Genentech (Wnt)

In  April 2005 we entered into a collaboration with Genentech focused on  the discovery and development of small molecule compounds that modulate  the Wnt signaling pathway.  We conducted research  activities under this collaboration from April 2005 until March 2007,  at which time Genentech assumed further responsibility for any future  development of this program.  We will not receive future research funding under this program. 

We  have the right to receive contingent cash payments under the agreement  assuming that Genentech pursues the development of one or more drug  candidates and specified development objectives are achieved.  We  are also eligible to receive royalties on product sales, should any  products under this collaboration be successfully commercialized.  If  Genentech does not advance drug candidates generated under this  collaboration beyond the discovery research stage, we are not entitled  to receive any future cash payments under this collaboration.  We  can not predict whether Genentech will pursue the further development  of drug candidates under the agreement and/or whether any development  objectives for which we may be entitled to a cash payment will be  successfully achieved.

In the event of  termination by Genentech without cause or if the agreement is  terminated by Genentech due to material breach, we would be entitled to  receive only a reduced royalty for those products that are covered by a  subset of certain intellectual property rights, in lieu of the standard  contract royalties that would otherwise apply.