Genentech – GDC–0068, GDC 0425 (RG7602), ARRY 575 and other Oncology Programs
We entered into a licensing and collaboration agreement with Genentech in December 2003 to develop small molecule drugs against multiple therapeutic targets in the field of oncology. We initiated this collaboration to advance two of our proprietary oncology programs into clinical development. These programs included small molecule leads we had developed along with additional, related intellectual property. Under the agreement, Genentech made an up-front payment, provides research funding and has so far paid us milestones for nominating a clinical candidate and advancing it into regulated safety assessment testing and Phase 1. In addition, Genentech has agreed to make additional potential development milestone payments and pay us royalties on any resulting product sales. Genentech is solely responsible for clinical development and commercialization of the resulting products.

In 2005, 2008 and 2009, we expanded our collaboration with Genentech to develop clinical candidates directed against an additional third, fourth and fifth target, respectively. Under the agreement, we receive additional research funding, as well as potential research and development milestone payments and product royalties based on the success of each new program. Genentech has paid Array a total of $15.5 million in up-front and milestone payments, and we have the potential to earn an additional $60 million for all programs if Genentech continues development and achieves the remaining clinical milestones set forth in the agreement.

In September 2010, we and Genentech extended the agreement for an additional two years of funded research through January 2013. Genentech may terminate the agreement upon 120 days' notice.

In June 2011, Genentech disclosed that one collaborative drug, GDC-0068, an AKT inhibitor, was advancing to a Phase 1b, open label, dose escalation study of the safety and pharmacology of GDC-0068 in combination with either Taxotere or fluoropyrimidine plus oxaliplatin in patients with advanced solid tumors.

In August 2011, Array and Genentech, a member of the Roche Group, entered into an oncology agreement with for the development of each company's small molecule Checkpoint kinase 1 (ChK-1) program. The programs include Genentech's compound GDC-0425 (RG7602), currently in Phase 1, and Array's compound ARRY-575, which is being prepared for an investigational new drug application to initiate a Phase 1 trial in cancer patients. Under the terms of the agreement, Genentech is responsible for all clinical development and commercialization activities. Array will receive an upfront payment of $28 million and is eligible to receive clinical and commercial milestone payments up to $685 million and up to double digit royalties on sales of any resulting drugs.