First Year Pricing .

The Prices for the Products for the first Year are listed in Schedule B and are subject to the adjustments set forth in Sections 4.2. and 4.3.

4.2 Price Adjustments .

The Prices for the Products during any Year subsequent to the first Year of this Agreement shall be determined in accordance with the following:

a) Manufacturing Costs . Effective at the beginning of March of each Year of this Agreement, Patheon shall be entitled to an adjustment to the Manufacturing Services fees in respect of the Products to reflect inflation, which adjustment shall be based on the annual change in the Consumer Price Index , published by ISTAT in respect of the immediately prior Year ending December 31 (i.e., the year over year change from December to December). This index is set forth at the following web address:

http://www.istat.it/salastampa/comunicati/in_calendaria/precon/20110114_00/

In connection with such Price adjustment, Patheon shall deliver to MDCO on or about February of each Year, a statement outlining the percentage change in the Consumer Price Index upon which such price adjustment is based. The adjusted prices shall be effective as of March 1 ^st of the same Year in which the adjustment is required and shall be applied to all Firm Orders accepted by Patheon on or after March 1 ^st . For sake of clarity, the adjusted price shall not be applied to any Firm Orders accepted by Patheon prior to March 1 ^st , even if the actual Delivery Date is on or after March 1 ^st .

b) Extraordinary Increases in Component Costs. If at any time market conditions result in Patheon’s cost of Components being materially greater than normal forecasted increases, then Patheon shall be entitled to an adjustment to the Price in respect of any affected Product to compensate it for such increased Component costs. For the purposes of this clause (b), changes materially greater than normal forecasted increases shall be considered to have occurred if: (i) the cost of a Component increases by [**]% of the cost for that Component upon which the most recent fee quote was based; or (ii) the aggregate cost for all Components required to manufacture a Product increases by [**]% of the total Component costs for such Product upon which the most recent fee quote was based. To the extent that Component costs have been previously adjusted pursuant to this clause (b) to reflect an increase in the cost of one or more Components, the adjustments provided for in (i) and (ii) above shall operate based on the costs attributed to such Component (or Components) at the time the last of such adjustments were made.

In connection with a Price adjustment pursuant to this Section 4.2(b), Patheon shall deliver to MDCO

a revised Schedule B and such budgetary pricing information, adjusted Component costs or other documentation reasonably sufficient to demonstrate that a Price adjustment is justified, provided that Patheon shall have no obligation to provide any supporting documents to the extent such documents are subject to obligations of confidentiality between Patheon and its suppliers.


4.2.1	Adjustment due to Volume Changes from Yearly Binding Volumes

(a)

On the execution of this Agreement, MDCO shall provide Patheon with its best estimate of the volume of Product that MDCO will require Patheon to supply during the Term of this Agreement (such forecast to be known as the “ Long Term Forecast ”), starting from January 1, 2012. This Long Term Forecast is provided in Schedule B. The volumes of Product forecasted in the Long Term Forecast snail not be deemed as binding on MDCO.


(b)	Prior to July 1 ^st of each Year during the Term, MDCO will provide Patheon with a firm volume commitment for the immediately following Year (the “ Yearly Binding Volume ” or “ YBV ”).

During the first Year of this Agreement, MDCO will provide Patheon with the YBV for the following Year (i.e. 2012) in two (2) separate 6-month volume commitments. The two (2) 6-month volume commitments will be aggregated to a single YBV. The first 6-month commitment, concerning the first semester of Year 2012, will be provided to Patheon prior to July 1, 2011. The second 6-month commitment, concerning the second semester of Year 2012, will be provided to Patheon prior to January 1, 2012.


(c)	Notwithstanding the foregoing Section 4.2.1(b), the Parties hereby agree that the Yearly Binding Volume may be reduced yearly during the Term of the Agreement within the flexibility ranges (hereinafter the “Flexibility Ranges” or “FR”) set out in the Table below:



YEAR	FLEXIBILITY RANGE ON YEARLY BINDING VOLUME
2012	[**]%
2013	[**]%
2014 and beyond	[**]%

If at the end of each Year, (i) the aggregate actual volume of Product ordered by MDCO pursuant to Section 5.5 (“ Actual Yearly Volume ”) during such Year varies from (ii) the Yearly Binding Volume (“ Yearly Binding Volume ”), by more than the Flexibility Ranges as set out in the Table above for such Year, then Patheon shall be entitled to and may request that MDCO pays to Patheon an amount to be determined as follows, for the non-absorbed fixed manufacturing costs incurred by Patheon during such Year:

Amount due to Patheon = [YBV x (1-FR/100) - AYV] *[**]% of the Price

For the purposes of the Agreement, the following terms shall have the respective meanings set out below:


•	Yearly Binding Volume (or “ YBV ”): means the aggregate yearly

binding volume of Product for each relevant Year, as provided by MDCO pursuant to Section 4.2.1(b) above; and


	Actual Yearly Volume (or “ AYV ”): means the actual total volume of Product ordered by MDCO and invoiced by Patheon pursuant to Section 5.5 during the relevant Year.

In any Year in which MDCO’s AYV is less than MDCO’s YBV, Patheon will make every reasonable effort to mitigate the potential effects of this shortfall and to avoid any need to require the adjustment payments from MDCO as specified in this Section 4.2.1.(b). The determination of whether an adjustment payment will be required by Patheon is subject solely to Patheon’s discretion and determination. It is an elective payment, and is not mandated by this Agreement.


(d)	If during a Year MDCO requests a volume of Product which exceeds by more than [] percent (+[]%) the YBV for such Year pursuant to Section 4.2.1(b) above, then the Parties shall evaluate in good faith such request in order to reach an agreement on Product feasibility in the current Year and Patheon shall use all commercially reasonable efforts to meet MDCO’s requests.

4.3 Adjustments Due to Technical Changes .

Amendments to the Specifications, the Quality Agreement, or the Product manufacturing process, requested by either Party, will only be implemented following a technical and cost review by Patheon and are subject to MDCO and Patheon’s approval. Once agreement is reached between the Parties as to revisions, the proposed charges, if any, will be implemented to the Prices specified in Schedules B or C necessitated by any such amendment. Such approval not to be unreasonably withheld. If MDCO accepts a proposed Price change, the proposed change in the Specifications, the Quality Agreement or the Product manufacturing process shall be implemented, and the Price change shall become effective only with respect to those orders of Products that are manufactured in accordance with the revised Specifications, the Quality Agreement or Product manufacturing process. In addition, MDCO agrees to purchase, at Patheon’s cost therefore (including all costs incurred by Patheon in connection with the purchase and handling of such Inventory), all Inventory utilized under the “old” Specifications or Quality Agreement and purchased or maintained by Patheon in order to fill Firm Orders or in accordance with Section 5.2, to the extent that such Inventory can no longer be utilized under the revised Specifications or Quality Agreement. Open purchase orders for Components no longer required under any revised Specifications or Quality Agreement that were placed by Patheon with suppliers in order to fill Firm Orders or in accordance with Section 5.2 shall be cancelled where possible, and where such orders are not subject to cancellation without penalty, shall be assigned to and satisfied by MDCO.

ARTICLE 5

ORDERS, SHIPMENT, INVOICING, PAYMENT

5.1 Orders and Forecasts .

a) Rolling Forecasts . Concurrent with the execution of this Agreement, MDCO shall provide Patheon with a written non-binding twelve (12) month forecast of the volume of each Product that MDCO then anticipates will be required to be produced and delivered to MDCO during each month of that twelve (12) month period. Such forecast will be updated by MDCO monthly on or

before the 10 ^th day of each calendar month on a rolling twelve (12) month basis and updated forthwith upon MDCO determining that the volumes contemplated in the most recent of such forecasts has changed by more than [**] percent ([**]%). The most recent 12 month forecast shall prevail.

b) Firm Orders . The first three (3) months of the initial rolling forecast shall constitute a Firm Order upon acceptance by Patheon. Thereafter, on or before the 10 ^th day of each calendar month, MDCO shall issue Firm Orders for Manufacturing Services in respect of the Products to be produced and delivered to MDCO on a date not less than three (3) months from the first day of the calendar month immediately following the date that the Firm Order is submitted. Such Firm Orders submitted to Patheon shall specify MDCO’s Manufacturing Services purchase order number, quantities by Product type, monthly delivery schedule and any other elements necessary to ensure the timely production and shipment of the Products. The quantities of Products ordered in such written orders shall be firm and binding on MDCO and shall not be subject to reduction by MDCO.

c) Patheon will use commercially reasonable efforts to deliver the ordered batch(es) of Product by the Delivery Date and shall promptly alert MDCO, in writing, of any delay that may affect such Delivery Date. Should a delay in delivery occur, Patheon will develop and carry out a remedial plan with MDCO to help prevent further possible late deliveries.

d) Patheon and MDCO will develop, establish and review appropriate key performance indicators (KPI’s) during the term of this Agreement to assess and improve the ongoing effectiveness of operations. These KPI’s will be reviewed at the Quarterly Steering Committee meetings. The KPI’s should be agreed upon by both Parties, but should, at a minimum, include production yields for drug product lots, on time delivery and batch record cycle review.

5.2 Reliance by Patheon .

MDCO understands and acknowledges that Patheon will rely on the Firm Orders and rolling forecasts submitted pursuant to Sections 5.1(a) and (b) in ordering the Components required to meet such Firm Orders. In addition, MDCO understands that to ensure an orderly supply of such Components, it may be desirable for Patheon to purchase such Components in sufficient volumes to meet the production requirements for Products during part or all of the forecasted periods referred to in Section 5.1(a) or to meet the production requirements of any longer period agreed to by Patheon and MDCO. Accordingly, MDCO authorizes Patheon to purchase Components in order to satisfy the Manufacturing Services requirements for Products for the first six (6) months contemplated in the most recent forecast provided by MDCO pursuant to Section 5.1(a) and agrees that Patheon may make such other purchases of Components to meet Manufacturing Services requirements during such longer periods as may be agreed to in writing from time to time by MDCO at the request of Patheon or MDCO. If Components ordered by Patheon pursuant to Firm Orders or this Section 5.2 are not included in finished Products manufactured for MDCO within twelve (12) months after the forecasted month in respect of which such purchases have been made (or such longer period as the Parties may agree) or if such Components have expired during such period, then MDCO shall pay to Patheon its costs therefore (including all costs incurred by Patheon in connection with the purchase and handling of such Components); provided, however, that in the event such Components are incorporated into Products subsequently manufactured for MDCO or into third party products manufactured by Patheon for a third party, MDCO will receive credit for any costs of such Components previously paid to Patheon by MDCO.

5.3 Minimum Orders .

MDCO may only order Manufacturing Services in respect of batches of Products in multiples of the Minimum Run Quantities as set out in Schedule B.

5.4 Shipments .

Shipments of Products shall be made EXW (Incoterms 2010) Manufacturing Site with Patheon being responsible for loading the carrier’s vehicle, unless otherwise mutually agreed. Risk of loss or of damage to Products shall remain with Patheon until Patheon loads the Products onto the carrier’s vehicle for shipment at the shipping point at which time risk of loss or damage shall transfer to MDCO. Products shall be transported in accordance with the Specifications. Product not shipped within [**] days of manufacture and released for shipping by Patheon will be subject to a [**] Euro €[**] per pallet space per month storage fee which will be invoiced to MDCO according to the provisions of section 5.5 of this Agreement.

5.5 Invoices and Payment .

Invoices shall be sent by email to the accounts payable email address provided by MDCO. Invoices will be sent, by Patheon to MDCO, at the time the Product is manufactured and released or at the shipping date whichever is earlier. Disputes regarding the amount of the invoices will not suspend MDCO’s payment obligations. Each such invoice shall, to the extent applicable, identify MDCO’s Manufacturing Services purchase order number, Product numbers, names and quantities, unit price, freight charges and the total amount to be remitted by MDCO. MDCO shall pay all such invoices within 30 days of the date thereof.

ARTICLE 6

PRODUCT CLAIMS AND RECALLS

6.1 Product Claims .

a) Product Claims . MDCO has the right to reject any portion of any shipment of Products that deviates from the Manufacturing Requirements without invalidating any remainder of such shipment. MDCO shall inspect the Products manufactured by Patheon upon receipt thereof and shall give Patheon written notice (a “ Deficiency Notice ”) of all claims for Products that deviate from the Manufacturing Requirements within thirty (30) days after MDCO’s receipt thereof (or, in the case of any defects not reasonably susceptible to discovery upon receipt of the Product, within thirty (30) days after discovery thereof by MDCO, but in no event after the expiration date of the Product). Should MDCO fail to provide Patheon with the Deficiency Notice within the applicable thirty (30) day period, then the delivery shall be deemed to have been accepted by MDCO on the thirtieth (30 ^th ) day after delivery or discovery, as applicable. Except as set out in Section 6.2, Patheon shall have no liability for any deviations for which it has not received notice within the applicable thirty (30) day period.

b) Determination of Deficiency . Upon receipt of a Deficiency Notice, Patheon shall have ten (10) days to advise MDCO by notice in writing that it disagrees with the contents of such Deficiency Notice. If MDCO and Patheon fail to agree within ten (10) days after Patheon’s notice to MDCO as to whether any Products identified in the Deficiency Notice deviate from the Manufacturing Requirements, then the Parties shall mutually select an independent laboratory to evaluate if the Products deviate from the Manufacturing Requirements. Such evaluation shall be binding on the Parties, and if such evaluation certifies that any Products deviate from the Manufacturing Requirements, MDCO may reject those Products in the manner contemplated in this Section 6.1. In that event the evaluation costs will be borne by Patheon, otherwise MDCO will be responsible for the evaluation costs. If such evaluation does not so certify in respect of any such Products, then MDCO shall be deemed to have accepted delivery of such Products on the fortieth (40 ^th ) day after delivery (or, in the case of any defects not reasonably susceptible to discovery upon receipt of the Product, on the fortieth (40 ^th ) day after discovery thereof by MDCO, but in no event after the expiration date of the Product).

c) Shortages and/or damaged Products . Claims for shortages in the amount of

Products shipped by Patheon and/or damages to Products delivered by Patheon shall be dealt with as may be reasonably agreed to by the Parties, consistent with the circumstances pertaining to the Product shortage or damage.

6.2 Patheon’s Responsibility for Defective and Recalled Products .

a) Defective Product . In the event MDCO rejects Products in accordance with Section 6.1 and the deviation is determined to have arisen from Patheon’s failure to provide the Manufacturing Services in accordance with the Manufacturing Requirements, Patheon will credit MDCO’s account for Patheon’s invoice price for such defective Products. If MDCO shall have previously paid for such defective Products, Patheon shall promptly, at MDCO’s election, either; (i) refund the invoice price for such defective Products; (ii) offset such amount against other amounts due to Patheon hereunder; or (iii) replace such Products with conforming Products without MDCO being liable for payment therefor under Section 3.1, contingent upon the receipt from MDCO of all Active Materials required for the manufacture of such replacement Products. For greater certainty, Patheon’s responsibility for any loss of Active Materials in connection with defective Product shall be captured under Section 10.2.

b) Recalled Product . To the extent that a recall or return results from, or arises out of, a failure by Patheon to provide the Manufacturing Services in accordance with the Manufacturing Requirements, Patheon shall be responsible for the documented out-of-pocket expenses of such recall or return and shall use its commercially reasonable efforts to replace the recalled or returned Products with new Products, contingent upon the receipt from MDCO of all Active Materials required for the manufacture of such replacement Products. For greater certainty, Patheon’s responsibility for any loss of Active Materials in connection with recalled or returned Product shall be captured under Section 10.2. In the event that Patheon is unable to replace the recalled or returned Products (except where such inability results from a failure to receive the required Active Materials), then, upon MDCO’s request, Patheon shall reimburse MDCO for the price that MDCO paid to Patheon for Manufacturing Services in respect of the affected Products. In all other circumstances, recalls, returns or other corrective actions shall be made at MDCO’s cost and expense.

Except as provided in Sections 6.2(a) and (b) above, Patheon shall not be liable nor have any responsibility for any deficiencies in, or other liabilities associated with, any Product manufactured by it, (collectively, "Product Claims"). For greater certainty, Patheon shall have no obligation for any Product Claims to the extent such Product Claim (i) is caused by deficiencies with respect to the Specifications, the safety, efficacy or marketability of the Products or any distribution thereof, (ii) results from a defect in a Component that is not reasonably discoverable by Patheon using the test methods set forth in the Specifications, (iii) results from a defect in the Active Materials or Components supplied by MDCO that is not reasonably discoverable by Patheon using the test methods set forth in the Specifications, (iv) is caused by actions of third parties occurring after such Product is shipped by Patheon pursuant to Section 5.4, (v) is due to packaging or labeling defects or omissions for which Patheon has no responsibility, (vi) is due to any unascertainable reason despite Patheon's having met the Manufacturing Requirements, or (vii) is due to any other breach by MDCO of its obligations under this Agreement.

Notwithstanding anything in this Agreement to the contrary, the Parties agree that, for the purposes of this Article 6 and Section 10.2, Patheon shall not be liable vis-à-vis MDCO for any vial of Product manufactured for the Japanese market and rejected, recalled or returned due to cosmetic defects. For avoidance of doubt, Patheon will be entitled to invoice MDCO for the Price of the Products rejected, recalled or returned due to cosmetic defects.

6.3 Disposition of Defective or Recalled Products .

MDCO shall not dispose of any damaged, defective, returned or recalled Products in relation

to which it intends to assert a claim against Patheon without Patheon’s prior written authorization to do so. Alternatively, Patheon may instruct MDCO to return such Products to Patheon. Patheon shall bear the cost of disposition with respect to any damaged, defective, returned or recalled Products in relation to which it bears responsibility under Section 6.2 hereof. In all other circumstances, MDCO shall bear the cost of disposition, including all applicable fees for Manufacturing Services, with respect to any damaged, defective, returned or recalled Products.

6.4 Healthcare Provider or Patient Questions and Complaints .

MDCO shall have the sole responsibility for responding to questions and complaints from its customers. Questions or complaints received by Patheon from MDCO’s customers, healthcare providers or patients shall be promptly referred to MDCO. Patheon shall co-operate as reasonably required to allow MDCO to determine the cause of and resolve any such questions and complaints. Such assistance shall include follow-up investigations, including testing. In addition, Patheon shall provide MDCO with all mutually agreed upon information that will enable MDCO to respond properly to questions or complaints relating to the Products as provided in the Quality Agreement. Unless it is determined that the cause of any such complaint resulted from a failure by Patheon to provide the Manufacturing Services in accordance with the Manufacturing Requirements, all costs incurred in respect of this Section 6.4 shall be borne by MDCO. In the event that the cause of the complaint is attributable to a failure by Patheon to provide the Manufacturing Services in accordance with the Manufacturing Requirements, such Product shall be deemed to be Defective Product as defined in Section 6.2(a) above; and, MDCO shall be entitled to compensation and reimbursement by Patheon for such Defective Product in accordance with the provisions of Sections 6.2 and 10.2.

6.5 Sole Remedy .

Except for the indemnity provided in Sections 2.2.(e.) and 10.3 and subject to the limitations set forth in Sections 10.1 and 10.2, the remedies described in this Article 6 shall be MDCO’s sole remedy for any failure by Patheon to provide the Manufacturing Services in accordance with the Manufacturing Requirements.

ARTICLE 7

CO-OPERATION

7.1 Quarterly Review .

Each Party shall forthwith upon execution of this Agreement appoint one of its employees to be a relationship manager responsible for liaison between the Parties. The relationship managers shall meet not less than quarterly to review the current status of the business relationship and manage any issues that have arisen.

7.2 Access & Audits .

Patheon will provide MDCO with reasonable access at mutually agreeable times and during regular business hours to the areas of the Manufacturing Site in which the Products are manufactured, stored, handled or shipped to permit MDCO to verify that the Manufacturing Services are being performed in accordance with the Manufacturing Requirements. But, with the exception of “for-cause” audits, MDCO will be limited each Year to one cGMP-type audit, lasting no more than two (2) days, and involving no more than four (4) auditors. MDCO may request additional cGMP-type audits, additional audit days, or the participation of additional auditors subject to payment to Patheon of a fee of €[**] for each additional audit day and €[**] per audit day for each additional auditor. The right of access provided in this Section 7.2 will not include a right to access or inspect Patheon’s

financial records.

7.3 Reports .

Patheon will supply on an annual basis and at MDCO’s expense as outlined in Schedule B, attached hereto, all Product data in its control, including release test results, complaint test results, and all investigations (in manufacturing, testing and storage), that MDCO reasonably requires in order to complete any filing under any applicable regulatory regime, including any Annual Report that MDCO is required to file with the FDA, EMA, or other applicable competent regulatory authority.

7.4 Regulatory Authority Filings .

MDCO is solely responsible for the preparation and filing of the application for approval by the Regulatory Authorities and any relevant costs shall be borne by MDCO. The Parties agree to manage such filing before the Regulatory Authorities in accordance with the provisions set out in the Quality Agreement. The time taken by Patheon to review the documents will be charged back to MDCO at the rates detailed in Schedule B.

ARTICLE 8

TERM AND TERMINATION

8.1 Initial Term .

This Agreement shall become effective as of the Effective Date and shall continue until 31 ^st December 2016 (the “ Initial Term ”), unless terminated earlier by one of the Parties in accordance herewith. This Agreement shall automatically continue after the Initial Term for successive terms of two years each unless either Party gives written notice to the other Party of its intention to terminate this Agreement at least 18 months prior to the end of the then current term.

8.2 Termination for Cause .

a) Either Party, at its sole option, may terminate this Agreement upon written notice in circumstances where the other Party has failed to remedy a material breach of any of its representations, warranties or other obligations under this Agreement within 60 days following receipt of a written notice (the “ Remediation Period ”) of said breach that expressly states that it is a notice under this Section 8.2(a) (a “ Breach Notice ”). If the material breach by its nature is not curable, the non-breaching Party shall have the right to terminate this Agreement with immediate effect by giving the breaching Party notice of any such non-curable breach, specifying such non- curable breach in reasonable detail and stating that it terminates this Agreement, such termination right to be exercised within a period of thirty (30) days following the date as of which the terminating Party receives knowledge of any such breach.

b) Either Party at its sole option may immediately terminate this Agreement upon written notice, but without prior advance notice, to the other Party in the event that: (i) the other Party is declared insolvent or bankrupt by a court of competent jurisdiction; (ii) a voluntary petition of bankruptcy is filed in any court of competent jurisdiction by such other Party; or (iii) this Agreement is assigned by such other Party for the benefit of creditors.

c) MDCO may terminate this Agreement as to any Product upon thirty (30) days’ prior written notice in the event that any governmental agency takes any action, or raises any objection, that prevents MDCO from importing, exporting, purchasing or selling such Product.

d) Patheon may terminate this Agreement upon six (6) months’ prior written notice

if MDCO assigns pursuant to Section 13.6 any of its rights under this Agreement to an assignee that, in the opinion of Patheon acting reasonably, is: (i) not a credit worthy substitute for MDCO; or (ii) a competitor of Patheon; or (iii) an entity with whom Patheon has had prior unsatisfactory business relations.

8.3 Product Discontinuation .

MDCO shall provide at least twelve (12) months advance notice if it intends to no longer order Manufacturing Services for a Product due to that Product’s discontinuance in the market.

8.4 Obligations on Termination .

If this Agreement is completed, expires or is terminated in whole or in part for any reason, then (in addition to any other remedies Patheon may have in the event of default by MDCO):

a) MDCO shall take delivery of and pay for all undelivered Products that are manufactured pursuant to a Firm Order, at the price in effect at the time the Firm Order was placed;

b) MDCO shall purchase, at Patheon’s cost (including all costs incurred by Patheon in connection with the purchase and handling of such Inventory), the Inventory applicable to the Products that cannot reasonably be used for other products produced by Patheon, that was purchased, produced or maintained by Patheon in contemplation of filling Firm Orders or in accordance with Section 5.2 prior to notice of termination being given;

c) MDCO shall satisfy the purchase price payable pursuant to Patheon’s orders with suppliers of Components, provided such orders were made by Patheon in reliance on Firm Orders or in accordance with Section 5.2;

d) Patheon shall return to MDCO all unused Active Materials (with shipping and related expenses, if any, to be borne by MDCO); and

e) MDCO acknowledges that no competitor of Patheon shall be permitted access to the Manufacturing Site;

f) MDCO shall make commercially reasonable efforts, at its own expense, to remove from Patheon site(s), within fifteen (15) Business Days, all of MDCO’s unused Active Materials, Components and Inventory (whether current or obsolete), supplies, undelivered Product, chattels, Equipment or other moveable property owned by MDCO, related to the Agreement and located at a Patheon site or that is otherwise under Patheon’s care and control (“MDCO Property”). MDCO shall pay to Patheon a thirty Euro (€30.00) per pallet space per month storage fee for all MDCO Property remaining at Patheon’s site(s) after the fifteenth (15th) Business Day following the completion, termination or expiration of the Agreement and will assume any third party storage charges invoiced to Patheon regarding any such MDCO Property. Patheon will invoice MDCO for such storage charges according to the provisions of section 5.5 of this Agreement.

Any termination or expiration of this Agreement shall not affect any outstanding obligations or payments due hereunder prior to such termination or expiration, nor shall it prejudice any other remedies that the Parties may have under this Agreement. For greater certainty, termination of this Agreement for any reason shall not affect the obligations and responsibilities of the Parties pursuant to Articles 4, 5, 6, 10 and 11 and Sections 7.4, 8.4, 13.1, 13.2, 13.3 and 13.16, all of which survive any termination.

g) MDCO shall pay any amounts due under the provisions of this Section 8.4 within 30 days of the date of termination or expiry of this Agreement.

ARTICLE 9

REPRESENTATIONS, WARRANTIES AND COVENANTS

9.1 Authority .

Each Party covenants, represents and warrants that it has the full right and authority to enter into this Agreement, and that it is not aware of any impediment that would inhibit its ability to perform its obligations hereunder.

9.2 MDCO Warranties .

MDCO covenants, represents and warrants that:


(a)	the Specifications for each of the Products are its or its Affiliate’s property and that MDCO may lawfully disclose the Specifications to Patheon;

(b)

any Intellectual Property, other than Patheon’s Intellectual Property, utilized by Patheon in connection with the provision of the Manufacturing Services according to the Specifications (i) is MDCO’s or its Affiliate’s Intellectual Property, (ii) may be lawfully used as directed by MDCO, and (iii) to MDCO’s knowledge, such use does not infringe and will not infringe any Third Party Rights;


(c)	to MDCO’s knowledge, the provision of the Manufacturing Services by Patheon in respect of any Product pursuant to this Agreement or use or other disposition of any Product by Patheon as may be required to perform its obligations under this Agreement does not and will not infringe any Third Party Rights;


(d)	there are no actions or other legal proceedings, the subject of which is the infringement of Third Party Rights related to: (i.) any of the Specifications, (ii.) any of the Active Materials, (iii.) any of the Components, or (iv.) the sale, use or other disposition of any Product made in accordance with the Specifications;

9.3 Patheon Warranties .


(a)	Patheon covenants, represents and warrants that it shall perform the Manufacturing Services in accordance with the Manufacturing Requirements.


(b)	Patheon covenants, represents and warrants that any Manufacturing Services Based Intellectual Property utilized by Patheon in connection with the provision of the Manufacturing Services (i) is Patheon’s or its Affiliate’s property, (ii) may be lawfully used as used by Patheon, and (iii) to Patheon’s knowledge, such use does not infringe and will not infringe any Third Party Rights.


(c)	Anti-Bribery . Patheon represents and warrants that neither Patheon nor its Affiliates, or any of its or their directors, officers, employees or representatives will, directly or indirectly, offer or pay, or authorize an offer or payment of, any money or anything of value to any Public Official

(defined below) or public entity, with the knowledge or intent that the payment, promise or gift, in whole or in part, will be made in order to influence an official act or decision that will assist Patheon or MDCO in securing an improper advantage or in obtaining or retaining business or in directing business to any person or entity. Patheon agrees to comply with the MDCO’s requests for any information and documentation necessary to verify compliance with this provision and applicable anti-corruption laws.

Patheon represents and warrants that, at the execution date of this Agreement, neither Patheon nor its Affiliates, or any of its or their directors, officers, employees or representatives, who perform Manufacturing Services under this Agreement nor any person or entity acting on Patheon’s behalf is a Public Official (as defined hereinafter) with the ability to influence an official act. Patheon will notify MDCO in writing if any of the above captioned individuals, becomes a Public Official with the ability to influence an official act during the term of this Agreement.

In addition to other rights or remedies under this Agreement or at Law, MDCO shall be entitled to terminate this Agreement, pursuant to Section 8.2(a), in the event that improper payments are being or have been made to Public Officials by Patheon or by any person or entity acting or its behalf, in order to influence an official act or decision that will assist Patheon or MDCO in securing an improper advantage or in obtaining or retaining business or in directing business to any person or entity.

For the purposes of this Agreement, “Public Official” means any officer or employee of a government, a public international organization or any department or agency thereof, or any person acting in an official capacity, including, for a public agency or enterprise; and any political party or party official, or any candidate for public office.

9.4 Debarred Persons .

Patheon covenants that it will not in the performance of its obligations under this Agreement use the services of any person debarred or suspended under 21 U.S.C. §335(a) or (b), or any analogous law or regulation. Patheon represents that it does not have at the execution date of this Agreement, and covenants that it will not hire, as an officer or an employee any person who has been convicted of health care fraud or a felony under the laws of the United States for conduct relating to the regulation of any drug product under the Federal Food, Drug, and Cosmetic Act (United States). If any of Patheon or Patheon’s Affiliate directors, officers, employees, agents, representatives or advisors, who perform services under this Agreement is debarred or receives notice of an action or threat of action of debarment, Patheon shall immediately notify MDCO of same and shall take all the appropriate disciplinary actions against the individuals responsible for the activity which constitutes cause for debarment. MDCO shall be entitled to terminate this Agreement pursuant to Section 8.2(a) in the event of debarment of Patheon or its Affiliates.

9.5 No Warranty .

PATHEON MAKES NO WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, BY FACT OR LAW, OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS AGREEMENT. PATHEON MAKES NO WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE OR WARRANTY OF MERCHANTABILITY WITH RESPECT TO THE

PRODUCTS.

ARTICLE 10

REMEDIES AND INDEMNITIES

10.1 Consequential Damages .

TO THE EXTENT PERMITTED BY THE APPLICABLE LAW, UNDER NO CIRCUMSTANCES WHATSOEVER SHALL EITHER PARTY BE LIABLE TO THE OTHER IN CONTRACT, TORT, NEGLIGENCE, BREACH OF STATUTORY DUTY OR OTHERWISE FOR (I) ANY (DIRECT OR INDIRECT) LOSS OF PROFITS, OF PRODUCTION, OF ANTICIPATED SAVINGS, OF BUSINESS OR GOODWILL OR (II) FOR ANY OTHER LIABILITY, DAMAGE, COSTS OR EXPENSE OF ANY KIND INCURRED BY THE OTHER PARTY OF AN INDIRECT OR CONSEQUENTIAL NATURE, REGARDLESS OF ANY NOTICE OF THE POSSIBILITY OF SUCH DAMAGES.

10.2 Limitation of Liability - Active Materials .

Except in the event the Active Materials are damaged due to the failure of Patheon to provide the Manufacturing Services in accordance with the Manufacturing Requirements due to negligence or willful misconduct, under no circumstances whatsoever shall Patheon be responsible for any loss or damage to the Active Materials. Patheon’s maximum liability for loss or damage to the Active Materials shall not exceed the Maximum Credit Value.

10.3 Patheon .

Subject to Section 10.1, Patheon and its Affiliates agree to defend, indemnify and hold MDCO, its officers, employees and agents harmless against any and all losses, damages, costs, claims, demands, judgments and liability to, from and in favour of third parties resulting from, or relating to any claim of personal injury or property damage, to the extent that such injury or damage is the result of Patheon’s negligence or willful misconduct in performing the Manufacturing Services in accordance with the Manufacturing Requirements, except to the extent that any such losses, damages, costs, claims, demands, judgments and liability are due to the negligence or wrongful act(s) of MDCO, its officers, employees or agents or Affiliates.

In the event of a claim, MDCO shall: (a) promptly notify Patheon of any such claim; (b) use commercially reasonable efforts to mitigate the effects of such claim; (c) reasonably cooperate with Patheon in the defense of such claim; (d) permit Patheon to control the defense and settlement of such claim, all at Patheon’s cost and expense.

10.4 MDCO .

Subject to Section 10.1, MDCO agrees to defend, indemnify and hold Patheon, its Affiliates, officers, employees and agents harmless against any and all losses, damages, costs, claims, demands, judgments and liability to, from and in favour of third parties resulting from, or relating to any claim of infringement or alleged infringement of any Third Party Rights in respect of the Products, or any portion thereof, and/or any claim of personal injury or property damage to the extent that such injury or damage is the result of a breach of this Agreement by MDCO, including, without limitation, any representation or warranty contained herein, except to the extent that any such losses, damages, costs, claims, demands, judgments and liability are due to the negligence or wrongful act(s) of Patheon, its officers, employees or agents.

In the event of a claim, Patheon shall: (a) promptly notify MDCO of any such claims; (b)

use commercially reasonable efforts to mitigate the effects of such claim; (c) reasonably cooperate with MDCO in the defence of such claim; (d) permit MDCO to control the defense and settlement of such claim, all at MDCO’s cost and expense.

10.5 Reasonable Allocation of Risk .

The provisions of this Agreement (including, without limitation, this Article 10) are reasonable and create a reasonable allocation of risk having regard to the relative profits the Parties respectively expect to derive from the Products, and that Patheon, in its fees for the provision of the Manufacturing Services, has not accepted a greater degree of the risks arising from the manufacture, distribution and use of the Products, based on the fact that MDCO has developed and holds the marketing approval for the Products and requires Patheon to manufacture the Products strictly in accordance with the Specifications, and that MDCO and not Patheon is in a position to inform and advise potential users of the Products as to the circumstances and manner of use of the Products.

ARTICLE 11

CONFIDENTIALITY

11.1 Confidential Information - Disclosing Party’s Property .

Except as otherwise provided in this Agreement, any Confidential Information that is disclosed by or on behalf of a Disclosing Party lo the Receiving Party will remain the property of the Disclosing Party.

11.2 Receiving Party’s Obligations .

The Receiving Party undertakes to:

(a)

use the Confidential Information solely and exclusively for the purposes of this Agreement (or such other purpose as is agreed in writing between the Parties at the time of disclosure), and not to use the Confidential Information for any other purpose whatsoever, including the development, manufacture, marketing, sale or licensing of any process or product or any other commercial purpose anywhere in the world, unless the Parties enter into an agreement specifying otherwise; and


(b)	maintain the confidentiality of the Confidential Information and not to disclose it directly or indirectly to any other company, organization, individual or third party, except as expressly permitted; and


(c)	at the request of the Disclosing Party, to return, delete or destroy all copies of the Confidential Information, in whatever form it is held, except one (1) copy which may be kept by the Receiving Party in its secured files for evidence purposes only.

11.3 Allowable Disclosures .


(a)	Notwithstanding Section 11.2, the Receiving Party may disclose Confidential Information to any of its Affiliates, and its Affiliates’ directors, employees and professional advisers who need to know the Confidential Information in order to fulfill the purpose of this Agreement, provided that the Receiving Party ensures that prior to such disclosure,

each such Person to whom Confidential Information is to be disclosed is made aware of the obligations contained in this Agreement, and adheres to these terms as if it were a party to this Agreement.

(b)

Nothing in Section 11.2 will preclude disclosure of any Confidential Information required by any governmental, quasi-governmental or regulatory agency or authority or court entitled by Law to disclosure of the same, or which is required by Law or the requirements of a national securities exchange or another similar regulatory body to be disclosed, provided that the Receiving Party promptly notifies the Disclosing Party when such requirement to disclose has arisen to enable the Disclosing Party to seek an appropriate protective order, to make known to the relevant agency, authority, court or securities exchange the proprietary nature of the Confidential Information, and to make any applicable claim of confidentiality. The Receiving Party agrees to co-operate in any action that the Disclosing Party may decide to take. If the Receiving Party is required to make a disclosure in accordance with this clause, it will only make a disclosure to the extent to which it is obliged.

11.4 Exclusions .

The provisions of Section 11.2 will not apply to any Confidential Information which the Receiving Party can demonstrate, to the reasonable satisfaction of the Disclosing Party:


(a)	was already in the possession of the Receiving Party or any of its Affiliates (through no fault of the Receiving Party or any of its Affiliates and no breach of this Agreement by the Receiving Party) prior to its disclosure by the Disclosing Party under this Agreement;


(b)	is purchased or otherwise legally acquired by the Receiving Party or any of its Affiliates at any time from a third party having the right to disclose it;


(c)	comes into the public domain, other than through the fault of the Receiving Party or any of its Affiliates; or


(d)	is independently generated by the Receiving Party or any of its Affiliates without any recourse or reference to the Confidential Information.

11.5 Continuing Obligations of Confidentiality .

The obligations of each Party in this Section will survive for a period of five (5) years after the date of expiration or termination of this Agreement.

ARTICLE 12

DISPUTE RESOLUTION

12.1 Commercial Disputes .

In the event of any dispute arising out of or in connection with this Agreement (other than a dispute determined in accordance with Section 6.1(b) or a Technical Dispute), the Parties shall first try to solve it amicably. In this regard, either Party may send a notice of dispute to the other, and

each Party shall appoint, within ten (10) Business Days from receipt of such notice of dispute, a single representative to handle the dispute. The representatives so designated shall confer as necessary in order to solve such dispute. If these representatives fail to solve the matter within one month from their appointment, or if a Party fails to appoint a representative within the ten (10) Business Day period set forth above, such dispute shall immediately be referred to the Chief Operating Officer (or such other officer as he/she may designate) of each Party who will meet and discuss as necessary in order to try to solve the dispute amicably. Should the Parties fail to reach a resolution under this Section 12.1, the dispute will be referred to a court of competent jurisdiction in accordance with Section 13.16.

12.2 Technical Dispute Resolution .

In the event of a dispute (other than disputes in relation to the matters set out in Sections 6.1(b) and 12.1) between the Parties that is exclusively related to technical aspects of the manufacturing, quality control testing, handling, storage or other activities under this Agreement (a “ Technical Dispute ”), the Parties shall make all reasonable efforts to resolve the dispute by amicable negotiations. In this regard, senior representatives of each Party shall, as soon as practicable and in any event no later than ten (10) Business Days after a written request from either Party to the other, confer in good faith to resolve any Technical Dispute. If, despite such efforts, the Parties are unable to resolve a Technical Dispute within a reasonable time, and in any event within thirty (30) Business Days of such written request, the Technical Dispute shall, at the request of either Party, be referred for determination to a mutually acceptable expert with experience and expertise in the subject matter of the dispute. The costs and expenses of the expert shall be shared equally by the Parties. In the event that the Parties cannot agree whether a dispute is a Technical Dispute, Section 12.1 shall prevail. For greater certainty, the Parties agree that the release of the Products for sale or distribution pursuant to the applicable marketing approval for such Products shall not by itself indicate compliance by Patheon with its obligations in respect of the Manufacturing Services and further that nothing in this Agreement shall remove or limit the authority of the relevant qualified person (as specified by the Quality Agreement) to determine whether the Products are to be released for sale or distribution.

ARTICLE 13

MISCELLANEOUS

13.1 Inventions .


(a)	For the term of this Agreement, MDCO hereby grants to Patheon and to the Subcontractor a non-exclusive, paid-up, royalty-free, non-transferable license of MDCO’s Intellectual Property which Patheon and the Subcontractor must use solely for the purpose of performing the Manufacturing Services.


(b)	All Intellectual Property generated or derived by Patheon and/or by the Subcontractor in the course of performing the Manufacturing Services, to the extent it is specific to the development, manufacture, use and sale of MDCO’s Product that is the subject of the Manufacturing Services, shall be the exclusive property of MDCO.

(c)

All Manufacturing Services Based Intellectual Property generated or derived by Patheon and/or by the Subcontractor in the course of performing the Manufacturing Services shall be the exclusive property of Patheon or of its Subcontractor (as the case may be); Patheon hereby grants to MDCO and (if it is the case) will cause the Subcontractor to grant, a perpetual, irrevocable, non-exclusive, paid-up, royalty-free,

transferable license of the Manufacturing Services Based Intellectual Property used to manufacture the Product(s) which MDCO may use for the Manufacturing Services and in connection with the offer for sale and for the sale of the Product.


(d)	Each Party shall be solely responsible for the costs of filing, prosecution and maintenance of patents and patent applications on its own Inventions.


(e)	Either Party shall give the other Party written notice, as promptly as practicable, of all Inventions which can reasonably be deemed to constitute improvements or other modifications of the Products or processes or technology owned or otherwise controlled by such Party.

13.2 Intellectual Property .

Subject to Section 13.1, all Intellectual Property of MDCO shall be owned by MDCO and all Intellectual Property of Patheon or its Affiliates shall be owned by Patheon. Neither Party has, nor shall it acquire, any interest in any of the other Party’s Intellectual Property unless otherwise expressly agreed to in writing signed by an authorized representative of each Party. Each Party agrees not to use any prior Intellectual Property of the other Party, except as specifically authorized by the other Party or as required for the performance of its obligations under this Agreement.

13.3 Insurance .

Each Party shall maintain commercial general liability insurance, including blanket contractual liability insurance covering the obligations of that Party under this Agreement through the term of this Agreement and for a period of 1 (one) year thereafter, which insurance shall afford limits of not less than (i) €[**] for each occurrence for personal injury or property damage liability; and (ii) €[**] in the aggregate per annum with respect to product and completed operations liability. If requested each Party will provide the other with a certificate of insurance evidencing the above and showing the name of the issuing company, the policy number, the effective date, the expiration date and the limits of liability. The insurance certificate shall further provide for a minimum of thirty (30) days’ written notice to the insured of a cancellation of, or material change in, the insurance. If a Party is unable to maintain the insurance policies required under this Agreement through no fault on the part of such Party, then such Party shall forthwith notify the other Party in writing and the Parties shall in good faith negotiate appropriate amendments to the insurance provision of this Agreement in order to provide adequate assurances.

13.4 Independent Contractors .

The Parties are independent contractors and this Agreement shall not be construed to create between Patheon and MDCO any other relationship such as, by way of example only, that of employer-employee, principal agent, joint-venturer, co-partners or any similar relationship, the existence of which is expressly denied by the Parties hereto.

13.5 No Waiver .

Either Party’s failure to require the other Party to comply with any provision of this Agreement shall not be deemed a waiver of such provision or any other provision of this Agreement, with the exception of Sections 6.1 and 8.2.

13.6 Assignment and Subcontracting .


(a)	Neither Party may assign this Agreement or any of its rights or obligations

hereunder except with the written consent of the other Party, such consent not to be unreasonably withheld. It is agreed upon between the Parties that Patheon may arrange for the Manufacturing Services to be performed by the aforementioned Subcontractor.


(b)	Notwithstanding the foregoing provisions of this Section 13.6, either Party may assign this Agreement to any of its Affiliates or to a successor to or purchaser of all or substantially all of its business, provided that such assignee executes an agreement with the non-assigning Party hereto whereby it agrees to be bound hereunder.

13.7 Force Majeure .

Neither Party shall be liable for the failure to perform its obligations under this Agreement if such failure is occasioned by a cause or contingency beyond such Party’s reasonable control, including, but not limited to, strikes or other labour disturbances, lockouts, riots, quarantines, communicable disease outbreaks, wars, acts of terrorism, fires, floods, storms, interruption of or delay in transportation, defective equipment, lack of or inability to obtain fuel, power or components or compliance with any order or regulation of any government entity acting within colour of right (a “ Force Majeure Event ”). A Party claiming a right to excused performance under this Section 13.7 shall immediately notify that other Party in writing of the extent of its inability to perform, which notice shall specify the occurrence beyond its reasonable control that prevents such performance. Neither Party shall be entitled to rely on a Force Majeure Event to relieve it from an obligation to pay money (including any interest for delayed payment) which would otherwise be due and payable under this Agreement.

13.8 Additional Product .

Additional products may be added to this Agreement and such additional products shall be governed by the general conditions hereof with any special terms (including, without limitation, price) governed by amendments to the Schedules attached hereto as applicable.

13.9 Notices .

Any notice, approval, instruction or other written communication required or permitted hereunder shall be sufficient if made or given to the other Party by personal delivery, by facsimile (fax) communication, or confirmed receipt email or by sending the same by first class mail, postage prepaid to the respective addresses or facsimile (fax) numbers or electronic mail addresses set forth below:

If to MDCO :
The Medicines Company
8 Sylvan Way
Parsippany, NJ 07054
Attention: Mr. Paul Antinori
Senior Vice President and General Counsel
Facsimile (fax) number: 862-207-6062
Email address: Paul.Antinori@themedco.com

If to MDCO (for accounting purposes) :
The Medicines Company
8 Sylvan Way
Parsippany, NJ 07054
Attention: Mr. Bill O’Connor

Chief Accounting Officer
Facsimile (fax) number: 862-207-6094
Email address: Bill.O’Connor@themedco.corn

If to Patheon International A.G:
Patheon International A.G
Lindenstrasse 14, 6340 Baar, (Switzerland)
Attention: General Counsel Europe
Facsimile (fax) number: +41 417104229

With a copy to Patheon Italia S.p.A :
Patheon Italia S.p.A
Viale G.B. Stucchin. 110
Monza, Italia
Attention: Department of Legal Services
Facsimile (fax) number: +39 039 2047219

or to such other addresses, facsimile numbers or electronic mail addresses provided to the other Party in accordance with the terms of this Section 13.9. Notices or written communications made or given by personal delivery, facsimile or electronic mail shall be deemed to have been sufficiently made or given when sent (receipt acknowledged), or if mailed, five (5) days after being deposited in the European Union mail, postage prepaid or upon receipt, whichever is sooner.

13.10 Severability .

If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable in any respect, such determination shall not impair or affect the validity, legality or enforceability of the remaining provisions hereof, and each provision is hereby declared to be separate, severable and distinct. The Parties shall endeavor, in due form, to replace the invalid or void provision with a new provision or to fill the gap with a provision which best enables the economic purpose pursued to be achieved.

13.11 Entire Agreement .

This Agreement, together with the Quality Agreement, constitutes the full, complete, final and integrated agreement between the Parties hereto relating to the subject matter hereof and supersedes all previous written or oral negotiations, commitments, agreements, transactions or understandings with respect to the subject matter hereof. Any modification, amendment or supplement to this Agreement must be in writing and signed by authorized representatives of both Parties. In case of conflict, the prevailing order of documents shall be this Agreement and then the Quality Agreement except in matters pertaining to product quality, GMP and regulatory responsibilities, in which case the Quality Agreement will prevail. THE TERMS OF ANY PURCHASE ORDER, ACKNOWLEDGMENT OR SIMILAR STANDARDIZED FORM GIVEN OR RECEIVED IN THE CONTEXT OF THE SUBJECT MATTER OF THIS AGREEMENT WHICH ARE IN ADDITION TO OR INCONSISTENT WITH THE TERMS OF THIS AGREEMENT WILL HAVE NO EFFECT AND SUCH TERMS AND CONDITIONS ARE HEREBY EXPRESSLY EXCLUDED.

13.12 Other Terms .

No terms, provisions or conditions of any purchase order or other business form or written authorization used by MDCO or Patheon will have any effect on the rights, duties or obligations of the Parties under or otherwise modify this Agreement, regardless of any failure of MDCO or Patheon to object to such terms, provisions, or conditions unless such document specifically refers to this

Agreement and is signed by both Parties.

13.13 No Third Party Benefit or Right .

For greater certainty, nothing in this Agreement shall confer or be construed as conferring on any third party any benefit or the right to enforce any express or implied term of this Agreement.

13.14 Execution in Counterparts .

This Agreement may be executed in two or more counterparts, by original or facsimile signature, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

13.15 Use of MDCO Name .

Patheon shall not make any use of MDCO’s name, trademarks or logo or any variations thereof, alone or in connection with any other word or words, without the prior written consent of MDCO, which consent shall not be unreasonably withheld.

13.16 Governing Law .

This Agreement shall be construed and enforced in accordance with the laws of Delaware, USA and subject to the exclusive jurisdiction of the courts of Delaware, USA. The UN Convention on Contracts for the International Sale of Goods shall not apply to this Agreement.

IN WITNESS WHEREOF, the duly authorized representatives of the Parties have executed this Agreement as of the date first written above.

PATHEON INTERNATIONAL A.G.

by /s/ A.J. Kelley 12-05-11

THE MEDICINES COMPANY

by /s/ Anthony Norman May 20, 2011

SCHEDULE A

PRODUCT LIST

Product List

Angiomax® for injection(name in U.S., Canada and other markets)

10 ml vials containing 250 mg of lyophilized bivalirudin

Angiox® for injection (name in the EU, Russian and Swiss markets)

10 ml vials containing 250 mg of lyophilized bivalirudin

SCHEDULE B

MINIMUM RUN QUANTITY, YEARLY BINDING VOLUME AND PRICE

A) MINIMUM RUN QUANTITY



PRODUCTS	MINIMUM RUN QUANTITY
Angiomax®/ Angiox®	2 Batches

B) LONG TERM FORECAST



PRODUCTS	2012	2013	2014	2015	2016
Angiomax®/ Angiox®	[**] vials	[**] vials	[**]vials	[**] vials	[**] vials

C) PRICE

Scenario 1 - Batch size: 30,000 vials (current filed)



Product	Fill Volume	Vial Size	Lyo cycle	Batch size proposed	Annual Volume	Unit Conversion Price ⁽¹⁾	Unit Total Price ⁽¹⁾
Angiomax ^® / Angiox ^®	5.5 ml	ext.Ø	~105 hours	30,000 vials	From 1 vial to 400k vials	[**] €/vial	[**] €/vial
Angiomax ^® / Angiox ^®	5.5 ml	23.75 mm	~105 hours	30,000 vials	More than 400k vials	[**] €/vial	[**] €/vial

Scenario 2 – Batch sixe: 48,000 vials (maximum lyo capacity)



Product	Fill Volume	Vial Size	Lyo cycle	Batch size proposed	Annual Volume	Unit Conversion Price ⁽¹⁾	Unit Total Price ⁽¹⁾
Angiomax ^® / Angiox ^®	5.5 ml	ext.Ø	~105 hours	~48,000 vials	From 1 vial to 400k vials	[**] €/vial	[**] €/vial
Angiomax ^® / Angiox ^®	5.5 ml	23.75 mm	~105 hours	~48,000 vials	More than 400k vials	[**] €/vial	[**] €/vial

Notes :

(1) Conversion Pricing includes only the costs for manufacturing, Identification (ID) testing of the API (ID), in-process testing and controls (IPC) and finished Product release, according to the Specifications. Pricing assumes production on a campaign basis (2 batches back to back). The total Price includes components (stopper, vial, seal) and excipients. Based on offers from component suppliers, Patheon estimates a component cost at [**] €/vial.

Component costs will be confirmed after confirmation that the Suppliers recommended and selected

by Patheon are acceptable to MDCO. The cost will be passed without any fee to MDCO and evidence of the costs will be provided by Patheon to MDCO upon request.

Notes :

Should Patheon become responsible for full testing of API, then a fee of [**] €/API batch will be applied. This responsibility does not include the management of the supplier from a Quality perspective (audits etc).

For sake of clarity, the Total Unit Price does not include the costs of any additional visual inspection of the Products for the Japanese’s market that it will be charged to MDCO separately.

REGULATORY SUPPORT WORK

In accordance with Section 7.4 of the Agreement, the Regulatory works performed by Patheon on behalf of MDCOs will be charged at €[**]/hr.

In addition to the above, the Annual Product Review (APR)/Product Quality Review (PQR) work shall be charged at €[**]/hr.

SCHEDULE C

STABILITY TESTING ACTIVITIES

Patheon and MDCO shall agree in writing on any stability testing to be performed by Patheon in connection with the Products. Such agreement shall specify the commercial and Product stability protocols applicable to the stability testing.

Charge per time point per storage condition is € [**].

SCHEDULE D

ACTIVE MATERIALS



Active Materials	Supplier
Bivalirudin	Lonza

ACTIVE MATERIALS CREDIT VALUE

The Active Materials Credit Value shall be as follows:



PRODUCT	ACTIVE MATERIALS	ACTIVE MATERIALS CREDIT VALUE
Angiomax® / Angiox®	Bivalirudin	€ [] per vial, if loss is to Product or in-process materials in vials € [] per gram, if loss is directly to Active Materials or to in-process production

MAXIMUM CREDIT VALUE

Patheon’s liability for Active Materials in accordance with Section 10.2 of the Agreement will not exceed in any one year, in the aggregate, the maximum credit value set forth below:



PRODUCT	MAXIMUM CREDIT VALUE
Angiomax® / Angiox®	[**]% of the annual conversion costs invoiced by Patheon and paid by MDCO for the manufacture of Product. during the Year in which the API’s loss occurs. Final calculation of the Maximum Credit Value will be made following the end of the applicable Year.

SCHEDULE E

BATCH NUMBERING

Each batch of the Product manufactured by Patheon will bear a unique lot number using Patheon’s batch numbering system. This number will appear on all documents relating to the particular batch of Product and shall identify the date of manufacture for the batch of Product.

SCHEDULE F

QUALITY AGREEMENT

Quality Agreement

Commercial Product

Between

THE MEDICINES COMPANY

8 Sylvan Way

Parsippany, NJ

a corporation existing under the laws of Delaware

(hereinafter referred to as “MDCO”)

-and-

PATHEON ITALIA S.P.A.

a corporation existing under the laws of ●,

Specific sites covered by this Agreement:

Monza facility, Viale G.B. Stucchi 110, 20900 Monza (MB), Italy,

(hereinafter referred to as “Patheon”)

Effective Date: ●

SCHEDULE F

QUALITY AGREEMENT

TABLE OF CONTENTS

SECTION 1: PREMISES AND AGREEMENT 1

SECTION 2: RESPONSIBILITIES TABLE 2

SECTION 3: GENERAL 4

SECTION 4: DESCRIPTION OF RESPONSIBILITIES 5

SECTION 5: APPENDICES 15

APPENDIX A: PRODUCT(S)

APPENDIX B: QUALITY CONTACTS

APPENDIX C: PATHEON APPROVED VENDOR LIST

APPENDIX D: MDCO APPROVED VENDOR LIST

APPENDIX E: PATHEON APPROVED CONTRACT
LABORATORIES LIST

SCHEDULE F

QUALITY AGREEMENT

SECTION 1: PREMISES AND AGREEMENT

PREMISES . Under a manufacturing services agreement dated ● between Patheon and MDCO (the “ MSA ”), Patheon agrees to perform pharmaceutical manufacturing services (the “Manufacturing Services”) for certain Products (as described in Appendix A hereto) and MDCO is required to give certain information to Patheon in order for Patheon to perform the Manufacturing Services (the “ Specifications ”). Under the MSA, Patheon is required to operate within the Specifications.

The parties desire to assign and allocate the responsibility for procedures and Specifications impacting on the identity, strength, quality and purity of the Products.

In the event of any conflict between the terms of this Quality Agreement and the MSA, the MSA shall take precedence except with respect to any specific quality issue.

AGREEMENT . NOW THEREFORE in consideration of the Premises and rights conferred and the obligations assumed under the MSA and herein, and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged by each party), and intending to be legally bound, the parties agree as follows:

SCHEDULE F

QUALITY AGREEMENT

SECTION 2: RESPONSIBILITIES TABLE

Patheon will be responsible for all the operations that are marked with “X” in the column titled “Patheon” and MDCO will be responsible for all the operations that are marked with “X” in the column titled “MDCO”. If marked with “(X)”, cooperation is required from the designated party.



Section No.	Subject/Terms	MDCO	Patheon
4.1 Quality Management
4/1/2001	GMP, Health and Safety Compliance		X
4/1/2002	MDCO Audit Rights	X
4/1/2003	Subcontracting	(X)	X
4/1/2004	Self-Inspection		X
4.2 Regulatory Requirements
4/2/2001	Licenses, Marketing Authorizations and Permits	X	X
4/2/2002	Regulatory Filing / Registration Change Control	X	(X)
4/2/2003	Regulatory Compliance		X
4/2/2004	Government Agency Inspections, Communications and Requisitions	(X)	X
4.3 Material Control
4/3/2001	Test Methods and Specifications	X
4/3/2002	Material Destruction	(X)	X
4/3/2003	Vendor Audit Responsibility	X	X
4/3/2004	Material Certifications	X	X
4/3/2005	Incoming Material Release		X
4.4 Building, Facilities, Utilities and Equipment
4/4/2001	General		X
4/4/2002	Equipment, Calibration and Preventative Maintenance		X
4/4/2003	Environmental Monitoring Program		X
4.5 Product Controls
4/5/2001	Master Batch Record	(X)	X
4/5/2002	Reprocessing and Rework	N/A	N/A
4/5/2003	Personnel Training		X
4.7 Exception Reports (Deviations / Investigations)
4/7/2001	Manufacturing Instruction Deviations	(X)	X
4/7/2002	Packaging Instructions Deviations	(X)	X
4/7/2003	Notification of Deviations		X



Section No.	Subject /Terms	MDCO	Patheon
4.8 Release of Product
4/8/2001	Test Methods and Specifications	X	X
4/8/2002	Batch Release for Shipment		X
4/8/2003	Certificate of Analysis & Certificate of Compliance		X
4/8/2004	Product Release	X
4.9 Validation
4/9/2001	Master Validation Plan	(X)	X
4/9/2002	Cleaning & Cleaning Validation Program	(X)	X
4/9/2003	Analytical Method and Procedure Validation	X
4.10 Change Control
4.10.1	General	X	X
4.11 Documentation
4.11.1	Record Retention		X
4.11.2	Batch Document Requisition		X
4.12 Laboratory Controls
4.12.1	Specifications and Test Methods	X	X
4.12.2	Out of Specifications (OOS)		X
4.12.3	Supply of Reference Standards	X
4.13 Stability
4.13.1	Sample Storage		X
4.13.2	Stability Studies and Protocol	X	X
4.13.3	Stability Failures	(X)	X
4.13.4	Termination of MSA		X
4.14 Annual Product Review & Product Quality Review
4.14.1	General		(X)
4.15 Storage and Distribution
4.15.1	General	(X)	X
4.15.2	Product Storage and Shipment Changes	X	(X)
4.15.3	Product Quarantine		X
4.15.4	Shipment and Distribution	X	(X)
4.16 Product Complaints
4.16.1	Complaint Investigation	X	(X)
4.17 Product Recall
4.17.1	Product Recall Notification	X	(X)
4.17.2	Government Agency Notification	X	X
4.18 Reference and Retention Samples
4.18J	Excipient, Active Pharmaceutical Ingredient, and Product Reference Sample		X
4.18.2	API and Product Retention Sample	X

SCHEDULE F

QUALITY AGREEMENT

SECTION 3: GENERAL


3.1	Any communications about the subject matter of this Agreement will be directed, in the first instance, to the person(s) identified in Appendix B.


3.2	Capitalized terms not otherwise defined herein will have the meaning specified in the MSA.


3.3	If any provision of this Agreement should be or found invalid, or unenforceable by law, the rest of the Agreement will remain valid and binding and the parties will negotiate a valid provision which meets as close as possible the objective of the invalid provision.


3.4	If this Agreement requires modification to comply with regulatory or legal requirements, such that either party affected cannot be reasonably expected to continue to perform under this Agreement, then the parties will negotiate and revise the Agreement accordingly


3.5	Any amendment of this Agreement will be made in writing and signed by both parties.

3.6

This Agreement will start on the Effective Date that is set forth on the cover page of this Agreement and will remain in force until the latest of: (i) the expiration date of the last batch of Product produced by Patheon for commercial distribution; (ii) completion of any ongoing stability studies; (iii) two years after the termination of the last effective MSA; or (iv) all Quality obligations under all applicable MSA’s have been fulfilled.


3.7	Despite the termination of this Quality Agreement all regulatory obligations contained herein that are required of either Party or both Parties by an applicable regulatory authority or agency shall survive termination of this Quality Agreement.

SCHEDULE F

QUALITY AGREEMENT

SECTION 4: DESCRIPTION OF RESPONSIBILITIES


4.1	Quality Management


4.1.1	GMP, Health and Safety Compliance

Patheon will conduct operations in compliance with applicable environmental, occupational health and safety laws, and cGMP regulations.


4.1.2	MDCO Audit Rights


4.1.3	Subcontracting

Patheon will not subcontract any tasks or services to a third party without MDCO’s consent.


4.1.4	Self-Inspection

Patheon will perform self-inspections of its premises, facilities, and processes used to manufacture, package, test, and store MDCO’s starting, intermediate, and/or finished products in accordance with Patheon’s written standard operating procedures (“SOP’s”) to ensure compliance with cGMP and this Quality Agreement.


4.2	Regulatory Requirements


4.2.1	Licenses, Marketing Authorizations and Permits

MDCO will be solely responsible for obtaining and/or maintaining, on a timely basis, any permits or other regulatory approvals for the Products or the Specifications, including, without limitation, all marketing and post-marketing approvals.

Patheon will obtain and maintain the appropriate manufacturing license(s) to allow for the Manufacturing services.

MDCO shall provide Patheon with a copy of the draft CMC section, as well as, all supporting documents which have been relied upon to prepare the CMC section at least twenty-one (21) days prior to filing any Marketing Authorization, such as a New Drug Application or Abbreviated New Drug Application with any Regulatory Authority.

Patheon will verify that the CMC section accurately describes the manufacturing processes that Patheon will perform.

Patheon and MDCO shall work together to resolve any deficiencies in the documentation

prior to submission to any regulatory agency.

MDCO shall provide Patheon with final copies of all CMC filings at the time of submission.

If MDCO does not provide Patheon with the documents requested within the time stipulated and if Patheon reasonably believes that Patheon’s standing with a regulatory authority may be jeopardized, Patheon may, in its sole discretion, delay or postpone any inspection by the regulatory authority until such time as Patheon has reviewed the requested documents and is satisfied with their contents.


4.2.2	Regulatory Filing / Registration Change Control

MDCO will determine whether changes to the Product or related to the Product will impact a regulatory filing and will apply for and receive approval for any required manufacturing amendment, change or addition to their Product marketing authorization. Upon request, Patheon will provide assistance in the preparation of pertinent sections of new or supplemental regulatory applications before filing. Patheon will also have the right to review the new or supplemental sections that apply to Patheon’s areas of responsibility before filing. MDCO will provide Patheon copies of sections of product registration/regulatory submissions that are relevant to the manufacture of the Product. MDCO is responsible for all communications with Regulatory Authorities as well as for the approval, maintenance, and updating of marketing approval in a timely manner.


4.2.3	Regulatory Compliance

Patheon will ensure that Product(s) are manufactured and tested in strict compliance with current US Federal and EC regulatory and statutory requirements relating to Good Manufacturing Practices (GMP) (US 21 CFR parts 210 and 211 and EU Directive 2003/94/EC for the manufacture of finished medicinal product) as applicable, regulatory approvals and local laws and regulations applicable at the site(s) of manufacture and/or testing.


4.2.4	Government Agency Inspections, Communication and Requisitions

Patheon will permit all relevant inspections by regulatory authorities of premises, procedures, and documentation.

Patheon will notify MDCO within one (1) Business Day of receipt of any notice of inspection from a regulatory authority and within one (1) Business Day of any regulatory authority request for Product samples, batch documentation, or other information related to the Product.

Patheon will notify MDCO within one (1) Business Day of receipt of any Form 483’s warning letter or the like from any regulatory agency that relates to the Product; or if the supply of Product will be affected, or if the facilities used to produce, test or package the Product will be affected.

The responses from Patheon related to the Product will be reviewed and approved by MDCO prior to submission to the regulatory agency. Notwithstanding, Patheon reserves the right to respond to the regulatory agency without approval, if, in the reasonable opinion of Patheon’s Legal counsel, it is required to do so.


4.3	Material Control


4.3.1	Test Methods and Specifications

MDCO will provide Patheon with a copy of the Specifications and test methods used for Active Pharmaceutical Ingredients and Materials if MDCO issues raw material Specifications.


4.3.2	Destruction of Active Pharmaceutical Ingredient or Product

Patheon has the right to either return to MDCO or dispose of any outdated or rejected Active Pharmaceutical Ingredients or Product. If the Active Pharmaceutical Ingredient or Product is disposed of, disposal will be consistent with the nature of the Active Pharmaceutical Ingredient or Product and will be sent to a permitted waste disposal facility.

Prior to such disposal Patheon will send notice to MDCO about Patheon’s intent to dispose of the Active Pharmaceutical Ingredient or Product. If no direction is received from MDCO, Patheon will dispose of the Active Pharmaceutical Ingredient or Product no sooner than ninety (90) days after the date of the notice.

The Active Pharmaceutical Ingredient or Product will be disposed and destroyed in compliance with local environmental regulations and performed in a secure and legal manner that prevents unauthorized use or diversion.

Upon completion of destruction of Active Pharmaceutical Ingredient or Product, Patheon will provide to MDCO a Certificate of Destruction issued by Patheon or by the licensed third party that destroyed the Active Materials or bulk Product.

Patheon will maintain destruction records in accordance with Patheon SOP’s.


4.3.3	Vendor Audit Responsibility


4.3.3.1	Excipient, Component and API Vendors:

(i.)

MDCO is responsible for the API vendor. MDCO will approve the API manufacturer/s and will inform Patheon about the approval status. MDCO will be also responsible for providing PATHEON with a proof of API manufacturer/s compliance with EU GMP Part II and will ensure the API cGMP compliance in accordance with Section 4.3.4 of this Agreement. The MDCO stipulated vendor(s) will be included on MDCO’s approved vendor list (attached hereto as Appendix D).


(ii.)	PATHEON is responsible for Components and excipient vendors. PATHEON will be responsible for approving the manufacturers and for ensuring their cGMP compliance in accordance with Patheon SOP. The PATHEON stipulated vendor(s) will be included on PATHEON’s approved vendor list (attached hereto as Appendix C).


4.3.4	Material Certifications

MDCO and PATHEON are each responsible for providing a certificate of compliance for each of its respective vendors confirming the following:


(i.)	That the materials are compliant with the provisions outlined in the “Note for Guidance on minimizing the risk of transmitting spongiform encephalopathy agents

via human and veterinary medicinal products” (EMEA/410/01, Rev.2 or update) and

(ii.)

A residual solvent certificate confirming that there is no potential for specific toxic solvents listed in the EP / USP / ICH residual solvents Class I, Class II or Class III to be present and the material, if tested, will comply with established EP / USP / ICH requirements. If any of the solvents listed in the EP / USP / ICH residual solvents Class I, Class II or Class III are used in the manufacture or are generated in the manufacturing process, solvents of concern will be indicated.


4.3.5	Incoming Material Release

Prior to its use in the manufacture of any Product all Material(s) will be inspected, tested and released by Patheon against the Specification approved by MDCO. Patheon will perform only an Assay and Identification test on the Active Pharmaceutical Ingredient.


4.4	Building, Facilities, Utilities and Equipment


4.4.1	General

All buildings and facilities used in the manufacturing, packaging, testing and storage of any materials and/or Product will be of suitable size, construction and location to facilitate cleaning, and will be maintained in a good state of repair. Maintenance and cleaning records will be kept in accordance with Patheon’s SOP’s.


4.4.2	Equipment, Calibration and Preventative Maintenance

All equipment used in the manufacturing, packaging, testing and storage of any materials and/or Product will be suitable for its intended use and appropriately located to allow for cleaning and maintenance. Calibration and maintenance records will be kept according to Patheon SOP’s for all critical equipment. Patheon will calibrate instrumentation and qualify computer systems used in the manufacture and testing of the Product in accordance with Patheon’s SOP’s.


4.4.3	Environmental Monitoring Program

Patheon will perform and maintain an environmental monitoring program. The collected data will be reviewed and interpreted by the responsible person within Patheon’s quality unit. Any out of limit results will be managed appropriately in accordance with Patheon SOP’s.


4.5	Production Controls


4.5.1	Master Batch Record

MDCO will provide the Specifications to Patheon and Patheon will manufacture Product in accordance with the Specifications.

Patheon is responsible for preparing the master batch records for the Product, however, MDCO is responsible to review and approve such master batch records prior to the manufacture of the Product.

Patheon will not make changes to master batch records except through the established Patheon change control system, and all master document revisions will be provided in Italian and English and will be approved by MDCO’s quality unit All proposed changes to the

master batch records will be provided by Patheon in the change control, which will be issued in English.


4.5.2	Reprocessing and Rework

Reprocessing and Rework is not permitted for Product(s) covered in this Quality Agreement or the associated MSA.


4.5.3	Personnel Training

Patheon will provide appropriate training for all employees. Each person engaged in the manufacture, packaging, testing, storage, and shipping of the Product will have the education, training, and experience necessary, consistent with current GMP and safety training requirements.


4.6	Exception Reports (Deviations / Investigations)


4.6.1	Manufacturing Instruction Deviations

Patheon will document, investigate and resolve deviations from approved manufacturing instructions or Specifications in accordance with Patheon’s SOP’s. Patheon will report and obtain approval from MDCO’s responsible person for all deviations to its Product. Such MDCO approval will not be unreasonably withheld. Patheon will provide MDCO with a list of the deviations in the Certificate of Compliance.


4.6.2	Primary Packaging Instructions Deviations

Patheon will document, investigate, and resolve any deviation from approved primary packaging instructions or Specifications according to Patheon SOP’s. Patheon will report and obtain approval from MDCO’s responsible person for all deviations to its Product. Such MDCO approval will not be unreasonably withheld. Patheon will provide copies of all deviation reports to MDCO as part of the executed batch packaging record.

4.7.3 Notification of Deviations

Patheon will notify MDCO within one (1) Business Day if any deviation occurs during manufacture of the Product, where such deviation may affect the quality, efficacy or availability of the Product.


4.1	Release of Product


4.1.5	Test Methods and Specifications

MDCO will provide to Patheon the in-process and finished Product Specifications and will develop and supply validated analytical test methods to Patheon for these methods.


4.1.6	Batch Release for Shipment

Batch review and release for shipment to MDCO will be the responsibility of Patheon’s Quality Assurance department who will act in accordance with Patheon’s SOP’s.


4.1.7	Certificate of Analysis & Certificate of Compliance

For each batch released by Patheon for shipment to MDCO, Patheon will deliver to MDCO

a copy of the batch record (with attachments) in Italian in electronic (pdf) format; and, a Certificate of Analysis detailing the results of final product testing against the test specifications. Patheon will also provide a Certificate of Compliance that will include a statement that the batch has been manufactured in accordance with cGMPs and the Specifications. The Certificate of Analysis and the Certificate of Compliance will be provided in English.


4.1.8	Product Release to Market

MDCO will have sole responsibility for release of the Product to the market.


4.2	Validation


4.2.5	Master Validation Plan

Patheon will establish applicable master validation plans and maintain a validation program for the Product. MDCO will review and approve the, performance qualification and process validation protocols and reports relevant to the introduction of Product in the facility.


4.2.6	Cleaning & Cleaning Validation Programs

MDCO will provide to Patheon toxicological information to be used in the development of a cleaning program. Patheon will maintain an appropriate cleaning program and cleaning validation program.


4.2.7	4.9.3 Analytical Method and Procedure Validation

MDCO must ensure that its analytical methods and manufacturing procedures are validated. If the methods and procedures are not validated by MDCO, then Patheon may assist in validation development with the costs being borne by MDCO.


4.3	CHANGE CONTROL


4.3.6	General

Patheon will notify and obtain approval from MDCO before implementing any proposed changes to the Specifications, process, Active Materials, Materials, testing, that are involved in the manufacture of the Product. This MDCO approval will not be unreasonably withheld.

MDCO will be responsible for determining whether or not to initiate registration variation procedures and for maintaining adequate control over the quality commitments of the marketing authorization made to the regulatory authorities by MDCO for the Products.

Following validation of a process change, Patheon will deliver a copy of the related validation report to MDCO and the associated stability data, if applicable, as it becomes available.


4.4	Documentation


4.4.4	Record Retention

Patheon wilt maintain all batch records for a minimum of one (1) year past Product expiry date and will supply all these records to MDCO upon request.

Patheon will maintain records and evidence on the testing of raw materials for five (5) years

after the materials were last used in the manufacture of the Product.

At the end of the above noted retention period, MDCO will be contacted concerning the future storage or destruction of the documents.


4.5	Laboratory Controls


4.5.4	Specifications and Test Methods

Patheon will test and approve starting material, in-process materials, and the Product in accordance with the approved Specifications, analytical methods, and Patheon’s SOP’s.

MDCO will provide Patheon with the API Specifications including the manufacturer’s Certificate of Analysis. Patheon will be responsible for performing only an assay and ID testing on the API.

MDCO will provide Patheon with test methods for API and excipients (if non-compendial). Patheon is responsible for validating non-compendial testing methods.


4.5.5	Out of Specifications (OOS)

Patheon will manage OOS in accordance with Patheon in-house SOP. Patheon will generate a deviation report as per Patheon SOP’s.


4.5.6	Supply of Reference Standards

MDCO will provide Patheon with the API Reference Standards.


4.6	Stability


4.6.3	Sample Storage

Patheon will store stability samples as required.


4.6.4	Stability Studies and Protocol

MDCO will develop and validate stability indicating assay(s) prior to process validation. If required, Patheon may assist, with the cost being borne by MDCO.

Patheon will conduct stability studies in accordance with the agreed and validated stability testing analytical methods at the agreed upon testing points in accordance with the approved stability protocol.

Patheon will perform the stability testing described in accordance with the stability protocol developed by MDCO. Stability data will be provided by Patheon to MDCO on an ongoing basis as agreed to by both parties.


4.6.5	Stability Failures

Stability failures will be managed in accordance with Patheon OOS SOP. If a result indicates that a Product has failed to remain within stability Specifications, Patheon will notify MDCO within one (1) Business Day.

Patheon shall promptly prepare a deviation report for any and all stability failures generated

during follow-up studies that will be reviewed and approved by both Patheon and MDCO.


4.6.6	Termination of MSA

If the MSA is terminated, Patheon will continue to provide MDCO with stability data supporting the acceptability of the Product until all Product distributed by MDCO has reached the end of its shelf-life.


4.7	Annual Product Review & Product Quality Review

Patheon shall prepare an Annual Product Review (APR)/Product Quality Review (PQR) for the Products covering the activities executed during the review period January 1 through December 31. The report shall be prepared according to cGMP and it shall be in English. Patheon shall provide a copy of the APR/PQR to MDCO within 60 days of the review period.


4.8	Storage and Distribution


4.8.1	General

Patheon will ship Product in accordance with the agreed qualified transportation requirements provided by MDCO to Patheon.


4.8.2	Product Storage and Shipment Changes

Each Party will inform the other Party about any proposed changes in storage and shipping conditions.


4.8.3	Product Quarantine

Patheon will have a system in place for assuring that Product is not shipped unless authorized by MDCO’s quality unit.


4.8.4	Shipment and Distribution

MDCO will be responsible for shipping and distribution of the Product.


4.9	Product Complaints


4.9.1	Complaint Investigation

MDCO will investigate and resolve all medical and non-medical Product complaints.

MDCO shall inform Patheon within 5 business days, or sooner as required, of complaints involving potential Product issues that may be related to Manufacturing.

Patheon will investigate all Patheon manufacturing and packaging type Product complaints related to the Manufacturing Services provided and will provide a written report within 30 days, or sooner if mutually agreed and/or if required to meet regulatory reporting requirements.

MDCO will retrieve complaint sample(s) and forward them to Patheon in a timely manner to facilitate a complete and comprehensive investigation.

MDCO will inform Patheon if the sample is not available.

MDCO shall maintain a record of all complaints, and notify health authorities and/or regulatory agencies as required.


4.10	Product Recall


4.10.1	Product Recall Notification

MDCO will notify Patheon about a Product recall or other regulatory type product notification (e.g. field alert) as soon as possible. MDCO will be responsible for all related field alert and/or recall activities.

Patheon and MDCO shall each maintain such records as may be necessary to permit a Recall of any Products delivered to MDCO or customers of MDCO. Each Party shall promptly notify the other by telephone (to be confirmed in writing) of any information that might affect the marketability, safety or effectiveness of the Products and/or which might result in the Recall or seizure of the Products. Upon receiving any such notice or upon any such discover, each Party shall cease and desist from further shipments of such Products in its possession or control until a decision has been made whether a Recall or some other corrective action is necessary. The decision to initiate a Recall or to take some other corrective action, if any, shall be made and implemented by MDCO.

MDCO shall have the responsibility for handling customer returns of the Products. Patheon shall provide MDCO with such assistance as MDCO may reasonably require to handle such returns.


4.10.2	Government Agency Notification

MDCO will perform the Product recall and will inform the appropriate regulatory authorities. Where required by legislation and/or regulation, Patheon reserves the right to notify regulatory authorities of Product quality issues. Patheon will inform MDCO prior to any notification to the regulatory authorities.


4.11	Reference and retention Samples


4.11.1	Excipient, Active Pharmaceutical Ingredient, and Product Reference Samples

Patheon will keep a reference sample of each excipient, and Active Pharmaceutical Ingredient received by Patheon and used to manufacture the Product. The reference sample will consist of at least two (2) times the quantity required for all Quality Control tests required to determine whether the materials meet required Specifications.

Patheon will store the reference samples under controlled conditions in accordance with GMP storage requirements for one (1) year beyond the expiration date of the last batch of the product containing the materials. The reference samples will be made available by Patheon to MDCO, if requested.

Patheon will retain retention samples of finished Product under controlled conditions in accordance with GMP storage requirements for one (1) year past Product expiry or such longer period as required by taw. Each retention sample will consist of at least two (2) times the quantity required for all Quality Control tests required to determine whether the materials meet required Specifications plus one (1) times the quantity required for sterility testing.


4.11.2	Active Pharmaceutical Ingredient and Product Retention Sample

MDCO will retain samples of API and Product at MDCO approved storage facility. Each

retention sample will consist of at least (2) times the quantity required for all Quality Control tests required to determine whether the materials meet required Specifications plus (1) times the quantity required for sterility testing.

* * *

IN WITNESS WHEREOF, the parties have caused their duly authorized officer to execute and deliver this Quality Agreement as of the Effective Date identified on the first page:



The Medicines Company
By: (Signature) (insert Name/Title)	Date:
By: (Signature) (Insert Name/Title)	Date:
PATHEON ITALIA S.P.A.	Date:
By: (Signature) Maria Di Cillo (QA/QC-QP)

SCHEDULE F

QUALITY AGREEMENT

SECTION 5: APPENDICES


•	Appendix A: Product(s)


•	Appendix B: Quality Contacts


•	Appendix C: Patheon Approved Supplier List


•	Appendix D: MDCO Approved Supplier List


•	Appendix E: Patheon Approved Contract Laboratories List

APPENDIX A: PRODUCTS



Products (s)	Galenic Form	Dosage (Strength)
Bivalirudin (Angiomax & Angiox	lyophilized	250mg/mL

APPENDIX B: QUALITY CONTACTS



	Patheon	MDCO
Responsibility	Quality Assurance	Quality Assurance
Name	Maria Di Cillo	Batsheva Bain
Title	QA/QC Manager-QP	Director, Supplier Quality and Regulatory Compliance
Phone	390,292,047,509	973-290-6326
Fax	390,292,047,314	862-207-6326
E-mail	maria.dicillo(3)pa theon.com	Batsheva.bain@themedco.com
Address	Viale G.B. Stucchi, 110 20900 Monza (MB)	The Medicines Company 8 Sylvan Way Parsippany, NJ 07054
Responsibility	Regulatory Affairs	Regulatory Affairs
Name	Isabella Scrocchi	Batsheva Bain
Title	Regulatory Affairs Manager	Director, Supplier Quality and Regulatory Compliance
Phone	390,292,047,270	973-290-6326
Fax	390,292,047,314	862-207-6326
E-mail	isabella.scrocchi@patheon.com	Batsheva.bain@themedco.com
Address	Viale G.B. Stucchi, 110 20900 Monza (MB)	The Medicines Company 8 Sylvan Way Parsippany, NJ 07054
Responsibility	Product Complaints	Product Complaints
Name	Francesco Boschi	Jamal Brown
Title	Complaints & Self audits	Director, Quality
Phone	390,292,047,271	973-290-6145
Fax	390,292,047,314	862-207-6145
E-mail	francesco.boschi@patheon.	Jamal.brown@themedco.com
E-mail	com
Address	Viale G.B. Stucchi, 110 20900 Monza (MB)	The Medicines Company 8 Sylvan Way Parsippany, NJ 07054



Responsibility	Product Release	Product Release
Name	Maria Di Cillo	Batsheva Bain
Title	QA/QC Manager-QP	Director, Supplier Quality and Regulatory Compliance
Phone	390,292,047,509	973-290-6326
Fax	390,292,047,314	862-207-6326
E-mail	maria.dicillo@patheon.com	Batsheva.bain@themedco.com
Address	Viale G.B. Stucchi, 110 20900 Monza (MB)	The Medicines Company 8 Sylvan Way Parsippany, NJ 07054
Responsibility	Account Manager	Business Manager
Name	Andrea Como	Angie Green
Title	Technical Business Manager	Vice President, Manufacturing Outsourcing Operations
Phone	0039.039.2047.433	973-290-6042
Fax		862-207-6042
E-mail	andrea.como@patheon.com	Angie.green@themedco.com
Address	Viale G.B. Stucchi, 110 20900 Monza (MB)	The Medicines Company 8 Sylvan Way Parsippany, NJ 07054

*Deputy QPs can be responsible for Product Release, in accordance with PATHEON SOP

APPENDIX C: PATHEON APPROVED VENDOR LIST

Sodium hydroxide

Supplier: [**]

Mannitol

Supplier: [**]

APPENDIX D: MDCO APPROVED VENDOR LIST

Lonza Braine SA

Chaussée de Tubize 297

BE – 1420 Braine – L’Alleud

APPENDIX E: PATHEON APPROVED CONTRACT LABORATORIES LIST

Eurofins Biolab S.r.l.

Via B. Buozzi, 2

20090 Vimodrone (MI), Italy

SCHEDULE G

QUALITY AGREEMENT

TERRITORY

All member states of the European Economic Area (EEA), the United States of America and:



Argentina	Israel
Australia	New Zealand
Brazil	Peru
Canada	Russia
Chile	Switzerland
China	Turkey
India	Venezuela

Exhibit 10.2

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

SETTLEMENT AGREEMENT

BY AND AMONG

THE MEDICINES COMPANY

AND

TEVA PHARMACEUTICALS USA, INC.

DATED AS OF SEPTEMBER 30, 2011

SETTLEMENT AGREEMENT

THIS SETTLEMENT AGREEMENT , (this “Settlement Agreement”) is entered into as of September 30, 2011 (the “Effective Date”) by and between The Medicines Company, a company organized and existing under the laws of the State of Delaware with offices located at 8 Sylvan Way, Parsippany, New Jersey 07054 and its Affiliates (collectively “MDCO”), and Teva Pharmaceuticals USA, Inc., a corporation organized and existing under the laws of the State of Delaware with offices located at 1090 Horsham Road, North Wales, Pennsylvania 19454 and its Affiliates (collectively “Teva”). Each of MDCO and Teva is sometimes referred to herein, individually, as a “Party” and, collectively, as the “Parties.”

R E C I T A L S:

1. WHEREAS , MDCO is the owner of New Drug Application No. 20-873, which was approved by the Food and Drug Administration (“FDA”) for the manufacture and sale of a bivalirudin for injection product, which MDCO sells under the tradename Angiomax;

2. WHEREAS , Teva Parenteral Medicines, Inc. submitted Abbreviated New Drug Application No. 90-748 (“Teva Parenteral’s ANDA”) to the FDA under Section 505(j) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §355(j)) seeking approval to engage in the manufacture, use and sale of the bivalirudin for injection product which is the subject of Teva Parenteral’s ANDA (the “Teva Parenteral Product”);

3. WHEREAS , Pliva Hrvatska d.o.o., through Barr Laboratories, Inc. as its filing agent, submitted Abbreviated New Drug Application No. 91-206 (“Pliva’s ANDA” and collectively with the Teva Parenteral’s ANDA, the “Teva ANDAs”) to the FDA under Section 505(j) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §355(j)) seeking approval to engage in the manufacture, use and sale of the bivalirudin for injection product which is the subject of Pliva’s ANDA (collectively with the Teva Parenteral Product, the “Teva Products”);

4. WHEREAS , Teva subsequently amended both Teva ANDAs to include a “paragraph IV certification” seeking approval to engage in the manufacture, use and sale of the Teva Product prior to the expiration of United States Patent Nos. 7,582,727 and 7,598,343 (“Litigated Patents”);

5. WHEREAS , MDCO sued Teva for infringement of the Litigated Patents based on Teva’s filing of the Teva ANDAs, consolidated as civil actions in the United States District Court for the District of Delaware (the “Court”), The Medicines Company v. Teva Parenteral Medicines, Inc., et al. , Civil Action No. 09-cv-750 (ECR) (Consolidated); The Medicines Company v. PLIVA HRVATSKA d.o.o. , et al. , Civil Action No. 09-cv-751 (ECR) (Consolidated); The Medicines Company v. Teva Parenteral Medicines, Inc., et al. , Civil Action No. 09-cv-999; and The Medicines Company v. PLIVA HRVATSKA d.o.o. , et al. , Civil Action No. 09-cv-1000 (ECR) (the “Pending

Litigation”);

6. WHEREAS , Teva has filed a brief as an amicus curies (the “Teva A micus Brief”) in an appeal pending before the United States Court of Appeals for the Federal Circuit (the “Appellate Court”), The Medicines Company v. David J. Kappos, et al. , Federal Circuit No. 2010-1534 (the “Pending Appeal”);

7. WHEREAS , Teva has withdrawn Teva Parenteral’s ANDA and is no longer seeking approval from the FDA for Teva Parenteral’s ANDA;

8. WHEREAS , MDCO and Teva wish to settle the Pending Litigation and have reached an agreement, pursuant to the terms and conditions set forth in this Settlement Agreement together with an associated License Agreement (attached hereto as Exhibit A), an agreed Judgment and Order of Permanent Injunction with regard to the Pending Litigation (the “Consent Judgment,” attached hereto as Exhibit B and together with the Settlement Agreement, the License Agreement being collectively referred to as the “Settlement Documents”);

9. WHEREAS , contemporaneously herewith the Parties are also entering into a API Manufacturing Agreement for Teva’s supply of bivalirudin active ingredient to MDCO (the “API Supply Agreement”);

10. WHEREAS , neither MDCO nor Teva have received any consideration from the other for their entry into this Settlement Agreement other than that which is set forth in the Settlement Documents and API Supply Agreement; and

11. WHEREAS , the Settlement Documents and API Supply Agreement constitute both MDCO’s and Teva’s best independent judgment as to the most convenient, effective and expeditious way to mutually settle all disputes that have arisen associated with Teva’s ANDAs.

NOW, THEREFORE , in consideration of the mutual covenants and agreements described herein, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

1. Capitalized terms used, but not defined herein, shall have the meanings ascribed to them in the License Agreement.

2. The Parties consent to the jurisdiction of the Court for the purposes of the settlement of the Pending Litigation.

3. The Parties agree that the Court has jurisdiction over the Pending Litigation and over MDCO and Teva, and that venue is proper in the District of Delaware.

4. Teva admits that the Litigated Patents, and all the claims contained therein, were infringed by the filing of the Teva ANDAs and absent a license from MDCO would be infringed by the making, sale, offering for sale, use, and/or import of the Teva Products in the Territory.

5. Teva admits that the Litigated Patents, and all the claims contained therein, are valid and enforceable. For the avoidance of doubt, the foregoing in this Section 5, the foregoing Section 4 and clause (i) of Section 3.2 of the License Agreement shall not be applied with respect to (i) any jurisdiction outside of the United States, or (ii) any patents other than the Litigated Patents, and MDCO will not invoke such admissions or covenants or otherwise rely on same for any purpose other than with respect to the Litigated Patents and in the United States.

6. Teva agrees that except as is otherwise expressly provided for in the License Agreement, it shall not make, use, sell, offer for sale or import, directly or indirectly the Teva Products.

7. [**].

8. Teva represents, warrants, and covenants that it has not granted or assigned to any third party, directly or indirectly, any right or license under or to the Teva ANDAs or the Teva Products , and that it will not do any of the foregoing (including, selling, assigning, transferring, or divesting either of the Teva ANDAs to a Third Party), except as provided in the License Agreement. MDCO represents, warrants, and covenants that MDCO is the sole owner of the Litigated Patents, MDCO possess the sole right to enforce the Litigated Patents, and MDCO has not granted or assigned to any Third Party or Affiliate, directly or indirectly, any right under any of the Litigated Patents that would allow such Third Party or Affiliate to sue Teva for infringement of any of the Litigated Patents based on Teva making, using, selling, offering for sale or importing the Teva Products, and that MDCO will not do any of the foregoing, except as provided in the License Agreement.

9. MDCO and Teva each represents and warrants that it has the full right, authority and power to enter into this Settlement Agreement on its own behalf and that this Settlement Agreement shall create and constitute a binding obligation on its part as of the Effective Date.

10. MDCO and Teva shall each execute the License Agreement contemporaneously with the execution of this Settlement Agreement, and any breach of the License Agreement shall constitute a breach of this Settlement Agreement.

11. From the execution of this Settlement Agreement, and unless the Settlement Agreement is terminated, neither Party will actively pursue litigation activities related to the Pending Litigation, except to the extent required by court order or other Applicable Law. In consideration of the benefits of entering into the Settlement Documents, the Parties, through their respective attorneys, shall enter into and cause to be filed in the Pending Litigation, within three (3) Business Days of the Effective Date, the Consent Judgment in the Court. In the event that the Court should refuse to enter the Consent Judgment, the Parties shall work together in good faith to modify the Consent Judgment to meet the requirements of the Court, provided that nothing contained herein shall be deemed to require a Party to agree to a modification of the Consent Judgment or any other Settlement Document that materially affects the economic value of the transactions contemplated hereby. If despite such good faith efforts the Court refuses within thirty (30) days of the Effective Date to enter a consent judgment in the Pending Litigation that the Litigated Patents are infringed by the Teva Products in the absence of a license, this

Settlement Agreement (other than Sections 15 -17) and Settlement Documents shall be null and void ab initio , the API Supply Agreement shall automatically terminate and any and all payments or shipments of API (as defined in the API Supply Agreement) received by a Party pursuant to the Settlement Documents or API Supply Agreement shall be immediately refunded or returned, as applicable, to the other Party.

12. Within three (3) Business Days of the Effective Date, Teva shall file with the Appellate Court a motion to withdraw the Teva Amicus Brief stating that Teva no longer has an interest in the Pending Appeal.

12.

13. The Parties shall submit the Settlement Documents to the Federal Trade Commission Bureau of Competition (the “Commission”) and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice (the “DOJ”) as soon as practicable following the Effective Date and in no event later than ten (10) Business Days following the Effective Date. The Parties shall use all reasonable efforts to coordinate the making of such filings and respond promptly to any requests for additional information made by either of such agencies. Each Party reserves the right to communicate with the Commission or the DOJ regarding such filings as it believes appropriate. Each Party shall keep the other reasonably informed of such communications and shall not disclose the confidential information of the other without such other Party’s consent (not to be unreasonably withheld). To the extent that any legal or regulatory issues or barriers arise with respect to the Settlement Documents, or any subpart thereof, the Parties shall work together in good faith and use reasonable efforts to modify the Settlement Documents to overcome any such legal or regulatory issues (including, for example, objections by the Commission, the DOJ or any applicable court) in a mutually acceptable fashion, but in no event shall either Party be required to agree to any modification of the Settlement Documents that materially affects the economic value of the transactions contemplated hereby. For purposes of this Settlement Agreement, “reasonable efforts” shall mean reasonable efforts and commitment of resources consistent with such Party’s similarly situated products or projects in order to achieve a stated goal as expeditiously as practical.

14. Within five (5) Business Days of the Effective Date, MDCO shall make a single payment to Teva in the amount of [**] United States dollars ($[**]), by wire transfer to an account designated by Teva, in recognition of the savings inuring to MDCO in terms of the avoidance of costs, expenditure of time and resources, disruption and burden associated with prosecuting the Pending Litigation. Except as set forth above, MDCO and Teva each will bear its own costs and legal fees for the Pending Litigation.

15. The terms of the Settlement Documents and the negotiations of the Parties pertaining to them, shall be maintained in confidence by the Parties. Without limiting the generality of the foregoing, neither Party or its counsel shall provide discovery (including without limitation documents, oral testimony and/or statements whether by deposition or otherwise, the work of outside experts or consultants, or work product embodying any of the above) to any Third Party in any judicial or arbitral proceeding in the Territory pertaining to the Settlement Documents. Notwithstanding these obligations, (i) a Party may issue a press release

with the prior written consent of the other Party (such consent to be at the sole discretion of such other Party); (ii) MDCO may issue a press release in the form attached hereto as Schedule 13.5 of the License Agreement; (iii) either Party may disclose such terms in discovery as otherwise required by court order, provided that the other Party shall be given the opportunity to (a) review and comment on the proposed disclosure reasonably in advance of the disclosure, and (b) quash such order and to obtain a protective order requiring that the information and documents that are the subject of such order be held in confidence by such court; (iv) MDCO may disclose (a) to a Third Party (a “Settling Party”) the terms set forth in Sections 2 and 6 (along with the defined terms in Section 1 referenced in those provisions) of the License Agreement that trigger a most favored nations provision in a settlement relating to the Litigated Patents, the ‘404 patent, or the MDCO Product between MDCO and such Settling Party, provided that such disclosure is only for purposes of establishing whether and to what extent such a most favored nations provision has been triggered and such Settling Party has agreed in writing to maintain the confidentiality of such terms of the Settlement Documents and not to use such terms other than in connection with such purpose and no other purpose, and (b) to a person unaffiliated with such Settling Party and acceptable to MDCO Sections 2 and 6 (along with the defined terms in Section 1 referenced in those provisions) of the License Agreement solely to assess the applicability of the most favored nations provision to the terms disclosed to such Settling Party, provided that such unaffiliated person has agreed in writing to maintain the confidentiality of the Settlement Documents and not to use such terms other than in connection with such assessment and no other purpose; (v) either Party may disclose such terms to such Party’s actual and prospective investors and lenders, attorneys, accountants, and FDA consultants on a need-to-know basis and who have agreed in writing and in advance to maintain the confidentiality of such information in accordance with the confidentiality provisions set forth herein; (vi) Teva may disclose such terms to the FDA as may be necessary or useful in obtaining and maintaining Regulatory Approval of the Teva ANDA and Launching the Teva Product as provided by the License Agreement, so long as Teva requests that the FDA maintain such terms in confidence, (vii) Teva may disclose such terms to its manufacturers and customers in accordance with Teva’s exercise of its pre-Launch rights set forth in Sections 2.1 and 3.1 of the License Agreement; and (viii) either Party may disclose such terms as otherwise required by Law, including without limitation SEC reporting requirements, or by the rules or regulations of any stock exchange to which the Parties are subject; provided that, the Parties will coordinate in advance with each other in connection with the redaction of certain provisions of the Settlement Documents and API Supply Agreement with respect to any SEC filings, and each Party shall use reasonable efforts to seek confidential treatment for such terms; provided, however, that each Party shall ultimately retain control over what information to disclose to the SEC or any other such agencies.

16. This Settlement Agreement shall terminate upon the earlier to occur of (i) expiration of the Litigated Patents and (ii) termination of the License Agreement, provided that Sections 15 through 17 shall survive any termination of this Settlement Agreement.

17. In the event that any of the provisions of this Settlement Agreement shall be held by a court or other tribunal of competent jurisdiction to be illegal, invalid or unenforceable in any jurisdiction, such provisions shall be limited or eliminated in such jurisdiction to the minimum extent necessary so that this Settlement Agreement shall otherwise remain in full force

and effect. Such invalidity or unenforceability will not affect either the balance of such provision, to the extent it is not invalid or unenforceable, or the remaining provisions hereof, nor render invalid or unenforceable such provision in any other jurisdiction. This Settlement Agreement shall be governed by the laws of the State of New York without regard to the conflicts of law provisions thereof. The Parties irrevocably agree that the United Sates District Court for the Southern District of New York shall have exclusive and sole jurisdiction to deal with any disputes arising out of or in connection with this Settlement Agreement and that, accordingly, any proceedings arising out of or in connection with this Settlement Agreement shall be brought in the United Sates District Court for the Southern District of New York. Notwithstanding the foregoing, if there is any dispute for which the United Sates District Court for the Southern District of New York does not have subject matter jurisdiction, the state courts in the State, City and County of New York shall have jurisdiction. In connection with any dispute arising out of or in connection with this Settlement Agreement, each Party hereby expressly consents and submits to the personal jurisdiction of the federal and state courts in the State of New York. The Settlement Documents supersede all prior discussions and writings of the Parties, and constitute the entire agreement between the Parties with respect to the subject matter contained therein. No waiver or modification of this Settlement Agreement will be binding upon either Party unless made in writing and signed by a duly authorized representative of such Party and no failure or delay in enforcing any right will be deemed a waiver. Notices hereunder will be effective only if in writing and upon receipt if delivered personally or by overnight mail carrier or fax transmission or other electronic means, or three (3) Business Days after deposit in the U.S. mail, first class postage prepaid to the applicable addressee sent forth in Section 13.2 of the License Agreement. The prevailing Party in any action to enforce this Settlement Agreement shall be entitled to costs and fees (including attorneys’ fees and expert witness fees) incurred in connection with such action. In making and performing this Settlement Agreement, the Parties are acting and shall act as independent contractors. Nothing in this Settlement Agreement shall be deemed to create an agency, joint venture or partnership relationship between the Parties. This Settlement Agreement shall become binding when any one or more counterparts hereof, individually or taken together, bears the signatures of each of the Parties. This Settlement Agreement may be executed in any number of counterparts (including fax or electronic counterparts), each of which shall be an original as against a Party whose signature appears thereon, but all of which taken together shall constitute one and the same instrument. Each Party shall, without further consideration, execute and deliver additional documents and instruments and perform all other and further actions as may be necessary or reasonably requested in order to carry out the purposes and intentions of this Settlement Agreement.

[Signature Page Follows]

[Signature Page to Settlement Agreement Regarding Bivalirudin Injection Product]

IN WITNESS WHEREOF, the Parties hereto have each caused this Settlement Agreement to be executed by their authorized representatives as of the Effective Date.

THE MEDICINES COMPANY

Date: 9/30/11 By: /s/ Glenn Sblendorio

Name: Glenn Sblendorio

Title: EVP & CFO

TEVA PHARMACEUTICALS USA, INC.

Date: Sept. 30, 2011 By: /s/ Deborah Griffin

Name: Deborah Griffin

Title: V.P. & C.F.O.

Date: Sept. 28, 2011 By: /s/ David Stark

Name: David M. Stark

Title: V.P. & G.C.

EXHIBIT A

LICENSE AGREEMENT

BY AND AMONG

THE MEDICINES COMPANY

AND

TEVA PHARMACEUTICALS USA, INC.

DATED AS OF SEPTEMBER 30, 2011

Incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the fiscal period ended September 30, 2011.

EXHIBIT B

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE



THE MEDICINES COMPANY, Plaintiff, v. TEVA PARENTERAL MEDICINES, INC., TEVA PHARMACEUTICALS USA, INC. and TEVA PHARMACEUTICAL INDUSTRIES, LTD. Defendants.	) ) ) ) ) C.A. No. 09-750 (ECR) ) (Consolidated) ) ) ) ) ) )
THE MEDICINES COMPANY, Plaintiff, v. PLIVA HRVATSKA d.o.o., PLIVA d.d., BARR LABORATORIES, INC., BARR PHARMACEUTICALS, INC., BARR PHARMACEUTICALS, LLC, TEVA PHARMACEUTICALS USA, INC. and TEVA PHARMACEUTICAL INDUSTRIES, LTD. Defendants.	) ) ) ) ) C.A. No. 09-751 (ECR) ) (Consolidated) ) ) ) ) ) ) ) ) ) )
THE MEDICINES COMPANY, Plaintiff, v. TEVA PARENTERAL MEDICINES, INC., TEVA PHARMACEUTICALS USA, INC. and TEVA PHARMACEUTICAL INDUSTRIES, LTD Defendants.	) ) ) ) ) C.A. No. 09-999 (ECR) ) (Consolidated) ) ) ) ) )
THE MEDICINES COMPANY, Plaintiff, v. PLIVA HRVATSKA d.o.o., PLIVA d.d., BARR LABORATORIES, INC., BARR PHARMACEUTICALS, INC., BARR PHARMACEUTICALS, LLC, TEVA PHARMACEUTICALS USA, INC. and TEVA PHARMACEUTICAL INDUSTRIES, LTD. Defendants.	) ) ) ) ) C.A. No. 09-1000 (ECR) ) (Consolidated) ) ) ) ) ) ) ) ) ) )

JUDGMENT AND ORDER OF PERMANENT INJUNCTION

This action for patent infringement having been brought by Plaintiff The Medicines Company (“MDCO”) against Defendants Teva Pharmaceutical Industries Limited, Teva Parenteral Medicines, Inc., Teva Pharmaceuticals USA, Inc., Pliva Hrvatska d.o.o., Pliva d.d., Barr Laboratories, Inc., Barr Pharmaceuticals, Inc., and Barr Pharmaceuticals, LLC (collectively “Teva”) for infringement of United States Patent Nos. 7,582,727 and 7,598,343 (the “Litigated Patents”);

Teva and MDCO have entered into a Settlement Agreement, under which MDCO will grant Teva a license to the Litigated Patents (the “License”), pursuant to the terms and conditions in the Settlement Agreement and License;

Teva acknowledges that the Litigated Patents, and all the claims contained therein, are valid and enforceable; and

Teva acknowledges that selling, offering for sale, using and/or importing into the United States a lyophilized product containing bivalirudin under Abbreviated New Drug Application Nos. 91-206 or 90-748 (“Teva’s Product”) would infringe each of the Litigated Patents in the absence of a license.

MDCO and Teva now consent to this Judgment and Order.

IT IS HEREBY ORDERED, ADJUDGED AND DECREED:

1. This Court has jurisdiction over the parties and subject matter of this action.

2. Teva would infringe each of the Litigated Patents by using, making, selling, offering to sell, and/or importing Teva’s Product in the United States.

3. [**].

4. All affirmative defenses, claims and counterclaims which have been or could have been raised by Teva in this action with respect to the Litigated Patents are dismissed with prejudice.

5. Except as authorized and licensed by MDCO under the Settlement Agreement and License, Teva, its officers, agents, servants, employees, affiliates, successors and all persons in

active concert or participation with Teva, are permanently enjoined from using, offering for sale, making, selling, or manufacturing in the United States, or importing into the United States, Teva’s Product and/or inducing or assisting others to use, offer for sale, make, sell, or manufacture in the United States, or import into the United States, Teva’s Product.

6. In any other or future cause of action or litigation in the United States, Teva shall not dispute that the Litigated Patents are each infringed by using, making, selling, offering to sell, and/or importing Teva’s Product.

7. In any other or future cause of action or litigation in the United States, Teva shall not dispute that all the claims of the Litigated Patents are valid and enforceable in all respects.

8. The foregoing injunctions against Teva shall take effect immediately upon entry of this Judgment and Order by the Court, and shall continue until the expiration of the Litigated Patents.

9. This Judgment and Order is binding upon and constitutes claim preclusion and issue preclusion between the parties in this action or in any other action in the United States between the parties with respect to: (i) the validity and enforceability of the Litigated Patents, and (ii) infringement of the Litigated Patents by using, making, selling, offering to sell, and/or importing Teva’s Product.

10. The parties waive all right to appeal from this Judgment and Order.

11. [**].

12. Each party is to bear its own costs and attorneys fees.

Dated: ____________



Frederick L. Cottrell, III (#2555) Laura D. Hatcher (#5098) Richards, Layton & Finger P.A. One Rodney Square P.O. Box 551 Wilmington, DE 19899 Telephone: (302) 651-7700 Facsimile: (302) 651-7701 Edgar H. Haug Porter F. Fleming Angus Chen Frommer Lawrence & Haug LLP 745 Fifth Avenue New York, NY 10151 Telephone: (212) 588-0800 Facsimile: (212) 588-0500	John C. Phillips, Esq. Phillips, Goldman & Spence, P.A. 1200 North Broom Street Wilmington, DE 19806 Lynn MacDonald Ulrich, Esq. Winston & Strawn LLP 35 West Wacker Drive Chicago, IL 60601

SO ORDERED

Dated: __________
______________________________________

THE HON. EDUARDO C. ROBRENO
UNITED STATES DISTRICT JUDGE

Exhibit 10.3

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

LICENSE AGREEMENT

BY AND AMONG

THE MEDICINES COMPANY

AND

TEVA PHARMACEUTICALS USA, INC.

DATED AS OF SEPTEMBER 30, 2011

LICENSE AGREEMENT

THIS LICENSE AGREEMENT (this “Agreement”) is entered into as of September 30, 2011 (the “Effective Date”) by and between The Medicines Company, a company organized and existing under the laws of the State of Delaware with offices located at 8 Sylvan Way, Parsippany, New Jersey 07054 and its Affiliates (collectively, “MDCO”), and Teva Pharmaceuticals USA, Inc., a corporation organized and existing under the laws of the State of Delaware with offices located at 1090 Horsham Road, North Wales, Pennsylvania 19454 and its Affiliates (collectively “Teva”). Each of MDCO and Teva is sometimes referred to herein, individually, as a “Party” and, collectively, as the “Parties.”

R E C I T A L S:

WHEREAS , MDCO is the owner of NDA (as defined below) No. 20-873, which was approved by the FDA (as defined below) for the Manufacture (as defined below) and sale of Angiomax (as defined below);

WHEREAS, Pliva Hrvatska d.o.o., through Barr Laboratories, Inc. as its filing agent, submitted Abbreviated New Drug Application No. 91-206 (the “Teva ANDA”) to the FDA under Section 505(j) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. §355(j)) seeking approval to engage in the manufacture, use and sale of the bivalirudin for injection product which is the subject of the Teva ANDA;

WHEREAS, Teva subsequently amended the Teva ANDA to include a “paragraph IV certification” seeking approval to engage in the manufacture, use and sale of the Teva Product (as defined below) prior to the expiration of United States Patent Nos. 7,582,727 and 7,598,343 (the “Litigated Patents”);

WHEREAS , Teva admits that the Teva Product infringes the Litigated Patents and that the Litigated Patents are valid and enforceable;

WHEREAS , MDCO and Teva are parties to a certain Settlement Agreement of even date herewith (the “Settlement Agreement”), pursuant to which MDCO and Teva are settling pending litigation; and

WHEREAS , pursuant to the Settlement Agreement, MDCO and Teva have agreed to enter into this Agreement.

NOW THEREFORE , in consideration of the foregoing premises, the mutual covenants and agreements described herein and in the Settlement Agreement, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:

1. Definitions . Capitalized terms used, but not defined herein, shall have the meanings ascribed to them in the Settlement Agreement.

1.1. “’404 Patent” means U.S. Patent No. 5,196,404.

1.2. “Accelerated Launch Date” means the earlier of: [**].

1.3. “ Act ” means the United States Federal Food, Drug, and Cosmetic Act, as amended from time to time, and the rules, regulations and guidelines promulgated thereunder.

1.4. “Adverse Drug Experience” has the meaning set forth in 21 C.F.R. § 314.80(a), as amended, supplemented or superseded from time to time.

1.5. “Affiliate” means a Person that controls, is controlled by or is under common control with a Party. For the purposes of this definition, the word “control” (including, with correlative meaning, the terms “controlled by” or “under common control with”) means the actual power, either directly or indirectly through one or more intermediaries, to direct the management and policies of such Person, whether by the ownership of fifty percent (50%) or more of the voting interest of such Person (it being understood that the direct or indirect ownership of a lesser percentage of such interest shall not necessarily preclude the existence of control), or by contract or otherwise. In addition, with respect to this Agreement and the Settlement Documents, Teva Parenteral Medicines, Inc., Teva Pharmaceutical Industries Limited, Pliva Hrvatska d.o.o., Pliva d.d., Barr Laboratories, Inc., Barr Pharmaceuticals, Inc., Barr Pharmaceuticals, LLC, Plantex USA Inc., and Plantex, Ltd, and their respective Affiliates, shall be deemed Affiliates of Teva Pharmaceuticals USA, Inc.

1.6. “AG Product” means a generically Labeled lyophilized product that is Marketed and/or supplied under NDA No. 20-873, described therein now or hereafter.

1.7. “Agreement” shall have the meaning assigned to such term in the preamble to this Agreement.

1.8. “ANDA” means an Abbreviated New Drug Application to the FDA for approval to Manufacture and/or Market a pharmaceutical product in the Territory.

1.9. “Angiomax” means the pharmaceutical product, solely in the lyophilized powder form, that contains the Compound as its sole active ingredient which is approved for Marketing in the Territory pursuant to MDCO’s NDA and is currently sold under the tradename Angiomax.

1.10. “Anticipated Launch Date” means June 30, 2019.

1.11. “API Supply Agreement” shall have the meaning assigned to such term in the Settlement Agreement.

1.12. “Applicable Law” means the applicable Laws, rules, regulations, guidelines and requirements of any Governmental Authority related to the development, registration, Manufacture and Marketing of the Teva Product in the Territory or the performance of either Party’s obligations under this Agreement.

1.13. “[**]” means the [**].

1.14. “ [**] ” means the [**].

1.15. “Authorized AG Product” means an AG Product authorized, whether pursuant to a license, supply arrangement, covenant not to sue, release, waiver or the like, for Marketing pursuant to an agreement between MDCO and a Third Party.

1.16. “Authorized Generic ANDA Product” means [**].

1.17. “Authorized Launch Date” means the earlier of: [**].

1.18. “Business Day” means any day other than a Saturday, Sunday or a day on which banks in New York, New York are authorized or required by Law to close.

1.19. “Claim” means any Third Party claim, lawsuit, investigation, proceeding, regulatory action or other cause of action.

1.20. “Commercially Reasonable Efforts” means efforts and diligence in accordance with the subject Party’s reasonable and sound business, legal, medical and scientific judgment and in accordance with the efforts and resources such Party would use in other aspects of its business that have similar commercial value and market potential, taking into account the competitiveness of the marketplace, the business life-cycle, the proprietary position of the company and the company’s profitability of the pertinent product.

1.21. “Compound” means bivalirudin.

1.22. “Confidential Information” means any scientific, technical, formulation, process, Manufacturing, clinical, non-clinical, regulatory, Marketing, financial or commercial information or data relating to the business, projects, employees or products of either Party and provided by one Party to the other by written, oral, electronic or other means in connection with this Agreement.

1.23. “Consent Judgment” shall have the meaning assigned to such term in the Settlement Agreement.

1.24. “Covenant Not to Sue” shall have the meaning assigned to such term in Section 3.5.

1.25. “ [**] ” means [**].

1.26. “Effective Date” shall have the meaning assigned to such term in the preamble to this Agreement.

1.27. “FDA” means the United States Food and Drug Administration or any successor agency thereof.

1.28. “Final Court Decision” means a final decision of any Federal court from which no appeal has been or can be taken (other than a petition to the United States Supreme Court for a writ of certiorari).

1.29. “ [**] ” means [**].

1.30. “ [**] ” means [**].

1.31. “ [**] ” a [**].

1.32. “First Commercial Sale” means the shipment of commercial quantities of product for immediate commercial sale to major retail chains, major pharmaceutical wholesalers, hospitals or managed care providers in the Territory, [**].

1.33. “Force Majeure” means any circumstances reasonably beyond a Party’s control, including, acts of God, civil disorders or commotions, acts of aggression, fire, explosions, floods, drought, war, sabotage, embargo, utility failures, supplier failures, material shortages, labor disturbances, a national health emergency, or appropriations of property.

1.34. “GAAP” means generally accepted accounting principles in effect in the United States from time to time, consistently applied.

1.35. “Generic Equivalent Product” means any lyophilized pharmaceutical product containing the Compound as its sole active ingredient which is submitted to the FDA for Regulatory Approval pursuant to an ANDA as a Therapeutic Equivalent to Angiomax.

1.36. “Governmental Authority” means any court, tribunal, arbitrator, agency, legislative body, commission, official or other instrumentality of (i) any government of any country, or (ii) a federal, state, province, county, city or other political subdivision thereof.

1.37. “Label” means any Package labeling designed for use with a product, including the package insert for such product that is approved by the FDA, and “Labeled” or “Labeling” shall have the correlated meaning.

1.38. “Launch” means the first Shipment of Teva Product by Teva to an unaffiliated Third Party.

1.39. “Law” or “Laws” means all laws, statutes, rules, codes, regulations, orders, judgments and/or ordinances of any Governmental Authority.

1.40. “License and Authorization” shall have the meaning assigned to such term in Section 2.2.

1.41. “Litigated Patents” shall have the meaning assigned to such term in the Recitals.

1.42. “Losses” means any liabilities, damages, costs or expenses, including reasonable attorneys' fees and expert fees, incurred by any Party that arises from any claim, lawsuit or other action by a Third Party.

1.43. “Manufacture” means all activities related to the manufacturing of a pharmaceutical product, or any ingredient thereof, including, manufacturing Compound or supplies for development, manufacturing a product for commercial sale, packaging, in-process

and finished product testing, release of product or any component or ingredient thereof, quality assurance activities related to manufacturing and release of product, ongoing stability tests and regulatory activities related to any of the foregoing, and “Manufactured” or “Manufacturing” shall have the correlated meaning.

1.44. “Market” means to distribute, promote, advertise, market, offer for sale or sell, to a Third Party and “Marketing” or “Marketed” shall have the correlated meaning.

1.45. “MDCO” shall have the meaning assigned to such term in the preamble to this Agreement.

1.46. “MDCO Liability” shall have the meaning assigned to such term in Section 9.1.

1.47. “MDCO Party” shall have the meaning assigned to such term in Section 9.2.

1.48. “MDCO’s External Auditor” shall have the meaning assigned to such term in 6.7.

1.49. “MDCO’s NDA” means MDCO’s NDA No. 20-873 for the Regulatory Approval of Angiomax.

1.50. “MDCO’s Patents” means (i) the Litigated Patents and any patent that issues as a result of a reexamination or reissue thereof, (ii) except for the ‘404 Patent, any other present or future U.S., international, or foreign patent owned or controlled by MDCO or any of its Affiliates which claims cover the Manufacturing, Marketing, using, or importing of the Teva Product.

1.51. “NDA” means a New Drug Application filed with the FDA pursuant to and under 21 U.S.C. § 355(b), together with the FDA’s implementing rules and regulations.

1.52. “Net Sales” shall equal the gross amount invoiced for sales of the Teva Product by Teva to Third Parties in the Territory less the following, deductions from such gross sales, all as determined in accordance with Teva’s standard practices for other pharmaceutical products and consistent with the customary practices in the generic pharmaceutical industry in the Territory, consistently applied, and which, as applicable, are actually incurred, allowed, accrued or specifically allocated. For the sake of clarity, all such deductions represent reductions to the gross amount invoiced for sales of the Teva Product by Teva to Third Parties in the Territory in accordance with GAAP:

1.52.1 [**] percent ([**]%) of gross sales for cash discounts;

1.52.2 reasonable estimates for chargebacks, rebates, administrative fee arrangement and similar price concessions offered to wholesalers and other distributors, buying groups, health care insurance carriers, pharmacy benefit management companies, health maintenance organizations, other institutions or

health care organizations or other customers directly related to the sale of Teva Product;

1.52.3 reasonable estimates for customer returns of Teva Product (including as a result of recalls);

1.52.4 reasonable estimates for rebates or other price reductions provided, based on sales of Teva Product to any governmental or regulatory authority in respect of state or federal Medicare, Medicaid or similar programs; and

1.52.5 reasonable estimates for billing adjustments, price or shelf stock adjustments, or other promotional allowances.

1.53. “Package” means all primary containers, including bottles, cartons, shipping cases or any other like matter used in packaging or accompanying a product, and “Packaged” or “Packaging” shall have the correlated meaning.

1.54. “Party” or “Parties” shall have the meaning assigned to such term in the preamble to this Agreement.

1.55. “Patent Term Extension” means any extension of the patent term of the ‘404 Patent beyond March 23, 2010 for any reason including, but not limited to, legislative, judicial actions or action by the U.S. Patent and Trademark Office.

1.56. “Pending Litigation” shall have the meaning assigned to such term in the Settlement Agreement.

1.57. “Person” means any individual, partnership, association, corporation, limited liability company, trust, or other legal person or entity.

1.58. “Regulatory Approval” means final Marketing approval by the FDA for the sale and Marketing of a pharmaceutical product in the Territory.

1.59. “Settlement Agreement” shall have the meaning assigned to such term in the Recitals.

1.60. “Settling Party” shall have the meaning assigned to such term in Section 13.5.

1.61. “Shipped” means, with respect to a product, when a Person has delivered shipments of such product to a common carrier for shipment to its customers for resale to consumers; in each instance, a “Shipment” “Ship” or “Shipping” shall have the correlated meaning.

1.62. “Term” shall have the meaning assigned to such term in Section 12.1.

1.63. “Territory” means the United States of America, and its territories, commonwealths, districts and possessions, including the Commonwealth of Puerto Rico.

1.64. “Teva” shall have the meaning assigned to such term in the preamble to this Agreement.

1.65. “Teva ANDA” shall have the meaning assigned to such term in the Recitals.

1.66. “ [**] ” means [**] and their respective Affiliates.

1.67. “Teva Launch Date” means the earlier of:

1.67.1 the Anticipated Launch Date;

1.67.2 an Authorized Launch Date;

1.67.3 [**]

1.67.4 [**].

1.68. “Teva Liability” shall have the meaning assigned to such term in Section 9.2.

1.69. “Teva Party” shall have the meaning assigned to such term in Section 9.1.

1.70. “Teva Product” means a lyophilized product containing the Compound as its sole active ingredient, which is the subject of the Teva ANDA, including all lyophilized formulations thereof, described therein now or hereafter.

1.71. “Teva Product Manufacturing Costs” for Teva Product shall mean, [**].

1.72. “Teva Product Gross Profits” means the Net Sales for Teva Product less the Teva Product Manufacturing Costs incurred by Teva for such Teva Product.

1.73. “Teva’s Patents” means any present or future U.S., international, or foreign patent owned or controlled by Teva which claims cover the Manufacturing, Marketing, using, or importing of Angiomax, AG Product and/or Generic Equivalent Product.

1.74. “Therapeutic Equivalent” shall have the meaning given to it by the FDA in the current edition of the “Approved Drug Products with Therapeutic Equivalence Evaluations” (the “Orange Book”) as may be amended from time to time during the Term.

1.75. “Third Party” or “Third Parties” means any Person or entity other than a Party or its Affiliates.

2. License and Authorization

2.1. Subject to the terms, conditions and limitations hereof, including the conditions set forth in Section 3, MDCO hereby grants to Teva a non-exclusive license, under

MDCO’s Patents to: (i) Manufacture, have Manufactured, import and Market the Teva Product in or for the Territory, on and after the applicable Teva Launch Date; and (ii) Manufacture, and have Manufactured, import and conduct regulatory activities regarding Teva Product prior to the Teva Launch Date (but not to Market (except as provided in Section 3.1) or Ship the Teva Product prior to the Teva Launch Date) in sufficient quantities for the Launch of Teva Product and to permit Teva to Market and Ship the Teva Product beginning on and after the Teva Launch Date. To the extent MDCO owns or controls any regulatory exclusivities granted by the FDA that may prevent Regulatory Approval of the Teva Product or Teva’s Manufacture, importing or Marketing of Teva Product in the Territory as permitted hereunder, MDCO hereby waives, effective as of the date that Teva is licensed to conduct the applicable activity hereunder, such exclusivities and shall, if requested by Teva and if applicable, send the FDA, a written confirmation of MDCO’s agreement to waive, effective as of the date that Teva is licensed to conduct the applicable activity hereunder, such regulatory exclusivities with respect to the Teva Product and/or the Teva ANDA; provided, however, that the foregoing waiver shall not apply with respect to any pediatric exclusivity attached to the ‘404 Patent.

2.2. The license, waiver and authorization granted in Sections 2.1 and 3.1 of this Agreement are referred to herein as the “License and Authorization.” Except to the extent permitted pursuant to Section 13.3, and without derogating from Teva’s “have Manufactured” rights set forth in Section 2.1, Teva shall not have the right to sublicense, assign or transfer any of its rights under the License and Authorization.

2.3. [**].

2.4. Except as set forth in the License and Authorization or expressly set forth in this Agreement, there are no authorizations, licenses or rights granted by either Party under this Agreement, by implication, estoppel or otherwise, including any right granted to Teva to Market or Manufacture any Generic Equivalent Product except under the Teva ANDA. Nothing herein shall be construed as the granting or any license or right to or under the ‘404 Patent. All rights not expressly granted by MDCO herein are hereby retained by MDCO. In addition, MDCO explicitly retains the right itself or through an Affiliate to Market an generically Labeled version of Angiomax, and MDCO is free to grant a license under MDCO’s Patents and/or supply AG Product to any Third Party.

2.5. In the event MDCO authorizes, whether pursuant to a license, supply arrangement, covenant not to sue, release, waiver or the like (other than the granting of a retroactive license, covenant not to sue, release, waiver or the like, to a Third Party with respect to past Marketing or Manufacturing of a Generic Equivalent Product (including the future Marketing of Generic Equivalent Product already Manufactured or in the processes of being Manufactured)), a Third Party [**] to sell a Generic Equivalent Product or an Authorized AG Product [**], MDCO shall inform Teva [**].

3. Conditions

3.1. Teva hereby agrees that it shall not Market or Ship Teva Product in the Territory prior to the applicable Teva Launch Date. Notwithstanding the foregoing, Teva shall be

permitted (i) [**] days in advance of the Anticipated Launch Date [**] to inform potential customers of the date on which Teva would be permitted to sell the Teva Product; and (ii) [**] days in advance of the Anticipated Launch Date [**] to engage in confidential non-binding and preliminary pricing and non-binding and preliminary contracting activities with respect to the Teva Product.

3.2. Teva hereby agrees not to (i) challenge any Patent Term Extension or the validity or enforceability of the Litigated Patents or the ‘404 Patent; (ii) aid, abet, assist, enable or participate with any Third Party in a challenge to the validity or enforceability of the Litigated Patents or the ‘404 Patent or the non-infringement by a Generic Equivalent Product sold by a Third Party of the Litigated Patents or the ‘404 Patent in or for the Territory, except to the extent required by court order or other Applicable Law; (iii) subject to Section 3.11, Market or Manufacture a Generic Equivalent Product other than the Teva Product pursuant to the License and Authorization; or (iv) subject to Sections 3.10 and 3.11, aid, abet, enable or contract with any Third Party regarding the Marketing or Manufacturing of any Generic Equivalent Product in or for the Territory other than the Teva Product. This Section 3.2 will automatically terminate upon the earlier of [**].

3.3. In addition to any other right or remedy MDCO may be entitled to, in the event that during the Term, Teva breaches Section 3.2, MDCO may, at its sole discretion, immediately, effective upon notice to Teva, terminate the API Supply Agreement, and/or this Agreement. If MDCO terminates this Agreement pursuant to this Section 3.3, Section 4 shall survive such termination.

3.4. Nothing set forth herein or in the other Settlement Documents shall be deemed to give MDCO any control over any Marketing exclusivity that may be granted to Teva by the FDA in connection with the Teva ANDA or the Teva Product. Nothing set forth herein or in the other Settlement Documents shall be deemed to prevent or restrict Teva from Manufacturing or Marketing any Generic Equivalent Product which would not infringe MDCO’s Patents, and nothing herein shall prohibit Teva from entering into any agreement with a Third Party related to any Generic Equivalent Product that does not infringe MDCO’s Patents.

3.5. MDCO hereby covenants that it will not sue, assert any claim or counterclaim against, otherwise participate in any action or proceeding against Teva or its Affiliates or any of their shareholders, licensees, sublicensees, customers, suppliers, importers, manufacturers, distributors, insurers, or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause or authorize any person or entity to do any of the foregoing, in each case claiming or otherwise asserting that the Manufacture or use anywhere in the world for exportation into the Territory, or the sale, offer for sale, or importation of the Teva Product (and for clarity, the Compound used to Manufacture the Teva Product), in or for the Territory, infringes MDCO’s Patents insofar as MDCO’s Patents apply to the Teva ANDA or the Teva Product (the “Covenant Not to Sue”). MDCO will impose the foregoing Covenant Not to Sue on any Third Party to which MDCO may assign, grant a right to enforce, or otherwise transfer (by any means) any of MDCO’s Patents subject to the foregoing Covenant Not to Sue. The Covenant Not to Sue shall not apply in the event Teva has violated either of the Consent

Judgments or has materially breached this Agreement or the Settlement Agreement. For any U.S. patents subject to the Covenant Not to Sue and listed in the FDA Orange Book, the Covenant Not to Sue will hereby be treated as a non-exclusive license, so that Teva or its Affiliates may file and maintain with the FDA “Paragraph IV Certifications” under 21 U.S.C. § 355(j)(2)(A)(vii)(IV) and 21 U.S.C. § 355(b)(2)(A)(iv) with respect thereto.

3.6. In consideration of the mutual execution of the Settlement Documents and the mutual agreement to be legally bound by the terms hereof, MDCO and Teva, with the intention of binding themselves and their respective Affiliates, and their respective predecessors, successors, heirs and assigns, directors, officers, employees and representatives, hereby fully, finally and irrevocably release and discharge each other from any and all actions, causes of action, suits, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, liabilities, controversies, agreements, promises, variances, trespasses, damages, judgments, extents, executions, claims, counterclaims, demands, costs, expenses, losses, liens and obligations, whatsoever, in law or equity, whether known or unknown, and waive any and all defenses, occurring before or as of the Effective Date related to the Litigated Patents, including (i) in connection with the Pending Litigation, (ii) Teva’s making, using, selling, offering for sale or importing Compound anywhere in the world for purposes of selling Compound to Teva’s customers prior to the Effective Date, (iii) associated with the Teva ANDA and Teva Product, and including without limitation MDCO’s assertion of the Litigated Patents against Teva, or (iv) all other claims that were asserted or could have been asserted in the Pending Litigation. For purposes of clarity, nothing herein shall inhibit any Party’s ability to enforce the terms of this Agreement or the Settlement Agreement or MDCO’s ability to enforce any patent, including the MDCO’s Patents against Third Parties, except as specifically provided in the Covenant Not to Sue. In connection with this Agreement, each Party, on behalf of itself and its Affiliates, expressly waive and relinquish all rights and benefits afforded in any jurisdiction similar to those afforded in Section 1542 of the California Civil Code, which provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN TO HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.

3.7. Except to the extent required by court order or other Applicable Law, Teva shall not release any agent or consultant (whether retained by Teva or by any attorney that represents Teva) to assist or cooperate with any current or future litigant in a litigation against MDCO with respect to the Litigated Patents, the ‘404 Patent, or otherwise with respect to Angiomax in the Territory and shall not release, grant a waiver of conflict of interest or otherwise take any action which would allow or permit any attorney who represented Teva in the Pending Litigation (i) to breach the confidentiality of non-public information to which such attorney had access in connection with the Pending Litigation; or (ii) to represent or otherwise assist any current or future litigant in a litigation against MDCO with respect to the Litigated Patents, the

‘404 Patent and Angiomax in the Territory.

3.8. Except as required by Law or for purposes of patient safety, MDCO will not, and will not cause, support or authorize any Person to (i) delete, remove or cancel NDA No. 20-873 for so long as Teva is selling Teva Product or AG Product, or (ii) in any regulatory, judicial or other forum or before any governmental agency challenge or contest the first to file exclusivity under 21 U.S.C. § 355(j)(5)(B)(iv) (as amended or replaced) with respect to the Teva ANDA.

3.9. At the request of Teva, MDCO will submit appropriate and necessary documentation to the FDA evidencing the licenses, waivers and covenants granted to Teva under this Agreement.

3.10. Subject to the remainder of this Section 3.10, Teva hereby agrees that Teva shall not supply the Compound to any Third Party which Teva knows or has reason to know will be used to Manufacture a Generic Equivalent Product that is intended for Marketing or use in the Territory. Teva shall require that any Third Party, [**], to whom Compound is delivered pursuant to Section 3.10.1(i) below, agree not to use such Compound to Manufacture a Generic Equivalent Product that is intended for Marketing or use in the Territory except as permitted under Section 3.10.1. In the event Teva or MDCO becomes aware that Compound Manufactured by Teva is used by a Third Party to Manufacture a Generic Equivalent Product that is intended for use in the Territory other than as contemplated by this Section 3.10, Teva will immediately cease the supply of Compound to such Third Party.

3.10.1 Notwithstanding the foregoing or anything else to the contrary in this Agreement or the other Settlement Documents, nothing in the Settlement Documents will prohibit or restrict Teva from: [**].

3.10.2 MDCO hereby covenants that it will not sue, assert any claim or counterclaim against Teva or its Affiliates or any of their shareholders, licensees, sublicensees, suppliers, importers, manufacturers, insurers, or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause or authorize any person or entity to do any of the foregoing, otherwise participate in any action or proceeding, in each case claiming or otherwise asserting that, the foregoing activities set forth in Sections 3.10.1 infringe MDCO’s Patents , and MDCO hereby prospectively releases Teva and the foregoing Persons from liability under MDCO’s Patents with respect to the foregoing activities set forth in Sections 3.10.1. MDCO will impose the foregoing covenant not to sue on any Third Party to which MDCO may assign, grant a right to enforce, or otherwise transfer (by any means) any of MDCO’s Patents subject to the foregoing covenant not to sue. This covenant not to sue shall not apply in the event Teva has violated either of the Consent Judgments or has breached this Agreement or the Settlement Agreement. In addition to any other right or remedy MDCO may be entitled to, in the event that (i) Teva breaches this Section 3.10, or (ii) Compound supplied by Teva is used in a Generic Equivalent Product sold in the Territory by a Third Party [**] prior to:

[**], MDCO may, at its sole discretion, immediately, effective upon notice to Teva, terminate the API Supply Agreement and/or this Agreement.

3.11. Notwithstanding anything set forth herein or in the other Settlement Documents, if Teva acquires all or substantially all the assets and business (by merger, purchase, reorganization, reincorporation, or otherwise) of a Third Party that owns an ANDA filed with the FDA seeking Regulatory Approval of a Generic Equivalent Product (an “Acquired Company ANDA”, and such acquisition an “ANDA Company Acquisition”), Teva reserves the right to, prior to the closing of such ANDA Company Acquisition, divests such Acquired Company ANDA and the Parties agree that the Third Party acquirer of such Acquired Company ANDA shall not be subject to the terms and conditions of the Settlement Documents. In addition, Teva shall have the right to withdraw and abandon the Acquired Company ANDA promptly following the closing of the ANDA Company Acquisition without being in breach of the Settlement Documents, and Teva shall promptly following the closing date of such ANDA Company Acquisition, provide notice to MDCO confirming the withdrawal and abandonment of the Acquired Company ANDA .

4. License to Teva’s Patents

4.1. In full and complete consideration of the license and covenant not to sue granted by Teva to MDCO in this Section 4, MDCO shall make a one-time payment to Teva of [**] United States dollars ($[**]) within five (5) Business Days of the Effective Date. The foregoing payment shall be made by wire transfer to the account designated by Teva.

4.2. Teva hereby grants to MDCO an exclusive (except as to Teva), sublicensable, fully paid-up license, under Teva’s Patents to: (i) Manufacture, have Manufactured, and import Angiomax, AG Product and Generic Equivalent Product in or for the Territory; and (ii) Market Angiomax, AG Product and Generic Equivalent Product in the Territory. For clarity, the foregoing grant of such exclusivity shall not preclude Teva from Manufacturing, importing and Marketing Generic Equivalent Product itself and Manufacturing Generic Equivalent Product for others.

4.3. Teva shall promptly inform MDCO in writing of any infringement of Teva’s Patents by a Third Party with respect to the Manufacturing and/or Marketing of Angiomax, AG Product or Generic Equivalent Product in or for the Territory (the “MDCO Field”) of which Teva has knowledge, and shall provide MDCO with any readily available information relating to such infringement.

4.4. During the Term, MDCO shall have the right, but not obligation, to prosecute at its own expense all infringements of Teva’s Patents in the MDCO Field and, in furtherance of such right, Teva hereby agrees that MDCO may include Teva as a named party plaintiff in any such suit, without expense to MDCO. The total cost of any such infringement action commenced or defended solely by MDCO shall be borne by MDCO, and MDCO shall keep any recovery or damages derived therefrom.

4.4.1 In the event that any action alleging invalidity of any of Teva’s

Patents shall be brought against Teva or MDCO, MDCO shall have the right, but not the obligation, to participate in the defense of such action at its own expense, and Teva shall not enter into any settlement of such action that would derogate from the scope of the license granted to MDCO hereunder without MDCO’s prior written consent.

4.4.2 In any infringement suit as MDCO may institute to enforce Teva’s Patents in the MDCO Field pursuant to this Agreement, Teva shall, at the request and expense of MDCO, cooperate in all reasonable respects and make available relevant records, papers, information, samples, specimens, and the like.

4.4.3 Teva retains the right to enforce Teva’s Patents outside of the MDCO Field, and in the event that MDCO chooses not to enforce Teva’s Patents with respect to infringement within the MDCO Field, MDCO will notify Teva within one hundred twenty (120) days following the date that MDCO becomes aware of such infringement and Teva shall have the right, but not the obligation, to enforce Teva’s Patents with respect to such infringement and keep any recovery or damages derived therefrom.

4.5. Teva hereby covenants that it will not sue, assert any claim or counterclaim against, otherwise participate in any action or proceeding against MDCO or any of its shareholders, licensees, sublicensees, customers, suppliers, importers, manufacturers, distributors, insurers, or any heirs, administrators, executors, predecessors, successors, or assigns of the foregoing, or cause or authorize any person or entity to do any of the foregoing, in each case claiming or otherwise asserting that the Manufacture, use sale, offer for sale, or importation of Angiomax, or any other product in a lyophilized powder form containing the Compound as its sole active ingredient (and for clarity, the Compound used to Manufacture such products), in or for the Territory, infringes Teva’s Patents. Teva will impose the foregoing covenant on any Third Party to which Teva may assign, exclusively license or otherwise transfer any of Teva’s Patents subject to the foregoing covenant.

5. Marketing of Teva Product

5.1. During any period Teva is paying a royalty under Sections 6.1 or 6.2, Teva shall, at its sole cost and expense, utilize Commercially Reasonable Efforts in Marketing the Teva Product in the Territory to maximize sales of Teva Product. During the Term prior to the Teva Launch Date regarding the Marketing of Teva Product, Teva shall not enter into any arrangements or agreements with any Third Party to Market Teva Product in the Territory without MDCO’s prior written consent, which shall not be unreasonably withheld, except that Teva shall not be restricted in entering into customary agreements with its ordinary trade customers including, wholesalers, distributors, and retailers or with suppliers and vendors of advertising, marketing and promotional services.

5.2. Except as provided in Section 13.3, only Teva shall be permitted to Launch and Market Teva Product under this Agreement.

5.3. It is the intent of Teva to seek to sell Teva Product so as to maximize Teva

Product Gross Profits. Teva will have sole discretion, however, in setting the price for the sale of the Teva Product in the Territory. Teva will also agree that if it prices Teva Product in order to gain or maintain sales of other products, then for purposes of calculating the payments due hereunder, the Net Sales of such Teva Product shall be adjusted to reverse any discount which was given to a customer that was in excess of customary discounts for the Teva Product (or, in the absence of relevant data for this Teva Product, other similar products under similar market conditions).

6. Royalties

6.1. Teva Product . Teva will pay to MDCO a royalty of [**] percent ([**]%) of Teva Product Gross Profits on Teva Product sold [**].

6.2. [**]. Teva will pay to MDCO a royalty of [**] percent ([**]%) of Teva Product Gross Profits on Teva Product sold [**]. In the event that the Teva Product Gross Profits on Teva Product for any calendar quarter is less than zero, Teva shall be permitted to set off the difference between zero and such Teva Product Gross Profits against future amounts payable by Teva pursuant to this Section 6.2 in future calendar quarters.

6.3. Royalty Payments . Payments due under this Section 6 shall be made within [**] days from the end of each calendar quarter in which Teva Product is sold. All such payments shall include a report detailing the calculation of gross sales, Net Sales, Teva Product Gross Profits and the royalties payable hereunder.

6.4. Annual True-Up . Within one hundred and eighty (180) days after the end of the last calendar year during the Term in which fees are payable to MDCO pursuant to this Section 6, Teva shall perform a “true up” reconciliation (and shall provide MDCO with a written report of such reconciliation) of the items comprising deductions from Net Sales outlined in Sections 1.51.2, 1.51.4 and 1.51.5. The reconciliation shall be based on actual cash paid or credits actually issued plus an estimate for any remaining liabilities incurred related to Teva Product but not yet paid. If the foregoing reconciliation report shows either an underpayment or an overpayment between the Parties, the Party owing payment to the other Party shall pay the amount of the difference to the other Party within thirty (30) days of the date of delivery of such report.

6.5. Final True-Up . Within twenty-five (25) months of the after the end of the last calendar year during the Term in which fees are payable to MDCO pursuant to this Section 6, Teva shall perform a “true-up” reconciliation (and shall provide MDCO with a written report of such reconciliation) of the items comprising deductions from Net Sales for returns as outlined in Section 1.51.3. The reconciliation shall be based on actual cash paid or credits issued for returns, through the twenty-four (24) month period following the termination of the Supply Term. If the foregoing reconciliation report shows either an underpayment or an overpayment between the Parties, the Party owing payment to the other Party shall pay the amount of the difference to the other Party within thirty (30) days of the date of delivery of such report.

6.6. Maintenance of Records . During the Term, and for a period of three (3)

years thereafter, Teva shall, and shall ensure that its Affiliates shall, keep at either its normal place of business, or at an off-site storage facility, detailed, accurate and up to date:

6.6.1 records and books of account sufficient to confirm the calculation of the gross sales, Net Sales, AG Product Gross Profits (as applicable), Teva Product Gross Profits (as applicable), and the royalties payable hereunder; and

6.6.2 information and data contained in any invoices or reports accompanying any payment to MDCO provided to MDCO in connection with this Agreement.

6.7. Inspection . On no less than [**] Business Days notice from MDCO, Teva shall make all the records, books of account, information and data referred to in Section 6.7 of this Agreement available for inspection during normal business hours by an internationally recognized independent accounting firm selected by MDCO and reasonably acceptable to Teva that is not paid in whole or in part by a contingent fee arrangement, (“MDCO’s External Auditor”) for the purpose of general review or audit; provided that MDCO may not request such inspection more than once in any calendar year. Upon reasonable belief of discrepancy or dispute, MDCO’s External Auditor shall be entitled to take copies or extracts from such records, and books of account (but only to the extent related to the contractual obligations set out in this Agreement) during any review or audit, provided MDCO’s External Auditor signs a confidentiality agreement with Teva providing that such records, and books of account shall be treated as Confidential Information which may not be disclosed to any Person, including MDCO. MDCO’s External Auditor shall only disclose to MDCO the results of the MDCO’s External Auditor’s audit, which results shall be concurrently disclosed to Teva. Any underpayment of amounts due hereunder as reflected by MDCO’s External Auditor’s results shall be promptly paid by Teva to MDCO.

6.8. Inspection Costs . MDCO shall be solely responsible for its costs in making any such review and audit, unless MDCO identifies a discrepancy in the calculation of royalties paid to MDCO under this Agreement in any calendar year from those properly payable for that calendar year of [**] percent ([**]%) or greater, in which event Teva shall be solely responsible for the cost of such review and audit and shall pay MDCO any payment due. All information disclosed by Teva or its Affiliates pursuant to this Section 6 shall be deemed Confidential Information.

6.9. Payment Method . All payments to be made by Teva to MDCO under this Agreement shall be in United States dollars in immediately available funds and shall be made by wire transfer to the account designated by MDCO, such account to be designated by MDCO at least five (5) Business Days prior to the date any such payment is due.

6.10. Late Payments . In addition to any other rights and remedies, in the event payments required to be made under this Agreement are not made on or prior to the required payment date, the amount of the late payment shall bear interest at the lesser of [**] percent ([**]%) above the prime rate reported in The Wall Street Journal (Eastern Edition) on the date such payment was due and the maximum permissible rate under the Law commencing on the

date such payment is due until such date as the payment is made.

6.11. Taxes . MDCO shall be responsible for and shall pay all taxes payable on any income or any payments by Teva to MDCO. Teva and MDCO shall bear sole responsibility for payment of compensation to their respective personnel, employees or subcontractors and for all employment taxes and withholding with respect to such compensation pursuant to Applicable Law. Teva shall have the right to withhold taxes in the event that the revenue authorities in any country require the withholding of taxes on amounts paid hereunder to MDCO. Teva shall secure and promptly send to MDCO proof of such taxes, duties or other levies withheld and paid by Teva for the benefit of MDCO. Each Party agrees to cooperate with the other Party in claiming exemptions from such deductions or withholdings under any agreement or treaty from time to time in effect.

7. Confidentiality

7.1. Confidentiality Obligation . The Parties and their respective employees, directors, officers, consultants and contractors shall keep and maintain as confidential any Confidential Information supplied by the other Party during the Term. The confidentiality and non-disclosure obligations contained in this Agreement shall not apply to the extent that, evidenced by written records or similar proof, such Confidential Information is:

7.1.1 at the time of disclosure by one Party to the other, in the public domain or otherwise publicly known;

7.1.2 after disclosure by one Party to the other becomes part of the public domain, other than by breach by a Party of any obligation of confidentiality;

7.1.3 information which the receiving Party can establish by competent evidence was already in its possession at the time of receipt or was independently developed by the receiving Party; or

7.1.4 received from a Third Party who was lawfully entitled to disclose such information free of an obligation of confidentiality.

7.2. Exceptions . Notwithstanding Section 7.1, in addition to any disclosure allowed under Section 13.5 the Party receiving Confidential Information may disclose such Confidential Information to the extent that such disclosure has been ordered by a court of law or directed by a Governmental Authority, provided that, the disclosure is limited to the extent ordered or directed and wherever practicable, the Party that owns the Confidential Information has been given sufficient written notice in advance to enable it to seek protection or confidential treatment of such Confidential Information.

7.3. Expiration of Confidentiality . The confidentiality obligation contained in this Section 7 shall survive the termination or expiry of this Agreement for so long as such information remains confidential.

7.4. Disclosure . If a Party is subpoenaed or otherwise requested by any Person, including any Governmental Authority, to give testimony or provide information which in any way relates to this Agreement, the Teva Product or practices associated with the Teva Product, such Party shall give the other Party prompt notice of such request, and unless otherwise required by Law, shall make no disclosure until such other Party has had a reasonable opportunity to contest the right of the requesting Person to such disclosure. The Parties shall provide each other with all reasonable cooperation and generally make its employees available to give testimony or to provide reasonable assistance in connection with any lawsuits, claims, proceedings and investigations relating to this Agreement, the Teva Product or practices associated with the Teva Product.

7.5. Enforcement . The Parties agree that equitable relief, including injunctive relief and specific performance, is appropriate in enforcing the confidentiality provisions of this Agreement. In the event of any such action to construe this provision, the prevailing Party will be entitled to recover, in addition to any charges fixed by the court, its costs and expenses of suit, including reasonable attorney’s fees. Such remedies shall not be deemed to be the exclusive remedies for a breach of this provision, but shall be in addition to all other remedies available at law or equity.

8. Representations and Warranties of Parties

MDCO represents and warrants to Teva that MDCO possess the rights and authority to grant the License and Authorization to Teva and its Affiliates under this Agreement, and Teva represents and warrants to MDCO that Teva possess the rights and authority to grant MDCO the license and associated rights set forth in Section 4, and with respect to Sections 8.1 and 8.2 below, each of MDCO and Teva represents, warrants, and covenants, to the other Party that:

8.1. Organization and Authority . Such Party is a corporation or limited liability company duly organized, validly existing and in good standing under the Laws of the jurisdiction of its formation. Such Party has the requisite power and authority to enter into this Agreement. Such Party has the requisite power and authority to execute and deliver this Agreement and to perform all of its obligations hereunder. The execution and delivery of this Agreement and the performance by such Party of its obligations hereunder have been authorized by all requisite action on its part. This Agreement has been validly executed and delivered by such Party, and, assuming that such documents have been duly authorized, executed and delivered by the other Party, constitutes a valid and binding obligation of such Party, enforceable against such Party in accordance with its terms.

8.2. Consents and Approvals; No Violations .

8.2.1 Except as otherwise set forth in this Agreement or the Settlement Agreement, no material filing with, and no material permit, authorization, consent, or approval, of or from any Governmental Authority is required to be obtained by or on behalf of such Party of the transactions contemplated by this Agreement, except for those filings, permits, authorizations, consents or approvals, the failure of which to be made or obtained would not materially

impair such Party’s ability to consummate the transactions contemplated hereby or materially delay the consummation of the transactions contemplated hereby.

8.2.2 Neither the execution nor the delivery of this Agreement by such Party, nor the performance by such Party of its obligations hereunder, will (i) violate the certificate of incorporation, certificate of formation, by-laws or other organizational document of such Party; (ii) conflict in any material respect with or result in a material violation or breach of, or constitute a material default under, any material contract, agreement or instrument to which such Party is a party; or (iii) violate or conflict in any material respect with any material Law, rule, regulation, judgment, order or decree of any court or Governmental Authority applicable to such Party, except in the case of clause (ii) or (iii) for violations, breaches or defaults which would not have a material adverse effect on such Party’s ability to consummate the transactions contemplated hereby.

8.2.3 The Parties shall submit this Agreement together with the Settlement Agreement to the Federal Trade Commission Bureau of Competition and the Assistant Attorney General in charge of the Antitrust Division of the Department of Justice as soon as practicable following its execution and in no event later than ten (10) Business Days following its execution.

9. Indemnities; Product Liability; Insurance

9.1. Indemnity by MDCO . MDCO shall defend, indemnify and hold harmless each of Teva and its Affiliates and its and their directors, officers, employees and contractors (“Teva Party”) from and against any and all Losses, (“MDCO Liability”) arising from or in connection with:

9.1.1 any Claim resulting from any negligent acts or acts of willful misconduct of any MDCO Party in connection with the performance of its obligations under this Agreement; or

9.1.2 the breach by MDCO of any of its representations or warranties contained in this Agreement;

except, in each case, to the extent that the MDCO Liability is caused by the negligence, breach of the terms of this Agreement, or willful misconduct of a Teva Party.

9.2. Indemnity by Teva . Teva shall defend, indemnify and hold harmless each of MDCO and its Affiliates and its and their directors, officers, employees and contractors (“MDCO Party”) from and against any and all Losses (“Teva Liability”) arising from or in connection with:

9.2.1 any Claim resulting from any negligent acts or acts of willful misconduct of any Teva Party in connection with the performance of its obligations under this Agreement;

9.2.2 any Claim based on or arising out of the use, Manufacturing, Labeling, Packaging or Marketing of Teva Product, including, any investigation by a Governmental Authority or any claim for personal injury or property damage asserted by any user of Teva Product; or

9.2.3 the breach by Teva of any of its representations or warranties contained in this Agreement.

except, in each case, to the extent that Teva’s Liability is caused by the negligence, breach of the terms of this Agreement, or willful misconduct of a MDCO Party.

9.3. Control of Proceedings . A Party seeking indemnification hereunder shall provide prompt written notice to the other Party (and, in any event, within thirty (30) days) of the assertion of any claim against such Party as to which indemnity is to be requested hereunder. The indemnifying Party shall have the sole control over the defense of any Claim, provided that, the indemnifying Party shall obtain the written consent of the indemnified Party prior to settling or otherwise disposing of such Claim if as a result of the settlement or Claim disposal the indemnified Party’s interests are in any way adversely affected.

9.4. No Admissions . The indemnified Party shall not make any payment or incur any expenses in connection with any Teva Liability or MDCO Liability (as the case may be), or make any admissions or do anything that may compromise or prejudice the defense of any Claim without the prior written consent of the indemnifying Party.

9.5. Claim Information . Each Party shall promptly:

9.5.1 inform the other by written notice of any actual or threatened Claim to which Sections 9.1 or 9.2 apply;

9.5.2 provide to the other Party copies of all papers and official documents received in respect of any such Claim; and

9.5.3 cooperate as reasonably requested by the other Party in the defense of any such Claim.

9.6. Limitation of Liability. Except as may be included in a Claim under Section 9.1, 9.2 or 9.8, or a breach by any Party of Section 3 or Section 13.5, in no event shall any Party or its Affiliates be liable for special, punitive, indirect, incidental or consequential loss or damage (including lost profits or revenues associated with MDCO’s breach of its AG Product supply obligations) based on contract, tort or any other legal theory arising out of this Agreement.

9.7. Product Liability Insurance . Each Party shall maintain, at its own cost, general commercial liability insurance (including comprehensive product liability) in such amount as MDCO and Teva, respectively, customarily maintain with respect to its other products and which is reasonable and customary in the U.S. pharmaceutical industry for companies of

comparable size and activities but in any event not less than $5,000,000 per occurrence and $5,000,000 in the aggregate. In the event the insurance policy obtained by a Party is a “claims made” policy (as opposed to an “occurrence” policy), such Party shall obtain comparable insurance for not less than six (6) years following the expiry or termination of this Agreement.

9.8. Irreparable Harm . Teva acknowledges that in the event of a Launch by Teva of Teva Product in the Territory other than as permitted under this Agreement or a breach of Section 3.10, the damages to MDCO and its business (including, but not limited to, lost sales of Angiomax) would be difficult to calculate and the adequacy of monetary damages calculated at Law would be uncertain. Accordingly, Teva agrees that in any action by MDCO seeking injunctive or other equitable relief in connection with any such Launch other than as permitted under this Agreement or a breach of Section 3.10, Teva shall not assert or plead the availability of an adequate remedy at Law as a defense to the obtaining of any such remedy. Teva hereby waives any equitable defense to such injunction including, laches, unclean hands, acquiescence or any estoppel arguments. The foregoing shall not be in lieu of any other remedy to which MDCO may be entitled hereunder in equity or at Law as a result of such a breach and the Parties agree that lost profits resulting from lost sales by MDCO of Angiomax are a reasonably foreseeable element of damages which MDCO would suffer and to which, notwithstanding anything to the contrary set forth herein, MDCO will be entitled to recover in accordance with the Law.

9.9. Limitation on Representations, Warranties and Indemnification . NEITHER PARTY SHALL BE DEEMED TO MAKE ANY REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS OR IMPLIED, EXCEPT AS SPECIFICALLY SET FORTH HEREIN. ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED BY EACH PARTY.

10. Force Majeure

10.1. Force Majeure . Neither Party shall be entitled to terminate this Agreement or shall be liable to the other under this Agreement for loss or damages attributable to any Force Majeure, provided the Party affected shall give prompt notice thereof to the other Party. Subject to Section 10.2, the Party giving such notice shall be excused from such of its obligations hereunder for so long as it continues to be affected by Force Majeure.

10.2. Continued Force Majeure . If any Force Majeure continues unabated for a period of at least ninety (90) days, the Parties shall meet to discuss in good faith what actions to take or what modifications should be made to this Agreement as a consequence of such Force Majeure in order to alleviate its consequences on the affected Party.

11. Trademarks and Trade Names

11.1. Except as may appear on the AG Product vials, Labeling and Packaging, Teva shall have no right to use any trademark or tradedress of MDCO and shall have no rights to any other intellectual property of MDCO or its Affiliates other than to the extent of the License

and Authorization.

12. Term and Termination

12.1. Term . Unless sooner terminated in accordance with the terms hereof, the term of this Agreement shall extend from the Effective Date until the expiration of all of the MDCO’s Patents (the “Term”).

12.2. Termination . In addition to MDCO’s right to immediately terminate this Agreement as set forth in Section 3, either Party shall be entitled to terminate this Agreement by written notice to the other if:

12.2.1 the other Party commits a material breach of this Agreement, and fails to remedy it within sixty (60) days of receipt of notice from the first Party of such breach and of its intention to exercise its rights under this Section 12.2; or

12.2.2 an order is made or a resolution is passed for the winding up of the other Party (other than voluntarily for the purposes of solvent amalgamation or reconstruction) or an order is made for the appointment of an administrator to manage the other Party's affairs, business and property or if a receiver (which expression shall include an administrative receiver) is appointed over any of the other Party's assets or undertaking or if circumstances arise which entitle the court or a creditor to appoint a receiver or manager or which entitle the court to make a winding-up order or if a voluntary arrangement is proposed in respect of the other Party or if the other Party takes or suffers any similar or analogous action in consequence of debt, and such order, appointment or similar action is not removed within ninety (90) days.

12.3. Effect of Termination . In the event of expiry or termination of this Agreement for any reason, each Party shall promptly return all Confidential Information of the other Party provided during the Term or destroy and certify the destruction of such Confidential Information.

12.4. Liability on Termination . The termination or expiry of this Agreement shall not release either of the Parties from any liability which at the time of termination or expiry has already accrued to the other Party, nor affect in any way the survival of any other right, duty or obligation of the Parties which is expressly stated elsewhere in this Agreement to survive such termination or expiry.

12.5. Surviving Sections . The provisions of Sections 1, 3.6, 6.5 through 6.11, 7, 8, 9, and 13 shall continue in force in accordance with their respective terms notwithstanding expiry or termination of this Agreement for any reason. In addition, except in the event that Teva has violated the Consent Judgment or has materially breached this Agreement or the Settlement Agreement, the Covenant Not to Sue and the final paragraph of Section 3.11 shall survive termination or earlier expiration of this Agreement.

13. Miscellaneous

13.1. Notice .

13.1.1 Any notice or other document given under this Agreement shall be in writing in the English language and shall be given by hand or sent by prepaid airmail, or by confirmed fax transmission to the address of the receiving Party as set out in Section 13.2 below unless a different address or fax number has been notified to the other in writing for this purpose.

13.1.2 Each such notice or document shall:


(i)	if sent by hand, be deemed to have been given when delivered at the relevant address;


(ii)	if sent by prepaid mail, be deemed to have been given five (5) days after posting; or


(iii)	if sent by confirmed fax transmission be deemed to have been given when transmitted, provided that, a confirmatory copy of such fax transmission shall have been sent by prepaid overnight mail within twenty-four (24) hours of such transmission.

13.2. Address for Notice . The address for services of notices and other documents on the Parties shall be:

To MDCO

The Medicines Company

8 Sylvan Way

Parsippany, NJ 07054

Attn: Chief Executive Officer

Facsimile:

with a copy to:

The Medicines Company

8 Sylvan Way

Parsippany, NJ 07054

Attn: General Counsel

Facsimile:

To Teva

Teva Pharmaceuticals USA, Inc.
1090 Horsham Road
PO Box 1090
North Wales, PA 19454-1090
Attn: Chief Executive Officer
Facsimile: 215-591-8803

with a copy to:

Teva North America
425 Privet Road
Horsham, PA 19044
Attention: General Counsel
Facsimile: 215-293-6499

13.3. Assignment .

13.3.1 Subject to Section 13.3.2, neither Party shall assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the other Party, not to be unreasonably withheld or delayed.

13.3.2 Each Party shall be entitled, without prior written consent of the other Party, to assign all or any of its rights or obligations under this Agreement to an Affiliate or transfer such rights and obligations to a successor entity by way of merger or acquisition of substantially all of the assets of such Party (whether by consolidation, sale of assets, or otherwise); provided the Affiliate or other successor entity expressly assumes in writing those rights, duties and obligations under this Agreement and this Agreement itself and the Affiliate or other successor is a financially capable business entity.

13.3.3 Subject to the foregoing, this Agreement shall be binding upon and

inure to the benefit of the Parties and their respective successors and permitted assigns. Any assignment or transfer in contravention of the terms of this Agreement shall be null and void.

13.4. Amendment . This Agreement may not be varied, changed, waived, discharged or terminated, including by course of conduct or trade usage, except by an instrument in writing signed by the Party against which enforcement of such variation, change, waiver, discharge or termination is sought.

13.5. Public Announcements . The terms of the Settlement Documents and the negotiations of the Parties pertaining to them, shall be maintained in confidence by the Parties. Without limiting the generality of the foregoing, neither Party or its counsel shall provide discovery (including without limitation documents, oral testimony and/or statements whether by deposition or otherwise, the work of outside experts or consultants, or work product embodying any of the above) to any Third Party in any judicial or arbitral proceeding in the Territory pertaining to the Settlement Documents. Notwithstanding these obligations, (i) a Party may issue a press release with the prior written consent of the other Party (such consent to be at the sole discretion of such other Party); (ii) MDCO may issue a press release in the form attached hereto as Schedule 13.5; (iii) either Party may disclose such terms or discovery as otherwise required by court order, provided that the other Party shall be given the opportunity to (a) review and comment on the proposed disclosure reasonably in advance of the disclosure, and (b) quash such order and to obtain a protective order requiring that the information and documents that are the subject of such order be held in confidence by such court; (iv) MDCO may disclose (a) to a Third Party (a “Settling Party”) the terms set forth in Sections 2 and 6 (along with the defined terms in Section 1 referenced in those provisions) that trigger a most favored nations provision in a settlement relating to the Litigated Patents, the ‘404 patent, or the MDCO Product between MDCO and such Settling Party, provided that such disclosure is solely for purposes of establishing whether and to what extent such a most favored nations provision has been triggered and such Settling Party has agreed in writing to maintain the confidentiality of such terms of the Settlement Documents and not to use such terms other than in connection with such purpose and no other purpose, and (b) to a person unaffiliated with such Settling Party and acceptable to MDCO Sections 2 and 6 (along with the defined terms in Section 1 referenced in those provisions) solely to assess the applicability of the most favored nations provision to the terms disclosed to such Settling Party, provided that such unaffiliated person has agreed in writing to maintain the confidentiality of the Settlement Documents and not to use such terms other than in connection with such assessment and no other purpose; (v) either Party may disclose such terms to such Party’s actual and prospective investors and lenders, attorneys, accountants, and FDA consultants on a need-to-know basis and who have agreed in writing and in advance to maintain the confidentiality of such information in accordance with the confidentiality provisions set forth herein; (vi) Teva may disclose such terms to the FDA as may be necessary or useful in obtaining and maintaining Regulatory Approval of the Teva ANDA and Launching the Teva Product as provided by the License Agreement, so long as Teva requests that the FDA maintain such terms in confidence, and (vii) Teva may disclose such terms to its manufacturers and customers in accordance with Teva’s exercise of its pre-Launch rights set forth in Sections 2.1 and 3.1 and (viii) either Party may disclose such terms as otherwise required by Law, including without

limitation SEC reporting requirements, or by the rules or regulations of any stock exchange to which the Parties are subject; provided that, the Parties will coordinate in advance with each other in connection with the redaction of certain provisions of the Settlement Documents and API Supply Agreement with respect to any SEC filings, and each Party shall use reasonable efforts to seek confidential treatment for such terms; provided, however, that each Party shall ultimately retain control over what information to disclose to the SEC or any other such agencies.

13.6. Superiority of Agreement . The Parties agree that this Agreement supersedes all prior discussions and writings of the Parties, and that the provisions of this Agreement, together with any amendments hereto, shall prevail over any inconsistent statements or provisions contained in any prior discussions, arrangements or comments between the Parties and in any documents passing between the Parties, including, any forecast, purchase order, purchase order revision, acknowledgment, confirmation or notice. It is agreed that:

13.6.1 neither Party has entered into this Agreement in reliance upon any representation, warranty or undertaking of the other Party which is not expressly set out in this Agreement;

13.6.2 neither Party shall have any remedy in respect of misrepresentation or untrue statement made by the other Party or for any breach of warranty which is not contained in this Agreement;

13.6.3 this Section 13.6 shall not exclude any liability for, or remedy in respect of, fraudulent misrepresentation; and

13.6.4 notwithstanding the foregoing, the Settlement Agreement shall be deemed of equal dignity to this Agreement and this Agreement shall be construed together with the Settlement Agreement in a consistent manner as reflecting a single intent and purpose.

13.7. Governing Law . This Agreement shall be governed by the Laws of the State of New York without regard to the conflicts of law provisions thereof. The Parties irrevocably agree that the United States District Court for the Southern District of New York shall have exclusive jurisdiction to deal with any disputes arising out of or in connection with this Agreement and that, accordingly, any proceedings arising out of or in connection with this Agreement shall be brought in the United States District Court for the Southern District of New York. Notwithstanding the foregoing, if there is any dispute for which the United States District Court for the Southern District of New York does not have subject matter jurisdiction, the state courts in the State, City and County of New York, shall have jurisdiction. In connection with any dispute arising out of or in connection with this Agreement, each Party hereby expressly consents and submits to the personal jurisdiction of the federal and state courts in the State, City and County of New York.

13.8. Agreement Costs. Each Party shall pay its own costs, charges and expenses incurred in connection with the negotiation, preparation and completion of this

Agreement.

13.9. Counterparts . This Agreement may be executed in any number of counterparts and may be executed by the Parties on separate counterparts (including fax or electronic counterparts), each of which is an original but all of which together constitute the same instrument.

13.10. Severability . If and to the extent that any provision of this Agreement is held to be illegal, void or unenforceable, such provision shall be given no effect and shall be deemed not to be included in this Agreement but without invalidating any of the remaining provisions of this Agreement.

13.11. Relationship of the Parties . In making and performing this Agreement, the Parties are acting, and intend to be treated, as independent entities; and nothing contained in this Agreement shall be construed or implied to create an agency, partnership, joint venture, or employer and employee relationship between MDCO and Teva. Except as otherwise provided herein, neither Party may make any representation, warranty or commitment, whether express or implied, on behalf of or incur any charges or expenses for or in the name of the other Party.

13.12. Construction . The language in all parts of this Agreement shall be construed, in all cases, according to its fair meaning. MDCO and Teva acknowledge that each Party and its counsel have reviewed and revised this Agreement and that any rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement. The words “hereof,” “herein,” “hereto” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The terms defined in the singular shall have a comparable meaning when used in the plural, and vice versa. Whenever used herein, the words “include,” “includes” and “including” shall mean “include, without limitation,” “includes, without limitation” and “including, without limitation,” respectively. The masculine, feminine or neuter gender and the singular or plural number shall each be deemed to include the others whenever the context so indicates. With respect to any particular action or agreement, the use of the words “MDCO shall” or “MDCO will” herein shall also mean “MDCO shall cause” the particular action to be performed. Similarly, with respect to any particular action or agreement, the use of the words “Teva shall” or “Teva will” herein shall also mean “Teva shall cause” the particular action to be performed. Nothing in this Agreement shall operate to exclude any provision implied into this Agreement by Law and which may not be excluded by Law or limit or exclude any liability, right or remedy to a greater extent than is permissible under Law.

13.13. Dispute Resolution .

13.13.1 Preliminary Process . If there is a disagreement between the Parties as to the interpretation of this Agreement or in relation to any aspect of the performance by either Party of its obligations under this Agreement, the Parties shall, within ten (10) Business Days of receipt of a written request from either Party, meet in good faith and try to resolve the disagreement without

recourse to legal proceedings.

13.13.2 Escalation of Dispute . If resolution of the disagreement does not occur within five (5) Business Days after such meeting, the matter shall be escalated to applicable Teva and MDCO Presidents (or other ranking senior executive) for resolution.

13.13.3 Equitable Relief . Nothing in this Section 13.13 restricts either Party’s freedom to seek urgent relief to preserve a legal right or remedy, or to protect a proprietary or trade secret right, or to otherwise seek legal remedies through any available channel if resolution is not otherwise achieved under this Section 13.13.

13.14. Cumulative Rights . The rights and remedies of each of the Parties under or pursuant to this Agreement are cumulative, may be exercised as often as such Party considers appropriate and are in addition to its rights and remedies under general law.

13.15. No Third Party Benefit . This Agreement shall be binding upon and enure solely to the benefit of the Parties hereto, their Affiliates, successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other Person or Persons any right, benefits or remedies of any nature whatsoever under or by reason of this Agreement.

13.16. Further Assurance . Each of the Parties shall do, execute and perform and shall procure to be done and perform all such further acts, deeds, documents and things as the other Party may reasonably require from time to time to give full effect to the terms of this Agreement.

13.17. Waiver . No failure or delay by either Party in exercising any right or remedy provided by law under or pursuant to this Agreement shall impair such right or remedy or operate or be construed as a waiver, acquiescence or variation of it or preclude its exercise at any subsequent time and no single or partial exercise of any such right or remedy shall preclude any other or further exercise of it or the exercise of any other right or remedy. A waiver by a Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which such Party would otherwise have on any future occasion.

[Signature Page Follows]

[Signature Page to License Agreement Regarding Bivalirudin Injection Product]

IN WITNESS WHEREOF , the undersigned have executed this Agreement as of the Effective Date.

THE MEDICINES COMPANY

Date: _ 9/30/11_ _______ By: _ /s/ Glenn Sblendorio ___________________

Name: ___ Glenn Sblendorio_ ________________

Title: __ EVP & CFO ________________________

TEVA PHARMACEUTICALS USA, INC.

Date: September 30, 2011 __ By: _ /s/ Deborah A. Griffin ___________________

Name: __ Deborah A. Griffin __________________

Title: __ VP & CFO __________________________

Date: _ September 28, 2011 __ By: _/ s/ David M. Stark_ _______________________

Name: _ David M. Star k________________________

Title: __ VP &GC _____________________________

Schedule 13.5

MDCO Press Release

Contact: Michael Mitchell

The Medicines Company

973-290-6000

investor.relations@themedco.com

DRAFT, NOT FOR RELEASE:

The Medicines Company Settles Angiomax® (bIVALIRUDIN) Patent LitigationS with Teva

Parsippany, N.J., October __, 2011 — The Medicines Company (NASDAQ: MDCO) today announced that it has settled the lawsuits filed by MDCO in the U.S. District Court for the District of Delaware relating to the Abbreviated New Drug Applications (ANDAs) filed by Teva Parenteral Medicines, Inc. and its affiliate, Pliva Hrvatska d.o.o. (collectively “Teva”), for generic versions of Angiomax® (bivalirudin for injection). The settlement includes a license by MDCO to Teva Pharmaceuticals USA, Inc. and its affiliates under which Teva may launch a generic bivalirudin product under one of its ANDAs in the U.S. on June 30, 2019. In certain limited circumstances, MDCO’s license to Teva would become effective prior to June 30, 2019.

As part of the agreement, Teva admits that the two patents asserted in the lawsuits are valid and enforceable against, and would be infringed by, Teva's proposed generic bivalirudin products. The patents at issue in the litigation are listed in the Orange Book and expire on July 27, 2028.

MDCO also entered into an agreement with Teva under which Teva will supply bivalirudin active pharmaceutical ingredient (API) to MDCO. This provides an additional source of API to support planned growth of product use.

“This result reflects our continued confidence in the strength of our patents, and we will continue to vigorously defend our intellectual property,” said Dr. Clive Meanwell, Chairman and CEO of The Medicines Company. “We are delighted to partner with Teva who will provide us needed additional manufacturing capacity and a second source of high quality Angiomax® active ingredient which we can finish, fill and supply to our hospital customers for millions of patients.”

As required by law, MDCO and Teva will submit the agreements to the U.S. Federal Trade Commission and the U.S. Department of Justice.

Background on the litigation now settled.

On September 4, 2009, MDCO announced that it had received a Paragraph IV Certification Notice Letter from Teva notifying MDCO that Teva had submitted ANDAs to the Food and Drug Administration for approval to market generic versions of Angiomax®. On October 8, 2009 and December 28, 2009, MDCO filed patent infringement lawsuits against the Teva defendants. The complaints, which were filed in the U.S. District Court for the District of Delaware, alleged infringement of U.S. Patent Nos. 7,582, 727 and 7,598,343, which expire on July 27, 2028.

MDCO remains in infringement litigations involving U.S. Patent Nos. 7,582, 727 and 7,598,343 with APP Pharmaceuticals, Hospira, Mylan Pharmaceuticals, and Dr. Reddy’s Laboratories.

About The Medicines Company

The Medicines Company (NASDAQ: MDCO) provides medical solutions to improve health outcomes for patients in acute and intensive care hospitals worldwide. These solutions comprise medicines and knowledge that directly impact the survival and well-being of critically ill patients. The Medicines Company's website is www.themedicinescompany.com.

Statements contained in this press release about The Medicines Company that are not purely historical, and all other statements that are not purely historical , may be deemed to be forward-looking statements for purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Without limiting the foregoing, the words "believes," "anticipates" and "expects" and similar expressions, including the Company’s preliminary revenue results, are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by these forward-looking statements. Important factors that may cause or contribute to such differences include the extent of the commercial success of Angiomax, the Company’s ability to develop its global operations and penetrate foreign markets, whether the Company's products will advance in the clinical trials process on a timely basis or at all, whether the Company will make regulatory submissions for product candidates on a timely basis, whether its regulatory submissions will receive approvals from regulatory agencies on a timely basis or at all, whether physicians, patients and other key decision makers will accept clinical trial results, risks associated with the establishment of international operations, and such other factors as are set forth in the risk factors detailed from time to time in the Company's periodic reports and registration statements filed with the Securities and Exchange Commission including, without limitation, the risk factors detailed in the Company's Quarterly Report on Form 10-Q filed on August 2, 2011, which are incorporated herein by reference. The Company specifically disclaims any obligation to update these forward-looking statements.

Exhibit 10.4

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

SUPPLY AGREEMENT

(the "Agreement")

entered into on this 30th day of September, 2011

between

Plantex USA Inc.

A company incorporated under the laws of New Jersey with its principal place of business at

400 Chestnut Ridge Rd., Woodcliff Lake, NJ 07677

(“ Plantex ”)

and

The Medicines Company

A company incorporated under the laws of Delaware with registered office at8 Sylvan Way, Parsippany, NJ 07054

(“ Purchaser ”)

1. INTERPRETATION AND DEFINITIONS 2

2. SALES AND PURCHASE OF API 4

3. ORDERS, QUANTITIES, LEAD TIME AND DELIVERY 5

4. PRICE AND PAYMENT 7

5. QUALITY INSPECTION OF PRODUCT 8

6. CONFIDENTIALITY 13

7. WARRANTIES 9

8. CLAIMS FOR PATENT INFRINGEMENT 10

9. INDEMNIFICATION 10

10. TERM 12

11. BREACH AND TERMINATION 12

12. GOVERNING LAW AND DISPUTE RESOLUTION 13

13. FORCE MAJEURE 14

14. GENERAL PROVISIONS 15

15. NOTICES 17

WHEREAS, Plantex is a manufacturer (through its Affiliates) of active pharmaceutical ingredients at Plantex’s Facility, as defined below,

WHEREAS, Purchaser is a pharmaceutical company whose activities focus on research, development, production, licensing, manufacturing and marketing of pharmaceutical products;

WHEREAS , Purchaser is the owner of New Drug Application No. 20-873 (the “NDA”), which was approved by the FDA for the manufacture and sale of a product containing the API, as defined below, as its sole active ingredient, which Purchaser sells under the tradename Angiomax ® (“Angiomax”);

WHEREAS , Affiliates of Plantex, Teva Parenteral Medicines, Inc. and Pliva Hrvatskad.o.o., through Barr Laboratories, Inc. as its filing agent, submitted Abbreviated New Drug Applications to the FDA seeking approval to engage in the manufacture, use and sale of a generic Angiomax product;

WHEREAS , Purchaser sued certain Affiliates of Plantex for patent infringement related to such submissions to the FDA;

WHEREAS , Purchaser and certain Affiliates of Plantex have decided to settle such litigation and Purchaser and Teva Pharmaceutical Industries Limited, an Affiliate of Plantex, are entering into, on even date herewith, a Settlement Agreement (the Settlement Agreement”) and License Agreement (“License Agreement”);

WHEREAS, Plantex wishes to supply the API to Purchaser on the terms and conditions set out below; and Purchaser wishes to acquire the API from Plantex on such terms and conditions.

THEREFORE, in consideration of the premises and of the mutual covenants and agreements set forth in this Agreement, and other good and valuable consideration the adequacy and sufficiency of which is acknowledged, the Parties, intending to be legally bound, agree as follows:

1. INTERPRETATION AND DEFINITIONS


1.1.	The preamble to this Agreement forms an integral part hereof.


1.2.	Clause headings in this Agreement are intended solely for convenience of reference and shall be given no effect in the interpretation of this Agreement.


1.3.	All appendices to this Agreement, if any, whether attached at the time of signature hereof or at any time thereafter, shall be construed as an integral part of this Agreement. In case of any inconsistency between the appendices and the body of the Agreement, the body of the Agreement shall take precedence and prevail over the appendices to the extent of any such inconsistency.


1.4.	In this Agreement, the following expressions shall bear the meanings assigned to them below and cognate expressions shall bear corresponding meanings.

1.4.1.

“ Affiliates ”– with regard to either Party, any person, corporation, company, partnership, joint venture or other entity controlling, controlled by or under common control with such Party. For such purpose the term “control” means the holding of fifty percent (50%) or more of the common voting stock or ordinary shares in, or the right to appoint fifty percent (50%) or more of the directors of, or the right to share fifty percent (50%) or more of the profits of, the said corporation, company, partnership, joint venture or entity. For the purposes of this Agreement, Teva Pharmaceutical Industries Limited and any Affiliates of Teva Pharmaceutical Industries Limited, including, Teva Parenteral Medicines, Inc., Teva Pharmaceuticals USA, Inc., Pliva Hrvatska d.o.o., Pliva d.d., Barr Laboratories, Inc., Barr Pharmaceuticals, Inc., Barr Pharmaceuticals, LLC, and Plantex Ltd. shall be deemed Affiliates of Plantex. Wherever one or more Affiliates of Plantex are involved in or responsible for any of the activities and obligations ascribed to Plantex in this Agreement, the omission of specific reference to any such Affiliates in any such instances shall not relieve Plantex or such Affiliates from responsibility for such activities and obligations.


1.4.2.	“ Alternative Material ”–active pharmaceutical ingredient equivalent to the API, as defined below, which is manufactured by a third party holding a drug master file for such active material.


1.4.3.	“ APl ”–the active pharmaceutical ingredient bivalirudin.


1.4.4.	“ Authorized Generic ”– a generically labeled lyophilized bivalirudin drug product marketed by Purchaser or a third party authorized by Purchaser.


1.4.5.	“ DMF ”– the drug master file filed and maintained by Plantex and its Affiliates with the FDA relating to the manufacture of the API.


1.4.6.	“ Effective Date ”‑ the date at the head of this Agreement, provided that the Agreement has been duly executed by both Parties.


1.4.7.	“ FDA ”–the United States Food and Drug Administration and all agencies under its direct control or any successor organization.


1.4.8.	“ Finished Product ” - the finished form of pharmaceutical product to be formulated by Purchaser, using the API as the active ingredient.


1.4.9.	" cGMP " – current good manufacturing practices in accordance with the rules and regulations promulgated by the FDA.


1.4.10.	“ Marketing Authorizations ”– the required authorizations and approvals to be granted by the FDA or any other duly designated Regulatory Authority in the Territory for the marketing, use and sale or distribution of the Finished Product in the Territory.


1.4.11.	“ Party ”–Plantex or Purchaser as the context requires, and “Parties” collectively PLANTEX and Purchaser.


1.4.12.	“ Plantex’s Facility ” - a manufacturing facility identified in the DMF for purposes of manufacture of the API pursuant to this Agreement.


1.4.13.	“ Quarter ”– a three-month consecutive period with the first three month period commencing on the first of either January 1, April 1, July 1 or October 1 and each subsequent 3 month calendar period commencing on the day immediately following the last day of the then immediately preceding period.


1.4.14.	“ Quality Agreement ”– the API Quality Agreement between Purchaser and Plantex Ltd., of even date herewith, relating to the manufacture of the API.


1.4.15.	“ Regulatory Authorities ” - any and all governmental bodies and organizations, including, without limitation, the FDA, which regulate the manufacture, importation, distribution, use or sale of the API or Finished Product in the Territory.


1.4.16.	“ Specifications ”–the technical specifications of the API set out in Appendix A .


1.4.17.	“ Territory ”–the United States of America, and each of its territories, districts and possessions and the commonwealth of Puerto Rico, subject to Section 2.3.


1.4.18.	“ Term ”– as defined in Section 9.

2. SALES AND PURCHASE OF API


2.1.	During the Term, Plantex hereby agrees to manufacture, sell and supply to Purchaser solely for the formulation by or for Purchaser of the Finished Product and the licensing, marketing and sale thereof solely in the Territory, and Purchaser hereby agrees to purchase the API produced by Plantex on the terms and conditions set out in this Agreement for the said sole purpose.


2.2.	In the event that Purchaser desires to transfer the Marketing Authorizations to one or more third parties, Plantex shall provide such third parties with a “Letter of Access” to the DMF; provided that Plantex’ agreement to do so may be conditioned upon the agreement of the Purchaser to assign this Agreement to such third party.


2.3.	In the event that Purchaser requests to expand the Territory covered in this Supply Agreement, Plantex will use commercially reasonable efforts to support such request.

3. ORDERS, QUANTITIES, LEAD TIME AND DELIVERY


3.1.	Commercial Supply .


3.1.1	Purchaser shall issue Purchase Orders for a minimum of [] kgs in [], a minimum of [] kgs in [], and a minimum of [] kgs in [] of the API from Plantex. These requirements shall remain fixed regardless of whether or not a generic form of Angiomax is launched in the market in the Territory.


3.1.2	Beginning in [] and for the duration of the Term thereafter, Purchaser shall issue Purchase Orders for a minimum [] kgs of the API per calendar year from Plantex, subject to Section 3.1.2.1 below.

3.1.2.1

If a generic form of Angiomax is launched in the market in the Territory, then from and after January 1, 2013 Purchaser shall have the right to terminate its agreement to purchase API hereunder with immediate effect, and the Parties will meet in good faith to discuss terms for Purchaser’s possible continued purchase of API (as to both quantities and, as provided in Section 4.3, the price of the API).

3.2.

Purchaser and its Affiliates shall use the API only for the manufacture of Finished Products for sale or use in the Territory. Purchaser and its Affiliates are prohibited from reselling or otherwise transferring all or any portion of API that is not used in the manufacture of Finished Products for sale or use in the Territory to any other person or entity, either directly or indirectly, including through its contract manufacturers or other third parties, without written permission of Plantex.

3.3.

Forecasts . On or before October 31, 2011 , and thereafter by the 15th day of each October and April during the Term, Purchaser shall provide Plantex with a good faith, twenty-four (24) month rolling forecast of its API requirements by quarter (“Forecast”) commencing from the quarter following the quarter in which the Forecast is provided (i.e. January or July, as the case may be) .. The first [**] months of each Forecast, shall be considered binding (the "Binding Forecasted Period") for the API indicated for those months . The quantities set forth in each Binding Forecasted Period for each Forecast shall not be in an amount less than eighty percent (80%) or greater than one hundred and twenty percent (120%) of the quantities set forth in the second [**] month period of the immediately preceding Forecast.

3.4.

Orders . Concurrent with Purchaser supplying Plantex with the Forecasts, the Purchaser shall place firm purchase orders for the quantities not less than the quantities specified in the Binding Forecasted Period of such Forecasts (" Purchase Orders "). Purchase Orders shall reference this Agreement and specify the API, quantities, prices, delivery destination and required delivery dates, which shall be in accordance with the applicable Forecast. In the event Purchaser provides Purchase Orders subsequent to the date of submitting the Forecast, the required delivery dates in such Purchase Orders shall be at least ninety (90) days from the date of placing the Purchase Order, except as otherwise specifically and expressly agreed to in writing by Plantex (" Lead Time "). Purchase orders shall be subject to confirmation and acceptance by Plantex, at its sole discretion. Purchaser has placed a Purchase Order applicable to its 2011 requirements, a copy of which is attached as Appendix B.

3.5.

Plantex shall use its commercially reasonable efforts to confirm and accept Purchase Orders and supply the quantities set forth in the Purchase Orders within [**] business days of the designated delivery dates (provided that such Purchase Orders comply with the applicable Lead Time). Plantex shall promptly advise Purchaser if, for any reason, including without limitation force majeure as defined in Section 13 hereof, it believes that it will be unable to supply Purchaser (a) with the requisite quantities of API specified in a Purchase Order, or (b) by the date of delivery specified in a Purchase Order.

In the event that Plantex delays the delivery of the API specified in a Purchase Order, or part thereof, by more than one (1) month beyond the delivery date set forth in such Purchase Order or fails to delivery API which conforms to the warranties set forth in Section 6.1, then for so long as Plantex’s inability persists, Purchaser shall as its sole and exclusive remedy have the right to purchase Alternative Material to the extent necessary to cover the shortfall in Plantex’s supply of API, only until such time as Plantex notifies Purchaser in writing that it is able to resume the supply of API, and Purchaser’s minimum purchase obligations hereunder shall be reduced by the amount of Alternative Material so purchased by Purchaser. Purchaser's right pursuant to this Section shall not apply to the quantities specified in the Purchase Order which exceed one hundred and twenty per cent (120%) of the quantities set forth in the Binding Forecasted Period.


3.6.	Delivery . The API shall be delivered EX WORKS (per Incoterms 2010) at Plantex’ Facility.


3.7.	Risk of Loss and Title . Risk of loss and/or damage to the API ordered by Purchaser, and title therein, will pass to Purchaser upon delivery of the API.


3.8.	Quality . At the time of the delivery, the API shall conform to the Specifications. Certain of the Parties’ responsibilities with respect to the API are set forth in the Quality Agreement, which is incorporated herein as if set forth at length.


3.9.	Packaging . The API shall be delivered to Purchaser as specified in the DMF and Specifications.

4. PRICE AND PAYMENT


4.1.	The price for the minimum purchase quantities of API provided in Section 3.1 will be fixed at $[] per gram for [] and [] and $[] per gram for [**].


4.2.	Beginning with [] and for the duration of the Term thereafter, so long as Purchaser purchases [] kgs or more per year of the API, the price shall be $[] per gram, but if Purchaser purchases less than []kgs per year of the API, the price shall be $[**] per gram.


4.3.	Notwithstanding the above, pricing for [**] and for the duration of the Term shall be subject to Section 3.1.2.1 and Sections 4.3.1 and 4.3.2 below:


4.3.1.	If a generic form of Angiomax is launched in the market in the Territory, the Parties will meet to discuss, in accordance with Section 3.1.2.1, Purchaser’s possible continued purchase of API and the pricing for [**] and for the duration of the Term.

4.3.2.

Plantex shall be entitled to modify the price of the API beginning with calendar year [**] and for each calendar year in the Term thereafter due to a documented increase of more than [**]% of the manufacturing cost of the API which is a result of increases of the purchase price index, cost of goods, labor and overhead charges and any changes in the market which have affected the price; provided that in no event will Plantex be able to increase the price for the API more than [**]% in any calendar year.


4.4.	Plantex shall issue and dispatch invoices with each delivery (or partial delivery) of the API delivered by it together with such certificates and documentation as may be required for the purposes of customs clearance of the API including without limitation a signed certificate of analysis.

4.5.

All invoices shall be paid in US Dollars within [**] days from the date of the applicable invoice. Prices do not include any sales tax, which shall be payable by Purchaser if applicable. Payments shall be made by wire transfer to Plantex’s designated bank account as notified to Purchaser by Plantex. Amounts not paid when due shall accrue interest calculated at the rate of four percent (4%) plus the U.S. prime rate (but in no event greater than the maximum rate permitted by law) in effect on the date that the payment should have been made, as published in The Wall Street Journal, Eastern U.S. Edition, calculated on a daily basis. No deductions of any kind from any payment becoming due to Plantex may be made in the absence of an official credit memorandum from Plantex authorizing the deduction.

5. QUALITY INSPECTION OF PRODUCT and REGULATORY INSPECTIONS

5.1.

Purchaser shall inspect each shipment upon its receipt of API for all defects and conformance with the Specifications. Any API not rejected within [**] days of delivery to Purchaser shall be deemed to have been accepted by Purchaser. Any latent defects in API not detectable by means of the inspection specified in this Section shall be notified by Purchaser to Plantex promptly after discovery thereof but by not later than the date of expiration of the shelf life for the relevant API.

5.2.

In the event that Purchaser alleges that any API delivered to it does not meet the Specifications, Purchaser shall notify Plantex setting out full details of the alleged defect. Purchaser shall, on request by Plantex, provide Plantex with a sample of the allegedly non-conforming API, which shall be examined by Plantex as soon as reasonably practicable but in any event within [**] days of receipt thereof by Plantex.


5.3.	In the event that Plantex is in agreement with the contentions as to non-conformance raised by Purchaser:


5.3.1.	Plantex shall at its sole discretion either: (1) credit Purchaser the amount paid or invoiced for such API or (2) dispatch to Purchaser replacement API as soon as is reasonably practicable but in any event within [**] days following Purchaser's notification of non-conformance, all costs in respect of which shall be borne by Plantex;

5.3.2.

Purchaser shall, if so requested by Plantex, return to Plantex at Plantex’s expense, any API that is nonconforming or otherwise dispose of such API, at Plantex’s expense, and in accordance with instructions provided by Plantex. If Plantex does not so direct, within [**] business days following Purchaser's notification of non-conformity, Purchaser may dispose of such API as Purchaser may deem reasonably appropriate, provided that any such disposal complies with environmentally acceptable standards, and Plantex shall bear the costs of such disposal.


5.3.3.	Plantex’s liability in any such case remains strictly limited only to replacement of or credit for the API.

5.4.

In the event that Plantex is not in agreement with the contentions as to non-conformance raised by Purchaser, representative samples of the allegedly non-conforming API, together with details of Purchaser’s contentions as to non-conformance, shall be submitted to a mutually acceptable independent laboratory which shall examine such samples in a method specified by the Parties as part of a mutually agreed testing procedure. The Parties shall endeavor to procure that within thirty (30) days, the said laboratory issues its finding as to whether the API conforms to the specifications. The results of the said laboratory shall be final and binding on the Parties, and not subject to appeal or review, and the costs associated with such submission and determination shall be borne by the Party against which the laboratory decides. Notwithstanding the above, if it is determined that the non-

compliance is due to damage to the API caused by Purchaser or its agents, Plantex will have no liability to Purchaser with respect to such non-compliance and the cost of any testing and evaluation by the independent laboratory will be borne solely by Purchaser.

5.5.

Plantex shall, upon receiving a written request from Purchaser, supply technical information on the API and methods of manufacture to the extent that such information is necessary to enable Purchaser to fulfill its obligations under this Agreement, including compliance with any statutory or Regulatory Authority located within the Territory. Upon Plantex receiving at least [**] days advance notice in writing from Purchaser, and not more than once every two (2) years, Plantex shall permit Purchaser, by prior arrangement with and at a time convenient to Plantex, to inspect those areas of Plantex’s Facilities where API is manufactured for Purchaser, and audit its records (in the presence of a representative of Plantex) relating to the manufacturing and quality control of the API to the extent reasonably necessary to enable Purchaser to verify compliance with any regulatory requirements to which Purchaser is subject and which are applicable to the manufacture, importation, and marketing of the API. Purchaser acknowledges that all information supplied by Plantex or acquired by Purchaser by virtue of the provisions of this clause shall be strictly confidential and subject to the provisions of Section11 hereof.


5.6.	Purchaser undertakes to be solely responsible for any recall of the Finished Products at any time, and to accept any liability arising in respect of the Finished Products.


5.7.	In the event of a conflict between the terms set forth in this Section 5 and the terms provided in the Quality Agreement, the terms set forth in the Quality Agreement shall control.

6. REPRESENTATIONS ANDWARRANTIES


6.1.	PLANTEX, on behalf of itself and its Affiliates, hereby represents, warrants and covenants to the Purchaser that:


6.1.1.	the API shall conform to the Specifications;


6.1.2.	the API to be supplied hereunder shall be manufactured, stored and packaged for shipment in accordance with cGMP at a Plantex Facility;


6.1.3.	all API supplied hereunder shall be free and clear of all security interests, liens, or other encumbrances of any kind or character; and


6.1.4.	all API supplied hereunder shall be accompanied by all documentation necessary for the use in the Territory under the applicable Marketing Authorizations.


6.2.	Expect as set forth in Section 3.5 and as may be subject to indemnification under Section 8.2, the replacement of non conforming API shall be

Purchaser’s sole remedy for claims that any shipment of API failed to comply with the warranties set forth herein.


6.3.	THE WARRANTIES SET OUT ABOVE ARE THE ONLY WARRANTIES GIVEN BY PLANTEX AND ARE MADE IN LIEU OF ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED. ANY EXPRESS OR IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE OR MERCHANTABILITY APPLICABLE TO THE APIARE HEREBY EXCLUDED.


6.4.	Plantex hereby represents and warrants that it has the authority to bind all of its Affiliates to the terms of this Agreement.


6.5.	Plantex makes no warranty as to the patentability of any of the API or as to immunity from any action for infringement of third party intellectual property rights including but not limited to registered patents or patent applications arising out of the regulatory approvals, importation into the territory, distribution, marketing, sale and/or use of the API.


6.6.	If any limitation of liability shall be deemed invalid by any applicable law, then each Party’s liability shall be within the limitation permitted by that law.

7. CLAIMS FOR PATENT INFRINGEMENT

7.1.

In the event a claim for patent infringement is brought against Purchaser on account of Plantex’s supply of API to Purchaser and use thereof in the manufacture, use, marketing or sale of the Finished Product, or Purchaser has reason to believe that any such claim might be brought against it, Purchaser shall inform Plantex as soon as possible of the particulars of the claim. Plantex shall cooperate with Purchaser in the defense of any such claim.


7.2.	The provisions of this Section 7 shall survive the expiration or termination of this Agreement for any reason.

8. INDEMNIFICATION

8.1.

Subject to and without derogating from the limitations of Purchaser’s liabilities as set forth in this Agreement, the Purchaser shall defend, indemnify and hold Plantex, its Affiliates and each of their respective officers, directors, agents, employees and shareholders (collectively, “ Plantex Indemnitees ”) harmless from and against any and all claims, damages, loss and expense suffered by Plantex arising from claims by third parties in connection with or resulting from any of the following: (a) the storage, handling, manufacture, license, use, marketing, advertising, promotion, distribution or sale of the Finished Product by Purchaser or its Affiliates, sublicensees, distributors or agents or the conduct of business by Purchaser or its Affiliates, sublicensees, distributors or agents in the Territory, including, but not limited to, liabilities for product liability and returned goods; and (b) the breach of any representation, warranty or covenant by Purchaser under this Agreement; and (c) gross negligence or willful misconduct by the Purchaser or its Affiliates and each of their respective officers, directors, agents, employees in connection with the implementation of this Agreement; and (d) violation of any applicable law by Purchaser or any of its Affiliates and each of their respective officers, directors, agents, employees; and (e) any bodily injury, illness or death of any person caused or alleged to be caused by the use, distribution or sale of the Finished Product; and (f) any actual or alleged infringement (whether direct, contributory, or induced) or violation of any patent, trade secret or proprietary rights of any third party arising out of Purchaser’s or its Affiliates and each of their respective officers, directors, agents and employees manufacturing, importing, registering, storing, distributing or selling the Finished Product.

8.2.

Subject to and without derogating from the limitations of Plantex' liabilities as set forth in this Agreement, Plantex shall defend, indemnify and hold the Purchaser, its Affiliates and each of their respective officers, directors, agents, employees and shareholders (collectively, “ Purchaser Indemnitees ”) harmless from and against any and all damages, loss or expense suffered by Purchaser arising from claims by third parties in connection with or resulting from any of the following: (a) the breach of any representation, warranty or covenant by Plantex under this Agreement; and (b) gross negligence or willful misconduct by Plantex or its Affiliates and each of their respective officers, directors, agents, employees in connection with the implementation of this Agreement; and (c) violation of any applicable law by Plantex or any of its Affiliates and each of their respective officers, directors, agents, employees. Not withstanding the above section 8.2 Plantex’s liability in the event of a product liability claim shall be limited to the aggregate dollar value of the Purchaser’s minimum purchase requirements, as set forth in this agreement, actually ordered by Purchaser for the twelve months immediately proceeding the time the claim is made.


8.3.	Each of Purchaser and Plantex (“ the Indemnitee ”) undertakes in favor of the other of them (“ the Indemnifier ”):


8.3.1.	to promptly notify the Indemnifier of the bringing or threat of any claim or legal proceeding against the Indemnitee and for which the Indemnitee is indemnified by the Indemnifier;


8.3.2.	to abide by such lawful and reasonable instructions as the Indemnifier may issue concerning the conduct of such claim, or the defense of such proceeding and at the Indemnifiers request to relinquish control of such claim or defense to the Indemnifier.


8.3.3.	not to make, without the Indemnifier’s express written authorization, any admission of liability to a claimant or plaintiff or his or her legal representative or insurer in respect of such claim or such proceedings or threatened proceedings and,


8.3.4.	not to make, without the Indemnifier’s express written authorization, any settlement or compromise of such claim or threatened claim or such proceedings or threatened proceedings.

8.4.

Neither party shall be liable to the other party (whether under contract or tort, including negligence) or otherwise, or to any third party for any indirect, special or consequential damages, including without limitation, for any loss or damage to business earnings, anticipated sales, anticipated or lost profits or goodwill suffered by the other party and/or related with and/or connected to the performance of this Agreement, even if such party is advised or should have known of the possibility of such damages.


8.5.	The provisions of this Section 8 shall survive the expiration or termination of this Agreement for any reason.

9. TERM

This Agreement shall commence on the Effective Date and, unless earlier terminated as provided below, shall remain in full force and effect until December 31, 2015(the “ Initial Term ”). Thereafter, the Agreement will automatically renew for up to two successive three (3) year periods (each such period, a “ Renewal Term ”), unless terminated by Purchaser on at least six (6) months written notice or by Plantex on at least twenty four (24) months written notice prior to the expiration of the Initial Term or either Renewal Term. The Initial Term together with the Renewal Terms shall be the Term .


10.	BREACH AND TERMINATION


10.1.	Either of Plantex or Purchaser may terminate this Agreement prior to its expiration at any time by sending a written notification to the other Party in the event that:


10.1.1.	the other Party fails materially to perform any obligation hereunder or the other Party materially violates any representation or warranty made herein and such failure or violation continues unremedied for a period of thirty (30) days following written notice by the terminating Party; or


10.1.2.	the other party admits to being or is declared insolvent or voluntary or involuntary proceedings are instituted by or against it in bankruptcy, or receivership, or for a winding-up or for the dissolution or re-organization of its assets.

10.2.

Purchaser shall have the right to terminate this Agreement with immediate effect upon the breach of the Settlement Agreement or section 3.3 or 3.10.2 of the License Agreement by an Affiliate of Plantex and as otherwise set forth in the Settlement Agreement. In the event this Agreement is terminated pursuant to this Section 10.2, all of Purchaser’s obligations herein, including the minimum purchase requirements set forth in Section 3.1 and any requirement to order or purchase API (including any outstanding orders or already manufactured API) shall immediately terminate.


10.3.	Purchaser shall have the right to terminate this Agreement

as provided in Section 3.1.2.1.


10.4.	Except with respect to a termination pursuant to Section 10.2, or unless agreed otherwise between the Parties, Purchaser will be required to purchase, and Plantex shall be required to supply the API in respect of which orders have been placed prior to expiration or termination of the Agreement, but not yet supplied on the date of termination.

10.5.

Upon termination of this Agreement, all rights and obligations will cease to exist except for (a) the payment of unpaid invoices due, (b) the confidentiality and Indemnification rights and obligations of the Parties, which shall survive the termination of this Agreement for a period of ten (10) years, and (c) any other term or condition that by its term survives termination. Clauses referring to governing law and jurisdiction shall survive the termination of this Agreement.

11. CONFIDENTIALITY

11.1.

In carrying out the terms of this Agreement and/or the Quality Agreement it may be necessary, from time to time, for a Party to disclose to the other Party certain information which is considered by the disclosing Party to be proprietary and of confidential nature (the “ Confidential Information ”). Confidential Information shall include but shall not be limited to, any and all information, know-how and data, technical or non-technical, concerning any finished drug product or active pharmaceutical ingredient, its Manufacture, marketing and sale, plans, processes, compositions, formulations, specifications, samples, systems, techniques, analyses, production and quality control data, testing data, marketing and financial data, and such other information or data relating to any finished drug product or active pharmaceutical ingredient.

11.2.

The recipient of any Confidential Information shall not use it for any purpose other than for the purposes of fulfilling its obligations under this Agreement. The recipient shall disclose Confidential Information only to those of its officers, directors, employees advisors and Affiliates (and such Affiliates' officers, directors, employees and advisors) requiring knowledge thereof in connection with their duties directly related to the implementation of this Agreement, and said officers, directors, employees, advisors and Affiliates (and such Affiliates' officers, directors, employees and advisors) shall hold the information in confidence pursuant to this Agreement. The recipient agrees that it will exercise the same degree of care and protection to preserve the proprietary and confidential nature of the Confidential Information disclosed by the disclosing Party, as recipient would exercise to preserve its own proprietary and confidential information, and in any case no less than a reasonable degree of care. Recipient agrees that it will, upon request of the disclosing party, immediately return all documents and any copies thereof containing Confidential Information belonging to, or disclosed by the disclosing party.


11.3.	Confidential Information shall not be deemed to include:


11.3.1.	Information in the public domain or which was known to or in the

possession of the recipient prior to the disclosure;


11.3.2.	Information which is independently developed by recipient or its Affiliates and which can be evidenced by way of documentation.


11.3.3.	Information that becomes available to recipient on a non-confidential basis, whether directly or indirectly, from a source other than a Party, which source, to the best of recipient’s knowledge, did not acquire this information on a confidential basis.


11.3.4.	Information which recipient is required to disclose pursuant to a valid order of a court or other governmental body or otherwise required by law upon prior notice to the other Party that such Confidential Information has been required.

11.4.

Upon expiration or earlier termination of this Agreement, the recipient of any Confidential Information shall, as the disclosing Party may direct in writing, either destroy or return to the disclosing Party all Confidential Information disclosed together with all copies thereof, provided, however, the recipient may retain one archival copy thereof for the purpose of determining any continuing obligations of confidentiality.


11.5.	The provisions relating to confidentiality in this Section shall remain in effect following termination of this Agreement for a period of ten (10) years.

11.6.

All publicity, press releases and other announcements relating to this Agreement or the transactions contemplated hereby shall be reviewed in advance by, and shall be subject to the approval of, both Parties. Each Party responding to a request for such approval shall respond to the requesting Party in writing within five (5) days of such request or within such shorter period as either Party may require in order to comply with applicable law.

12. GOVERNING LAW AND DISPUTE RESOLUTION

This Agreement will be governed by and construed in accordance with the laws of the State of New York, without regard for the conflicts of law principles thereof. The Parties agree that any controversies arising under this Agreement shall be presented before the State Courts for the State of New York. Plantex and Purchaser hereby submit themselves to the personal jurisdiction of such courts in connection with any such proceedings.

13. FORCE MAJEURE


13.1.	Except for the obligation of a Party to make payments to the other pursuant to this Agreement (that will not be deferred or extended for any reason), neither Party shall be liable for any non-performance or delay in

performance due to any cause beyond its reasonable control (insofar as they are beyond such control) including, but without derogating from the generality of the foregoing expression, strikes, lock-outs, labor disputes, acts of God, war, riot, civil commotion, malicious damage, act of terrorism, embargo, compliance with any law or governmental order, rule, regulation or direction, accident, breakdown of plant, fire, flood, or storm.


13.2.	In the event of either Party being so hindered or prevented, such Party shall give notice of suspension as soon as reasonably possible to the other Party stating the date and extent of such suspension and the cause thereof.


13.3.	Any Party whose obligations have been suspended as aforesaid shall nevertheless make every endeavor to carry out its obligations under this Agreement, even if in a partial or compromised manner, and shall resume the performance of such obligations as soon as commercially reasonable after the removal of the cause and shall so notify the other Party.


13.4.	In the event that such cause continues for more than six (6) consecutive months either Party may terminate this Agreement on fourteen (14) days written notice to the other Party, and in such event neither Party shall have any claim against the other arising from such termination.

14. GENERAL PROVISIONS

14.1.

Non-assignability : This Agreement may not be assigned in whole or in part by either of the parties hereto without the prior written consent of the non assigning party hereto. Such consent may be conditioned upon the agreement of the assigning Party to remain primarily liable for performance of all obligations of the assignee. Both Parties shall be entitled to assign, delegate, and/or subcontract its rights and obligation under this Agreement, in whole or in part, to one or more of its Affiliates on prior written notice to the other Party. Purchaser shall be entitled to assign, delegate, and/or subcontract its rights and obligation under this Agreement, in whole, to a third party that acquires ownership of the NDA. The foregoing notwithstanding, either Party shall be entitled to assign this Agreement to an acquirer of all or substantially all of its capital stock or assets, whether through purchase, merger, consolidation or otherwise.

14.2.

Power and representation : Each Party has full power and authority to execute, deliver and perform this Agreement and to incur the obligations provided herein under their respective laws. The entering into of this Agreement has been duly authorized by all proper and necessary action, corporate or otherwise, of each of the Parties. No consent or approval of shareholders or of any other person, other than those which have been obtained by each Party and remain in effect, is required as a condition to the validity, implementation or enforceability of this Agreement.


14.3.	No intellectual property rights : Nothing in this Agreement shall be deemed to give either Party any right, title, license or other interest in or to any trade name, trade mark, patent, copyright, design, packaging, set-up or other intellectual property right of the other of them or any of its Affiliates retaining

such right at the date of signature of this Agreement or at any time thereafter.


14.4.	UN Convention : To the extent that it may otherwise be applicable, the Parties hereby expressly agree to exclude from the operation of this Agreement, the United Nations Convention on Contracts for the International Sale of Goods, concluded at Vienna, on 11 April 1980, as amended and as may be amended further from time to time.


14.5.	Entire Agreement : This Agreement constitutes the entire understanding between the Parties with regard to the subject matter hereof, and supersedes all prior written and oral understandings and agreements. This Agreement may be amended only by a written instrument duly signed by the Parties.


14.6.	Insurance :

Both Parties agree to maintain in full force at their individual expense the following minimum required insurance coverage: (i) comprehensive General Liability insurance coverage, including broad form contractual liability coverage, affording a limit of $5,000,000 Bodily Injury/Property Damage Liability per occurrence and in the aggregate; and (ii) product liability insurance with minimum limits of $5,000,000 per occurrence and $10,000,000 annual aggregate. These minimum required insurance coverages shall be kept in full force at all times during the entire period of the Agreement and any renewals thereof. If any required insurance is written on a claims made basis, the policy holder/named insured shall ensure continuity of coverage for any claims arising after the policy expiry date for a period of 24 months. Both Parties agree to provide written notice to the other upon becoming aware of any material change, non-renewal or cancellation of insurance. Failure to maintain minimum required insurance may be deemed a breach of the Agreement. Upon execution of the Agreement and upon request thereafter, both Parties will provide to the other evidence of required insurance, causing each other to be shown as “certificate holder”, except for Purchaser’s product liability insurance where Supplier shall be listed as “additional insured”.

The insurance policies shall contain an explicit clause declaring that the policy is primary, preliminary and non contributory to any other insurance maintained by the other party, and the insurance company shall waive any claim or demand as to participation in any such other insurance policy under which the other company is covered, and will not participate as a co-insurer in any cases of loss or damage.

14.7.

Conflict with other documents : In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions set forth in any standard or other purchase order documentation or any document evidencing acceptance thereof or setting out terms of delivery and/or payment, the terms and conditions of this Agreement shall prevail unless such other document records expressly state that it prevails over this Agreement and is signed by duly authorized representatives of both Parties.


14.8.	No Agency : Plantex and Purchaser will act at all times as independent

parties. This Agreement does not make Purchaser an agent or legal representative of Plantex for any purpose whatsoever. Purchaser is not granted any right or authority to assume or to create any obligation or responsibility, express or implied, on behalf of or in the name of Plantex, with regard to any manner or thing whatsoever, unless otherwise specifically agreed upon in writing.


14.9.	Either Parties’ failure to terminate or seek redress for a breach of, or to insist upon strict performance of any term, covenant, condition or provision contained in this Agreement will not prevent a similar subsequent act from constituting a breach of this Agreement.

14.10.

If any portion of this Agreement is determined to be illegal or otherwise unenforceable by agreement of the Parties, by an arbitrator, by a court of competent jurisdiction or by an administrative agency of competent jurisdiction, that Section, to the extent permitted by law, shall be treated as deleted from this Agreement and the remaining portions of this Agreement will continue to be in full force and effect according to the terms hereof.


14.11.	This Agreement may be executed in one or more counterparts, each of which shall constitute an original and all of which, when taken together, shall constitute one agreement.


14.12.	It is hereby acknowledged that the manufacturer of the API(provided such manufacturer is an Affiliate of Plantex) is intended to be a third party beneficiary hereunder such that all representations and covenants of Purchaser and its Affiliates contained in this Agreement shall also inure to the benefit of such manufacturer of API.

15. NOTICES

Any payment’s notice, or other written communication required or permitted to be made or given hereunder may be made or given by either Party by facsimile or other electronic means such as e-mail; by first‑class mail, postage prepaid; or by courier to the mailing address or facsimile numbers set as below:


If to Plantex:	Plantex USA Inc.

400 Chestnut Ridge Rd.

Woodcliff Lake, New Jersey 07677

Attention: President

Fax Number: 201-343-3833

with a copy to: Plantex USA Inc.

400 Chestnut Ridge Rd.

Woodcliff Lake, New Jersey 07677

Attention: General Counsel

Fax Number: 215-293-6499

If to Purchaser: The Medicines Company

8 Sylvan Way

Parsippany, NJ 07054

Attention: Chief Executive Officer

Fax Number:

With a copy to: The Medicines Company

8 Sylvan Way

Parsippany, NJ 07054

Attention: General Counsel

Fax Number: 862 207 6062

or to such other addresses or facsimile numbers as a Party shall designate by notice, similarly given, to the other Party. Notices or written communications shall be deemed to have been sufficiently made or given: (i) if mailed, fourteen (14) days after being dispatched by mail, postage prepaid; (ii) if by air courier, seven days after delivery to the air courier company; or (iii) if by facsimile or other electronic means with confirmed transmission, within five (5) days of transmission. An additional copy of all notices issued by Purchaser relating to breach, termination or renewal of this Agreement shall be sent by Purchaser, to Plantex’s Legal Department, facsimile no. (201) 307-6909.

IN WITNESS WHEREOF , the undersigned authorized representatives of the respective Parties hereto have entered into and executed this Agreement as of the date set forth above.



PLANTEXUSA Inc.	The Medicines Company
signature: / s/George Svokos __________________ name: George Svokos title: President	signature: _ /s/ Glenn Sblendorio ______________ name: _ Glenn Sblendorio ________________ title: EVP & CFO _______________________
signature: /s/ Henit Lapid Ben Ari ______________ name: Henit Lapid Ben Ari title: Director of Sales and Marketing
Date: ____ Sept. 29 ________, 2011	Date: ____ Sept. 30 ________, 2011

Appendix A

Specifications

Tests and Limits

1. Characters

1.1Appearance

[**]

2. Identification

[**]

3 Tests

[**]

8.0 Assay

[**]

Appendix B

Purchase Order for 2011 Requirements



PO 000924-A (Revised)			September 15, 2011

Vendor			The Medicines Company
Plantex 400 Chestnut Ridge Road Woodcliff Lake, NJ 07677			Accounts Payable 8 Sylvan Way Parsippany, NJ 07054 United States
			Ship To
			The Medicines Company 8 Sylvan Way Parsippany, NJ 07054
Product	Description	Quantity	Unit Price	Total Price
API Bivalirudin	Purchase of API (bivalirudin)	[**] grams	$ [**]/gram	$ [**]
			Tax	$0
			Total	$ [**]

Coding
Cost Center		Account	Sub-Account	Project
[**]		[**]	0	0

Special Terms
• Firm order subject to signing of Settlement Agreement, License Agreement, and API Supply Agreement (collectively, the “Agreements”) on or before September 30, 2011. Purchase Order will cancel if the Agreements are not signed on or before September 30, 2011. • Availability of up to [] grams on or before []. Balance of purchase order available on or before []. • The terms of the delivery of the quantities specified in section 2 of the terms in this Purchase Order are in accord with the terms of the Supply Agreement. • Invoicing of the of the quantities specified in section 2 of the terms in this Purchase Order are in accord with the terms of the Supply Agreement • MDCO shall take title and risk of loss of the product upon invoicing by Teva. • MDCO requests that the product be stored under GMP conditions at one of Teva’s facilities until picked up by MDCO. • MDCO will pick up the all product under this Purchase Order upon its request but in any event no later than [].



All invoices in reference to this purchase order should be mailed to the address specified above, or emailed to ap@themedco.com . Please include the following information on all invoices:
	PO Number  Care of: Accounts Payable  Cost Center – If Specified in the PO  Account – If Specified in the PO  Sub-Account – If Specified in the PO  Project Code – If specified on the PO



Plantex	/s/ Glenn Sblendorio The Medicines Company

Exhibit 10.5

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

FIRST AMENDMENT TO
SECOND AMENDED AND RESTATED DISTRIBUTION AGREEMENT

This First Amendment to Second Amended and Restated Distribution Agreement (this “Amendment”) is between The Medicines Company, a Delaware corporation with offices at 8 Sylvan Way, Parsippany, NJ 07054 (“MDCO”), and Integrated Commercialization Solutions, Inc., a California corporation with offices at 3101 Gaylord Parkway, Frisco, TX 75034 (the “Distributor”). This Amendment is effective as of July 1, 2011 (the “Amendment Effective Date”).

RECITALS


A.	MDCO and Distributor are parties to a Second Amended and Restated Distribution Agreement effective as of October 1, 2010 (the “Agreement”);


B.	Pursuant to the Agreement, among other things, MDCO engaged Distributor to perform distribution services for certain of MDCO’s pharmaceutical products; and


C.	The parties now wish to amend the Agreement in certain respects.

AMENDMENT

NOW THEREFORE, the parties agree as follows:


1.	Defined Terms . Capitalized terms in this Amendment that are not defined in this Amendment have the meanings given to them in the Agreement. If there is any conflict between the Agreement and any provision of this Amendment, this Amendment will control.


2.	Confidentiality . Section 8.0 of the Agreement is deleted in its entirety and replaced with the following:

The terms and conditions of the Mutual Non-Disclosure provisions set forth on Schedule A are incorporated by reference herein.


3.	Schedule A . Schedule A to the Agreement is deleted in its entirety and replaced with the attached Revised Schedule A.


4.	Section 16.0 . A new Section 16.0 is added to the Agreement as follows:

16.0 Trademark and Intellectual Property

16.1

The Parties acknowledge that Distributor has performed the services set forth in Section 3.3 under the trade name “The Medicines Company Direct” and using registered trademarks belonging to MDCO, and that MDCO authorized and consented to Distributor performing these services and activities in this manner. Distributor expressly acknowledges and agrees that such prior use did not and does not confer to Distributor any patent right, copyright right, trademark right or other proprietary right of MDCO, and that MDCO is the exclusive owner of all such rights.

16.2

Effective on July 1, 2011 (the “Transition Date”), Distributor will cease using the trade name “The Medicines Company Direct” or any trademark, source mark, logo, name, word, phrase, symbol, design, or image belonging to MDCO, or any combination of these elements (individually and collectively referred to as “MDCO Mark”), for any purpose, except as provided in Section 16.4. For clarification only, Distributor hereby conveys to MDCO all right, title and interests of any kind, including all associated good will, to the mark “The Medicines Company Direct” and any registrations or applications for registration of such mark, and the right to recover for past infringement of such mark. Distributor agrees that it will not attach the title of MDCO in and to any MDCO Mark. Distributor will file appropriate withdrawals of any assumed name or DBA certificates with state regulatory authorities.


16.3	MDCO hereby grants a limited, non-exclusive, royalty-free, non-transferable license to Distributor to use the MDCO Mark in the Territory solely in Distributor’s performance of the obligations contemplated under this Agreement. The license granted in this Section 16.3 shall terminate effective on the Transition Date, except with respect to the matter described in Section 16.4.

16.4

Distributor has previously informed customers and regulators that drug pedigrees for Products sold before the Transition Date are available at www.themedicinescompanydirect.com . MDCO acknowledges that, to enable Distributor to remain in compliance with applicable pedigree laws _s Distributor will be permitted to redirect customers that attempt to access that website to Distributor’s standard pedigree website, www.TMCDirectOrders.com .


5.	Exhibit D . Section E of Exhibit D of the Agreement is deleted in its entirety and replaced with the following:

Early Renewal Incentive. In recognition of MDCO’s early renewal of agreement, Distributor will reduce all monthly invoices for the term of this Agreement by an amount equal to $[**] or $[**] over [**] months.


6.	No Other Changes . Except as otherwise provided in this Amendment, the terms and

conditions of the Agreement will continue in full force, nothing in the Amendment modifies any term or provision in the Agreement or the Continuing Guaranty.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the Amendment Effective Date.

INTEGRATED COMMERCIALIZATION THE MEDICINES COMPANY
SOLUTIONS, INC.



By: /s/ Doug Cook	By: /s/ Tanya Quinn
Name: Doug Cook	Name: Tanya Quinn
Title: VP, General Manager	Title: VP, Global Distribution & Customer Service

Revised Schedule A

Mutual Non-Disclosure Provisions

1. Definition of Confidential Information. “Confidential Information”‘ means any confidential or proprietary information that is disclosed or made available by one party (“Disclosing Party”) to the other party (“Recipient”), whether in writing or other tangible form, orally or otherwise. Confidential Information includes (a) information about customers, processes, systems, strategic plans, business plans, operating data, financial information and other information and (b) any analysis, compilation, study or other material prepared by Recipient (regardless of the form in which it is maintained) that contains or otherwise reflects any information disclosed or made available by Disclosing Party to Recipient.

2. Exclusions from Confidential Information. Confidential Information does not include information that:

(a) at the time of disclosure to Recipient, is generally available to the public;

(b) after disclosure to Recipient, becomes generally available to the public other than as a result of a breach of this Schedule A by Recipient (including any of its affiliates);

(c) Recipient can establish was already in its possession at the time the information was received from Disclosing Party if its source was not known by Recipient to be bound to an obligation of confidentiality with respect to such information;

(d) Recipient receives from a third party if its source was not known by Recipient to be bound to an obligation of confidentiality with respect to such information; or

(e) Recipient can establish was developed independently by Recipient without use, directly or indirectly, of any Confidential Information.

3. Limitations on Disclosure and Use. Confidential Information must be kept strictly confidential and may not be disclosed or used by Recipient except as specifically permitted by this Schedule A or as specifically authorized in advance in writing by Disclosing Party. Recipient may not take any action that causes Confidential Information to lose its confidential and proprietary nature or fail to take any reasonable action necessary to prevent any Confidential Information from losing its confidential and proprietary nature. Recipient will limit access to Confidential Information to its employees, officers, directors or other authorized representatives (or those of its affiliates) who (a) need to know such Confidential Information in connection with the Agreement and (b) are obligated to Recipient to maintain Confidential Information under terms and conditions at least as stringent as those under this Schedule A. Recipient will inform all such persons of the confidential and proprietary nature of Confidential Information and will take all reasonable steps to ensure they do not breach their confidentiality obligations, including taking any steps Recipient would take to protect its own similarly confidential information. Recipient will be responsible for any breach of confidentiality obligations by such persons.

4. Ownership. All Confidential Information and derivations of Confidential Information wdll remain the sole and exclusive property of Disclosing Party and, except as provided, no license or other right to it will be implied by this Schedule A. If Recipient has prepared any analysis, compilation, study or other material (regardless of form) that contains or otherwise reflects any Confidential Information, then such material will be owned solely by Disclosing Party and treated as its Confidential Information under this Schedule A.

5. Return or Destruction of Confidential Information . Upon Disclosing Party’s request, Recipient will promptly deliver to Disclosing Party or destroy all Confidential Information (including material that contains or otherwise reflects Confidential Information) in its custody or control and will deliver it to Disclosing Party within ten (10) business days after such request or deliver a written statement from a corporate officers certifying it has destroyed all of Disclosing Party’s Confidential Information. Unless authorized in writing by Disclosing Party, Recipient will not retain any copy, extract or summary of Confidential Information (including material that contains or otherwise reflects Confidential Information).

6. Equitable Relief. Each party acknowledges that, when it is Recipient, money damages would not be a sufficient remedy for Disclosing Party in the event of any breach of the non-disclosure and confidentiality provisions of this Schedule A and that Disclosing Party is entitled to seek specific performance and injunctive or other equitable relief as a remedy for any such breach. Recipient further agrees to waive any requirement for the posting of any bond in connection with any such remedy. Such remedy will be in addition to any other available remedies at law or in equity.

7. Disclosures Required by Law. If Recipient is required by law to disclose any Confidential Information, Recipient will give Disclosing Party prompt notice and will use all reasonable means to obtain confidential treatment for any Confidential Information that it is required to disclose before making any such disclosure. If Recipient cannot assure confidential treatment and it has exhausted all reasonable efforts to do so, Recipient may disclose Confidential Information if in its good faith judgment it is required by law to disclose the information it discloses.

Exhibit 10.6

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission. Asterisks denote omissions.

SECOND AMENDMENT TO

SECOND AMENDED AND RESTATED DISTRIBUTION AGREEMENT

This Second Amendment to Second Amended and Restated Distribution Agreement (this “Amendment”) is between The Medicines Company, a Delaware corporation with offices at 8 Sylvan Way, Parsippany, NJ 07054 (“MDCO”), and Integrated Commercialization Solutions, Inc., a California corporation with offices at 3101 Gaylord Parkway, Frisco, TX 75034 (“Distributor”). This Amendment is effective as of September 1, 2011 (the “Amendment Effective Date”). MDCO and Distributor shall, at times throughout this Amendment, be referred to individually as a “Party” and collectively as the “Parties”.

RECITALS


A.	MDCO and Distributor are parties to a Second Amended and Restated Distribution Agreement effective as of October 1, 2010, as amended by the First Amendment dated July 1, 2011 (the “Agreement”);


B.	Pursuant to the Agreement, among other things, MDCO engaged Distributor to perform distribution services for certain of MDCO's pharmaceutical products; and


C.	The Parties now wish to amend the Agreement in certain respects.

AMENDMENT

NOW THEREFORE, the parties agree as follows:


1.	Defined Terms . Capitalized terms in this Amendment that are not defined in this Amendment have the meanings given to them in the Agreement. If there is any conflict between the Agreement and any provision of this Amendment, this Amendment will control.


2.	Section 6.1 . Section 6.1 of the Agreement is deleted in its entirety and replaced with the following:

6.1.1 MDCO represents and warrants that during the Term (a) the Products have been approved by the United States Food and Drug Administration (“FDA”) to be marketed in the Territory; (b) all applicable federal and state approvals and permits for the manufacture, importation, design, testing, inspection, labeling, and instructions for use, sale and distribution of the Products in the Territory have been obtained; and (c) MDCO owns or holds the duly approved Biologies License Application (as such term is used in the Public Health Service Act, Title 21, United States Code), or the duly approved New Drug Application or Abbreviated New Drug Application (as such terms are used in the Federal Food, Drug and Cosmetic Act, Title 21, United States Code), for Angiomax® (bivalirudin) and Cleviprex® (clevidipine)/Cleviprex® (clevidipine butyrate), no drug pedigree or prior sales history for Argatroban is required to be provided in connection with the distribution of Argatroban under applicable federal or state drug pedigree laws.

6.1.2 To the extent that MDCO is required under Applicable Law, MDCO will be solely responsible for, and shall comply with, all applicable federal and state laws governing the regulation of manufacture, importation, design, testing, inspection, labeling, sale, and instructions

for use of the Products in the Territory.

6.1.3 Distributor represents that it has obtained all federal and state approvals and permits to perform its obligations under this Agreement.


3.	Exhibit B . The Parties agree that Exhibit B to the Agreement is hereby deleted in its entirety and replaced with the attached Revised Exhibit B.


4.	Exhibit D , The Parties agree that Exhibit D to the Agreement is hereby deleted in its entirety and replaced with the attached Revised Exhibit D.


5.	No Other Changes . Except as otherwise provided in this Amendment, the terms and conditions of the Agreement will continue in full force, nothing in the Amendment modifies any term or provision in the Agreement or the Continuing Guaranty.

IN WITNESS WHEREOF, the Parties have executed this Amendment as of the Amendment Effective Date.



INTEGRATED COMMERCIALIZATION SOLUTIONS, INC. By: /s/ Doug Cook Name: Doug Cook Title: VP, General Manager	THE MEDICINES COMPANY By: /s/ Tanya Quinn Name: Tanya Quinn Title: 9/13/11

REVISED EXHIBIT B

Product List



Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:	ANGIOMAX® (bivalirudin) for Injection 65293-001-01 RX Carton (10 single use vials) 250mg vial $[*] per Carton, (which may change from time to time at MDCO's sole discretion) Thirty (30) Cartons 20 to 25°C



Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:	ANGIOMAX® (bivalirudin) Nova Plus for Injection 65293-004-22 RX Carton (10 single use vials) 250mg vial $[*] per Carton, (which may change from time to time at MDCO's sole discretion) Thirty (30) Cartons 20 to 25°C
Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:	Cleviprex® (clevidipine butyrate) Injectable Emulsion 65293-002-011 RX Carton (10 single use vials) 50mg vial $[*] per Carton, (which may change from time to time at MDCO's sole discretion) Six (6) Cartons 2 to 8°C
Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:	Cleviprex® (clevidipine butyrate) Injectable Emulsion 65293-002-055 RX Carton (10 single use vials) 25mg vial $[*] per Carton, (which may change from time to time at MDCO's sole discretion) Twelve (12) Cartons 2 to 8°C



Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:		ARGATROBAN for Injection 42367-203-84 RX Carton (10 single use vials) 50mg vial $[*] Carton, (which may change from time to time at MDCO's sole discretion) Four (4) Cartons 20 to 25°C
Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:		Cleviprex® (clevidipine) Injectable Emulsion 65293-005-11 RX Carton (10 single use vials) 50mg vial $[*] Carton, (which may change from time to time at MDCO's sole discretion) Six (6) Cartons 2 to 8°C
Product Name: NDC#: Drug Type: Sellable Package Size: Dosage Form: Current WAC Price*: Case Pack Size Shipping and Storage Requirements:		Cleviprex® (clevidipine) Injectable Emulsion 65293-005-55 RX Carton (10 single use vials) 25mg vial $[*] Carton, (which may change from time to time at MDCO's sole discretion) Twelve (12) Cartons 2 to 8°C

REVISED EXHIBIT D

Fee Schedule



Services A. Marketing, Sales, Customer Service and Distribution Fees include the following Warehousing Management and Inventory Administration Customer Service / Order Entry Marketing and Distribution Services Invoicing and Accounts Receivable Management Direct Account Set Up Information Technology		Fee Percentage of WAC (see below)
Wholesaler Restock and Drop Shipments October 1, 2010 - September 30, 2011 Angiomax and Angiomax NovaPIus Cleviprex		Percent of WAC []% []%
October 1, 2011 - September 30, 2013 Angiomax and Angiomax NovaPIus Cleviprex September 1, 2011 - September 30, 2013 Argatroban		Percent of WAC []% []% Percent of WAC [**]%
Shipment to Direct Account End-Users October 1, 2010 - September 30, 2011 Angiomax and Angiomax NovaPIus Cleviprex September 1, 2011 - September 30, 2013 Argatroban		Percent of WAC []% []% Percent of WAC [**]%
Direct to End-User Fee - Cleviprex Only *Freight Upcharge (does not include Cleviprex)		$[**]/shipment additional fee MDCO to reimburse Distributor for upgrade From Ground to Next Day Saver or Next Day Air


B.	Contract Pricing (provided in Section 5.4)

MDCO will reimburse Distributor monthly for any MDCO Contract sales administered as a direct price (anything less than current WAC of the product) at time of sale. Reimbursement amount to Distributor is current WAC at time of contract sale minus contract price.

Any direct pricing will be provided by MDCO to Distributor.


C.	Pricing Actions

Distributor shall realize no benefit or penalty from pricing actions. In the event of a price increase on the Products, Distributor shall deduct the difference in value of the Products held in Distributor inventory held on the day prior to the price increase. For example, the day prior to the price increase the value of the products is $1,000,000 and a 6% price increase raises the value of the same inventory to $1,060,000 on the same number of units of Products. Distributor shall deduct the difference, $60,000, from the next Service Fee.

In the event of a price decrease on the Products, Distributor shall add the difference in value of the Products held in Distributor inventory held on the day prior to the price decrease. For example, the day prior to the price decrease the value of the products is $1,000,000 and a 6% price decrease lowers the value of the same inventory to $940,000 on the same number of units of Products. Distributor shall add the difference, $60,000, to the next Service Fee.


D.	Early Renewal Incentive

In recognition of MDCO's early renewal of agreement, Distributor will reduce all monthly invoices for the term of this Agreement by an amount equal to $[**] or $[**] over 36 months.

EXHIBIT 31.1

CERTIFICATIONS

I, Clive A. Meanwell, certify that:


1.	I have reviewed this Quarterly Report on Form 10-Q of The Medicines Company;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and


5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



		/s/ Clive A. Meanwell
		Clive A. Meanwell
		Chairman and Chief Executive Officer
Dated:	November 9, 2011

EXHIBIT 31.2

CERTIFICATIONS

I, Glenn P. Sblendorio, certify that:


1.	I have reviewed this Quarterly Report on Form 10-Q of The Medicines Company;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


c)	Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


d)	Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and


5.	The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):


a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and


b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.



		/s/ Glenn P. Sblendorio
		Glenn P. Sblendorio
		Executive Vice President and Chief Financial Officer
Dated:	November 9, 2011

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of The Medicines Company (the “Company”) for the period ended September 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Clive A. Meanwell, Chairman and Chief Executive Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



		By:	/s/ Clive A. Meanwell
			Clive A. Meanwell
			Chairman and Chief Executive Officer
Dated:	November 9, 2011

A signed original of this written statement required by Section 906 has been provided to The Medicines Company and will be retained by The Medicines Company and furnished to the SEC or its staff upon request

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of The Medicines Company (the “Company”) for the period ended September 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Glenn P. Sblendorio, Executive Vice President and Chief Financial Officer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:


(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and


(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



		By:	/s/ Glenn P. Sblendorio
			Glenn P. Sblendorio
			Executive Vice President and Chief Financial Officer
Dated:	November 9, 2011