DRRX Durect Corp

On July 19, 2019, DURECT Corporation (“DURECT” or the “Company”) entered into a license agreement (the “Agreement”) with Gilead Sciences, Inc.  (“Gilead”). Pursuant to the Agreement, the Company has granted Gilead the exclusive worldwide rights to develop and commercialize a long-acting injectable HIV product utilizing DURECT’s SABER® technology.    Gilead also received exclusive access to the SABER® platform for HIV and Hepatitis B Virus (HBV) and the exclusive option to license additional SABER-based products directed to HIV and HBV.

Under the terms of the Agreement, Gilead will make an upfront payment to DURECT of $25 million, with the potential for up to an additional $75 million in development and regulatory milestones, up to an additional $70 million in sales-based milestones, as well as tiered single-digit royalties on product sales for a defined period. Gilead has the exclusive option to license additional SABER-based products directed to HIV and HBV for an additional $150 million per product in upfront, development, regulatory and sales-based milestones as well as tiered single-digit royalties on sales.  The parties will collaborate on specified development activities with Gilead controlling and funding the development programs.  The Agreement contains customary representations, warranties and indemnification provisions.  The term of the Agreement is for the duration of Gilead’s obligation to pay royalties for product sales under the Agreement. The Agreement provides each party with specified termination rights, including the right of Gilead to terminate at will with advance notice to DURECT and each party to terminate the Agreement upon material breach of the Agreement by the other party. The description of the Agreement is qualified in its entirety by the full text of the Agreement which will be filed as an exhibit to the Company’s Form 10-Q for the quarter ended September 30, 2019.