In October 2007, we entered into a research and development collaboration, option and license agreement with GlaxoSmithKline (GSK) for the discovery, development, manufacture and worldwide commercialization of boron-based systemic therapeutics for at least eight product options in up to four target-based projects. Under the agreement, we will collaborate with GSK to identify and develop boron-based small molecule product candidates.

Pursuant to the agreement, GSK paid us a $12 million up-front fee in October 2007 and we have the right to require GSK to purchase $10 million of our capital stock. In each project, GSK has the option to obtain an exclusive license to develop, commercialize and market worldwide a specified number of product candidates once they have achieved proof of concept criteria. We will be primarily responsible for the discovery and development of each product candidate from the research stage until GSK exercises an option for such product candidate, at which point GSK will assume sole responsibility for the further development and commercialization of such product candidate. GSK is obligated to make payments to us if certain milestones are met, which range up to $252 million to $331 million in the aggregate per product candidate. GSK is further obligated to pay us tiered double-digit royalties, with the potential to reach the mid-teens, on annual net sales of products containing optioned compounds.