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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

ý	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For The Fiscal Year Ended December 31, 2009
OR
o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                        to                         .

Commission File No. 0-19700

AMYLIN PHARMACEUTICALS, INC.
(Exact Name of Registrant as Specified in its Charter)

Delaware (State or other jurisdiction of incorporation or organization)	33-0266089 (I.R.S. Employer Identification No.)
9360 Towne Centre Drive San Diego, California (Address of principal executive offices)	92121 (Zip Code)

Registrant's telephone number, including area code: (858) 552-2200

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of each Exchange on Which Registered
Common Stock, $.001 par value	The NASDAQ Stock Market, LLC

Securities registered pursuant to Section 12(g) of the Act:

NONE

(Title of Class)

          Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ý    No o

          Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o    No ý

          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 ý    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 o    No o

          Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. 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 definition of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

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

          Indicate by check mark whether the registrant is a shell company (as defined in Exchange Act Rule 12b-2). Yes o    No ý

          The aggregate market value of the common stock of the registrant as of June 30, 2009 held by non-affiliates was $645,730,218.

          The number of shares outstanding of the registrant's common stock was 142,951,264 as of February 16, 2010.

DOCUMENTS INCORPORATED BY REFERENCE

          Portions of the registrant's Definitive Proxy Statement to be filed with the Securities and Exchange Commission (the "Commission") pursuant to Regulation 14A in connection with the 2010 Annual Meeting of Stockholders to be held on April 29, 2010 are incorporated herein by reference into Part III of this Annual Report. Such Definitive Proxy Statement will be filed with the Commission not later than 120 days after December 31, 2009.

You should read the following together with the more detailed information regarding our company, our common stock and our financial statements and notes to those statements appearing elsewhere in this document or incorporated by reference. The Securities and Exchange Commission, or SEC, allows us to "incorporate by reference" information that we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this annual report on Form 10-K.

Except for the historical information contained herein, this annual report on Form 10-K and the information incorporated by reference contains forward-looking statements that involve risks and uncertainties. These statements include projections about our accounting and finances, plans and objectives for the future, future operating and economic performance and other statements regarding future performance. These statements are not guarantees of future performance or events. Our actual results may differ materially from those discussed here. Factors that could cause or contribute to such differences are described in Part I, Item 1A, entitled "Risk Factors," as well as those discussed in Part II, Item 7, entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations," and elsewhere throughout this annual report on Form 10-K and in any other documents incorporated by reference into this annual report on Form 10-K. We disclaim any obligation to update any forward-looking statement.

PART I

Item 1.    Business

Business Overview

        We are a biopharmaceutical company committed to improving the lives of people with diabetes, obesity and other diseases through the discovery, development and commercialization of innovative medicines. We are marketing two first-in-class medicines to treat diabetes, BYETTA® (exenatide) injection and SYMLIN® (pramlintide acetate) injection and we are currently seeking approval for exenatide once weekly, an investigational sustained-release medication for type 2 diabetes that is administered only once a week.

        In 2009 we executed on key opportunities for the company including:

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gained approval for an expanded indication of BYETTA as a first-line, stand alone medication (monotherapy) along with diet and exercise;

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finalized BYETTA label updates;

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submitted a New Drug Application, or NDA, for exenatide once weekly and executed our DURATION clinical program designed to demonstrate superiority of exenatide once weekly compared to other diabetes medications;

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completed two obesity clinical trials and entered into a collaboration to develop obesity therapies with Takeda Pharmaceutical Company Limited, or Takeda; and

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improved our operating results and believe we are on track to achieve our stated goal of becoming operating cash flow positive on a sustainable basis by the end of 2010 and achieving operating profitability by the end of 2011.

        BYETTA is the first approved medicine in a class of compounds called glucagon-like peptide-1 (GLP-1) receptor agonists. In October 2009, the FDA approved an expanded indication to include BYETTA as a first-line, stand-alone medication (monotherapy) along with diet and exercise to improve glycemic control in adults with type 2 diabetes and changes to the BYETTA label to incorporate updated safety language. Previously BYETTA was approved as an adjunctive therapy to improve glycemic control in patients with type 2 diabetes who have not achieved adequate glycemic control by using metformin, a sulfonylurea and/or a thiazolidinediene (TZD), three common oral therapies for

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type 2 diabetes. We believe the expanded monotherapy indication and label update present new opportunities for the BYETTA brand. Net product sales of BYETTA were $667.6 million in 2009, $678.5 million in 2008 and $636.0 million in 2007.

        We have an agreement with Eli Lilly and Company, or Lilly, for the global development and commercialization of exenatide. This agreement includes BYETTA and other formulations of exenatide such as exenatide once weekly. Under the terms of the agreement, operating profits from products sold in the United States are shared equally between Lilly and us, and Lilly will pay us royalties for product sales outside of the United States. Lilly has primary responsibility for developing and commercializing BYETTA outside of the United States, including any sustained release formulations of exenatide such as exenatide once weekly. By the end of 2009, BYETTA was commercially launched in approximately 60 countries worldwide.

        SYMLIN is the first and only approved medicine in a class of compounds called amylinomimetics. It is approved as an adjunctive therapy to improve glycemic control in patients with either type 2 or type 1 diabetes who are treated with mealtime insulin but who have not achieved adequate glycemic control. We own 100% of the global rights to SYMLIN and in 2010 we plan to explore partnering SYMLIN outside of the United States. Net product sales of SYMLIN were $86.4 million in 2009, $86.8 million in 2008 and $65.5 million in 2007.

        We have a field force of approximately 390 people dedicated to marketing BYETTA and SYMLIN in the United States. Our field force includes our specialty sales force and our managed care organization. Lilly co-promotes BYETTA in the United States. In May 2009, we announced a restructuring of our sales force, a new sales approach within the diabetes market and merged our then-existing primary care and specialty sales forces into a single organization that brings a specialty approach to endocrinologists and diabetes-focused primary care physicians. This new sales force is focused on targeting those doctors that write the majority of prescriptions for branded diabetes therapies. The restructuring of our sales force reduced our total number of sales representatives by approximately 200.

        In addition to our marketed products, we are working with Lilly and Alkermes, Inc., or Alkermes, to develop exenatide once weekly. In May 2009, we submitted an NDA for exenatide once weekly to the FDA. The FDA filed the NDA submission in July 2009 and the application has a ten-month review period. Clinical components of the NDA included results from our DURATION-1 study which tested the superiority of exenatide once weekly as compared to BYETTA and a meta-analysis across controlled clinical studies of three months or greater from the BYETTA database which showed no increased risk of cardiovascular events associated with exenatide use. Components of the NDA submission supporting product manufacturing included analyses of data from patients in our ongoing extension of the DURATION-1 study who used exenatide once weekly produced at our Ohio manufacturing facility to demonstrate comparability of the intended commercial product with that used during development. The FDA conducted a pre-approval inspection of this facility and has made a number of observations which we believe are addressable.

        In March 2009 and July 2009, we announced positive results from DURATION-2 and DURATION-3, respectively, the second and third in a series of six such studies designed to test the superiority of exenatide once weekly compared to other diabetes therapies. In DURATION-2, exenatide once weekly demonstrated superior glucose control with weight loss and no increase in hypoglycemia compared to maximum doses of sitagliptin (Januvia®) or pioglitazone (Actos®). In DURATION-3, exenatide once weekly demonstrated superior glucose control with weight loss and with less hypoglycemia compared to insulin glargine (Lantus®). In December 2009, we announced results from DURATION-5, a head-to-head study comparing exenatide once weekly to BYETTA. In DURATION-5, patients taking exenatide once weekly experienced a statistically superior reduction in glycated hemoglobin (A1C) compared to BYETTA.

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        In 2010, we will continue to focus on building a superior profile for exenatide once weekly by conducting additional clinical trials that will compare exenatide once weekly against competing products. For example, we expect to report results from our DURATION-4 study in late 2010 comparing exenatide once weekly with metformin, sitagliptin or pioglitazone and we have initiated DURATION-6 comparing exenatide once weekly with liraglutide (Victoza®). In addition, we expect to start our EXSCEL study in the first quarter of 2010, to demonstrate exenatide once weekly's effect on cardiovascular endpoints. We plan to continue making strategic investments in the exenatide franchise including the development of an exenatide once weekly pen delivery system, an exenatide suspension formulation and potential noninvasive delivery systems including transdermal and nasal.

        Our long-term growth strategy is focused on making prudent investment decisions based on strong clinical data to advance our obesity program and includes our Integrated Neurohormonal Treatment of Obesity, or INTO, strategy. In October 2009, we entered into a worldwide exclusive license, development and commercialization agreement with Takeda to co-develop and commercialize pharmaceutical products for the treatment of obesity and related indications. The agreement includes products to be developed from our product pipeline, including pramlintide/metreleptin, which is a compound currently in phase 2 development for the treatment of obesity. We recently announced results of a 52-week phase 2 study of this compound and, based on those results, we and Takeda plan to advance pramlintide/metreleptin toward phase 3 development.

        We maintain an active discovery research program focused on novel peptide and protein therapeutics. We have also entered into a number of strategic alliances and business initiatives that support our expansion into new therapeutic areas.

        Our principal executive offices are located at 9360 Towne Centre Drive, San Diego, CA 92121, and our telephone number is (858) 552-2200. We were incorporated in Delaware in September 1987. We maintain a website at www.amylin.com. The reference to our worldwide web address does not constitute incorporation by reference into this report of any of the information contained on our website.

        Our periodic and current reports that we file with the SEC are available free of charge on our website at www.amylin.com as soon as reasonably practicable after we have electronically filed them with, or furnished them to, the SEC.

Diabetes

        Diabetes is a major worldwide health problem and is the fifth leading cause of death by disease in the United States. Diabetes is a complex, metabolic disorder of carbohydrate, fat and protein metabolism, primarily resulting from the failure of pancreatic beta cells to produce sufficient insulin to match the demands for insulin in the body. Insulin is a hormone that plays a central role in helping the body process, convert and store energy from glucose. Another important hormone in glucose regulation is glucagon which is released from the alpha-cells of the pancreas. Its action opposes insulin by increasing glucose appearance in the bloodstream. With the discovery of incretin hormones, GLP-1, gastric inhibitory peptide and the pancreatic hormone amylin, it is now understood that several organs and hormones play a role in maintaining glucose balance in the body. In individuals with diabetes, the relative shortage of insulin impairs the ability of glucose to enter and fuel the body's cells and, as a result, glucose builds up in the bloodstream causing hyperglycemia (high blood sugar). Prolonged elevation of blood glucose may result in damage to the kidney, retina and nerves—and may lead to kidney failure, permanent nerve damage, blindness and amputation. High glucose also increases the risk of cardiovascular disease. Conversely, too much insulin in the bloodstream can cause hypoglycemia (low blood sugar). Individuals who manage their diabetes with insulin or other oral antidiabetic medication are especially vulnerable to swings of high to low blood sugar level and the risk of very low blood sugar which, if left untreated, can be fatal.

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        It is estimated that over 240 million people worldwide have diabetes. Of that population, it is estimated that approximately 90-95% have type 2 diabetes, previously known as adult-onset diabetes, and the remainder have type 1 diabetes, previously known as juvenile-onset diabetes. In the United States alone, there are approximately 23.6 million people, or 7.8% of the population, with diabetes. Only 17.9 million of these people have been diagnosed, while 5.7 million people with diabetes have not been diagnosed. From 1980 through 2007, newly diagnosed cases of diabetes among Americans aged 18-79 nearly tripled. In addition, there are currently approximately 57 million people in the United States with pre-diabetes, a condition that raises the risk of developing type 2 diabetes, heart disease and stroke. People with pre-diabetes have blood glucose levels higher than normal but not high enough to establish a diagnosis of diabetes.

        Long-term control of blood glucose is known to limit the risk of developing diabetes-related retinal, renal and neurologic complications. A1C is the most widely used measure of long-term blood glucose control. A1C level is a recognized indicator of an individual's average blood glucose concentrations over the preceding three- to four-month period. Lower A1C levels indicate better average blood glucose control, with values in people without diabetes usually being less than 6%. The ADA suggests that people with diabetes should aim for an A1C value that is lower than 7%. It is estimated that more than half of Americans being treated for diabetes are failing to achieve recommended blood glucose levels and, according to research studies conducted in the United States and abroad, these patients would significantly benefit from improved glycemic control. Additionally, aggressive use of insulin and some oral medications to reduce glucose levels can be associated with an increased risk of hypoglycemia and weight gain. Consequently, there has long been a need to develop new treatment strategies that safely improve glucose control, improve the overall health profile of patients with diabetes and reduce the risk of complications.

        In 2008, findings from various long-term clinical trials, including the 10-year follow up of the UK Prospective Diabetes Study and the "Action to Control Cardiovascular Risk in Diabetes," or ACCORD, trial suggested that it is important to treat patients with less advanced diabetes earlier. These studies also suggest that it is important to lower blood glucose without weight gain, associated cardiovascular risk and hypoglycemia which are often associated with older diabetes therapies. The cardiovascular outcomes of these studies suggest that blood glucose control strategies employing weight conscious therapies will be increasingly valued.

        For people suffering from diabetes, poor control of blood glucose levels has been shown to result in severe long-term complications. For instance, the United States Centers for Disease Control, or CDC, has stated that complications due to diabetes include:

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heart disease and stroke;

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high blood pressure;

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blindness due to retinopathy, a condition manifested by damage to the retina;

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nephropathy, or kidney disease;

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neuropathy, a condition where there is damage to the nervous system;

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amputations due to peripheral vascular disease; and

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periodontal disease.

        Obesity is common in patients with type 2 diabetes and weight control is a major problem for many patients with both type 1 and type 2 diabetes. In fact, more than 80% of people with type 2 diabetes are overweight. Weight gain is particularly common in those using insulin and certain oral medications as part of their treatment regimen. In addition, patients with diabetes frequently have wide fluctuations in blood sugar following meals. These fluctuations in blood sugar can significantly affect a

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patient's quality of life. Blood glucose fluctuations, weight gain and diabetes complications may each contribute to substantial disability, reduced quality of life, reduced productivity in the workplace, increased pain and suffering and premature death. Obesity increases the risk of cardiovascular disease 44% in people with type 2 diabetes and cardiovascular death accounts for three quarters of all deaths among people with diabetes. In fact, the risk of coronary heart disease, cardiovascular disease and death are significantly increased in the overweight population and to an even greater extent in obese patients with type 2 diabetes.

        In 2005, we introduced two new treatment options for the management of diabetes, BYETTA and SYMLIN. BYETTA offers patients with inadequate glycemic control the opportunity to better control their blood glucose levels and lose weight. SYMLIN offers patients with inadequate glycemic control using mealtime insulin a treatment option that can both improve glucose control and result in weight loss. These novel first-in-class medicines provide new options in disease management and glucose control to millions of people suffering with diabetes.

Marketed Products

BYETTA® (exenatide) injection

        BYETTA is the first approved medicine in a new class of compounds called incretin mimetics, or GLP-1 receptor agonists. We began selling BYETTA in the United States in June 2005 as an add-on therapy to improve glycemic control in patients with type 2 diabetes who have not achieved adequate glycemic control and who are taking metformin and/or a sulfonylurea, two common oral therapies for type 2 diabetes. In December 2006, the FDA approved an additional use for BYETTA as an add-on therapy to improve glycemic control in people with type 2 diabetes who have not achieved adequate glycemic control by using a TZD. In October 2009, the FDA approved an expanded indication for BYETTA as a first-line, stand-alone medication (monotherapy) along with diet and exercise to improve glycemic control in adults with type 2 diabetes. The type 2 diabetes treatment guidelines of the American Diabetes Association, or ADA, the European Association for the Study of Diabetes, or EASD, and the American Association of Clinical Endocrinologists, or AACE, include the GLP-1 receptor agonist class, which includes BYETTA, as a secondary treatment option for type 2 diabetes patients.

        We estimate the number of people in the United States currently using metformin, sulfonylurea and/or a TZD to be approximately 8.3 million and the number of people using diet and exercise to be approximately 3 million. More than half of all diabetes patients using oral medications are believed to have an A1C higher than the ADA's recommendation of less than 7% and the vast majority of these patients could be candidates for BYETTA.

        BYETTA provides glucose control by augmenting the body's natural physiologic processes, allowing the body to respond to blood glucose changes as they occur. BYETTA directly affects the beta cells' responses to elevated glucose by enhancing insulin secretion; this effect dissipates as glucose levels approach the normal range. BYETTA also restores first-phase insulin response, an effect which is evident following the initial dose. BYETTA is administered twice a day by using a fixed dose injection, and requires no dose adjustments due to changes in meal size or composition, exercise or other variables. No additional glucose monitoring is required with BYETTA therapy.

        The most common adverse effect of BYETTA is mild to moderate nausea, which tends to dissipate with time. Mild to moderate hypoglycemia has also been observed, primarily when used in conjunction with a sulfonylurea, agents that are known to cause hypoglycemia.

        In August 2008, the FDA updated a prior alert for BYETTA referencing pancreatitis. Prescriptions for BYETTA declined in the second half of 2008 and into 2009. In October 2009, the FDA approved changes to the BYETTA label to incorporate updated safety information, including pancreatitis-related

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safety language and an expansion of existing language regarding use of BYETTA in patients with renal impairment. We continue to work to better understand the relationship between BYETTA and pancreatitis described in some spontaneously reported cases. In keeping with our focus on patient safety, we continue to pursue our drug safety program that includes thorough investigation of individual spontaneous case reports along with clinical and epidemiologic studies. Within the detection limits of an initial epidemiology study which we provided to the FDA, we have not observed an increased incidence of pancreatitis associated with BYETTA compared to other treatments for diabetes and thus believe a definite causal relationship between BYETTA and pancreatitis has not been proven.

        By the end of 2009, we had a field sales force of approximately 390 individuals who target those doctors that write the majority of BYETTA and SYMLIN prescriptions. Together with the Lilly field organization, our goal is to provide education, through both one-on-one interactions and educational programs, to ensure that physicians understand BYETTA, including its mechanisms of action, potential benefits, identify appropriate patients and provide important use considerations. We have refined our marketing efforts to remind both endocrinologists and primary care physicians of BYETTA's unique benefits of glucose control with weight loss. Primary care physicians write approximately 70% of diabetes prescriptions in the United States. Additionally, we have access to health care plan reimbursement for BYETTA at approximately 80% coverage nationally on tier 2, which requires a relatively low co-payment from patients who are covered under such plans.

        We continue to support initiatives to facilitate the successful initiation of therapy by primary care physicians. This effort includes: increased patient educational material for health care providers to distribute in their offices; a network of approximately 400 diabetes educators to work with physicians and their patients within their local communities; direct support to patients through the BYETTA Easy Start Line, which provides a toll-free number that allows patients to contact trained medical professionals to better understand the benefits of BYETTA therapy and to get assistance starting and using the BYETTA pen; a pharmacy support component partnering with managed care plans designed specifically to assist with patient refills; and an enhanced BYETTA website. We believe this support is helpful to patients who may be on their first injectable therapy and to primary care providers who may be less accustomed to treating patients with an injectable product earlier in the disease cycle and who have fewer resources in their offices.

        Lilly co-promotes BYETTA in the United States with us and has primary responsibility for developing and commercializing BYETTA outside the United States, including any sustained-release formulations such as exenatide once weekly. By the end of 2009 BYETTA was launched in approximately 60 countries worldwide.

BYETTA Development Activities

        Concurrent with BYETTA's initial approval, the FDA issued an approvable letter for BYETTA when used as a stand-alone therapy (monotherapy) for people with type 2 diabetes. In October 2009, the FDA approved an expanded indication for BYETTA as a first-line, stand-alone therapy along with diet and exercise to improve glycemic control in adults with type 2 diabetes.

        In June 2009, we announced results from a meta-analysis of cardiovascular, or CV, events that showed no increased risk of CV events associated with BYETTA injection use compared to a pooled comparator group treated with either placebo or insulin. This analysis applied the principles that were described in the FDA's guidance for evaluating CV risk in type 2 diabetes agents. In the meta-analysis of 12 completed, randomized, controlled clinical trials of 12-52 weeks, the unadjusted rate at which patients experienced at least one CV event was 2.0 percent for BYETTA and 2.6 percent for the comparator group. The relative risk between BYETTA and the comparator group was 0.69 with a 95 percent confidence interval of 0.46-1.03. To determine if there are favorable cardiovascular effects of exenatide treatment, we and Lilly recently initiated a large cardiovascular outcomes trial with a

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superiority design that will evaluate the effects of exenatide once weekly on major cardiovascular events, compared to standard of care with traditional antidiabetes medications.

SYMLIN® (pramlintide acetate) injection

        SYMLIN is the first and only approved medicine in a new class of compounds called amylinomimetics. We began selling SYMLIN in the United States in April 2005 as adjunctive therapy to mealtime insulin to treat diabetes. Other than insulin and insulin analogues, SYMLIN is the first FDA-approved medication addressing glucose control for patients with type 1 diabetes since the discovery of insulin over 80 years ago. SYMLIN is indicated for use in people treated with insulin alone or, in the case of patients with type 2 diabetes, treated with insulin with or without one or more oral medications to help improve blood glucose control.

        SYMLIN works with insulin to smooth out the peaks in blood glucose levels to give patients more stable blood glucose levels after meals and throughout the day. SYMLIN also lowers the A1C levels of most patients beyond what insulin alone can achieve. SYMLIN induces satiety, which leads to eating less and weight loss in most patients. In addition, because SYMLIN works with insulin to control blood sugar, patients often need less insulin to achieve desired blood sugar levels after meals.

        SYMLIN is used with insulin and has been associated with an increased risk of insulin-induced severe hypoglycemia. The risk can be reduced by appropriate patient selection, careful patient instruction and insulin dose adjustments. Other adverse effects commonly observed are primarily gastrointestinal, including nausea, which decrease over time in most patients.

        Our SYMLIN marketing is focused on a target physician population of approximately 20,000, with a goal of educating these physicians on SYMLIN, including its mechanisms of action, potential benefits, use considerations and appropriate patient selection for initiating SYMLIN therapy. These physicians write approximately 36% of all insulin prescriptions in the United States. In January 2008, we launched the SymlinPen® 120 and the SymlinPen® 60 pen-injector devices for administering SYMLIN which currently represent nearly 75 percent of all new SYMLIN prescriptions. These pre-filled pen-injector devices feature fixed dosing to improve mealtime glucose control and can be stored at room temperature not to exceed 86 degrees F (30 degrees C) after first use. We continue to educate physicians about the SymlinPen and believe the SymlinPen enables patients to more easily deliver proper dosing than using a vial and syringe and improves the convenience of administering SYMLIN. Since introduction of the SymlinPen in 2008, usage has grown substantially relative to vial and syringe usage, and now represents the majority of sales and prescriptions. By the end of 2010, we will cease manufacturing and distributing the Symlin vial. Our near-term goal for SYMLIN is to grow SYMLIN prescriptions by highlighting how the product addresses the key unmet needs of patients using mealtime insulin.

Research and Development

Product Pipeline Programs

        We have late-stage and early-stage development programs in the therapeutic areas of diabetes and obesity. Our years of research in diabetes and deep understanding of peptide hormones—their physiology, functionality and impact on the disease—are being leveraged to develop potential treatments for obesity. The metabolic components of these diseases are linked in numerous ways, which are reflected in the impact each has on the other.

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Diabetes

Exenatide Once Weekly

        Exenatide once weekly is our late stage development program in diabetes. Exenatide is the active ingredient in BYETTA and is combined with proprietary technology developed by us and our partner, Alkermes, to provide a sustained release delivery of exenatide. The combination of potency and the glucose-dependent mechanism of action inherent in exenatide makes it well suited to development of a once weekly formulation. We have an agreement with Alkermes to assist us in the development, manufacture and commercialization of exenatide once weekly and this program is included in our collaboration agreement with Lilly. We are aggressively working with Lilly and Alkermes to develop exenatide once weekly and to bring it to market as soon as possible.

        In October 2007, we announced positive results of our DURATION-1 pivotal comparator study comparing treatment with exenatide once weekly to treatment with BYETTA over a 30-week period. The study enrolled 295 patients not achieving adequate glucose control either with use of diet and exercise or with use of oral glucose-lowering agents. Exenatide once weekly showed a statistically significant improvement in A1C of approximately 1.9% from baseline, compared to an improvement of approximately 1.5% for BYETTA. Approximately three out of four subjects treated with exenatide once weekly achieved an A1C of 7% or less.

        After 30 weeks of treatment, both exenatide once weekly and BYETTA treatment resulted in an average weight loss of approximately eight pounds. Nearly 90% of subjects in both groups completed the study. There were no major or severe hypoglycemia events regardless of background therapy. As expected, based on prior BYETTA studies, minor hypoglycemia with exenatide once weekly use was limited to subjects using background sulfonylurea therapy. Exenatide once weekly was associated with approximately 30% less nausea than twice-daily BYETTA. Approximately one out of five subjects receiving exenatide once weekly reported treatment-related nausea during the 30-week study. In both groups nausea was predominately mild and transient.

        In June 2008, we announced additional results of our 30-week DURATION-1 study. In addition to showing improvements in A1C, type 2 diabetes patients treated with exenatide once weekly experienced the following effects on several cardiovascular risk factors: a reduction of total cholesterol 11.9 mg/dL from a baseline of 173 mg/dL; a reduction of LDL of 4.9 mg/dL from a baseline 91.6 mg/dL; and a reduction of HDL of 0.9 mg/dL from a baseline of 43.9 mg/dL.

        Also in June 2008, we announced results from a 52-week open-label clinical study that showed the durable efficacy of exenatide once weekly. In this extension of our 30-week DURATION-1 study, patients either remained on exenatide once weekly or switched from BYETTA to exenatide once weekly for an additional 22 weeks. Patients taking exenatide once weekly over the course of one year sustained a similar improvement in glucose control of 2.0% lower A1C and lower fasting plasma glucose from baseline compared to those receiving treatment for 30 weeks who achieved 1.9% lower A1C from baseline.

        This 52-week study also showed that patients who switched from BYETTA after 30 weeks to exenatide once weekly experienced additional improvements in A1C and fasting plasma glucose. Following the 30-week comparison period, patients who continued on exenatide once weekly showed sustained improvements in A1C and fasting plasma glucose while patients who switched from BYETTA to exenatide once weekly had further improvements in glycemic control that were consistent with those patients receiving exenatide once weekly for 52 weeks. Seventy-two percent of patients treated with exenatide once weekly achieved an endpoint A1C of 7% or less and 54% achieved an A1C of 6.5% or less. In patients who switched from BYETTA to exenatide once weekly, 75% of patients achieved an endpoint A1C of 7% or less and 53% achieved an A1C of 6.5% or less. Exenatide once weekly was associated with an average weight loss of 9.5 pounds over 52 weeks. Exenatide once weekly was well

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tolerated during the first 30 weeks and the following 22-week, open-ended treatment period with overall tolerability improving over the course of the study. No major hypoglycemia events regardless of background therapy were observed with exenatide once weekly. Cases of minor hypoglycemia with exenatide once weekly and BYETTA use were limited to patients using background sulfonylurea therapy. In both groups, nausea was predominately mild and transient and occurred less frequently in exenatide once weekly patients.

        In May 2009, we submitted an NDA for exenatide once weekly to the FDA. The FDA filed the NDA submission in July 2009 and the application has a ten-month review period. Clinical components of the NDA included results from our DURATION-1 study which tested the superiority of exenatide once weekly as compared to BYETTA and a meta-analysis across controlled clinical studies of three months or greater from the BYETTA database which showed no increased risk of cardiovascular events associated with exenatide use. Components of the NDA submission supporting product manufacturing included analyses of data from patients in our ongoing extension of the DURATION-1 study who used exenatide once weekly produced at our Ohio manufacturing facility to demonstrate comparability of the intended commercial product with that used during development.

        In June 2009, we announced additional long-term, interim results from the DURATION-1 study that showed sustained glucose control with weight loss, as well as improvements in systolic blood pressure and triglycerides, through two years of treatment with exenatide once weekly. In the controlled portion of the open-label study, patients received exenatide once weekly or BYETTA injection for 30 weeks, followed by 74 weeks of treatment with exenatide once weekly for all patients during an open-ended assessment period. Significant reductions in A1C of 1.7 percent and fasting plasma glucose of 40 mg/dL were maintained after two years of treatment. Sixty-five percent of patients achieved an A1C of 7% or less. Body weight was significantly reduced, with patients losing an average of 5.8 pounds. Serum lipid profiles were significantly improved, and there was a significant reduction in systolic blood pressure. Nausea was the most common event during the 30-week treatment period and decreased over time, occurring in 12% of patients during the 74-week assessment period when all patients were receiving exenatide once weekly. No severe hypoglycemia was observed.

        In March 2009, we announced results from DURATION-2, a 26-week clinical study designed to compare exenatide once weekly to maximum doses of sitagliptin and pioglitazone, two commonly prescribed oral diabetes medications, in 491 patients with type 2 diabetes taking stable doses of metformin. After completing 26 weeks of treatment, evaluable patients randomized to exenatide once weekly experienced a statistically significant reduction in A1C of 1.7 percentage points from baseline, compared to a reduction of 1.0 percentage point for sitagliptin and 1.4 percentage points for pioglitazone. Treatment with exenatide once weekly also produced statistically significant differences in weight, with weight loss of 6.2 pounds at 26 weeks, compared with a loss of 1.9 pounds for sitagliptin, and a weight gain of 7.4 pounds for pioglitazone. The most frequently reported adverse events among exenatide once weekly and sitagliptin users were nausea and diarrhea. Upper respiratory tract infection and peripheral edema were the most frequently reported events by patients receiving pioglitazone. There was no major hypoglycemia in any treatment group.

        In July 2009, we announced results from DURATION-3, a clinical trial designed to compare patients randomized to either exenatide once weekly or Lantus (insulin glargine). Patients randomized to exenatide once weekly experienced a statistically significant superior reduction in A1C of 1.5 percentage points from baseline, compared to a reduction of 1.3 percentage points for Lantus after completing 26 weeks of treatment. At the end of the study, patients treated with exenatide once weekly achieved a mean A1C of 6.8% compared with a mean A1C of 7.0% in those treated with Lantus. Treatment with exenatide once weekly also produced significant differences in weight, with a mean weight loss of 5.8 pounds at 26 weeks, compared with a mean weight gain of 3.1 pounds for Lantus. In addition, although patients treated with exenatide once weekly experienced a greater reduction in blood glucose than those treated with Lantus, they also reported significantly fewer episodes of confirmed

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hypoglycemia. Reported adverse events were upper respiratory infection, including nasopharyngitis, in both treatment arms, as well as gastrointestinal events, including nausea, in the exenatide once weekly treatment group.

        In December 2009, we announced results from DURATION-5, a head-to-head study comparing exenatide once weekly to BYETTA. After 24 weeks of treatment, patients taking exenatide once weekly experienced a statistically superior reduction in A1C of 1.6 percentage points from baseline, compared to a reduction of 0.9 percentage points for BYETTA. Patients treated with exenatide once weekly achieved a mean A1C of 7.1% compared with a mean A1C of 7.7% in those treated with BYETTA. Both treatment groups achieved statistically significant weight loss by the end of the study, with an average loss of 5.1 pounds for patients taking exenatide once weekly and 3.0 pounds for patients taking BYETTA. These findings are consistent with the results of other studies comparing exenatide once weekly with BYETTA. Consistent with previous DURATION trials, the most frequently reported adverse event in both groups was nausea. There were no major hypoglycemic events. Cases of minor hypoglycemia in both groups were limited to patients using background sulfonylurea therapy.

        In the fourth quarter of 2008, we initiated our DURATION-4 superiority trial comparing exenatide once weekly as a stand-alone therapy to metformin, a TZD or a dipeptidyl peptidase type IV (DPP-IV) inhibitor and expect to complete this study in 2010. In early 2010, we also initiated DURATION-6, a superiority trial that will be designed to compare exenatide once weekly with liraglutide and expect to complete this study in 2011.

        Given the positive effects on cardiovascular surrogate outcomes observed with exenatide, the encouraging data from the ACCORD trial, which indicates decreased cardiovascular events with BYETTA, and the current regulatory interest in cardiovascular outcomes, we and Lilly have announced that we intend to initiate in 2010, a large cardiovascular outcomes trial with a superiority design that will evaluate the effects of exenatide once weekly on major cardiovascular events, compared to standard of care with traditional antidiabetes medications. This study will give us the opportunity to demonstrate the effect of exenatide once weekly on cardiovascular outcomes and other end points of interest to our stakeholders. We do not believe this study will be a requirement for exenatide once weekly approval. We expect results from this study to be available in 2016.

        In May 2009, we and Lilly announced an agreement to develop, manufacture and market exenatide once weekly in a dual chamber cartridge pen configuration. We believe this design will enable patients to mix and administer exenatide once weekly from a pre-filled pen device instead of the syringe and vial currently used in clinical trials and planned as our initial launch configuration. We and Lilly are evaluating the pharmacokinetics, tolerability and safety of an exenatide suspension formulation for once weekly and once monthly dosing that would eliminate the need to reconstitute the product prior to use. We are also evaluating non-invasive formulations of exenatide including transdermal and nasal delivery systems.

Obesity

        Obesity is a chronic condition that affects millions of people and is linked to increased health risk of several medical conditions including type 2 diabetes, high blood pressure, heart disease, stroke, osteoarthritis, sleep disorders and several types of cancers. Obesity is also rapidly becoming a major health problem in all industrialized nations and many developing countries. According to NAASO (The Obesity Society), obesity is the second leading cause of preventable death in the United States. It is estimated that 66% of the adult population in the United States is overweight and nearly 60 million adult Americans are considered obese. It is also estimated that the total direct and indirect costs attributed to overweight and obesity health issues exceed $100 billion in the United States each year.

        Genetic, metabolic, psychological and environmental factors can all contribute to obesity. Obesity is measured by Body Mass Index, or BMI, a mathematical formula using a person's height and weight.

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BMI is calculated by dividing a person's weight in kilograms by the person's height in meters squared. A person with a BMI between 25 and 29.9 is considered overweight. A person with a BMI of 30 or more is considered obese, and a person with a BMI of 40 or more is considered severely obese. Current treatments for obesity include diet, exercise, drug therapy and surgery.

        The National Heart, Lung and Blood Institute and the World Health Organization have issued evidence-based guidelines for the identification, evaluation and treatment of obesity. Non-pharmacological treatment modalities (dietary modifications, behavioral interventions and increased physical activity) are considered the cornerstone of clinical obesity management. If lifestyle changes do not promote weight loss after six months, pharmacotherapy is considered helpful for eligible high-risk patients. Only two pharmacological agents are currently approved for the long-term treatment of obesity in the United States. Bariatric surgery is considered an option only for patients with severe obesity and serious co-morbid conditions.

        The National Institutes of Health, Surgeon General and FDA recognize a large unmet medical need for safe and efficacious therapies to prevent the debilitating metabolic diseases and mortality associated with obesity.

Integrated Neurohormonal Therapy for Obesity (INTO)

        Since 2006, we have been executing an obesity strategy to assess the safety and efficacy of multiple neurohormones used in combination to treat obesity. We refer to this strategy as Integrated Neurohormonal Therapy for Obesity, or INTO. Our INTO strategy is based on combination therapies and as part of this program we are studying combinations of peptide and protein hormones.

        Three molecular franchises are the primary focus of our INTO strategy: amylin and, in particular, pramlintide, its synthetic version (a first generation amylinomimetic); leptin, and in particular, metreleptin, its recombinant version, a protein hormone produced from the fat cell that plays a fundamental role in metabolism; and PYY 3-36, and in particular, a second-generation Y-family analog molecule, that is secreted by the gut and provides a satiety signal in the post-meal period.

        In October 2009, we entered into a worldwide exclusive license, development and commercialization agreement with Takeda to co-develop and commercialize pharmaceutical products for the treatment of obesity and related indications. The agreement includes products to be developed from our pipeline, including pramlintide/metreleptin combination therapy, which is a compound currently in phase 2 for the treatment of obesity and discussed in more detail below. The agreement also includes additional compounds from our and Takeda's obesity research programs. We will be responsible for executing development activities for potential products through phase 2 for regulatory approval in the United States. Takeda will lead development activities beyond phase 2 in the United States and all development activities outside the United States.

Pramlintide

        Pramlintide plays an important role in our current INTO strategy. Pramlintide has been studied extensively in people with and without diabetes and is the active ingredient in SYMLIN. In February 2006, we reported results from a 16-week Phase 2 dose-ranging study with pramlintide in obese subjects. After completing 16 weeks of treatment with pramlintide in addition to lifestyle intervention, subjects on average experienced an 8.4 to 13.4 pound weight loss from baseline, compared to a 6.2 pound weight loss with placebo plus lifestyle intervention.

        Pramlintide was well tolerated and showed progressive weight loss at doses up to 360 mcg. No new safety signals were observed in this study, which included higher doses than those previously studied in obese subjects. There was clear evidence of a dose response for the twice-daily regimens. Consistent with previous observations, the most common adverse effect was mild nausea. Weight loss in subjects

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who did not experience nausea was similar to that seen in the overall study population. In October 2006, we reported results from a continuation of this study that demonstrated that patients completing 52 weeks of pramlintide therapy experienced a 7-8% mean body weight reduction, depending upon the dose they received, compared to a 1% reduction in patients receiving placebo.

        We have conducted clinical studies using pramlintide in combination with leptin and with PYY 3-36. The proof-of-concept pramlintide and metreleptin study, which we discuss below, investigated the synergy of pramlintide and metreleptin found in preclinical studies.

Metreleptin

        Metreleptin is the second compound we are studying in connection with our INTO program. Metreleptin is the recombinant form of human leptin, a naturally occurring protein hormone secreted by fat cells. Leptin plays a key role in metabolism through multiple metabolic actions and appears to act primarily at the level of the hypothalamus to regulate food intake and energy expenditure. Leptin's roles in the treatment of obesity and lipodystrophy have been extensively studied, and the lead molecules have a strong safety profile. Humans suffering from lipodystrophy, a disease characterized by loss of body fat and consequent metabolic disorders (insulin resistance, hyperglycemia, and dyslipidemia), are rendered incapable of secreting sufficient amounts of leptin due to the loss of fat cell mass. We plan to file an NDA with the FDA for the treatment of lipodystrophy with leptin in 2010.

        In early 2006, we acquired the exclusive rights to the leptin molecular franchise and program (including metreleptin) from Amgen, Inc., or Amgen. Under the terms of the license agreement, we may make potential future payments related to development and regulatory milestones and will pay royalties on any product sales. Our license includes exclusive rights to the leptin intellectual property developed by Amgen as well as intellectual property Amgen originally licensed from Rockefeller University.

PYY 3-36

        Y-family agonists (such as PYY 3-36) are a third compound we are studying in connection with our INTO program. We are developing second generation Y-family mimetics that could be more potent and efficacious as drug candidates, but have been utilizing the native form of PYY 3-36 for the investigation of potential treatments of obesity. Independent researchers have reported a reduction in food intake in humans using PYY 3-36. In November 2007, we announced data from a 14-day safety and tolerability Phase 1 clinical trial showing that PYY 3-36 when used in combination with pramlintide was well-tolerated. We also announced that this combination was well-tolerated with dose escalation. We intend to focus our future development of the second generation Y-family mimetic either alone or in combination with a second generation amylinomimetic.

Pramlintide-Metreleptin Combination Product Candidate

        In November 2007, we announced results from a 24-week proof-of-concept study with pramlintide and metreleptin combination treatment in overweight or obese subjects. At the end of the study, the combination treatment reduced body weight on average 12.7%, significantly more than treatment with pramlintide alone (8.4%). Subjects treated with pramlintide/metreleptin lost an average of 25 pounds from the beginning of the study compared with an average of 17 pounds for subjects treated with pramlintide alone. Subjects receiving pramlintide/metreleptin continued to lose weight through the end of the study compared to those treated with pramlintide alone, whose weight loss had stabilized towards the end of the study. At the beginning of the study, the average weight of study participants was approximately 205 pounds. Consistent with previous clinical experience with pramlintide/metreleptin as single agents, the most common side effects seen with combination treatment were injection site adverse events and nausea, which were mostly mild to moderate and transient in nature.

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        In July 2009, we announced results from a 28-week dose-ranging study of pramlintide/metreleptin combination treatment in overweight and obese patients. This phase 2 study characterized patients who responded best to treatment and also provided important information to inform dose selection. At 28 weeks, evaluable patients with a BMI less than 35 kg/m2 and treated with the highest pramilintide/metreleptin doses experienced significantly more weight loss on average (11% weight loss; 22 pounds) than those receiving placebo (1.8% weight loss; 4 pounds) or either agent alone (approximately 5% weight loss; 10 pounds). Consistent with the physiologic role of leptin in regulating body fat, the weight loss in these patients was predominantly due to a reduction in fat mass (approximately 18 of the 22 pounds lost).

        In February 2010, we and Takeda announced that, based on positive results from a 52-week extension of this study, the pramlintide/metreleptin combination treatment for obesity will advance toward phase 3 development. Results from the 52-week extension showed the pramlintide/metreleptin combination met the key target criteria of sustained, double-digit weight loss without evidence of cardiovascular or neuropsychiatric safety signals. Patients treated with placebo during the 52-week extension regained almost all of their weight. Consistent with the results at 28 weeks, the most robust efficacy was seen in patients with a BMI less than 35 kg/m2.

        The combination therapy was well tolerated at 52 weeks, and no cardiovascular or neuropsychiatric (such as anxiety or depression) safety signals were observed. Consistent with previous clinical experience, the most common side effects seen at 28 weeks were injection site adverse events and nausea, which were mostly mild or moderate and transient in nature. The occurrence of these side effects was much lower during the extension phase of the study.

Research Activities

        A key element of our strategy is to develop first-in-class compounds for treating metabolic diseases. To achieve this goal, we are exploring hormones with multiple mechanisms of action that will potentially lead to products that have utility in treatment of more than one disease with the potential for many product forms. To do so, we take an integrated and biological, rather than a target-driven, approach to research. Our research is centered on peptide hormones that play an important metabolic role, and which we consider more likely to have an acceptable safety profile because these hormones exist naturally in the human body. Our development path begins with identifying a particular peptide and then determining if it is a circulating hormone, a substance that travels through the bloodstream to affect bodily functions. We then attempt to understand the hormone's functionality and potential impact on a disease. Rather than starting with a known biology and targeting molecules to modify, enhance or block it, our scientists are discovering the biology of previously unknown peptides and uncovering utility that could potentially translate into a new human therapy. The conventional development process commonly used in the pharmaceutical industry emphasizes utilizing isolated cells or molecular targets to advance drug discovery. Our approach to research calls for our scientists to quickly move to in vivo testing using highly predictive animal models that allow us to design subsequent information-rich clinical trials in humans.

        Based on a premise that every peptide hormone has a utility—and a potential therapeutic benefit—we have developed a proprietary and continually growing peptide hormone library we call PHORMOL™. PHORMOL encompasses an extensive panel of potentially valuable biologics that have been taken from nature, including human peptides not previously described. All of these have been synthesized to create a rich source of compounds for ongoing research in their functionality, utility and potential value in treating a range of human diseases.

        We are also developing capabilities in delivery system research and development, focused on product presentations that enhance clinical outcomes and patient convenience. Delivery systems are selected on the basis of technical feasibility, regulatory acceptance and market preference. They include

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injectable sustained-release formulations such as salt complexes, lipids, biodegradable polymer and gel systems, as well as non-injectable systems such as nasal sprays, oral and transdermal systems. We are also using our resources to optimize pharmaceutical properties of peptide drugs to develop new peptide hormone analogs that may be more amenable to alternative forms of delivery.

        We currently have approximately 370 full-time employees dedicated to our research and development activities. In the years ended December 31, 2009, 2008 and 2007, we incurred research and development expense of $185.1 million, $222.6 million and $216.3 million, respectively.

Strategic Relationships

Lilly Exenatide Collaboration

        We entered into a collaboration agreement with Lilly in 2002 for the global development and commercialization of exenatide, including the twice-daily version, BYETTA, and sustained-release formulations, such as exenatide once weekly. Under the terms of the agreement, Lilly made initial payments to us, and purchased approximately 1.6 million shares of our common stock. In addition, Lilly has made milestone payments to us upon the achievement of development milestones for BYETTA and exenatide once weekly and commercial milestones for BYETTA. Lilly is also obligated to make additional future commercial milestone payments to us of up to $80 million contingent upon the commercial launch of exenatide, including BYETTA in Japan and exenatide once weekly in the U.S., Europe and Japan. Under our co-promotion arrangement with Lilly, the parties use approximately equal efforts to co-promote BYETTA within the United States and have agreed to use approximately equal efforts to co-promote sustained-release formulations of exenatide within the United States. Lilly is responsible for commercialization efforts outside the United States. We share exenatide United States development and commercialization costs with Lilly equally and we pay Lilly 50% of the operating profits from the sale of products in the United States. Our collaboration agreement may be terminated by Lilly at any time on one years' notice.

        In late 2006, BYETTA was approved in the EU and, by the end of 2009, was commercially launched in approximately 60 countries worldwide. Lilly will pay us tiered royalties based upon the annual gross margin for all exenatide product sales, including any sustained-release formulations, outside of the United States. Royalty payments for exenatide product sales outside the United States will commence after a one-time cumulative gross margin threshold has been met. Lilly is responsible for 100% of the costs related to development of BYETTA and exenatide once weekly for sale outside of the United States. Lilly is also responsible for 100% of the costs related to commercialization of all exenatide products for sale outside the United States. We record all United States BYETTA product revenues and Lilly records all BYETTA product revenues from outside the United States.

        In October 2008, we entered into an Exenatide Once Weekly Supply Agreement with Lilly pursuant to which we will supply commercial quantities of exenatide once weekly for sale in the United States, if approved by the FDA. In addition, if Lilly receives approval to market the product in jurisdictions outside the Unites States, we will be required to manufacture the product intended for commercial sale by Lilly in those jurisdictions. We have also entered into a loan agreement with Lilly pursuant to which Lilly will make a $165 million unsecured line of credit available to us that we can draw upon from time to time, at our option, until June 30, 2011, with maturity no later than June 30, 2014.

        In April 2009, we and Lilly amended our collaboration agreement to clarify allocation and reimbursement procedures of certain shared expenses under the agreement. We also agreed to adopt a set of guidelines to govern the working relationship of an integrated medical, development and commercial team for exenatide comprised of Amylin and Lilly employees to be located in San Diego, referred to as Exenatide One.

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        In May 2009, we and Lilly entered into a cost allocation agreement which amended the exenatide development and commercialization cost-sharing provisions contained in our collaboration agreement. Under the terms of the cost allocation agreement, Lilly will be responsible for 53% of shared exenatide global development and commercialization expenses that generate utility in the United States and outside the United States, including global manufacturing development expenses. We will be responsible for 47% of these expenses. Lilly will also assume 100% of all exenatide development expenses that generate utility predominately outside the United States. Under the previous cost-sharing arrangement, Amylin was responsible for 20% of these expenses. The royalty structure for exenatide revenues generated outside the United States was also modified to reflect Lilly's revised expense burden, with a reduction in Lilly's royalty payments to us. Under the cost allocation agreement, we and Lilly will continue to share equally all exenatide development and commercialization expenses that generate utility predominately in the United States.

        In May 2009, we and Lilly entered into a joint supply agreement for an exenatide once weekly pen device. In connection with our collaboration agreement, we and Lilly have agreed to develop a dual chamber cartridge pen configuration for the delivery of exenatide once weekly. The exenatide once weekly pen will be manufactured at our Ohio manufacturing facility. Under the terms of the supply agreement, the initial cost of the capital investment will be allocated 60% to Lilly and 40% to us and the development costs of the pen will be allocated 53% to Lilly and 47% to us.

Takeda Obesity Collaboration

        In October 2009, we entered into a worldwide exclusive license, development and commercialization agreement with Takeda to co-develop and commercialize pharmaceutical products for the treatment of obesity and related indications. The agreement includes products to be developed from our pipeline, including pramlintide/metreleptin combination treatment. The agreement also includes additional compounds from our and Takeda's obesity research programs. Takeda will be responsible for commercializing the products in and outside the United States and will be responsible for all commercialization costs associated with the products.

        We received a one-time up-front payment of $75 million from Takeda upon entering into the agreement and we are eligible to receive additional payments upon achieving certain development, commercialization and sales-based milestones. The agreement also provides for future tiered, double-digit royalty payments to us based on global product sales. We will be responsible for executing development activities for potential products through phase 2 for regulatory approval in the United States. Takeda will lead development activities beyond phase 2 in the United States and all development activities outside the United States. Generally, we will be responsible for 20% of the development costs associated with obtaining approval for products in the United States and Takeda will be responsible for 80% of such United States development costs. Takeda will also be responsible for 100% of development costs associated with obtaining approval for products outside the United States.

Early Stage Strategic Collaborations

        In addition to Lilly and Takeda, we have established strategic relationships with other companies and we continue to assess additional opportunities for strategic relationships or in-licensing opportunities. For example, we formed a joint venture with PsychoGenics, Inc. called Psylin Neurosciences, Inc., or Psylin, a company focused on the discovery and development of peptide hormones for treatment of psychiatric disorders. In the second quarter of 2009, Psylin announced that it had initiated development of a novel compound for the treatment of depression. In September 2009, we announced that we entered into an exclusive agreement with Biocon, Limited, or Biocon, to jointly develop, manufacture and commercialize a novel peptide therapeutic for the potential treatment of diabetes. We will share development costs with Biocon on a specific program that came from our "Phybrid" technology platform. A Phybrid is a peptide hybrid molecule that combines the

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pharmacological effects of two peptide hormones into a single molecular entity. Under the terms of the agreement, we will provide expertise in peptide hormone development, particularly in the area of phybrid technology, as well as metabolic disease therapeutics. Biocon will use its expertise in recombinant microbial expression to manufacture the compound and also leverage its experience in preclinical and clinical development of diabetes products.

Sales, Marketing and Distribution

        We have built a sales and marketing organization that focuses on healthcare providers, managed healthcare organizations, wholesalers and pharmacies, government purchasers and other third-party payors. Our field organization also includes our managed care organization. Lilly co-promotes BYETTA in the United States.

        In May 2009, we announced a new sales approach within the diabetes market and merged our then-existing primary care and specialty sales forces into a single organization that brings a specialty approach to endocrinologists and diabetes-focused primary care physicians. This new sales force, comprised of approximately 390 people, is focused on targeting those doctors that write the majority of prescriptions for branded diabetes therapies. Our field force calls on endocrinologists and other physicians who have large diabetes care practices and other healthcare professionals who support their practices. Members of our sales and marketing team have extensive industry experience from a wide range of large and small companies and have substantial experience in the field of diabetes, as well as in launching and marketing pharmaceutical products.

        We utilize common pharmaceutical company practices to market our products. We call on individual physicians and other healthcare professionals and other organizations and individuals involved in the prescribing, purchasing and/or distributing of human medicines. We also provide professional symposia through our extensive medical education programs. Our medical education events are conducted live, via satellite or telephone and through web-based, interactive programs. We will continue to focus on medical education efforts for both BYETTA and SYMLIN through thousands of programs across the United States organized by our medical affairs and external professional education organizations. We train physicians and other healthcare professionals as speakers, so that they can in turn teach their peers about how best to incorporate BYETTA or SYMLIN into their patients' diabetes treatment regimens.

        We provide customer service and other related programs for our products, such as disease and product-specific websites, insurance research services, a customer service call center and order, delivery and fulfillment services. We have programs in the United States that provide qualified uninsured and underinsured patients with our products at no charge.

        We sell BYETTA and SYMLIN to wholesale distributors who in turn sell to retail pharmacies and government entities. Decisions made by these wholesalers and their customers regarding the levels of inventory they hold, and thus the amount of BYETTA and SYMLIN they purchase, may affect the level of our product sales in any particular period.

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Manufacturing

        We have selected manufacturers that we believe comply with current Good Manufacturing Practices, or cGMP, and other regulatory standards. Manufactured product is used commercially following established registration procedures and after applicable regulatory approvals have been granted. We have established a quality control and quality assurance program, including a set of standard operating procedures, analytical methods and specifications, designed to ensure that our products and product candidates are manufactured in accordance with applicable regulations. We require that our contract manufacturers adhere to cGMP, except for products and product candidates for toxicology and animal studies, which we require to be manufactured in accordance with current Good Laboratory Practices, or cGLP.

        Although some materials for our drug products are currently available from a single-source or a limited number of qualified sources, we attempt to acquire an adequate inventory of such materials, establish alternative sources and/or negotiate long-term supply arrangements. We believe we do not have any significant issues obtaining suppliers; however, we cannot be certain that we will continue to be able to obtain long-term supplies of our manufacturing materials.

BYETTA Manufacturing

        We obtain exenatide, the active ingredient contained in BYETTA, from Bachem, Inc., or Bachem, and Mallinckrodt, Inc., or Mallinckrodt, pursuant to agreements with each company. We have agreements with Wockhardt UK (Holdings) Ltd., or Wockhardt, and Baxter Pharmaceutical Solutions LLC, a subsidiary of Baxter, Inc., or Baxter, to supply us the dosage form of exenatide in cartridges. We have an agreement with Lilly to supply pens for delivery of BYETTA in cartridges.

SYMLIN Manufacturing

        We obtain pramlintide acetate, the active ingredient contained in SYMLIN, from Bachem and Lonza Ltd., or Lonza, pursuant to agreements with each company. We have a contract with Baxter for the dosage form of SYMLIN in vials. We also have an agreement with Wockhardt for the dosage form of SYMLIN in cartridges. We have an agreement with Ypsomed AG to supply pen components for the delivery of SYMLIN in cartridges. We also have an agreement with Sharp Corporation for the assembly of the SYMLIN pen components and cartridges.

Exenatide Once Weekly Manufacturing

        Under the terms of our development and license agreement with Alkermes, we are responsible for manufacturing the dosing formulation of exenatide once weekly for commercial sale and will pay Alkermes milestone payments upon achievement of development milestones and royalties ranging in the mid single digits on sales of exenatide once weekly. To date, we have paid an aggregate of $6 million, and issued warrants to purchase 75,000 shares of our common stock, as development milestone payments to Alkermes under the agreement. If all future milestones are achieved, we may be obligated to pay Alkermes an aggregate of $14 million in additional milestone payments. Alkermes has transferred to us its technology for manufacturing exenatide once weekly and is supplying us with the polymer materials required for the commercial manufacture of exenatide once weekly. The development and license agreement terminates on the later of 10 years from first commercial sale of product under the agreement or the expiration or invalidation of certain Alkermes patents covering such products. In addition, we can terminate the agreement at will upon 180 days written notice to Alkermes, and Alkermes can terminate the agreement pursuant to standard bankruptcy and liquidation provisions. Both parties can terminate the agreement pursuant to uncured material breach of contract terms.

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        We obtain bulk exenatide, the active ingredient in exenatide once weekly, from Lonza and Mallinckrodt and we obtain pre-filled diluent syringes for exenatide once weekly from Vetter Pharma-Fertigung GmbH & Co. KG pursuant to long-term agreements with each company. We have built and are operating a facility in West Chester, Ohio to manufacture exenatide once weekly. The FDA has inspected this facility for the manufacturing of exenatide once weekly and has made a number of observations which we believe are addressable.

Competition

        The biotechnology and pharmaceutical industries are highly competitive. There are many pharmaceutical companies, biotechnology companies, public and private universities and research organizations actively engaged in the research and development of products that may be similar to the products in our portfolio. A number of our largest competitors, including AstraZeneca, Bristol-Myers Squibb Company, GlaxoSmithKline, Lilly, Merck & Co., Novartis AG, Pfizer, Sanofi-Aventis, Roche and Takeda are pursuing the development of or are marketing pharmaceuticals that target the same diseases that we are targeting, and it is probable that the number of companies seeking to develop products and therapies for the treatment of diabetes, obesity and other metabolic disorders will increase. Recently, Novo Nordisk obtained approval of a GLP-1 receptor agonist to treat type 2 diabetes that it intends to launch this year. Many of these companies and other existing or potential competitors have substantially greater financial, technical and human resources than we do and may be better equipped to develop, manufacture and market products. These companies may develop and introduce products and processes competitive with or superior to ours. In addition, other technologies or products may be developed that have an entirely different approach or means of accomplishing the intended purposes of our products, which might render our technology and products noncompetitive or obsolete. For example, all of our current drug products are injectable, and may have to compete with therapies that do not require injection. We cannot be certain that we will be able to compete successfully.

        SYMLIN is the only non-insulin-based drug product approved for improving blood glucose control in people with type 1 diabetes. Further, insulin and oral medications are often insufficient for many people with type 2 diabetes to achieve satisfactory glucose and weight control. BYETTA or SYMLIN may be complementary to, or competitive with, these other medications.

        BYETTA and SYMLIN must compete with established therapies for market share. In addition, many companies are pursuing the development of novel pharmaceuticals that target diabetes. These companies may develop and introduce products competitive with or superior to BYETTA or SYMLIN. Such competitive products and potential products include:

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sulfonylureas;

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metformin;

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insulins (injectable and inhaled versions);

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TZDs;

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glinides;

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DPP-IV inhibitors;

•

incretin mimetics/GLP-1 receptor agonists;

•

insulin sensitizers, including PPARs;

•

alpha-glucosidase inhibitors; and

•

sodium-glucose transporter-2 (SGLT-2) inhibitors.

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        There is substantial competition in the discovery and development of treatments for obesity, as well as emerging prescription and over-the-counter treatments for this condition. Current treatments for obesity include dietary therapy, physical activity, drug therapy and surgery. Hoffmann-LaRoche and Abbott Laboratories already market oral medicines for the treatment of obesity. Glaxo Smith Kline now markets "over the counter" a former prescription product (orlistat-Alli) for treatment of obesity. In addition, a number of other pharmaceutical companies are developing new potential therapeutics and there have been two recent NDA filings for therapeutic agents to treat obesity.

Patents, Proprietary Rights, and Licenses

        We believe that patents and other proprietary rights are important to our business. Our policy is to file patent applications to protect technology, inventions and improvements that may be important to the development of our business. We also rely upon trade secrets, know-how, continuing technological innovations and licensing opportunities to develop and maintain our competitive position. We plan to enforce our issued patents and our rights to proprietary information and technology. We review third-party patents and patent applications, both to refine our own patent strategy and to identify useful licensing opportunities.

        We have a number of patents, patent applications and rights to patents related to our compounds, products and technology, but we cannot be certain that issued patents will be enforceable or provide adequate protection or that pending patent applications will result in issued patents. We have also filed foreign counterparts to many of these issued patents and applications.

        We may obtain patents for our compounds many years before we obtain marketing approval for them. Because patents have a limited life, which may begin to run prior to the commercial sale of the related product, the commercial value of the patent may be limited. However, we may be able to apply for patent term extensions to compensate in part for delays in obtaining marketing approval. For example, in the United States a patent term extension of 1,586 days has been granted for SYMLIN, resulting in a patent expiration date of March 16, 2019, and a patent term extension of 1,287 days has been granted for BYETTA, resulting in a patent expiration date of December 1, 2016. Similar patent term extensions may be available for other products that we are developing, but we cannot be certain we will obtain them.

        Included within our exenatide patent portfolio are issued patents for:

•

pharmaceutical compositions containing exenatide;

•

modulating gastric emptying;

•

inhibiting glucagon secretion;

•

stimulating insulin release; and

•

reducing food intake.

        These patents expire between 2016 and 2020. We do not have a composition of matter patent for the exenatide molecule.

        Included within our pramlintide patent portfolio are issued patents for:

•

pramlintide and other amylin agonist analogues invented by our researchers;

•

amylin agonist pharmaceutical compositions, including compositions containing pramlintide; and

•

methods for treating diabetes and related conditions using amylin agonists.

        These patents expire between 2011 and 2019.

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        Our SYMLIN and BYETTA products are subject to the provisions of the Drug Price Competition and Patent Term Restoration Act of 1984, or the Hatch-Waxman Act, which provides data exclusivity for a certain period of time. Beginning one year before expiration of the data exclusivity period, the Hatch-Waxman Act allows generic manufacturers to file Abbreviated New Drug Applications, or ANDAs, requesting the FDA's approval of generic versions of previously-approved products. For example, generic pharmaceutical manufacturers could file an ANDA for SYMLIN as of March 2009 and for BYETTA as of April 2009. If an ANDA is filed for one of our approved products prior to expiration of the patents covering those products, it could result in our initiating patent infringement litigation to enforce our rights.

        With respect to our drug candidates, we have patents and patent applications pending, or have licensed patents and patent applications, relevant to the development and commercialization of such drug candidates. Generally, our policy is to file foreign counterpart applications in countries with significant pharmaceutical markets.

        It is important that we do not infringe patents or proprietary rights of others and that we do not violate the agreements that grant proprietary rights to us. If we do infringe patents or violate these agreements, we could be prevented from developing or selling products or from using the processes covered by those patents or agreements, or we could be required to obtain a license from the third party allowing us to use their technology. We cannot be certain that, if required, we could obtain a license to any third-party technology or that we could obtain one at a reasonable cost. If we were not able to obtain a required license, we could be adversely affected. Because patent applications are confidential for at least some period of time, there may be pending patent applications from which patents will eventually issue and prevent us from developing or selling certain products unless we can obtain a license to use the patented technology.

        Patents relating to pharmaceutical, biopharmaceutical and biotechnology products, compounds and processes such as those that cover our existing products, compounds and processes and those that we will likely file in the future do not always provide complete or adequate protection. Future litigation or proceedings initiated by the United States Patent and Trademark Office regarding the enforcement or validity of our existing patents or any future patents could invalidate our patents or substantially reduce their protection. In addition, statutory or regulatory changes may adversely affect our ability to obtain protection or enforce our patents. Furthermore, our pending patent applications and patent applications filed by our collaborative partners may not result in the issuance of any patents or may result in patents that do not provide adequate protection. As a result, we may not be able to prevent third parties from developing the same compounds and products that we have developed or are developing. In addition, we do not have patent protection or we may not be able to enforce our patents in certain countries. As a result, manufacturers may be able to sell generic versions of our products in those countries.

        We also rely on unpatented trade secrets and improvements, unpatented internal know-how and technological innovation. We protect these rights mainly through confidentiality agreements with our corporate partners, employees, consultants and vendors. These agreements provide that all confidential information developed or made known to an individual during the course of their relationship with us will be kept confidential and will not be used or disclosed to third parties except in specified circumstances. In the case of employees, the agreements provide that all inventions made by the individual while employed by us will be our exclusive property. We cannot be certain that these parties will comply with these confidentiality agreements, that we have adequate remedies for any breach, or that our trade secrets will not otherwise become known or be independently discovered by our competitors. Under some of our research and development agreements, inventions discovered in certain cases become jointly owned by us and our corporate partner and in other cases become the exclusive property of one of us. It can be difficult to determine who owns a particular invention and disputes could arise regarding those inventions.

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Government Regulation

        Regulation by governmental authorities in the United States and foreign countries is a significant factor in the development, manufacture and marketing of pharmaceutical products. All of our potential products will require regulatory approval by governmental agencies prior to commercialization. In particular, human therapeutic products are subject to rigorous preclinical testing and clinical trials and other pre-market approval requirements by the FDA and regulatory authorities in foreign countries. Various federal, state and foreign statutes and regulations also govern or influence the manufacturing, safety, labeling, storage, record keeping and marketing of such products.

        A number of steps must be taken before a pharmaceutical agent may be marketed in the United States. First, the pharmaceutical agent must undergo preclinical testing. Preclinical tests include laboratory evaluation of product chemistry and animal studies to assess the potential safety and activity of the product candidate and its formulations. The results of these studies must be submitted to the FDA as part of an investigational new drug application, or IND, which must be reviewed by the FDA before a proposed clinical trial can begin. Typically, clinical trials involve a three-phase process. In Phase 1, clinical trials are conducted with a small number of healthy volunteers to determine the early safety and tolerability profile and the pattern of drug distribution and metabolism. In Phase 2, clinical trials are conducted with groups of patients afflicted with a specified disease in order to determine preliminary efficacy, dosing regimens and expanded evidence of safety. In Phase 3, large-scale, multi-center, adequate and well-controlled comparative clinical trials are conducted with patients afflicted with a target disease in order to provide enough data for the statistical proof of efficacy and safety required by the FDA and others. The results of the preclinical testing and clinical trials for a pharmaceutical product are then submitted to the FDA in the form of an NDA for approval to commence commercial sales. In responding to an NDA, the FDA may grant marketing approval, request additional information, or deny the application if it determines that the application does not satisfy its regulatory approval criteria. Once a drug is approved for marketing in the United States, the FDA requires ongoing safety monitoring to ascertain any undiscovered issues related to "real-world" use of the drug. The expanded patient exposure once a drug is introduced to the marketplace can reveal new risks (as well as new benefits) that were not detectable during clinical testing.

        Among the conditions for NDA approval is the requirement that the prospective manufacturer's quality control and manufacturing procedures conform to cGMP. In complying with cGMP, manufacturers must continue to expend time, money and effort in the area of production, quality control, and quality assurance to ensure full technical compliance. Manufacturing facilities are subject to periodic inspections by the FDA to ensure compliance.

        We are also subject to various federal, state, and local laws, regulations and recommendations relating to safe working conditions; laboratory and manufacturing practices; the experimental use of animals; and the use and disposal of hazardous or potentially hazardous substances, including radioactive compounds and infectious disease agents, used in connection with our research.

        The activities required before a pharmaceutical agent may be marketed in the EU are dictated by the International Conference on Harmonization and are generally similar to those established in the United States. Approval of new drugs across the EU relies on either the mutual recognition or decentralized approval procedure of the European Medicines Agency. Under the centralized procedure, the marketing application is referred for review to two review teams, each representing one of the member countries. Each reviewer then forwards an early assessment to the Committee for Medicinal Products for Human Use, or CHMP, for discussion and preparation of an initial consolidated assessment report, including a list of questions requesting clarification as well as additional information. This step initiates a series of dialogues, meetings and other communications among the CHMP, the two review teams and the applicant, leading in turn to clarification, education and refinement of the original assessment reports. Ultimately, a decision is reached to either grant marketing approval or

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deny the application if it is determined that the application does not satisfy the regulatory approval criteria. The clinical testing, manufacture and sale of pharmaceutical products outside of the United States and the EU are subject to regulatory approvals by other jurisdictions which may be more or less rigorous than those required by the United States or the EU.

Employees

        As of December 31, 2009, we had approximately 1,500 full-time employees. A significant number of our management and professional employees have had experience with pharmaceutical, biotechnology or medical product companies. We believe that we have been highly successful in attracting skilled and experienced personnel. None of our employees are covered by collective bargaining agreements and we consider relations with our employees to be good.

Executive Officers

        The names of our executive officers and certain information about them as of February 15, 2010 are set forth below:

Name	Age		Position
Daniel M. Bradbury		48	President, Chief Executive Officer and Director
Mark G. Foletta		49	Senior Vice President, Finance and Chief Financial Officer
Mark J. Gergen		47	Senior Vice President, Corporate Development
Orville G. Kolterman, M.D.		62	Senior Vice President, Research and Development
Marcea Bland Lloyd		61	Senior Vice President, Government and Corporate Affairs, and General Counsel
Roger Marchetti		51	Senior Vice President, Human Resources and Information Management
Paul G. Marshall		50	Senior Vice President, Operations
Vincent P. Mihalik		59	Senior Vice President, Sales and Marketing and Chief Commercial Officer
Lloyd A. Rowland		53	Vice President, Governance and Compliance, and Corporate Secretary

Mr. Bradbury has been our Chief Executive Officer since March 2007, serving as President since June 2006 and as Chief Operating Officer since June 2003. He has served as a director since June 2006 and serves on the Finance Committee. He previously served as Executive Vice President from June 2000 until June 2003. He joined Amylin in 1994 and has held officer-level positions in Corporate Development and Marketing during that time. Prior to joining Amylin, Mr. Bradbury spent ten years at SmithKline Beecham Pharmaceuticals, where he held a number of sales and marketing positions. He is a member of the board of directors of Illumina, Inc. He also serves on the RAND Health Board of Advisors and as a board member for PhRMA, BIOCOM, the Keck Graduate Institute's Board of Trustees and the San Diego Regional Economic Development Corporation. Mr. Bradbury is a member of the Royal Pharmaceutical Society of Great Britain and serves on the UCSD Rady School of Management's Advisory Council and the University of Miami's Innovation Corporate Advisory Council. He received a Bachelor of Pharmacy from Nottingham University and a Diploma in Management Studies from Harrow and Ealing Colleges of Higher Education.

Mr. Foletta has served as Senior Vice President, Finance and Chief Financial Officer since March 2006 and he previously served as Vice President, Finance and Chief Financial Officer from March 2000 to March 2006. Mr. Foletta previously served as a Principal of Triton Group Management, Inc. from 1997 to 2000. From 1986 to 1997, Mr. Foletta held a number of management positions with Intermark, Inc. and Triton Group Ltd., the most recent of which was Senior Vice President, Chief

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Financial Officer and Corporate Secretary. From 1982 to 1986, Mr. Foletta was with Ernst & Young, most recently serving as an Audit Manager. He is a director of Anadys Pharmaceuticals, Inc. Mr. Foletta received a B.A. in Business Economics from the University of California, Santa Barbara. He is a Certified Public Accountant and a member of the Financial Executives Institute.

Mr. Gergen has served as Senior Vice President, Corporate Development since August 2006 and previously served as Vice President of Business Development from May 2005 to August 2006. Prior to joining us, Mr. Gergen was an independent consultant to biotech and medical technology companies for strategy, financing and corporate development. From 2003 to 2005, Mr. Gergen was Executive Vice President at CardioNet, Inc. He held various positions at Advanced Tissue Sciences, Inc. from 2000 to 2003 most recently as Chief Restructuring Officer and Acting CEO. He also served as Senior Vice President, Chief Financial and Development Officer, and Vice President, Development, General Counsel and Secretary. From 1999 to 2000, Mr. Gergen was employed at Premier, Inc. and from 1994 to 1999 he held various positions with Medtronic, Inc. From 1990 to 1994 he held various legal and corporate development positions at Jostens, Inc. and from 1986 to 1990, he practiced law at various law firms. Mr. Gergen serves on the Board of Directors of a privately held company. Mr. Gergen received a B.A. in Administration from Minot State University and a J.D. from the University of Minnesota Law School.

Dr. Kolterman has served as Senior Vice President, Research and Development since June 2008 and previously served as Senior Vice President, Development from March 2008 to May 2008. He also served as Senior Vice President, Clinical and Regulatory Affairs from August 2005 to March 2008, Senior Vice President, Clinical Affairs from February 1997 to August 2005, Vice President, Medical Affairs from 1993 to 1997, and Director, Medical Affairs from 1992 to 1993. From 1983 to 1992, he was Program Director of the General Clinical Research Center and Medical Director of the Diabetes Center, at the University of California, San Diego Medical Center. Since 1989, he has been Adjunct Professor of Medicine at the University of California, San Diego. From 1978 to 1983, he was Assistant Professor of Medicine in the Endocrinology and Metabolism Division at the University of Colorado School of Medicine, Denver. He was a member of the Diabetes Control and Complications Trial Study Group and presently serves as a member of the Epidemiology of Diabetes Intervention and Complications Study. He is also a past-president of the California Affiliate of the American Diabetes Association. Dr. Kolterman received his M.D. from Stanford University School of Medicine.

Ms. Lloyd has served as our Senior Vice President, Government & Corporate Affairs and General Counsel since June 2008 and Senior Vice President, Legal and Corporate Affairs, and General Counsel since February 2007. Prior to joining us, Ms. Lloyd served as Group Senior Vice President, Chief Administrative Officer, General Counsel and Secretary of VHA Inc. from November 2004 to February 2007. Previously, she served as VHA's General Counsel and Secretary from May 1999 to November 2004. From 1993 to April 1999, Ms. Lloyd was Vice President and Assistant General Counsel of Medtronic Inc. and served as Medtronic's Assistant General Counsel from 1991 to 1993. From 1978 to 1991, Ms. Lloyd held various legal positions with Medtronic. Prior to joining Medtronic, Ms. Lloyd served as counsel to Pillsbury Company and Montgomery Ward & Co. and she taught Business Law at the University of Minnesota Business School. Ms. Lloyd is immediate past Chairperson of the Executive Leadership Foundation, a member of the board of directors for California Healthcare Institute and is an associate of the Women Business Leaders of the United States Health Care Industry Foundation. She received a B.S./B.A. from Knox College and a J.D. from Northwestern University.

Mr. Marchetti has served as our Senior Vice President, Human Resources and Information Management since July 2007 and previously served as Senior Vice President, Human Resources and Corporate Services from October 2005 to July 2007. Prior to joining us, he served as Vice President, Human Resources for Guidant Corporation from July 2002 to October 2005. Prior to this role, he served as Vice President, Finance and Information Systems, Guidant Europe, Middle East, Africa, and Canada, since the beginning of 2001. From 1999 through 2000, he served as Vice President, Human

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Resources for Guidant's Vascular Intervention group, and served as Guidant's Corporate Controller and Chief Accounting Officer from 1994 to 1999. He joined Eli Lilly and Company's Medical Devices and Diagnostics division in 1988. In 1992, he became Financial Manager of Lilly's pharmaceutical manufacturing operations in Indianapolis. From 1980 to 1986, he was with Touche Ross & Co. (currently Deloitte). He received a B.S. from LaSalle University in Philadelphia and his M.B.A. from the Ross School of Business at the University of Michigan. He is a Certified Public Accountant.

Mr. Marshall has served as Senior Vice President, Operations since December 2008. He previously served as Vice President Operations from December 2006 to December 2008. Prior to joining us, he was Vice President of Corporate Manufacturing at Amgen, Inc. From 2002 to 2005, Mr. Marshall served as President of Manufacturing at Recombinant Proteins at the Bioscience Division of Baxter International. From 1999 to 2002, he was Site Head of the Baxter International Thousand Oaks facility. He joined Creative BioMolecules in 1992, first as Head of Process Development and Clinical Manufacturing and then as Head of Operations. From 1988 to 1992, Mr. Marshall held various management positions with Welgen Manufacturing Partnership (now Amgen, Rhode Island), Repligen Corporation and Damon Biotech. Mr. Marshall received a B.S. and an M.S. in Biology from the University of Massachusetts at Dartmouth and completed three years of post-graduate work concentrating in hematology and coagulation research at Brown University.

Mr. Mihalik has served as Senior Vice President, Sales and Marketing and Chief Commercial Officer since January 2009. Mr. Mihalik has over 30 years of experience across multiple commercial roles. Before joining us, Mr. Mihalik served as Vice President of Global Brand Development Diabetes and Endocrine Platform Team Leader for Lilly since 2004. Previously, he was Business Unit Head of Diabetes Care for Lilly U.S. from 2001 to 2004. From 1990 to 2001 he served in various senior management positions at other healthcare companies including Senior Vice President and General Manager for Lab Systems and Molecular Biochemical at Roche Diagnostics Corporation, President, Diabetes Care North America at Boehringer Mannheim Group and President, Scientific Products Biomedical and General Manager, Pandex Diagnostic Research and Development Center for Baxter Healthcare Inc. He has a B.S. degree in Biology from The Pennsylvania State University and completed the Northwestern University Masters in Management-Executive Program.

Mr. Rowland has served as our Vice President, Governance and Compliance, Secretary, and Chief Compliance Officer since February 2007. He previously served as our Vice President, Legal, Secretary and General Counsel from September 2001 to February 2007. Prior to joining us, Mr. Rowland served in various positions at Alliance Pharmaceutical Corp., including as Vice President, General Counsel and Secretary, beginning in 1993. Earlier, Mr. Rowland served as Vice President and Senior Counsel, Finance and Securities, at Imperial Savings Association for four years. For the previous eight years, he was engaged in the private practice of corporate law with the San Diego, California law firm of Gray, Cary, Ames & Fry, and the Houston, Texas law firm of Bracewell & Patterson. He received a J.D. from Emory University.

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Item 1A.    Risk Factors

CAUTIONARY FACTORS THAT MAY AFFECT FUTURE RESULTS

Except for the historical information contained herein or incorporated by reference, this annual report on Form 10-K and the information incorporated by reference contains forward-looking statements that involve risks and uncertainties. These statements include projections about our accounting and finances, plans and objectives for the future, future operating and economic performance and other statements regarding future performance. These statements are not guarantees of future performance or events. Our actual results may differ materially from those discussed here. Factors that could cause or contribute to differences in our actual results include those discussed in the following section, as well as those discussed in Part II, Item 7 entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere throughout this annual report on Form 10-K and in any other documents incorporated by reference into this report. You should consider carefully the following risk factors, together with all of the other information included or incorporated in this annual report on Form 10-K. Each of these risk factors, either alone or taken together, could adversely affect our business, operating results and financial condition, as well as adversely affect the value of an investment in our common stock. There may be additional risks that we do not presently know of or that we currently believe are immaterial which could also impair our business and financial position.

         We have a history of operating losses, anticipate future losses and may never become profitable.

        We have experienced significant operating losses since our inception in 1987, including losses of $186.2 million in 2009, $321.9 million in 2008 and $216.5 million in 2007. As of December 31, 2009, we had an accumulated deficit of approximately $1.9 billion. The extent of our future losses and the timing of potential profitability are uncertain, and we may never achieve profitable operations. We have been engaged in discovering and developing drugs since inception, which has required, and will continue to require, significant research and development expenditures. We derived substantially all of our revenues prior to 2005 from development funding, fees and milestone payments under collaborative agreements and from interest income. BYETTA and SYMLIN may not be as commercially successful as we expect and we may not succeed in commercializing any of our other drug candidates. We may incur substantial operating losses for at least the next few years. These losses, among other things, have had and will have an adverse effect on our stockholders' equity and working capital. Even if we become profitable, we may not remain profitable.

         We began selling, marketing and distributing our first products, BYETTA and SYMLIN, in 2005 and we will depend heavily on the success of those products and, if approved, exenatide once weekly, in the marketplace.

        Prior to the launch of BYETTA and SYMLIN in 2005, we had never sold or marketed our own products. Our ability to generate product revenue for the next few years will depend solely on the success of these products and, if approved, exenatide once weekly. The ability of BYETTA, SYMLIN and, if approved, exenatide once weekly to generate revenue at the levels we expect will depend on many factors, including the following:

•

the ability of patients in the current uncertain economic climate to be able to afford our medications or obtain health care coverage that covers our products;

•

our ability to obtain approval for exenatide once weekly and the timing of the commercial launch of exenatide once weekly, if approved;

•

acceptance of and ongoing satisfaction with these first-in-class medicines in the United States and foreign markets by the medical community, patients receiving therapy and third party payers;

25

•

a satisfactory efficacy and safety profile as demonstrated in a broad patient population;

•

successfully expanding and sustaining manufacturing capacity to meet demand;

•

safety concerns in the marketplace for diabetes therapies;

•

the competitive landscape for approved and developing therapies that will compete with the products; and

•

our ability to expand the indications for which we can market the products.

         If we encounter safety issues with BYETTA or SYMLIN or any other drugs we market or fail to comply with extensive continuing regulations enforced by domestic and foreign regulatory authorities, it could cause us to discontinue marketing those drugs, reduce our revenues and harm our ability to generate future revenues, which would negatively impact our financial position.

        BYETTA and SYMLIN, in addition to any other of our drug candidates that may be approved by the FDA, will be subject to continual review by the FDA, and we cannot assure you that newly discovered or developed safety issues will not arise. With the use of any of our marketed drugs by a wide patient population, serious adverse events may occur from time to time that initially do not appear to relate to the drug itself, and only if the specific event occurs with some regularity over a period of time does the drug become suspect as having a causal relationship to the adverse event. Some patients taking BYETTA have reported developing pancreatitis. We are working to better understand the relationship between BYETTA and pancreatitis described in some spontaneously reported cases. In keeping with our focus on patient safety, we continue to pursue our drug safety program that includes thorough investigation of individual spontaneous case reports along with clinical and epidemiologic studies. Within the detection limits of an initial epidemiology study which we provided to the FDA, we have not observed an increased incidence of pancreatitis associated with BYETTA compared to other treatments for diabetes and thus believe a definite causal relationship between BYETTA and pancreatitis has not been proved. Any safety issues could cause us to suspend or cease marketing of our approved products, cause us to modify how we market our approved products, subject us to substantial liabilities, and adversely affect our revenues and financial condition.

        Moreover, the marketing of our approved products will be subject to extensive regulatory requirements administered by the FDA and other regulatory bodies, including adverse event reporting requirements and the FDA's general prohibition against promoting products for unapproved uses. The manufacturing facilities for our approved products are also subject to continual review and periodic inspection and approval of manufacturing modifications. Manufacturing facilities that manufacture drug products for the United States market, whether they are located inside or outside the United States, are subject to biennial inspections by the FDA and must comply with the FDA's current good manufacturing practice, or cGMP, regulations. The FDA stringently applies regulatory standards for manufacturing. Failure to comply with any of these post-approval requirements can, among other things, result in warning letters, product seizures, recalls, fines, injunctions, suspensions or revocations of marketing licenses, operating restrictions and criminal prosecutions. Any of these enforcement actions, any unanticipated changes in existing regulatory requirements or the adoption of new requirements, or any safety issues that arise with any approved products, could adversely affect our ability to market products and generate revenues and thus adversely affect our ability to continue our business.

        The manufacturers of our products and drug candidates also are subject to numerous federal, state, local and foreign laws relating to such matters as safe working conditions, manufacturing practices, environmental protection, fire hazard control and hazardous substance disposal. In the future, our manufacturers may incur significant costs to comply with those laws and regulations, which could increase our manufacturing costs and reduce our ability to operate profitably.

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         We currently do not manufacture our own drug products or some of our drug candidates and may not be able to obtain adequate supplies, which could cause delays, subject us to product shortages, or reduce product sales.

        The manufacturing of sufficient quantities of newly-approved drug products and drug candidates is a time-consuming and complex process. We currently have no manufacturing capabilities for our two marketed drug products. In order to successfully commercialize our products, including BYETTA and SYMLIN, and continue to develop our drug candidates, including exenatide once weekly, we rely on various third parties to provide the necessary manufacturing.

        There are a limited number of manufacturers that operate under the FDA's cGMP regulations capable of manufacturing for us. In addition, there are a limited number of bulk drug substance suppliers, cartridge manufacturers and disposable pen manufacturers. If we are not able to arrange for and maintain third-party manufacturing on commercially reasonable terms, or we lose one of our sole source suppliers used for our existing products or for some components of our manufacturing processes for our products or drug candidates, we may not be able to market our products or complete development of our drug candidates on a timely basis, if at all.

        Reliance on third-party suppliers limits our ability to control certain aspects of the manufacturing process and therefore exposes us to a variety of significant risks, including, but not limited to, risks to our ability to commercialize our products or conduct clinical trials, risks of reliance on the third-party for regulatory compliance and quality assurance, third-party refusal to supply on a long-term basis, or at all, the possibility of breach of the manufacturing agreement by the third-party and the possibility of termination or non-renewal of the agreement by the third-party, based on its business priorities, at a time that is costly or inconvenient for us. In addition, reliance on single-source suppliers subjects us to the risk of price increases by these suppliers which could negatively impact our operating margins. If any of these risks occur, our product supply will be interrupted resulting in lost or delayed revenues and delayed clinical trials. Our reliance on third-party manufacturers for the production of our two commercial products is described in more detail below.

        We rely on Bachem and Mallinckrodt to manufacture our long-term commercial supply of bulk exenatide, the active ingredient in BYETTA. In addition, we rely on single-source manufacturers for some of our raw materials used by Bachem and Mallinckrodt to produce bulk exenatide. We also rely on Wockhardt and Baxter to manufacture the dosage form of BYETTA in cartridges. We are further dependent upon Lilly to supply pens for delivery of BYETTA in cartridges.

        We rely on Bachem and Lonza to manufacture our commercial supply of bulk pramlintide acetate, the active ingredient contained in SYMLIN. In addition, we rely on Baxter to manufacture the dosage form of SYMLIN in vials. We rely on Wockhardt for the dosage form of SYMLIN in cartridges and Ypsomed AG to manufacture the components for the SYMLIN disposable pen. We also rely on Sharp Corporation for the assembly of the SYMLIN pen.

        If any of our existing or future manufacturers cease to manufacture or are otherwise unable to timely deliver sufficient quantities of BYETTA or SYMLIN, in either bulk or dosage form, or other product components, including pens for the delivery of these products, it could disrupt our ability to market our products, subject us to product shortages, reduce product sales and/or reduce our profit margins. Any delay or disruption in the manufacturing of bulk product, the dosage form of our products or other product components, including pens for delivery of our products, could also harm our reputation in the medical and patient communities. In addition, we may need to engage additional manufacturers so that we will be able to continue our commercialization and development efforts for these products or drug candidates. The cost and time to establish these new manufacturing facilities would be substantial.

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        Our manufacturers have produced BYETTA and SYMLIN for commercial use for approximately five years, however, unforeseeable risks related to environmental, economic, technical or other issues may be encountered as we, together with our manufacturers, continue to develop familiarity and experience with regard to manufacturing our products. Furthermore, we and the other manufacturers used for our drug candidates may not be able to produce supplies in commercial quantities if our drug candidates are approved. While we believe that business relations between us and our manufacturers are generally good, we cannot predict whether any of the manufacturers that we may use will meet our requirements for quality, quantity or timeliness for the manufacture of bulk exenatide or pramlintide acetate, dosage form of BYETTA or SYMLIN, or pens. Therefore, we may not be able to obtain necessary supplies of products with acceptable quality, on acceptable terms or in sufficient quantities, if at all. Our dependence on third parties for the manufacture of products may also reduce our gross profit margins and our ability to develop and deliver products in a timely manner.

        In order to manufacture exenatide once weekly on a commercial scale we must complete final validation of the manufacturing process and obtain approval for our manufacturing facility from the FDA. We have never established, validated, and operated a manufacturing facility and cannot assure you that we will be able to successfully establish or operate such a facility in a timely or economical manner, or at all. The FDA has inspected our manufacturing facility and has made a number of observations which we believe are addressable. However, we cannot be assured that these observations will be adequately addressed in a timely manner or at all. Although we are working diligently to qualify the commercial-scale manufacturing process at this facility, we cannot be assured that we will be able to demonstrate comparability of product manufactured at development scale and product manufactured at commercial scale. If we are unable to demonstrate comparability of product, we may not be able to commercially launch exenatide once weekly in a timely manner or at all. In addition, we are dependent on Alkermes to supply us with commercial quantities of the polymer required to manufacture exenatide once weekly. We also will need to obtain sufficient supplies of diluent, solvents, devices, packaging and other components necessary for commercial manufacture of exenatide once weekly. If exenatide once weekly is approved, we will be dependent upon Mallinckrodt and Lonza to manufacture our long-term commercial supply of bulk exenatide, the active ingredient in exenatide once weekly, and upon single suppliers to produce components for packaging exenatide once weekly.

         Our ability to generate revenues will be diminished if we fail to obtain acceptable prices or an adequate level of reimbursement for our products from third-party payers.

        The continuing efforts of government, private health insurers and other third-party payers to contain or reduce the costs of health care through various means, including efforts to increase the amount of patient co-pay obligations, may limit our commercial opportunity. In the United States, there are a number of health care reform proposals under consideration by the Federal government and we expect that there will continue to be a number of federal and state proposals to implement government control over the pricing of prescription pharmaceuticals. In addition, increasing emphasis on managed care in the United States will continue to put pressure on the rate of adoption and pricing of pharmaceutical products.

        Significant uncertainty exists as to the reimbursement status of health care products. Third-party payers, including Medicare, are challenging the prices charged for medical products and services. Government and other third-party payers increasingly are attempting to contain health care costs by limiting both coverage and the level of reimbursement for new drugs and by refusing to provide coverage for uses of approved products for disease indications for which the FDA has not granted labeling approval. Third-party insurance coverage may not be available to patients for BYETTA and/or SYMLIN or any other products we discover and develop. If government and other third-party payers do not provide adequate coverage and reimbursement levels for our products, the market acceptance of these products may be reduced.

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         Competition in the biotechnology and pharmaceutical industries may result in competing products, superior marketing of other products and lower revenues or profits for us.

        There are many companies that are seeking to develop products and therapies for the treatment of diabetes and other metabolic disorders. Our competitors include multinational pharmaceutical and chemical companies, specialized biotechnology firms and universities and other research institutions. A number of our largest competitors, including AstraZeneca, Bristol-Myers Squibb, GlaxoSmithKline, Lilly, Merck & Co., Novartis, Novo Nordisk, Pfizer, Sanofi-Aventis, Roche and Takeda, are pursuing the development or marketing of pharmaceuticals that target the same diseases that we are targeting, and it is possible that the number of companies seeking to develop products and therapies for the treatment of diabetes, obesity and other metabolic disorders will increase. Many of our competitors have substantially greater financial, technical, sales force, human and other resources than we do and may be better equipped to develop, manufacture and market technologically superior products. In addition, many of these competitors have significantly greater experience than we do in undertaking preclinical testing and human clinical studies of new pharmaceutical products and in obtaining regulatory approvals of human therapeutic products. Accordingly, our competitors may succeed in obtaining FDA approval for superior products. Furthermore, now that we have received FDA approval for BYETTA and SYMLIN, we may also be competing against other companies with respect to our manufacturing and product distribution efficiency and sales and marketing capabilities, areas in which we have limited or no experience as an organization.

        Our target patient population for BYETTA includes people with diabetes who have not achieved adequate glycemic control with diet and exercise or by using metformin, sulfonylurea and/or a TZD, three common oral therapies for type 2 diabetes. Our target population for SYMLIN includes people with either type 2 or type 1 diabetes whose therapy includes multiple mealtime insulin injections daily. Other products are currently in development or exist in the market that may compete directly with the products that we are developing or marketing. Various other products are available or in development to treat type 2 diabetes, including:

•

sulfonylureas;

•

metformin;

•

insulins, including injectable and inhaled versions;

•

TZDs;

•

glinides;

•

DPP-IV inhibitors;

•

incretin/GLP-1 receptor agonists;

•

PPARs; and

•

alpha-glucosidase inhibitors.

        In addition, several companies are developing various approaches, including alternative delivery methods, to improve treatments for type 1 and type 2 diabetes. We cannot predict whether our products will have sufficient advantages to cause health care professionals to adopt them over other products or that our products will offer an economically feasible alternative to other products. Our products could become obsolete before we recover expenses incurred in developing these products.

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         Delays in the conduct or completion of our clinical trials, the analysis of the data from our clinical trials or our manufacturing scale-up activities may result in delays in our planned filings for regulatory approvals of our products, and may adversely affect our ability to enter into new collaborative arrangements.

        We cannot predict whether we will encounter problems with any of our completed, ongoing or planned clinical studies that will cause us to delay or suspend our ongoing and planned clinical studies, delay the analysis of data from our completed or ongoing clinical studies or perform additional clinical studies prior to receiving necessary regulatory approvals. We also cannot predict whether we will encounter delays or an inability to create manufacturing processes for drug candidates that allow us to produce drug product in sufficient quantities to be economical, otherwise known as manufacturing scale-up.

        If the results of our ongoing or planned clinical studies for our drug candidates are not available when we expect or if we encounter any delay in the analysis of data from our clinical studies or if we encounter delays in our ability to scale-up our manufacturing processes:

•

we may be unable to complete our development programs for exenatide once weekly or our obesity clinical trials;

•

we may have to delay or terminate our planned filings for regulatory approval;

•

we may not have the financial resources to continue research and development of any of our drug candidates; and

•

we may not be able to enter into, if we chose to do so, any additional collaborative arrangements.

        Any of the following could delay the completion of our ongoing and planned clinical studies:

•

ongoing discussions with the FDA or comparable foreign authorities regarding the scope or design of our clinical trials;

•

delays in enrolling volunteers;

•

lower than anticipated retention rate of volunteers in a clinical trial;

•

negative results of clinical studies;

•

insufficient supply or deficient quality of drug candidate materials or other materials necessary for the performance of clinical trials;

•

our inability to reach agreement with Lilly regarding the scope, design, conduct or costs of clinical trials with respect to BYETTA, exenatide once weekly, nasal exenatide or transdermal exenatide; or

•

serious side effects experienced by study participants relating to a drug candidate.

         We are substantially dependent on our collaboration with Lilly for the development and commercialization of BYETTA and dependent on Lilly and Alkermes for the development of exenatide once weekly.

        We have entered into a collaborative arrangement with Lilly, who currently markets diabetes therapies and is developing additional diabetes drug candidates, to commercialize BYETTA and further develop sustained-release formulations of BYETTA, including exenatide once weekly. We entered into this collaboration in order to:

•

fund some of our research and development activities;

•

assist us in seeking and obtaining regulatory approvals; and

•

assist us in the successful commercialization of BYETTA and exenatide once weekly.

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        In general, we cannot control the amount and timing of resources that Lilly may devote to our collaboration. If Lilly fails to assist in the further development of exenatide once weekly or the commercialization of BYETTA, or if Lilly's efforts are not effective, our business may be negatively affected. We are relying on Lilly to obtain regulatory approvals for and successfully commercialize BYETTA and exenatide once weekly outside the United States. Our collaboration with Lilly may not continue or result in additional successfully commercialized drugs. Lilly can terminate our collaboration at any time upon twelve months' notice. If Lilly ceased funding and/or developing and commercializing BYETTA or exenatide once weekly, we would have to seek additional sources for funding and may have to delay, reduce or eliminate one or more of our commercialization and development programs for these compounds. If Lilly does not successfully commercialize BYETTA outside the United States, we may receive limited or no revenues from them. In addition, we are dependent on Alkermes to successfully develop and transfer to us its technology for manufacturing exenatide once weekly. If Alkermes' technology is not successfully developed to effectively deliver exenatide in a sustained release formulation, or Alkermes does not devote sufficient resources to the collaboration, our efforts to develop sustained release formulations of exenatide could be delayed or curtailed.

         If our patents are determined to be unenforceable or if we are unable to obtain new patents based on current patent applications or for future inventions, we may not be able to prevent others from using our intellectual property. If we are unable to obtain licenses to third party patent rights for required technologies, we could be adversely affected.

        We own or hold exclusive rights to many issued United States patents and pending United States patent applications related to the development and commercialization of exenatide, including BYETTA and exenatide once weekly, SYMLIN and our other drug candidates. These patents and applications cover composition-of-matter, medical indications, methods of use, formulations and other inventive results. We have issued and pending applications for formulations of BYETTA and exenatide once weekly, but we do not have a composition-of-matter patent covering exenatide. We also own or hold exclusive rights to various foreign patent applications that correspond to issued United States patents or pending United States patent applications.

        Our success will depend in part on our ability to obtain patent protection for our products and drug candidates and technologies both in the United States and other countries. We cannot guarantee that any patents will issue from any pending or future patent applications owned by or licensed to us. Alternatively, a third party may successfully challenge or circumvent our patents. Our rights under any issued patents may not provide us with sufficient protection against competitive products or otherwise cover commercially valuable products or processes. For example, our SYMLIN and BYETTA products are subject to the provisions of the Drug Price Competition and Patent Term Restoration Act of 1984, also known as the "Hatch-Waxman Act," which provides data exclusivity for a certain period of time. Beginning one year before expiration of the data exclusivity period, the Hatch-Waxman Act allows generic manufacturers to file Abbreviated New Drug Applications, or ANDAs, requesting the FDA's approval of generic versions of previously-approved products. For example, generic pharmaceutical manufacturers could file an ANDA for SYMLIN as of March 2009 and for BYETTA as of April 2009. If an ANDA is filed for one of our approved products prior to expiration of the patents covering those products, it could result in our initiating patent infringement litigation to enforce our rights. We can provide no assurances that we would prevail in such an action or in any challenge related to our patent rights.

        In addition, because patent applications in the United States are maintained, in general, in secrecy for 18 months after the filing of the applications, and publication of discoveries in the scientific or patent literature often lag behind actual discoveries, we cannot be sure that the inventors of subject matter covered by our patents and patent applications were the first to invent or the first to file patent applications for these inventions. Third parties have filed, and in the future are likely to file, patent

31

applications on inventions similar to ours. From time-to-time we have participated in, and in the future are likely to participate in, interference proceedings declared by the United States Patent and Trademark Office to determine priority of invention, which could result in a loss of our patent position. We have also participated in, and in the future are likely to participate in, opposition proceedings against our patents in other jurisdictions, such as Europe and Australia. Furthermore, we may not have identified all United States and foreign patents that pose a risk of infringement.

        We also rely upon licensing opportunities for some of our technologies. We cannot be certain that we will not lose our rights to certain patented technologies under existing licenses or that we will be able to obtain a license to any required third-party technology. If we lose our licensed technology rights or if we are not able to obtain a required license, we could be adversely affected.

         We may be unable to obtain regulatory clearance to market our drug candidates, including exenatide once weekly, in the United States or foreign countries on a timely basis, or at all.

        Our drug candidates, including exenatide once weekly, are subject to extensive government regulations related to development, clinical trials, manufacturing and commercialization. The process of obtaining FDA and other regulatory approvals is costly, time-consuming, uncertain and subject to unanticipated delays. Regulatory authorities may refuse to approve an application for approval of a drug candidate if they believe that applicable regulatory criteria are not satisfied. Regulatory authorities may also require additional testing for safety and efficacy. Moreover, if the FDA grants regulatory approval of a product, the approval may be limited to specific indications or limited with respect to its distribution, and expanded or additional indications for approved drugs may not be approved, which could limit our revenues. Foreign regulatory authorities may apply similar limitations or may refuse to grant any approval. Unexpected changes to the FDA or foreign regulatory approval process could also delay or prevent the approval of our drug candidates.

        The data collected from our clinical trials may not be sufficient to support approval of our drug candidates or additional or expanded indications by the FDA or any foreign regulatory authorities. Biotechnology stock prices have declined significantly in certain instances where companies have failed to meet expectations with respect to FDA approval or the timing for FDA approval. If the FDA's or any foreign regulatory authority's response is delayed or not favorable for any of our drug candidates, including exenatide once weekly, our stock price could decline significantly.

        Moreover, manufacturing facilities operated by us or by the third-party manufacturers with whom we may contract to manufacture our unapproved drug candidates may not pass an FDA or other regulatory authority preapproval inspection. Any failure or delay in obtaining these approvals could prohibit or delay us or any of our business partners from marketing these drug candidates.

        Consequently, even if we believe that preclinical and clinical data are sufficient to support regulatory approval for our drug candidates, the FDA and foreign regulatory authorities may not ultimately approve our drug candidates for commercial sale in any jurisdiction. If our drug candidates are not approved, our ability to generate revenues may be limited and our business will be adversely affected.

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         Litigation regarding patents and other proprietary rights may be expensive, cause delays in bringing products to market and harm our ability to operate.

        Our success will depend in part on our ability to operate without infringing the proprietary rights of third parties and preventing others from infringing our patents. Challenges by pharmaceutical companies against the patents of competitors are common. Legal standards relating to the validity of patents covering pharmaceutical and biotechnological inventions and the scope of claims made under these patents are still developing. As a result, our ability to obtain and enforce patents is uncertain and involves complex legal and factual questions. Third parties may challenge, in courts or through patent office proceedings, or infringe upon, existing or future patents. In the event that a third party challenges a patent, a court or patent office may invalidate the patent or determine that the patent is not enforceable. Proceedings involving our patents or patent applications or those of others could result in adverse decisions about:

•

the patentability of our inventions, products and drug candidates; and/or

•

the enforceability, validity or scope of protection offered by our patents.

        The manufacture, use or sale of any of our products or drug candidates may infringe on the patent rights of others. If we are unable to avoid infringement of the patent rights of others, we may be required to seek a license, defend an infringement action or challenge the validity of the patents in court. Patent litigation is costly and time consuming. We may not have sufficient resources to bring these actions to a successful conclusion. In addition, if we do not obtain a license, develop or obtain non-infringing technology, fail to successfully defend an infringement action or have infringing patents declared invalid, we may:

•

incur substantial monetary damages;

•

encounter significant delays in bringing our drug candidates to market; and/or

•

be precluded from participating in the manufacture, use or sale of our products or drug candidates or methods of treatment requiring licenses.

         We are subject to "fraud and abuse" and similar laws and regulations, and a failure to comply with such regulations or prevail in any litigation related to noncompliance could harm our business.

        Upon approval of BYETTA and SYMLIN by the FDA, we became subject to various health care "fraud and abuse" laws, such as the Federal False Claims Act, the federal anti-kickback statute and other state and federal laws and regulations. Pharmaceutical companies have faced lawsuits and investigations pertaining to violations of these laws and regulations. We cannot guarantee that measures that we have taken to prevent such violations, including our corporate compliance program, will protect us from future violations, lawsuits or investigations. If any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant fines or other sanctions.

         Our financial results will fluctuate, and these fluctuations may cause our stock price to fall.

        Forecasting future revenues is difficult, especially since we launched our first products in 2005 and the level of market acceptance of these products may change rapidly. In addition, our customer base is highly concentrated with four customers accounting for most of our net product sales. Fluctuations in the buying patterns of these customers, which may result from seasonality, wholesaler buying decisions or other factors outside of our control, could significantly affect the level of our net sales on a period to period basis. As a result, it is reasonably likely that our financial results will fluctuate to an extent

33

that may not meet with market expectations and that also may adversely affect our stock price. There are a number of other factors that could cause our financial results to fluctuate unexpectedly, including:

•

product sales;

•

cost of product sales;

•

achievement and timing of research and development milestones;

•

collaboration revenues;

•

cost and timing of clinical trials, regulatory approvals and product launches;

•

marketing and other expenses;

•

manufacturing or supply issues; and

•

potential acquisitions of businesses and technologies and our ability to successfully integrate any such acquisitions into our existing business.

         We may require additional financing in the future, which may not be available to us on favorable terms, or at all.

        We intend to use our available cash for:

•

Commercialization of BYETTA and SYMLIN and, if approved, the launch and commercialization of exenatide once weekly;

•

Establishment of additional manufacturing sources, including our Ohio manufacturing facility;

•

Development of exenatide once weekly and other pipeline candidates;

•

Executing our INTO strategy;

•

Our other research and development activities;

•

Other operating expenses;

•

Potential acquisitions or investments in complementary technologies or businesses; and

•

Other general corporate purposes.

        We may also be required to use our cash to pay principal and interest on outstanding debt, including a term loan with a current balance of approximately $93.8 million due in 2010, referred to as the Term Loan, and $775 million in outstanding principal amount of convertible senior notes, of which $200 million is due in 2011, referred to as the 2004 Notes, and $575 million is due in 2014, referred to as the 2007 Notes.

        If we require additional financing in the future, we cannot assure you that it will be available to us on favorable terms, or at all. Although we have previously been successful in obtaining financing through our debt and equity securities offerings, there can be no assurance that we will be able to so in the future, especially given the current adverse economic and credit conditions.

         Our investments in marketable debt securities are subject to credit and market risks that may adversely affect their fair value.

        We maintain a portfolio of investments in marketable debt securities which are recorded at fair value. Although we have established investment guidelines relative to diversification and maturity with the objective of maintaining safety of principal and liquidity, credit rating agencies may reduce the credit rating of our individual holdings which could adversely affect their value. Lower credit quality

34

and other market events, such as increases in interest rates, and further deterioration in the credit markets may have an adverse effect on the fair value of our investment holdings and cash position.

         Our business has a substantial risk of product liability claims, and insurance may not be adequate to cover these claims.

        Our business exposes us to potential product liability risks that are inherent in the testing, manufacturing and marketing of human therapeutic products. On March 4, 2009, the Supreme Court held in Wyeth v. Levine that federal law does not preempt state product liability claims involving pharmaceuticals. We are currently involved in fifty-three product liability cases which have been brought by individuals who have used BYETTA and generally seek compensatory and punitive damages for alleged injuries, consisting primarily of pancreatitis, and in a few cases wrongful death. We have also been notified of other claims of individuals who have not filed suit. Product liability claims could result in the imposition of substantial defense costs and liability on us, a recall of products, or a change in the indications for which they may be used. We currently have limited product liability insurance coverage. We cannot assure you that our insurance will provide adequate coverage against potential liabilities.

         Our ability to enter into and maintain third-party relationships is important to our successful development and commercialization of BYETTA, SYMLIN and our other drug candidates and to our potential profitability.

        With respect to sales, marketing and distribution outside the United States, we will be substantially dependent on Lilly for activities relating to BYETTA and sustained-release formulations of BYETTA, including exenatide once weekly. We believe that we will likely need to enter into marketing and distribution arrangements with third parties for, or find a corporate partner who can provide support for, the development and commercialization of SYMLIN or our other drug candidates outside the United States. We may also enter into arrangements with third parties for the commercialization of SYMLIN or any of our other drug candidates within the United States.

        With respect to BYETTA and, if approved, exenatide once weekly, Lilly is co-promoting within the United States. If Lilly ceased commercializing BYETTA or, if approved, exenatide once weekly, for any reason, we would likely need to either enter into a marketing and distribution arrangement with a third party for those products or significantly increase our internal sales and commercialization infrastructure.

        With respect to our obesity product candidates, we will generally be dependent upon Takeda for development activities beyond phase 2 for approval in the United States and all development activities outside the United States. We will also be dependent upon Takeda for commercializing approved products that result from our co-development activities, if any, in and outside the United States. If Takeda were to terminate our collaboration with them, we would likely need to find a third party collaborator to continue developing our obesity program, which we may be unable to do.

        We may not be able to enter into marketing and distribution arrangements or find a corporate partner for SYMLIN or our other drug candidates as we deem necessary. If we are not able to enter into a marketing or distribution arrangement or find a corporate partner who can provide support for commercialization of our drug candidates as we deem necessary, we may not be able to successfully perform these marketing or distribution activities. Moreover, any new marketer or distributor or corporate partner for our drug candidates, including Lilly and Takeda, with whom we choose to contract may not establish adequate sales and distribution capabilities or gain market acceptance for our products, if any.

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         We have a significant amount of indebtedness. We may not be able to make payments on our indebtedness, and we may incur additional indebtedness in the future, which could adversely affect our operations.

        In April 2004, we issued $200 million of the 2004 Notes and in June 2007, we issued $575 million of the 2007 Notes. In December 2007, we entered into the $125 million Term Loan, of which $93.8 million is currently outstanding and due in 2010. Our ability to make payments on our debt, including the 2004 and 2007 Notes and the Term Loan, will depend on our future operating performance and ability to generate cash and may also depend on our ability to obtain additional debt or equity financing. During four of the last five years, our operating cash flows were negative and insufficient to cover our fixed costs. We may need to use our cash to pay principal and interest on our debt, thereby reducing the funds available to fund our research and development programs, strategic initiatives and working capital requirements. Our ability to generate sufficient operating cash flow to service our indebtedness, including the 2004 and 2007 Notes and the Term Loan, and fund our operating requirements will depend on our ability, alone or with others, to successfully develop, manufacture, obtain required regulatory approvals for and market our drug candidates, as well as other factors, including general economic, financial, competitive, legislative and regulatory conditions, some of which are beyond our control. Our debt service obligations increase our vulnerabilities to competitive pressures because many of our competitors are less leveraged than we are. If we are unable to generate sufficient operating cash flow to service our indebtedness and fund our operating requirements, we may be forced to reduce or defer our development programs, sell assets or seek additional debt or equity financing, which may not be available to us on satisfactory terms or at all. Our level of indebtedness may make us more vulnerable to economic or industry downturns. If we incur new indebtedness, the risks relating to our business and our ability to service our indebtedness will intensify.

         We may be required to redeem our convertible senior notes upon a designated event or repay the Term Loan upon an event of default.

        Holders of the 2004 and 2007 Notes may require us to redeem all or any portion of their notes upon the occurrence of certain designated events which generally involve a change in control of our company. The lenders under the Term Loan may require us to repay outstanding principal and accrued interest due under the Term Loan upon the occurrence of an event of default, which could include, among other things, nonpayment of principle and interest, violation of covenants and a change in control. We may not have sufficient cash funds to redeem the 2004 and 2007 Notes upon a designated event or repay the Term Loan upon an event of default. We may elect, subject to certain conditions, to pay the redemption price for the 2004 Notes in our common stock or a combination of cash and our common stock. We may be unable to satisfy the requisite conditions to enable us to pay some or all of the redemption price for the 2004 Notes in our common stock. If we are prohibited from redeeming the 2004 or 2007 Notes, we could seek consent from our lenders to redeem the 2004 or 2007 notes. If we are unable to obtain their consent, we could attempt to refinance the 2004 or 2007 Notes. If we were unable to obtain a consent or refinance, we would be prohibited from redeeming the 2004 or 2007 Notes. If we were unable to redeem the 2004 or 2007 Notes upon a designated event, it would result in an event of default under the indentures governing the 2004 or 2007 Notes. An event of default under the indentures could result in a further event of default under our other then-existing debt, including the Term Loan. In addition, the occurrence of a designated event may be an event of default under our other debt. Further, an event of default under the Term Loan could result in an event of default under the indentures governing the 2004 or 2007 Notes.

36

         If our research and development programs fail to result in additional drug candidates, the growth of our business could be impaired.

        Certain of our research and development programs for drug candidates are at an early stage and will require significant research, development, preclinical and clinical testing, manufacturing scale-up activities, regulatory approval and/or commitments of resources before commercialization. We cannot predict whether our research will lead to the discovery of any additional drug candidates that could generate additional revenues for us.

         Our future success depends on our chief executive officer, and other key executives and our ability to attract, retain and motivate qualified personnel.

        We are highly dependent on our chief executive officer, and the other principal members of our executive and scientific teams. The unexpected loss of the services of any of these persons might impede the achievement of our research, development and commercialization objectives. Recruiting and retaining qualified sales, marketing, regulatory, scientific and other personnel and consultants will also be critical to our success. We may not be able to attract and retain these personnel and consultants on acceptable terms given the competition between numerous pharmaceutical and biotechnology companies. We do not maintain "key person" insurance on any of our employees.

         We may be unable to adequately prevent disclosure of trade secrets and other proprietary information.

        In order to protect our proprietary technology and processes, we rely in part on confidentiality agreements with our corporate partners, employees, consultants, manufacturers, outside scientific collaborators and sponsored researchers and other advisors. These agreements may not effectively prevent disclosure of confidential information and may not provide an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, others may independently discover our trade secrets and proprietary information.

        Costly and time-consuming litigation could be necessary to enforce and determine the scope of our proprietary rights, and failure to obtain or maintain trade secret protection could adversely affect our competitive business position.

         Our research and development activities and planned manufacturing activities involve the use of hazardous materials, which subject us to regulation, related costs and delays and potential liabilities.

        Our research and development and our planned manufacturing activities involve the controlled use of hazardous materials, chemicals and various radioactive compounds. Although we believe that our research and development safety procedures for handling and disposing of these materials comply with the standards prescribed by state and federal regulations, the risk of accidental contamination or injury from these materials cannot be eliminated. In addition, as part of the development of our planned manufacturing activities, we will need to develop additional safety procedures for the handling and disposing of hazardous materials. If an accident occurs, we could be held liable for resulting damages, which could be substantial. We are also subject to numerous environmental, health and workplace safety laws and regulations, including those governing laboratory procedures, exposure to blood-borne pathogens and the handling of biohazardous materials. Additional federal, state and local laws and regulations affecting our operations may be adopted in the future. We may incur substantial costs to comply with, and substantial fines or penalties if we violate any of these laws or regulations.

         We are exposed to potential risks from legislation requiring companies to evaluate internal control over financial reporting.

        The Sarbanes-Oxley Act requires that we report annually on the effectiveness of our internal control over financial reporting. Among other things, we must perform systems and processes

37

evaluation and testing. We must also conduct an assessment of our internal control to allow management to report on, and our independent registered public accounting firm to attest to, our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. In connection with our Section 404 compliance efforts, we have incurred or expended, and expect to continue to incur or expend, substantial accounting and other expenses and significant management time and resources. We have implemented certain remediation activities resulting from our ongoing assessment of internal control over financial reporting. Our future assessment, or the future assessments by our independent registered public accounting firm, may reveal material weaknesses in our internal control. If material weaknesses are identified in the future we would be required to conclude that our internal control over financial reporting is ineffective and we could be subject to sanctions or investigations by the Securities and Exchange Commission, the NASDAQ Stock Market or other regulatory authorities, which would require additional financial and management resources and could adversely affect the market price of our common stock.

         We have implemented anti-takeover provisions that could discourage or prevent an acquisition of our company, even if the acquisition would be beneficial to our stockholders, and as a result our management may become entrenched and hard to replace.

        Provisions in our certificate of incorporation and bylaws could make it more difficult for a third party to acquire us, even if doing so would benefit our stockholders. These provisions include:

•

allowing our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors;

•

allowing our board of directors to issue, without stockholder approval, up to 5.5 million shares of preferred stock with terms set by the board of directors;

•

limiting the ability of holders of our outstanding common stock to call a special meeting of our stockholders; and

•

preventing stockholders from taking actions by written consent and requiring all stockholder actions to be taken at a meeting of our stockholders.

        Each of these provisions, as well as selected provisions of Delaware law, could discourage potential takeover attempts, could adversely affect the trading price of our securities and could cause our management to become entrenched and hard to replace. In addition to provisions in our charter documents and under Delaware law, an acquisition of our company could be made more difficult by our employee benefits plans and our employee change in control severance plan, under which, in connection with a change in control and termination of employment, stock options held by our employees may become vested and our officers may receive severance benefits. We also have implemented a stockholder rights plan, also called a poison pill, which could make it uneconomical for a third party to acquire us on a hostile basis.

         Our executive officers, directors and major stockholders control approximately 48% of our common stock.

        As of December 31, 2009, executive officers, directors and holders of 5% or more of our outstanding common stock, in the aggregate, owned or controlled approximately 48% of our outstanding common stock. As a result, these stockholders are able to influence all matters requiring approval by our stockholders, including the election of directors and the approval of corporate transactions. This concentration of ownership may also delay, deter or prevent a change in control of our company and may make some transactions more difficult or impossible to complete without the support of these stockholders.

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         Substantial future sales of our common stock by us or our existing stockholders or the conversion of our convertible senior notes to common stock could cause the trading price of our common stock to fall.

        Sales by existing stockholders of a large number of shares of our common stock in the public market or the perception that additional sales could occur could cause the trading price of our common stock to drop. Likewise, the issuance of shares of common stock upon conversion of our convertible notes or redemption of our convertible notes upon a designated event, or upon additional convertible debt or equity financings or other share issuances by us, including shares issued in connection with potential future strategic alliances, could adversely affect the trading price of our common stock. Our convertible notes are currently convertible into a total of up to 15.2 million shares. In addition, the existence of these notes may encourage short selling of our common stock by market participants.

         Significant volatility in the market price for our common stock could expose us to litigation risk.

        The market prices for securities of biopharmaceutical and biotechnology companies, including our common stock, have historically been highly volatile, and the market from time to time has experienced significant price and volume fluctuations that are unrelated to the quarterly operating performance of these biopharmaceutical and biotechnology companies. Since January 1, 2008, the high and low sales price of our common stock varied significantly, as shown in the following table:

	High		Low
Year ending December 31, 2010
First Quarter (through February 16, 2010)	$	19.99	$	14.13
Year ending December 31, 2009
Fourth Quarter	$	15.63	$	11.01
Third Quarter	$	15.69	$	11.73
Second Quarter	$	14.30	$	8.56
First Quarter	$	14.13	$	7.89
Year ended December 31, 2008
Fourth Quarter	$	20.47	$	5.50
Third Quarter	$	35.00	$	18.55
Second Quarter	$	33.22	$	25.30
First Quarter	$	37.38	$	23.75

        Given the uncertainty of our future funding, whether BYETTA and SYMLIN will meet our expectations, and the regulatory approval of our other drug candidates, we may continue to experience volatility in our stock price for the foreseeable future. In addition, the following factors may significantly affect the market price of our common stock:

•

our financial results and/or fluctuations in our financial results;

•

safety issues with BYETTA, SYMLIN or our product candidates;

•

clinical study results;

•

determinations by regulatory authorities with respect to our drug candidates, including exenatide once weekly;

•

our ability to validate our Ohio manufacturing facility and the commercial manufacturing process for exenatide once weekly;

•

developments in our relationships with current or future collaborative partners;

•

our ability to successfully execute our commercialization strategies;

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•

developments in our relationships with third-party manufacturers of our products and other parties who provide services to us;

•

technological innovations or new commercial therapeutic products by us or our competitors;

•

developments in patent or other proprietary rights; and

•

governmental policy or regulation, including with respect to pricing and reimbursement.

Broad market and industry factors also may materially adversely affect the market price of our common stock, regardless of our actual operating performance. Periods of volatility in the market price of our common stock expose us to securities class-action litigation, and we may be the target of such litigation as a result of market price volatility in the future.

Item 1B.    Unresolved Staff Comments

        None.

Item 2.    Properties

        Our primary administrative offices and research laboratories are located in San Diego, California. As of December 31, 2009, we had leases for approximately 647,000 square feet of office and laboratory space. Our leases on a majority of these properties expire between 2015 and 2019. We have also entered into short-term leases and other agreements for small offices in Beachwood, Ohio, Laguna Niguel, California and Washington, D.C.

        Our wholly-owned subsidiary, Amylin Ohio LLC, owns two buildings and 44.4 acres of land in West Chester, Ohio. The buildings, once built out for the manufacture of exenatide once weekly, will have approximately 565,000 square feet of manufacturing and office space.

Item 3.    Legal Proceedings

        From time to time in the ordinary course of business, we become involved in various lawsuits, claims and proceedings relating to the conduct of our business, including those pertaining to product liability, patent infringement and employment claims. Since August 2008, we and Lilly have been named as defendants in 55 separate product liability cases involving approximately 340 plaintiffs in various courts in the United States. These cases have been brought by individuals who allege they have used BYETTA. They generally seek compensatory and punitive damages for alleged injuries, consisting primarily of pancreatitis, and in some cases, wrongful death. Most of the cases are pending in California state court, where the Judicial Council has granted our petition for a "coordinated proceeding" for all California state court cases alleging harm allegedly as a result of BYETTA use. We also have received notice from plaintiff's counsel of additional claims by individuals who have not filed suit. While we cannot reasonably predict the outcome of any lawsuit, claim or proceeding, we and Lilly intend to vigorously defend these matters. However, if we are unsuccessful in our defense, these matters could result in a material adverse impact to our financial position and results of operations.

Item 4.    Submission of Matters to a Vote of Security Holders

        None.

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PART II

Item 5.    Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

        Our common stock is traded on The NASDAQ Global Market under the symbol "AMLN." The following table sets forth, for the periods indicated, the reported high and low sales price per share of our common stock on The NASDAQ Global Market:

	High		Low
Year Ended December 31, 2009
Fourth Quarter	$	15.63	$	11.01
Third Quarter	$	15.69	$	11.73
Second Quarter	$	14.30	$	8.56
First Quarter	$	14.13	$	7.89
Year Ended December 31, 2008
Fourth Quarter	$	20.47	$	5.50
Third Quarter	$	35.00	$	18.55
Second Quarter	$	33.22	$	25.30
First Quarter	$	37.38	$	23.75

        The last reported sale price of our common stock on The NASDAQ Global Market on February 16, 2010 was $18.15. As of February 16, 2010, there were approximately 605 shareholders of record of our common stock.

        We have never declared or paid any cash dividends on our capital stock. We currently intend to retain any future earnings for funding operations and, therefore, do not anticipate paying any cash dividends in the foreseeable future.

        For information concerning prior stockholder approval of and other matters relating to our equity incentive plans, see "Equity Compensation Plan Information" under Item 12 in this annual report on Form 10-K.

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PERFORMANCE MEASUREMENT COMPARISON

The material in this section is not "soliciting material," is not deemed "filed" with the Securities and Exchange Commission, and is not to be incorporated by reference into any filing of Amylin under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

        The following graph compares total stockholder returns of Amylin for the past five years to two indices: the NASDAQ CRSP Total Return Index for the NASDAQ Stock Market (U.S. companies), or the NASDAQ-US, and the NASDAQ Pharmaceutical Index, or the NASDAQ-Pharmaceutical. The total return for our common stock and for each index assumes the reinvestment of dividends, although dividends have never been declared on our common stock, and is based on the returns of the component companies weighted according to their capitalizations as of the end of each monthly period. The NASDAQ-US tracks the aggregate price performance of equity securities of U.S. companies traded on the NASDAQ National Market System, or the NMS. The NASDAQ-Pharmaceutical tracks the aggregate price performance of equity securities of pharmaceutical companies traded on the NMS.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
Among Amylin Pharmaceuticals, Inc., The NASDAQ Composite Index
And The NASDAQ Pharmaceutical Index

42

Item 6.    Selected Financial Data

        Please read the following selected financial data in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and the Consolidated Financial Statements and related notes included elsewhere in this annual report on Form 10-K.

	Years Ended December 31
	2009			2008			2007			2006			2005
	(in thousands, except for per share amounts)
Consolidated Statements of Operations Data:
Net product sales	$	753,993		$	765,342		$	701,450		$	474,038		$	86,713
Revenues under collaborative agreements(1)		4,426			4,286			19,286			4,286			39,285
Total revenues		758,419			769,628			720,736			478,324			125,998
Costs and expenses:
Cost of goods sold		82,999			91,596			65,457			50,073			14,784
Selling, general and administrative(3)		343,864			395,112			390,982			281,950			171,520
Research and development(1)(4)		185,062			222,614			216,339			189,502			117,652
Collaborative profit-sharing		302,861			302,600			290,934			194,191			31,359
Restructuring(5)		16,980			54,926			—			—			—
Total costs and expenses		931,766			1,066,848			963,712			715,716			335,315
Make-whole payment on debt redemption		—			—			—			(7,875	)		—
Net interest and other (expense) income(2)		(11,532	)		(9,778	)		26,490			26,411			2,485
Loss on impairment of investments		(1,377	)		(14,943	)		—			—			—
Net loss		(186,256	)		(321,941	)		(216,486	)		(218,856	)		(206,832	)
Net loss per share—basic and diluted	$	(1.32	)	$	(2.35	)	$	(1.63	)	$	(1.78	)	$	(1.96	)
Shares used in calculating net loss per share—basic and diluted		140,702			137,006			132,621			122,647			105,532
Consolidated Balance Sheets Data:
Cash, cash equivalents and short-term investments	$	667,769		$	816,838		$	1,130,415		$	767,331		$	443,423
Working capital	$	541,313		$	722,290		$	1,049,024		$	702,930		$	415,134
Total assets	$	1,726,419		$	1,727,053		$	1,774,430		$	1,060,386		$	566,962
Long-term obligations, excluding current portion(2)	$	938,516		$	893,998		$	759,388		$	221,208		$	399,112
Accumulated deficit(2)	$	(1,947,867	)	$	(1,761,611	)	$	(1,439,670	)	$	(1,223,184	)	$	(1,004,328	)
Total stockholders' equity(2)	$	422,534		$	519,277		$	727,757		$	635,291		$	69,264

(1)

The selected financial data presented herein have been revised to conform to the current presentation with regard to our change in method of accounting for reimbursed research and development costs under collaborative arrangements, as described in Note 1-Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements presented beginning with page F-6. Accordingly, previously reported revenues under collaborative arrangements and research and development expense have been reduced by $70.5 million, $60.3 million, $32.5 million and $14.5 million for each of the years ended December 31, 2008, 2007, 2006 and 2005, respectively.

(2)

Adjusted for the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (see Note 1 of the Notes to Consolidated Financial Statements). Specifically, net interest and other income (expense) and accumulated deficit for the years ended December 31, 2008 and 2007 have been increased by $6.5 million and $5.4 million, respectively; long-term obligations, excluding current portion for the years ended December 31, 2008 and 2007 was reduced by $154.0 million and $174.7 million, respectively and total stockholders' equity was increased by $168.4 million and $174.9 million for the years ended December 31, 2008 and 2007, respectively.

(3)

Selling, general and administrative expenses for the years ended December 31, 2009, 2008, 2007 and 2006 include approximately $28.4 million, $34.0 million, $35.4 million and $29.0 million, respectively, of employee stock-based compensation expense under the fair value method of accounting for stock-based compensation arrangements.

(4)

Research and development expenses for the years ended December 31, 2009, 2008, 2007 and 2006 include approximately $15.4 million, $21.1 million, $23.6 million and $22.9 million, respectively, of employee stock-based compensation expense under the fair value method of accounting for stock-based compensation arrangements.

(5)

Restructuring charge for the years ended December 31, 2009 and 2008 included $0 and $0.8 million of employee stock-based compensation expense under the fair value method of accounting for stock-based compensation arrangements.

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Item 7.    Management's Discussion and Analysis of Financial Condition and Results of Operations

Overview

        We are a biopharmaceutical company committed to improving the lives of people with diabetes, obesity and other diseases through the discovery, development and commercialization of innovative medicines. We are marketing two first-in-class medicines to treat diabetes, BYETTA and SYMLIN and we are currently seeking approval for exenatide once weekly, an investigational sustained-release medication for type 2 diabetes that is administered only once a week.

        In 2009, we executed on key opportunities for the company including:

•

gaining approval for an expanded indication of BYETTA as a first-line, stand alone medication (monotherapy) along with diet and exercise;

•

finalized BYETTA label updates;

•

submitted an NDA, for exenatide once weekly and executed our DURATION clinical program designed to demonstrate superiority of exenatide once weekly compared to other diabetes medications;

•

completed two obesity clinical trials and entered into a collaboration to develop obesity therapies with Takeda; and

•

improved our operating results and believe we are on track to achieve our stated goal of becoming operating cash flow positive on a sustainable basis by the end of 2010 and achieving operating profitability by the end of 2011.

        BYETTA is the first approved medicine in a class of compounds called GLP-1 receptor agonists. In October 2009, the FDA approved an expanded indication to include BYETTA as a first-line, stand-alone medication (monotherapy) along with diet and exercise to improve glycemic control in adults with type 2 diabetes and changes to the BYETTA label to incorporate updated safety language. Previously BYETTA was approved as an adjunctive therapy to improve glycemic control in patients with type 2 diabetes who have not achieved adequate glycemic control by using metformin, a sulfonylurea and/or a TZD, three common oral therapies for type 2 diabetes. We believe the expanded monotherapy indication and label update present new opportunities for the BYETTA brand. Net product sales of BYETTA were $667.6 million in 2009, $678.5 million in 2008 and $636.0 million in 2007.

        We have an agreement with Lilly for the global development and commercialization of exenatide. This agreement includes BYETTA and other formulations of exenatide such as exenatide once weekly. Under the terms of the agreement, operating profits from products sold in the United States are shared equally between Lilly and us, and Lilly will pay us royalties for product sales outside of the United States. Lilly has primary responsibility for developing and commercializing BYETTA outside of the United States, including any sustained release formulations of exenatide such as exenatide once weekly. By the end of 2009, BYETTA was commercially launched in approximately 60 countries worldwide.

        SYMLIN is the first and only approved medicine in a class of compounds called amylinomimetics. It is approved as an adjunctive therapy to improve glycemic control in patients with either type 2 or type 1 diabetes who is treated with mealtime insulin but who have not achieved adequate glycemic control. We own 100% of the global rights to SYMLIN and in 2010 we plan to explore partnering SYMLIN outside of the United States. Net product sales of SYMLIN were $86.4 million in 2009, $86.8 million in 2008 and $65.5 million in 2007.

        We have a field force of approximately 390 people dedicated to marketing BYETTA and SYMLIN in the United States. Our field force includes our specialty sales force and our managed care

44

organization. Lilly co-promotes BYETTA in the United States. In May 2009, we announced a restructuring of our sales force, a new sales approach within the diabetes market and merged our then-existing primary care and specialty sales forces into a single organization that brings a specialty approach to endocrinologists and diabetes-focused primary care physicians. This new sales force is focused on targeting those doctors that write the majority of prescriptions for branded diabetes therapies. The restructuring of our sales force reduced our total number of sales representatives by approximately 200.

        In addition to our marketed products, we are working with Lilly and Alkermes to develop exenatide once weekly. In May 2009, we announced that we submitted an NDA for exenatide once weekly to the FDA. The FDA filed the NDA submission in July 2009 and the application has a ten-month review period. Clinical components of the NDA included results from our DURATION-1 study which tested the superiority of exenatide once weekly as compared to BYETTA and a meta-analysis across controlled clinical studies of three months or greater from the BYETTA database which showed no increased risk of cardiovascular events associated with exenatide use. Components of the NDA submission supporting product manufacturing included analyses of data from patients in our ongoing extension of the DURATION-1 study who used exenatide once weekly produced at our Ohio manufacturing facility to demonstrate comparability of the intended commercial product with that used during development. The FDA conducted a pre-approval inspection of this facility and has made a number of observations which we believe are addressable.

        In March 2009 and July 2009, we announced positive results from DURATION-2 and DURATION-3, respectively, the second and third in a series of six such studies designed to test the superiority of exenatide once weekly compared to other diabetes therapies. In DURATION-2, exenatide once weekly demonstrated superior glucose control with weight loss and no increase in hypoglycemia compared to maximum doses of sitagliptin or pioglitazone. In DURATION-3, exenatide once weekly demonstrated superior glucose control with weight loss and with less hypoglycemia compared to insulin glargine. In December 2009, we announced results from DURATION-5, a head-to-head study comparing exenatide once weekly to BYETTA. In DURATION-5, patients taking exenatide once weekly experienced a statistically superior reduction in A1C compared to BYETTA.

        In 2010, we will continue to focus on building a superior profile for exenatide once weekly by conducting additional clinical trials that will compare exenatide once weekly against competing products. For example, we expect to report results from our DURATION-4 study in 2010 comparing exenatide once weekly with metformin, sitagliptin or pioglitazone and we have initiated DURATION-6 comparing exenatide once weekly with liraglutide. In addition, we initiated our EXSCEL study in the first quarter of 2010, to demonstrate exenatide once weekly's effect on cardiovascular endpoints. We plan to continue making strategic investments in the exenatide franchise including the development of an exenatide once weekly pen delivery system, an exenatide suspension formulation and potential noninvasive delivery systems including transdermal and nasal.

        Our long-term growth strategy is focused on making prudent investment decisions based on strong clinical data to advance our obesity program and includes our Integrated Neurohormonal Treatment of Obesity, or INTO, strategy. In October 2009, we entered into a worldwide exclusive license, development and commercialization agreement with Takeda to co-develop and commercialize pharmaceutical products for the treatment of obesity and related indications. The agreement includes products to be developed from our product pipeline, including pramlintide/metreleptin, which are compounds currently in phase 2 development for the treatment of obesity. We recently announced results of a 52-week phase 2 study of this compound and, based on those results, we and Takeda plan to advance pramlintide/metreleptin toward phase 3 development.

45

        We maintain an active discovery research program focused on novel peptide and protein therapeutics. We have also entered into a number of strategic alliances and business initiatives that support our expansion into new therapeutic areas.

        Since our inception in September 1987, we have devoted substantially all of our resources to our research and development programs and, more recently, to the commercialization of our products. All of our revenues prior to May 2005 were derived from milestones and amortization of up-front payments under our exenatide collaboration agreement with Lilly, previous SYMLIN collaborative agreements, and previous co-promotion agreements. During the second quarter of 2005, we began to derive revenues from product sales of BYETTA and SYMLIN. At December 31, 2009, our accumulated deficit was approximately $1.9 billion.

        At December 31, 2009, we had $667.8 million in cash, cash equivalents and short-term investments. Additionally we have $165 million available to us pursuant to a credit facility with Lilly. Although we have yet to consistently generate positive operating cash flows, we intend to improve our operating results and reduce our use of cash for operating activities in order to achieve our goal to be operating cash flow positive on a sustainable basis by the end of 2010 and to achieve operating profitability by the end of 2011. Refer to the discussions under the headings "Liquidity and Capital Resources" below and "Cautionary Factors That May Affect Future Results" in Part I, Item 1A for further discussion regarding our anticipated future capital requirements.

Recent Developments

Diabetes

BYETTA

•

Received approval in October 2009 for the expanded indication of BYETTA injection as a first-line, stand-alone treatment (monotherapy) for type 2 diabetes.

•

Announced results from a meta-analysis of CV events that showed no increased risk of CV events associated with BYETTA injection use compared to a pooled comparator group treated with either placebo or insulin.

Exenatide Once Weekly

•

Announced results from the first head-to-head comparative effectiveness study, DURATION-2, that demonstrated exenatide once weekly provided superior glucose control, with weight loss, compared to maximum doses of Januvia or Actos(R) (pioglitazone).

•

Submitted an NDA for exenatide once weekly. The application was accepted for review by the FDA in early July 2009 and the application has a ten-month review period.

•

Announced results from a second head-to-head comparative effectiveness study, DURATION-3, that demonstrated exenatide once weekly provided superior glucose control over Lantus (insulin glargine) injection. Treatment with exenatide once weekly also led to statistically significant improvements in body weight, with reduced incidence of confirmed hypoglycemia.

•

Signed a joint supply agreement with Lilly to develop a pen device for exenatide weekly that will enable patients to mix and administer the medicine in a pre-filled pen device, instead of the syringe and vial currently used in clinical trials.

•

Communicated positive results from the DURATION-5 study that showed exenatide once weekly provided superior glucose control compared to BYETTA.

46

SYMLIN

•

Presented data that showed the use of mealtime SYMLIN improved glucose control, treatment satisfaction and quality of life for patients with type 2 diabetes.

Obesity programs

•

Announced a worldwide exclusive license, development and commercialization agreement with Takeda to co-develop and commercialize pharmaceutical products for the treatment of obesity and related indications.

Financial and Operational

•

Merged Amylin's existing primary care and specialty sales forces into a single organization that will bring a specialty approach to endocrinologists and diabetes-focused primary care physicians, ultimately improving the quality and frequency of our interactions with core prescribers.

•

Significantly improved operating results compared to 2009 and remain on track to achieve our stated goal of sustainable positive operating cash flows by the end of 2010 and operating profitability by the end of 2011.

Critical Accounting Policies and Estimates

        Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including those related to revenue recognition, stock-based compensation, inventory costs, research and development expenses and income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

        We believe the following critical accounting policies affect the significant judgments and estimates used in the preparation of our consolidated financial statements (see Note 1 to our consolidated financial statements on page F-6).

Revenue Recognition

        We recognize revenue from the sale of our products, license fees and milestones earned.

Net Product Sales

        We sell BYETTA and SYMLIN primarily to wholesale distributors, who in turn, sell to retail pharmacies and government entities. Decisions made by these wholesalers and their customers regarding the levels of inventory they hold, and thus the amount of BYETTA and SYMLIN they purchase, may materially affect the level of our product sales in any particular period. We recognize revenue from the sale of our products when delivery has occurred, title has transferred to the customer, the selling price is fixed or determinable, collectability is reasonably assured and we have no further obligations. We record product sales net of allowances for product returns, rebates and wholesaler chargebacks, wholesaler discounts and prescription vouchers. We are required to make significant judgments and estimates in determining some of these allowances. If actual results differ from our estimates, we will be required to make adjustments to these allowances in the future.

47

Product Returns

        We do not offer our wholesale customers a general right of return. However, we will accept returns of products that are damaged or defective when received by the wholesale customer or for any unopened product during the period beginning six months prior to and up to 12 months subsequent to its expiration date. Product returned is generally not resalable as our products require refrigeration. We refund the sales price for product returns in cash or credit to our customers. We estimate product returns based on our historical returns experience and record an allowance for estimated returns at the time of sale. Additionally, we consider several other factors in our estimation process including our internal sales forecasts, the expiration dates of product shipped and third party data to assist us in monitoring estimated channel inventory levels and prescription trends. Actual returns could exceed our historical experience and our estimates of expected future returns due to factors such as wholesaler and retailer stocking patterns and inventory levels and/or competitive changes. To date actual returns have not differed materially from our estimates.

Rebates and Wholesaler Chargebacks

        Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program and contracted discounts with commercial payors. Rebates are amounts owed after the final dispensing of the product by a pharmacy to a benefit plan participant and are based upon contractual agreements or legal requirements with private sector and public sector (e.g. Medicaid) benefit providers. The allowance for rebates is based on contractual discount rates, expected utilization under each contract and our estimate of the amount of inventory in the distribution channel that will become subject to such rebates. Our estimates for expected utilization for rebates are based on historical rebate claims and to a lesser extent third party market research data. Rebates are generally invoiced and paid quarterly in arrears so that our accrual consists of an estimate of the amount expected to be incurred for the current quarter's activity, plus an accrual for prior quarters' unpaid rebates and an accrual for inventory in the distribution channel.

        We recorded an allowance related to the Department of Defense's (DOD) Tricare Retail Pharmacy program pursuant to a final rule that was issued in March 2009 and became effective on May 26, 2009. The final rule clarified the DOD's interpretation of the National Defense Authorization Act of 2008, or NDAA, signed into law on January 28, 2008. The final rule changed the process by which rebate obligations for the Tricare Retail Pharmacy program are created such that a contractual agreement is no longer required and that obligation to pay such rebates emanates from the NDAA itself.

        Wholesaler chargebacks are discounts that occur when contracted customers purchase directly from an intermediary wholesale purchaser. Contracted customers, which currently consist primarily of Federal government entities purchasing off the Federal Supply Schedule, generally purchase the product at its contracted price, plus a mark-up from the wholesaler. The wholesaler, in-turn, charges back to us the difference between the price initially paid by the wholesaler and the contracted price paid to the wholesaler by the customer. The allowance for wholesaler chargebacks is based on expected utilization of these programs and reported wholesaler inventory levels. Actual rebates and wholesaler chargebacks could exceed historical experience and our estimates of future participation in these programs. To date, actual rebate claims and wholesaler chargebacks have not differed materially from our estimates.

Wholesaler Discounts

        Wholesaler discounts consist of prompt payment discounts and distribution service fees. We offer all of our wholesale customers a 2% prompt-pay discount within the first 30 days after the date of the invoice. Distribution service fees arise from contractual agreements with certain of our wholesale customers for distribution services they provide to us and are generally a fixed percentage of their

48

purchases of our products in a given period. Prompt payment discounts and distribution service fees are recorded as a reduction to gross sales in the period the sales occur. The allowance for wholesaler discounts is based upon actual data of product sales to wholesale customers and not on estimates.

Prescription Vouchers

        Prescription vouchers result in amounts owed to pharmacies that have redeemed vouchers for a free prescription. We provide prescription vouchers to physicians, who in turn distribute them to patients. Patients may redeem a voucher at a pharmacy for a free prescription. We reimburse the pharmacy for the price it paid the wholesaler for the medicine and record this reimbursement as a reduction to gross sales. The allowance for prescription vouchers is based on the number of unredeemed vouchers in circulation, and the estimated utilization rate. The estimated utilization rate is based on our historical utilization rates experience with prescription vouchers. The allowance for prescription vouchers could exceed historical experience and our estimates of future utilization rates. To date, actual prescription voucher utilization has not differed materially from our estimates.

Revenues under collaborative agreements

        Revenues under collaborative agreements consist of the amortization of product and technology license fees and milestone payments earned. Upfront product and technology license fees under multiple-element arrangements are deferred and recognized over the period of such services or performance if such arrangements require on-going services or performance. Non-refundable amounts received for substantive milestones are recognized upon achievement of the milestone. Any amounts received prior to satisfying our revenue recognition criteria are recorded as deferred revenue in the accompanying consolidated balance sheets.

Valuation of Stock-Based Compensation

        We account for stock-based compensation to employees in accordance with the fair value method of accounting for stock-based compensation arrangements which requires us to expense the estimated fair value of non-cash, stock-based payments to employees.

        We estimate the fair value of stock-based payments to employees using the Black-Scholes model. This estimate is affected by our stock price as well as assumptions regarding a number of inputs that require us to make significant estimates and judgments. These inputs include the expected volatility of our stock price, the expected term of employee stock options, the risk-free interest rate, expected dividends and expected forfeiture rate.

        We estimate volatility based upon the historical volatility of our common stock for a period corresponding to the expected term of our employee stock options and the implied volatility of market-traded options on our common stock with various maturities between six months and two years. The determination to use implied volatility in addition to historical volatility was based upon the availability of data related to actively traded options on our common stock and our assessment that the addition of implied volatility is more representative of future stock price trends than historical volatility alone.

        The expected life of our employee stock options represents the weighted-average period of time that options granted are expected to be outstanding in consideration of historical exercise patterns and the assumption that all outstanding options will be exercised at the mid-point of the then current date and their maximum contractual term.

        The risk-free interest rates are based on the yield curve of United States Treasury strip securities in effect at the time of grant for periods corresponding with the expected life of our employee stock options. We have never paid dividends and do not anticipate doing so for the foreseeable future.

49

Accordingly, we have assumed no dividend yield for purposes of estimating the fair value of our stock-based payments to employees.

        Stock-based compensation expense recognized is based on awards ultimately expected to vest, and therefore is reduced by expected forfeitures. We estimate forfeitures based upon historical forfeiture rates, and will adjust our estimate of forfeitures if actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative adjustment in the period of the change and will also impact the amount of stock-based compensation expense in future periods.

        If factors underlying the above assumptions change in future periods, the associated estimated non-cash, stock-based compensation expense that we record may differ significantly from what we have recorded in the current period.

Research and Development Expenses

        Research and development costs are expensed as incurred and include: salaries, benefits, bonus, stock-based compensation, license fees, milestone payments due under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices; and associated overhead and facilities costs. Reimbursed research and development costs under collaborative arrangements are recorded as a reduction to research and development expenses and are recognized in the period in which the related costs are incurred. Clinical trial costs are a significant component of research and development expenses and include costs associated with third-party contractors. Invoicing from third-party contractors for services performed can lag several months. We accrue the costs of services rendered in connection with third-party contractor activities based on our estimate of management fees, site management and monitoring costs and data management costs. Differences between actual clinical trial costs from estimated clinical trial costs have historically not been material and are adjusted for in the period in which they become known.

Income Taxes

        We have net deferred tax assets relating primarily to net operating loss carryforwards and research and development tax credit carryforwards. Subject to certain limitations, these deferred tax assets may be used to offset taxable income in future periods. Since we have been unprofitable since inception and the likelihood of future profitability is not assured, we have established a valuation allowance for most of these net deferred tax assets in our consolidated balance sheets at December 31, 2009 and 2008. If we determine that we are able to realize a portion or all of these deferred tax assets in the future, we will record an adjustment to increase their recorded value and a corresponding adjustment to increase income or additional paid in capital, as appropriate, in that same period.

        We recognize the impact of a tax position in our financial statements only if it is more likely than not that the tax position will be sustained upon examination by taxing authorities, based on the technical merits of the position. We provide estimates for unrecognized tax benefits which relate primarily to issues common among corporations in our industry. We apply a variety of methodologies in making these estimates which include advice from industry and subject experts, evaluation of public actions taken by the Internal Revenue Service and other taxing authorities, as well as our own industry experience. If our estimates are not representative of actual outcomes, our results could be materially impacted.

Inventories and Related Reserves

        Inventories consist of raw materials, work-in-process and finished goods for SYMLIN and BYETTA. We maintain inventory reserves primarily for production failures and potential product expiration. The manufacturing processes for our products are complex. Deviations in the manufacturing

50

process may result in production failures and additional inventory reserves. Obsolete inventory due to expiration may also result in additional inventory reserves. In estimating inventory obsolescence reserves, we analyze the shelf life, expiration dates and internal sales forecasts, each on a product-by-product basis. We expense costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until such time as we believe future commercialization is probable and future economic benefit is expected to be recognized. There were no pre-approval inventories capitalized as of December 31, 2009 or 2008.

Convertible Senior Notes

        During 2009, we adopted new authoritative guidance that significantly impacts the accounting for our convertible senior notes issued in June 2007 by requiring us to account separately for the liability and equity components of the notes. The liability component is measured so the effective interest expense associated with the notes reflects the issuer's borrowing rate at the date of issuance for similar debt instruments without the conversion feature. The difference between the cash proceeds associated with the notes and this estimated fair value is recorded as a debt discount and amortized to interest expense over the life of the notes.

        Determining the fair value of the liability component requires the use of accounting estimates and assumptions. These estimates and assumptions are judgmental in nature and could have a significant impact on the determination of the liability component and, in effect, the associated interest expense. According to the guidance, the carrying amount of the liability component is determined by measuring the fair value of a similar liability that does not have an associated equity component. If no similar liabilities exist, estimates of fair value are primarily determined using assumptions that market participants would use in pricing the liability component, including market interest rates, credit standing, yield curves and volatilities.

Recently Issued Accounting Pronouncements

        For a discussion of recently issued accounting pronouncements, refer to the section titled "Recently Issued Accounting Standards" within Note 1. Summary of Significant Accounting Policies to our Consolidated Financial Statements.

Results of Operations

Net Product Sales

        Net product sales for the years ended December 31, 2009, 2008 and 2007 were $754.0 million, $765.3 million and $701.5 million, respectively, and consisted of sales of BYETTA and SYMLIN, less allowances for product returns, rebates and wholesaler chargebacks, wholesaler discounts, and prescription vouchers.

        The following table provides information regarding net product sales (in millions):

	Year ended December 31,
	2009		2008		2007
BYETTA	$	667.6	$	678.5	$	636.0
SYMLIN		86.4		86.8		65.5
	$	754.0	$	765.3	$	701.5

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        The decrease in net product sales for BYETTA for the year ended December 31, 2009 as compared to the same period in 2008 primarily reflects decreased prescription demand following an August 2008 FDA update on a prior alert referencing pancreatitis and an allowance for rebates related to the U.S. Department of Defense's (DOD) Tricare Retail Pharmacy Program discussed below. These decreases are partially offset by higher prices in the year ended December 31, 2009 compared to the same period in 2008.

        The slight decrease in net product sales for SYMLIN for the year ended December 31, 2009 compared to the same period in 2008 primarily reflects higher prices offset by a reserve for the DOD's Tricare Retail Pharmacy program discussed below, and a reduction in prescription demand.

        We recorded an allowance related to the DOD's Tricare Retail Pharmacy program pursuant to a final rule that was issued in March 2009, and became effective May 26, 2009. The final rule clarified the DOD's interpretation of the national Defense Authorization Act of 2008, or NDAA, signed into law on January 28, 2008. The final rule changed the process by which rebate obligations for the Tricare Retail Pharmacy program are created such that a contractual agreement is no longer required and that obligation to pay such rebates emanates from the NDAA itself. In consideration of this final rule we recorded an allowance of $8.2 million for such rebates for the year ended December 31, 2009, of which $4.8 million represents a retroactive rebate assessment for sales made during 2008.

        The increase in net product sales for BYETTA and SYMLIN for the year ended December 31, 2008 as compared to the same period in 2007 primarily reflect continued growth in patient demand and the impact of price increases.

        Sales of our products in future periods may be impacted by numerous factors, including potential competition, the potential approval of additional products including exenatide once weekly, regulatory matters, economic factors and other environmental factors.

Revenues under Collaborative Agreements

        The following table summarizes the components of revenues under collaborative agreements for the years ended December 31, 2009, 2008 and 2007 (in millions):

	Year ended December 31,
	2009		2008		2007
Amortization of up-front payments	$	4.4	$	4.3	$	4.3
Recognition of milestone payments		—		—		15.0
	$	4.4	$	4.3	$	19.3

        During the year ended December 31, 2009 amortization of up-front payments consists of amounts earned pursuant to our exenatide collaboration agreement with Lilly and our obesity collaboration with Takeda. For the years ended December 31, 2008 and 2007, substantially all of the revenue recorded in these periods consists of amounts earned pursuant to our exenatide collaboration agreement with Lilly and consists primarily of the continued amortization of up-front payments and milestone payments.

        Amortization of up front payments is largely unchanged for the three years ended December 31, 2009, 2008 and 2007. During 2009 the amortization of up-front payments relates to up-front payments received in connection with our Lilly collaboration, for which amortization ended in 2009, and our collaboration with Takeda, for which amortization began in late 2009. During 2008 and 2007 the entire amount of amortization of up-front payments relates to our collaboration agreement with Lilly. There were no milestone payments in 2009 or 2008, compared to $15 million in milestone payments in 2007 earned primarily upon Lilly's launch of BYETTA in the European Union.

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        In future periods, we expect that revenues under collaborative agreements will consist of possible future milestone payments, including $40 million conditioned upon the launch of exenatide once weekly in the United States and continued amortization of the $75 million of the up-front payment received from Takeda upon signing of our collaboration agreement in 2009. This up-front payment is being amortized ratably over a ten year period representing the estimated development period of the compounds subject to the Takeda collaboration agreement. Following the commercial launch of exenatide once-weekly, revenue from collaboration agreements will also include amortization of a portion of the $125 million cash payment received in connection with the exenatide once weekly supply agreement discussed above. The receipt and recognition as revenue of future substantive milestone payments is subject to the achievement of performance requirements underlying such milestone payments.

Cost of Goods Sold

        Cost of goods sold was $83.0 million, representing a gross margin of 89%, $91.6 million, representing a gross margin of 88%, and $65.5 million, representing a gross margin of 91%, for the years ended December 31, 2009, 2008 and 2007, respectively. Cost of goods sold is comprised primarily of manufacturing costs associated with BYETTA and SYMLIN sales during the period. The increase in gross margin in 2009, as compared to 2008, primarily reflects higher net sales prices and lower unit costs for BYETTA driven by reduced inventory reserves and efficiencies driven by our reduced cost structure. The decrease in gross margin in 2008, as compared to 2007, primarily reflects increased production costs for BYETTA due to lower production volumes, increases in inventory reserves and product mix, including the introduction of the SymlinPen, partially offset by higher net sales prices per unit for BYETTA and SYMLIN. Annual fluctuations in gross margins may be influenced by production volumes, product mix, pricing and the level of sales allowances.

Selling, General and Administrative Expenses

        Selling, general and administrative expenses were $343.9 million, $395.1 million and $391.0 million in the years ended December 31, 2009, 2008 and 2007, respectively.

        The $51.2 million decrease in 2009 compared to 2008 reflects our reduced cost structure following our recent restructurings. The $4.1 million increase in 2008 compared to 2007 reflects slight increases in promotional spending for BYETTA and SYMLIN and business infrastructure.

        We, along with Lilly, are jointly responsible for the co-promotion of BYETTA within the United States, and share equally in sales force costs and external marketing expenses. Accordingly, our selling, general and administrative expenses include our 50% share of these costs in the United States.

Research and Development Expenses

        Currently, our research and development efforts are focused on programs for the treatment of diabetes and obesity in various stages of development. From inception through 1998, we devoted substantially all of our research and development efforts to SYMLIN. Beginning in 1999, our research and development costs started to include costs for our other drug candidates, primarily BYETTA and exenatide once weekly. In 2004 we initiated our program for the treatment of obesity with pramlintide and in 2006 we commenced our INTO clinical research program for obesity.

        The drug development process in the United States includes a series of steps defined by the FDA. The process begins with discovery and preclinical evaluation leading up to the submission of an IND to the FDA, which allows for the initiation of the clinical evaluation of a potential drug candidate in humans. Clinical evaluation is typically comprised of three phases of study: Phase 1, Phase 2 and Phase 3. Generally, the majority of a drug candidate's total development costs are incurred during Phase 3, which consists of trials that are typically both the longest and largest conducted during the

53

drug development process. Successful completion of Phase 3 clinical testing is followed by the submission of an NDA to the FDA for marketing approval. It is not uncommon for the FDA to request additional data following its review of an NDA, which can significantly increase the drug development timeline and expenses. Following initial regulatory approval for a drug candidate, companies generally initiate additional clinical trials aimed at expanding product labeling and market potential.

        The timing and costs to complete the successful development of any of our drug candidates are highly uncertain, and therefore difficult to estimate.

        Our research and development costs are comprised of salaries and bonuses, benefits, non-cash stock-based compensation, license fees, milestones under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices; and associated overhead expenses and facilities costs. Reimbursed research and development costs under collaborative arrangements are recorded as a reduction to research and development costs. We charge direct internal and external program costs to the respective development programs. We also incur indirect costs that are not allocated to specific programs because such costs benefit multiple development programs and allow us to increase our pharmaceutical development capabilities. These consist primarily of facilities costs and other internal shared resources related to the development and maintenance of systems and processes applicable to all of our programs.

        The following table sets forth information regarding our research and development expenses for our major projects for the years ended December 31, 2009, 2008 and 2007 (in millions):

	Year ended December 31,
	2009		2008(1)		2007(1)
Diabetes(1)	$	92.3	$	83.3	$	89.9
Obesity		26.0		55.3		51.5
Research and early-stage programs		24.8		30.4		29.3
Indirect costs		42.0		53.6		45.6
	$	185.1	$	222.6	$	216.3

(1)

Research and development expenses consist primarily of costs associated with BYETTA and exenatide once weekly which are shared by Lilly pursuant to our collaboration agreement. Research and development expenses by major project have been revised to conform to the current presentation with regard to our change in method of accounting for reimbursed research and development costs under collaborative arrangements (see Note 1, "Summary of Significant Accounting Policies" in the notes to the consolidated financial statements).

        Research and development expenses decreased to $185.1 million for the year ended December 31, 2009 from $222.6 million for the year ended December 31, 2008. The $37.5 million decrease primarily reflects our reduced cost structure and decreased development expenses for our obesity programs following recently completed clinical trials, partially offset by increased costs for our diabetes programs associated with manufacturing readiness activities at our Ohio manufacturing facility for exenatide once weekly.

        Research and development expenses increased to $222.6 million for the year ended December 31, 2008 from $216.3 million for the year ended December 31, 2007. The $6.3 million increase primarily reflects continued investments in exenatide once weekly, including manufacturing scale up at our Ohio manufacturing facility and costs associated with the ongoing DURATION clinical trials discussed above under the heading "Overview", and continued investment in our obesity development programs,

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including costs associated with the ongoing Phase 2B study evaluating pramlintide and metreleptin discussed above.

Collaborative Profit-Sharing

        Collaborative profit-sharing was $302.9 million, $302.6 million and $290.9 million for the years ended December 31, 2009, 2008 and 2007, respectively, and consists of Lilly's 50% share of the gross margin for BYETTA sales in the United States.

Restructuring

        In May 2009, we announced a restructuring of our sales force to merge our existing primary care and specialty sales forces into a single organization, or the 2009 Restructuring. The 2009 Restructuring reduced the total number of Amylin sales representatives by approximately 200 employees. We recorded restructuring charges of $17.0 million during the year ended December 31, 2009 consisting of employee separation costs and facilities related charges.

        In November 2008, we announced a strategic restructuring and workforce reduction, or the 2008 Restructuring, that reduced the size of our San Diego workforce by approximately 25%, or 330 employees. The goal of the 2008 Restructuring was to better align our cost structure with anticipated revenues and is part of our business plan to become operating cash flow positive on a sustainable basis by the end of 2010.

        In addition, we also consolidated our San Diego facilities and have sub-leased or intend to sub-lease vacated facilities. In connection with the 2008 Restructuring, we recorded a charge of $54.9 million for the year ended December 31, 2008. This charge consists primarily of expenses related to facility leases for exited facilities, including impairments of related tenant improvements and employee separation benefits. During the fourth quarter of 2009 we revised the estimated losses associated with the facility leases we ceased using in 2008 based upon recently executed sub-lease agreements and a related reassessment of current market conditions and recorded an additional loss of $5.6 million.

        The following table sets forth the components of the restructuring charges recognized for the years ended December 31, 2009 and 2008 (in millions):

	Year ended December 31,
	2009		2008
Facility related charges	$	5.6	$	31.3
Employee separation costs		10.9		13.9
Asset impairments		—		8.8
Other restructuring charges		0.5		0.9
	$	17.0	$	54.9

        We have substantially completed all of the above activities included in the restructuring plan and all costs associated with the restructurings were incurred during the years ended December 31, 2009 and 2008.

Interest and Other Income and Expense

        Interest and other income consist primarily of interest income from investment of cash and investments. Interest and other income was $7.8 million in 2009, $26.6 million in 2008 and $47.0 million in 2007. The decrease in 2009 compared to 2008 primarily reflects lower average investment balances

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and lower interest rates in 2009 compared to 2008. The decrease in 2008 compared to 2007 primarily reflects lower average investment balances and lower interest rates in 2008 as compared to 2007.

        Interest and other expense consist primarily of interest expense resulting from our long-term debt obligations and mark-to-market gains and losses on derivative financial instruments and includes interest payments and the amortization of debt issuance costs. Interest and other expense was $19.3 million in 2009, $36.3 million in 2008 and $20.5 million in 2007. The decrease in 2009 compared to 2008 primarily reflects an increase in interest capitalized to our Ohio manufacturing facility and 2009 mark-to-market gains on derivative financial instruments which, in 2008, were mark-to-market losses. The increase in 2008 compared to 2007 primarily reflects additional interest expense for our 2007 notes and $125 million long-term note payable entered into in December 2007.

Loss on Impairment of Investments

        We recognized a loss on impairment of investments of $1.4 million for the year ended December 31, 2009. The loss represents credit-related losses associated with two securities in our portfolio and was based upon the amortized cost basis and the observed market prices for the securities. At December 31, 2009, gross unrealized losses on our short-term investments were $1.1 million, all of which we determined to be temporary.

        We recognized a loss on impairment of investments of $14.9 million for the year ended December 31, 2008. This primarily represents a recognized $9.0 million other-than-temporary impairment loss on an equity investment in a privately held entity based upon our assessment of the entity's financial and technical performance and the entity's ability to raise additional capital in significantly deteriorated financial markets to fund ongoing operations. We also recognized a $5.9 million other-than-temporary impairment loss on a corporate debt security in our investment portfolio based upon our assessment of the impact of bankruptcy proceedings of the issuer on the recoverability of our investment.

Net Loss

        Our net loss for the year ended December 31, 2009 was $186.3 million compared to $321.9 million in 2008 and $216.5 million in 2007. The decrease in our net loss in 2009 compared to 2008 primarily reflects the decreased expenses discussed above. The increase in our net loss in 2008 compared to 2007 primarily reflects the increased expenses, including the restructuring charge, partially offset by the increased net product sales discussed above.

        We may incur operating losses for the next few years. In November 2008, we announced the 2008 Restructuring and our business plan to become operating cash flow positive on a sustainable basis by the end of 2010, and in May 2009 we announced the 2009 Restructuring. However, our ability to reach profitability in the future will be heavily dependent upon the amount of product sales that we achieve for BYETTA, SYMLIN and exenatide once weekly, if approved. Our ability to achieve profitability in the future will also depend on our ability to control our operating expenses, including ongoing expenses associated with the continued commercialization of BYETTA and SYMLIN, costs associated with the development and commercialization of exenatide once weekly, if approved, and expenses associated with our research and development programs, including our obesity and our early-stage development programs and related support infrastructure. Our operating results may fluctuate from quarter to quarter as a result of differences in the timing of expenses incurred and revenues recognized.

Liquidity and Capital Resources

        Since our inception, we have financed our operations primarily through public sales and private placements of our common and preferred stock, debt financings, payments received pursuant to our exenatide collaboration with Lilly and our obesity collaboration with Takeda, reimbursement of

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SYMLIN development expenses through earlier collaboration agreements, and since the second quarter of 2005, through product sales of BYETTA and SYMLIN.

        At December 31, 2009, we had $667.8 million in cash, cash equivalents and short-term investments, compared to $816.8 million at December 31, 2008 and we have $165 million of cash available to us pursuant to the loan agreement with Lilly discussed below. In November 2008, we implemented the 2008 Restructuring and in May 2009, we implemented the 2009 Restructuring. As a result of these restructurings, and other efforts to gain efficiencies in our business, we substantially improved our operating results in 2009 and believe we are on track to achieve our stated goals of positive operating cash flows by the end of 2010 and operating profitability by the end of 2011. Our use of cash for capital expenditures decreased in 2009 compared to 2008 driven by lower capital spending for our manufacturing facility for exenatide once weekly located in Ohio, partially offset by additional capital expenditures for the development of a pen device for exenatide once weekly. Our current business plan does not contemplate a need to raise additional funds from outside sources, however, we may evaluate opportunities to refinance existing indebtedness from time to time. If we require additional financing in the future, we cannot assure you that it will be available to us on favorable terms, or at all. Although we have previously been successful in obtaining financing through our debt and equity securities offerings, there can be no assurance that we will be able to so in the future, especially given the current adverse economic and credit conditions.

        Our operating activities provided cash of $19.9 million in the year ended December 31, 2009 and we used cash of $19.5 million and $125.2 million for our operating activities in the years ended December 31, 2008 and 2007, respectively. Our cash provided by our operating activities for the year ended December 31, 2009 includes $119.7 million of non-cash expenses, consisting primarily of stock-based compensation, depreciation and amortization.

        Our primary uses of cash for our operating activities includes uses of cash due to increases in other current assets of $35.7 million, a decrease in restructuring liabilities of $14.8 million and a decrease in payable to collaborative partner of $10.8 million. The increase in other current assets primarily reflects prepayments for raw material inventory. The decrease in restructuring liabilities reflects payment of employee separation costs associated with our restructuring at the end of 2008 and rental payments on vacated facilities that we are actively seeking to sublease. These restructuring payments are offset by an increase in the liability resulting from expenses associated with the 2009 Restructuring. The decrease in payable to collaborative partner primarily reflects a reduced net payable to Lilly due to higher cost-sharing payments due from Lilly due to increased development expenses for exenatide once weekly in the fourth quarter of 2009 compared to the same period in 2008.

        Our primary sources of cash for our operating activities includes sources of cash due to increases in deferred revenue and deferred collaborative profit sharing of $70.7 million and $54.6 million, respectively and a decrease in inventories of $16.1 million. The increase in deferred revenue reflects the $75 million up-front payment we received in connection with the Takeda obesity collaboration net of related amortization. The increase in deferred collaborative profit-sharing reflects payments due to us from Lilly for its 60% share of the capital expenditures we have made for the exenatide once weekly pen device. The decrease in inventories primarily reflects reduction in finished goods due to the timing and volume of production for BYETTA and SYMLIN. Working capital changes may fluctuate from quarter to quarter due to timing of inventory and other current asset purchases and the timing of payment of accounts payable, accrued compensation and other current liabilities.

        Our investing activities used cash of $116.1 million, $182.2 million and $296.1 million in the years ended December 31, 2009, 2008 and 2007, respectively. Investing activities in all three years consisted primarily of purchases and sales of short-term investments and purchases of property, plant and equipment. Purchases of property, plant and equipment decreased to $152.1 million in 2009 from $295.1 million in 2008. The decrease in 2009 was as expected and primarily reflects a reduction of costs

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associated with our manufacturing facility for exenatide once weekly, offset by costs incurred in connection with the exenatide once weekly pen device. The initial capital investment for the pen is expected to be $216.0 million over the next few years, which will be funded 60% by Lilly and 40% by us. Through December 31, 2009, we have incurred $97.7 million in capital expenditures associated with the exenatide once weekly pen device. We have billed Lilly $54.6 million for its share of these expenditures, of which $46.6 million has been received to date, and is included in cash used for operating activities as discussed above. Purchases of property, plant and equipment increased to $295.1 in 2008 from $268.7 million in 2007. The increases in 2008 primarily reflect costs associated with our manufacturing facility for exenatide once weekly and, to a lesser extent, purchases of tenant improvements, computer software, office equipment and scientific equipment to support our growth. We expect that our capital expenditures will continue to decrease in 2010 and will be principally focused on strategically investing in exenatide life cycle management, of which Lilly shares in 60% of the costs. Through December 31, 2009, we capitalized $701.9 million associated with the construction of this facility, including $97.7 million for the exenatide once weekly pen device discussed above. Capital expenditures for our Ohio facility also include costs associated with the construction of the facility, purchase and installation of equipment and capitalized labor and materials required to validate the facility. We will continue to evaluate potential additional investments in our Ohio manufacturing facility during the product life cycle for exenatide once weekly.

        Financing activities used cash of $20.3 million in the year ended December 31, 2009 and provided cash of $16.7 million and $776.9 million in the years ended December 31, 2008 and 2007, respectively. Financing activities in 2009 include repayments of our note payable partially offset by proceeds from the exercise of stock options and proceeds from our employee stock purchase plan. Financing activities in 2008 include proceeds from the exercise of stock options and proceeds from our employee stock purchase plan. Financing activities for 2007 included proceeds from the exercise of stock options, proceeds from our employee stock purchase plan and $559 million in net proceeds from the issuance of the 2007 Notes.

        At December 31, 2009, we had $200 million in aggregate principal amount of the 2004 Notes due April 15, 2011 and $575 million of the 2007 Notes due June 15, 2014 outstanding. The 2004 Notes are currently convertible into a total of up to 5.8 million shares of our common stock at approximately $34.35 per share and are not redeemable at our option. The 2007 Notes are currently convertible into a total of up to 9.4 million shares of our common stock at approximately $61.07 per share and are not redeemable at our option.

        In December 2007, we entered into a $140 million credit agreement. The credit agreement provides for a $125 million term loan and a $15 million revolving credit facility. The revolving credit facility also provides for the issuance of letters of credit and foreign exchange hedging up to the $15 million borrowing limit. At December 31, 2009 we had an outstanding balance of $93.8 million under the term loan, all of which is due in 2010, and had issued $8.9 million of standby letters of credit under the revolving credit facility. Both loans have a final maturity date of December 21, 2010. Interest on the term loan is payable quarterly in arrears at a rate equal to 1.75% above the London Interbank Offered Rate, or LIBOR, of either one, two, three or six months LIBOR term at our election. We have entered into an interest rate swap agreement which resulted in a fixed interest rate of 5.717% under the term loan. The interest rate on the credit facility is LIBOR plus 1.0% or the Bank of America prime rate, at our election.

        In October 2008, we entered into a loan agreement with Lilly pursuant to which Lilly made available to us a $165 million unsecured line of credit that we can draw upon from time to time until June 30, 2011. As of December 31, 2009 we had not drawn upon this line of credit. Any interest due under this credit facility will bear interest at the five-day average three-month LIBOR rate immediately prior to the date of the advance plus 5.25% and shall be due and payable quarterly in arrears on the first business day of each quarter. All outstanding principal, together with all accrued and unpaid

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interest, shall be due and payable the earlier of 36 months following the date on which the loan commitment is fully advanced or June 30, 2014.

        The following table summarizes our contractual obligations and maturity dates as of December 31, 2009 (in thousands).

	Payments Due by Period
Contractual Obligations	Total		Less than 1 year		1 - 3 years		3 - 5 years		More than 5 years
Long-term convertible debt	$	775,000	$	—	$	200,000	$	575,000	$	—
Interest on long-term convertible debt		85,125		22,250		37,000		25,875		—
Long-term note payable		93,750		93,750		—		—		—
Interest on long-term note payable, net of swap transactions(1)		4,690		4,690		—		—		—
Inventory purchase obligations(2)		104,195		54,168		40,468		9,559		—
Construction contracts		48,820		24,780		24,040		—		—
Operating leases		187,535		23,234		48,220		50,786		65,295
Total(3)	$	1,299,115	$	222,872	$	349,728	$	661,220	$	65,295

(1)

The interest payments shown were calculated using a rate of 5.717%, the net rate from the term loan and interest rate swap, on the outstanding principal balance of the term loan.

(2)

Includes $26.1 million of outstanding purchase orders, cancelable by us upon 30 days' written notice, subject to reimbursement of costs incurred through the date of cancellation. Also includes $37.6 million of commitments for exenatide once weekly that are contingent upon FDA approval of exenatide once weekly.

(3)

Excludes long-term obligation of $6.7 million related to deferred compensation, the payment of which is subject to elections made by participants that are subject to change.

        In addition, under certain license and collaboration agreements we are required to pay royalties and/or milestone payments upon the successful development and commercialization of related products. We expect to make development milestone payments up to $9.5 million associated with licensing agreements in the next 12 months. Additional milestones of up to approximately $250.5 million could be paid over the next two to fifteen years if development and commercialization of all our early stage programs continue and are successful. The majority of these milestones relate to potential future regulatory approvals and subsequent sales thresholds. Given the inherent risk in pharmaceutical development, it is highly unlikely that we will ultimately make all of these milestone payments; however, we would consider these payments as positive because they would signify that the related products are moving successfully through development and commercialization.

        Our future capital requirements will depend on many factors, including: the amount of product sales we and Lilly achieve for BYETTA and exenatide once weekly, if approved, net of profit sharing payments to Lilly, and product sales for SYMLIN; costs associated with the continued commercialization of BYETTA and SYMLIN and the commercialization of exenatide once weekly, if approved; costs associated with the operation of our exenatide once weekly manufacturing facility; costs of potential licenses or acquisitions; the potential need to repay existing indebtedness; our ability to receive or need to make milestone payments; our ability, and the extent to which we establish collaborative arrangements for SYMLIN or any of our product candidates; progress in our research and development programs and the magnitude of these programs; costs involved in preparing, filing, prosecuting, maintaining, enforcing or defending our patents; competing technological and market developments; and costs of manufacturing, including costs associated with establishing our own manufacturing capabilities or obtaining and validating additional manufacturers of our products; and scale-up costs for our drug candidates.

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Off-Balance Sheet Arrangements

        We do not have any off-balance sheet arrangements that are currently or reasonably likely to be material to our consolidated financial position or results of operations.

Item 7A.    Quantitative and Qualitative Disclosures about Market Risk

        We invest our excess cash primarily in United States Government securities, asset-backed securities, and debt instruments of financial institutions and corporations with investment-grade credit ratings. These instruments have various short-term maturities. We do not utilize derivative financial instruments, derivative commodity instruments or other market risk sensitive instruments, positions or transactions in any material fashion. Accordingly, we believe that, while the instruments held are subject to changes in the financial standing of the issuer of such securities, we are not subject to any material risks arising from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices or other market changes that affect market risk sensitive investments. Our debt is not subject to significant swings in valuation as interest rates on our debt are fixed. The fair value of our 2004 Notes and 2007 Notes at December 31, 2009 was approximately $192 million and $453 million, respectively. We have entered into an interest rate swap in connection with our $125 million term loan. The fair value of the interest rate swap at December 31, 2009 was a liability of $2.8 million. A hypothetical 1% adverse move in interest rates along the entire interest rate yield curve would not materially affect the fair value of our financial instruments that are exposed to changes in interest rates.

Item 8.    Financial Statements and Supplementary Data

        The financial statements and supplemental data required by this item are set forth at the pages indicated in Part IV, Item 15(a)(1) of this annual report.

Item 9.    Changes In and Disagreements with Accountants on Accounting and Financial Disclosure

        None.

Item 9A.    Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

        Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2009.

        Our management does not expect that our disclosure controls and procedures or our internal controls over financial reporting will prevent all potential error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, or misstatements due to error, if any, within the Company have been detected. While we believe that our disclosure controls and procedures and internal control over financial reporting are and have been effective, we intend to continue to examine and refine our disclosure controls and procedures and internal control over financial reporting and to monitor ongoing developments in these areas.

60

Management's Report on Internal Control Over Financial Reporting

        Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on our evaluation under the framework in Internal Control—Integrated Framework, our management concluded that our internal control over financial reporting was effective as of December 31, 2009. The effectiveness of our internal control over financial reporting as of December 31, 2009 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which is included herein.

Changes in Internal Control Over Financial Reporting

        There has been no change in our internal control over financial reporting in our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

61

Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting

The Board of Directors and Stockholders of Amylin Pharmaceuticals, Inc.

        We have audited Amylin Pharmaceuticals, Inc.'s internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Amylin Pharmaceuticals, Inc.'s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the company's internal control over financial reporting based on our audit.

        We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

        A company's internal control over financial reporting is a process designed 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. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

        Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

        In our opinion, Amylin Pharmaceuticals, Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2009, based on the COSO criteria.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the accompanying consolidated balance sheets of Amylin Pharmaceuticals, Inc. as of December 31, 2009 and 2008, and the related consolidated statements of operations, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2009 of Amylin Pharmaceuticals, Inc. and our report dated February 26, 2010 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

San Diego, California
February 26, 2010

62

PART III

Item 9B.    Other Information

        None.

Item 10.    Directors, Executive Officers and Corporate Governance

        The information required by this item with respect to directors is incorporated by reference from the information under the captions "Election of Directors," "Section 16(a) Beneficial Ownership Reporting Compliance," and "Code of Business Conduct and Ethics" contained in the proxy statement to be filed with the SEC pursuant to Regulation 14A in connection with our 2010 annual meeting of stockholders. The information required by this item with respect to executive officers appears under Part I of this annual report on Form 10-K under the caption "Business—Executive Officers."

Item 11.    Executive Compensation

        The information required by this item is incorporated by reference to the information under the captions "Compensation of Directors," "Executive Compensation," "Report of the Compensation Committee of the Board of Directors on Executive Compensation," and "Compensation Committee Interlocks and Insider Participation" contained in the proxy statement to be filed with the SEC pursuant to Regulation 14A in connection with our 2010 annual meeting of stockholders.

Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters

        The information required by this item is incorporated by reference to the information under the captions "Security Ownership of Certain Beneficial Owners and Management" and "Equity Compensation Plan Information" contained in the proxy statement to be filed with the SEC pursuant to Regulation 14A in connection with our 2010 annual meeting of stockholders.

Item 13.    Certain Relationships and Related Transactions, and Director Independence

        The information required by this item is incorporated by reference to the information under the captions "Election of Directors" and "Certain Transactions" contained in the proxy statement to be filed with the SEC pursuant to Regulation 14A in connection with our 2010 annual meeting of stockholders.

Item 14.    Principal Accountant Fees and Services

        The information required by this item is incorporated by reference to the information under the caption contained in "Ratification of Selection of Independent Registered Public Accounting Firm" contained in the proxy statement to be filed with the SEC pursuant to Regulation 14A in connection with our 2010 annual meeting of stockholders.

63

PART IV

Item 15.    Exhibits and Financial Statement Schedules

(a)(1) Index to Consolidated Financial Statements

        The financial statements required by this item are submitted in a separate section beginning on page F-1 of this annual report.

(a)(2) Financial Statement Schedules: The following Schedule is filed as part of this annual report on Form 10-K:

	Page Number
II. Valuation Accounts	F-44

        All other schedules have been omitted because they are not applicable or required, or the information required to be set forth therein is included in the Consolidated Financial Statements or notes thereto.

(a)(3) Index to Exhibits—See Item 15(b) below.

(b)

Exhibits

Exhibit Footnote		Exhibit Number
	(1)		3.1	Amended and Restated Certificate of Incorporation of the Registrant.
	(4)		3.2	Fourth Amended and Restated Bylaws of the Registrant.
	(9)		3.3	Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Registrant.
	(29)		3.4	Certificate of Amendment of Amended and Restated Certificate of Incorporation of the Registrant.
			4.1	Reference is made to Exhibits 3.1 - 3.4.
	(13)(2)		4.2	Registration Rights Agreement dated September 19, 2002, between the Registrant and Eli Lilly and Company.
	(12)		4.3	Rights Agreement dated June 17, 2002, between the Registrant and American Stock Transfer & Trust Company.
	(12)		4.4	Certificate of Designation of Series A Junior Participating Preferred Stock.
	(18)		4.5	First Amendment to Rights Agreement dated December 13, 2002, between the Registrant and American Stock Transfer & Trust Company.
	(7)		4.6	Indenture, dated as of April 6, 2004, between Registrant and J.P. Morgan Trust Company, National Association (as Trustee).
	(7)		4.7	Form of 2.50% Convertible Senior Note due 2011.
	(28)		4.8	Indenture, dated as of June 8, 2007, between Registrant and The Bank of New York Trust Company, N.A. (as Trustee).
	(28)		4.9	Registration Rights Agreement, dated as of June 8, 2007, among Registrant, Goldman Sachs & Co. and Morgan Stanley & Co. Incorporated.
	(1)		10.1	Form of Indemnity Agreement entered into between the Registrant and its directors and officers.†
	(10)		10.2	Registrant's 1991 Stock Option Plan, as amended.†
	(3)		10.3	Form of Incentive Stock Option Agreement under the 1991 Stock Option Plan.†
	(1)		10.4	Form of Supplemental Stock Option Agreement under the 1991 Stock Option Plan.†
	(1)		10.5	Form of Supplemental Stock Option Agreement not granted under the 1991 Stock Option Plan with related schedule.†

64

Exhibit Footnote		Exhibit Number
	(34)		10.6	Registrant's Amended and Restated 2001Employee Stock Purchase Plan.†
	(33)		10.7	Registrant's Non-Employee Directors' Stock Option Plan (the "Directors' Plan").†
	(5)(2)		10.8	Patent and Technology License Agreement, Consulting Agreement and Nonstatutory Stock Option Agreement dated October 1, 1996, between the Registrant and Dr. John Eng.
	(6)		10.9	Registrant's Directors' Deferred Compensation Plan.†
			10.10	Registrant's Directors' Plan Stock Option Agreement, as amended.†
	(8)		10.11	Special Form of Incentive Stock Option Agreement the 1991 Stock Option Plan of the Registrant.†
	(11)(2)		10.12	Development and License Agreement dated May 15, 2000, between the Registrant and Alkermes Controlled Therapeutics II, Inc.
	(32)		10.13	Registrant's Amended and Restated Officer Change in Control Severance Benefit Plan.†
	(24)		10.14	Registrant's Amended and Restated 2001 Equity Incentive Plan.†
	(13)(2)		10.15	Collaboration Agreement dated September 19, 2002, between the Registrant and Eli Lilly and Company.
	(13)(2)		10.16	U.S. Co-Promotion Agreement dated September 19, 2002, between the Registrant and Eli Lilly and Company.
	(13)		10.17	Milestone Conversion Agreement dated September 19, 2002, between the Registrant and Eli Lilly and Company.
	(16)(2)		10.18	Device Development and Manufacturing Agreement dated July 1, 2003, between Registrant and Eli Lilly and Company.
	(15)		10.19	Form of Registrant's 2001 Equity Incentive Plan Officer Stock Option Agreement, as amended.†
	(15)		10.20	Form of Registrant's 2001 Equity Incentive Plan Stock Option Agreement, as amended.†
	(17)(2)		10.21	Manufacturing Agreement dated May 12, 2003, between Registrant and UCB S.A.
	(19)(2)		10.22	Exenatide Manufacturing Agreement dated October 1, 2003, between Registrant and Mallinckrodt Inc.
	(19)(2)		10.23	Commercial Supply Agreement for Exenatide dated December 23, 2003, between Registrant and Bachem, Inc.
	(20)(2)		10.24	Commercial Supply Agreement dated February 14, 2005 between Registrant and Baxter Pharmaceutical Solutions LLC.
	(20)(2)		10.25	Commercial Supply Agreement dated March 2, 2005 between Registrant and Baxter Pharmaceutical Solutions LLC.
			10.26	Summary Description of Registrant's Named Executive Officer Oral At-Will Employment Agreements.†
	(21)		10.27	Description of Registrant's Executive Cash Bonus Plan.†
	(23)(2)		10.28	Amendment to Development and License Agreement dated October 24, 2005, between Registrant and Alkermes Controlled Therapeutics II.
	(22)(2)		10.29	Commercial Supply Agreement dated June 28, 2005, between Registrant and Bachem, Inc.
	(25)(2)		10.30	Commercial Supply Agreement dated October 12, 2006 between Registrant and Wockhardt UK (Holdings) Ltd.
	(25)(2)		10.31	Amendment to Collaboration Agreement dated October 31, 2006 between Registrant and Eli Lilly and Company.

65

Exhibit Footnote		Exhibit Number
	(26)		10.32	Employment Agreement, dated March 7, 2007, by and between Registrant and Daniel M. Bradbury.†
	(30)		10.33	Registrant's 2001 Non-Qualified Deferred Compensation Plan.†
	(30)		10.34	Credit Agreement, dated as of December 21, 2007, among Registrant, The Bank of America, N.A. (as Administrative Agent) and the other lenders set forth therein.
	(31)		10.35	First Amendment to Exenatide Manufacturing Agreement dated January 6, 2006, between Registrant and Mallinckrodt Inc.
	(31)(2)		10.36	Amended and Restated Commercial Supply Agreement dated April 1, 2008, between Registrant and Wockhardt UK (Holdings) Ltd.
	(31)(2)		10.37	Addendum to U.S. Co-Promotion Agreement dated May 8, 2008, between Registrant and Eli Lilly and Company
	(31)(2)		10.38	Third Amendment to Supply Agreement dated January 1, 2008, between Registrant and Mallinckrodt Inc.
	(4)		10.39	Amendment to Employment Agreement dated December 3, 2008, between Registrant and Daniel M. Bradbury†
	(32)(2)		10.40	Exenatide Once Weekly Supply Agreement, dated October 16, 2008, between Registrant and Eli Lilly and Company
	(32)		10.41	Loan Agreement dated October 16, 2008, between Registrant and Eli Lilly and Company
	(32)		10.42	First Amendment to Credit Agreement, dated October 27, 2008, among Registrant, the Bank of America, N.A. (as Administrative Agent) and other lenders set forth therein
	(32)(2)		10.43	Amendment to Commercial Supply Agreement dated December 8, 2008, between Registrant and Baxter Pharmaceutical Solutions LLC
	(32)(2)		10.44	Amendment to the Amended and Restated Commercial Supply Agreement dated January 23, 2009, between Registrant and Wockhardt UK (Holdings) Ltd.
	(33)		10.45	Amendment, dated April 9, 2009, to Collaboration Agreement between Registrant and Eli Lilly and Company
	(34)		10.46	Registrant's 2009 Equity Incentive Plan†
	(34)		10.47	Registrant's 2009 Equity Incentive Plan Officer Stock Option Agreement†
	(34)		10.48	Registrant's 2009 Equity Incentive Plan Stock Option Agreement†
	(35)(2)		10.49	Cost Allocation Agreement, dated May 4, 2009, between Registrant and Eli Lilly and Company
	(35)		10.50	Second Amendment, dated May 6, 2009, to Credit Agreement among Registrant, Bank of America N.A., as Administrative Agent, and certain lenders thereto
	(35)(2)		10.51	Exenatide Once Weekly Supply Agreement, dated May 11, 2009, between Registrant and Eli Lilly and Company
			10.52	License, Development and Commercialization Agreement, dated October 30, 2009, between Registrant and Takeda Pharmaceutical Company Limited*
			10.53	Side Letter Agreement, dated October 30, 2009, between Registrant and Takeda Pharmaceutical Company Limited*
			10.54	Third Amendment, dated December 18, 2009, to Credit Agreement among Registrant, Bank of America N.A., as Administrative Agent, and certain lenders thereto
			18	Letter from Independent Registered Public Accounting Firm related to change in accounting principle.
			21.1	Subsidiaries of Registrant.
			23.1	Consent of Independent Registered Public Accounting Firm.

66

Exhibit Footnote	Exhibit Number
		24.1	Power of Attorney. Reference is made to page 71.
		31.1	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
		31.2	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended.
		32.1	Certifications Pursuant to U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Public Company Accounting Reform and Investor Protection Act of 2002.

†

Indicates management or compensatory plan or arrangement required to be identified pursuant to Item 15(c).

*

Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.

(1)

Filed as an exhibit to the Registrant's Registration Statement on Form S-1 (No. 33-44195) or amendments thereto and incorporated herein by reference.

(2)

Confidential Treatment has been granted by the Securities and Exchange Commission with respect to portions of this agreement.

(3)

Filed as an exhibit to the Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, and incorporated herein by reference.

(4)

Filed as an exhibit on Form 8-K dated December 8, 2008, and incorporated herein by reference.

(5)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 1996, and incorporated herein by reference.

(6)

Filed as an exhibit to the Registrant's Registration Statement on Form S-8 (No. 333-61660) or amendments thereto and incorporated herein by reference.

(7)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2004, and incorporated herein by reference.

(8)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 1998, and incorporated herein by reference.

(9)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2001, and incorporated herein by reference.

(10)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999, and incorporated herein by reference.

(11)

Filed as an exhibit to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2000, and incorporated herein by reference.

(12)

Filed as an exhibit on Form 8-K dated June 18, 2002, and incorporated herein by reference.

(13)

Filed as an exhibit on Form 8-K dated October 3, 2002, and incorporated herein by reference.

(14)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2001, and incorporated herein by reference.

(15)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2003, and incorporated herein by reference.

67

(16)

Filed as an exhibit to Amendment 1 to Registrant's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 2003, and incorporated herein by reference.

(17)

Filed as an exhibit to Amendment 1 to Registrant's Quarterly Report on Form 10-Q/A for the quarter ended September 30, 2003, and incorporated herein by reference.

(18)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2002, and incorporated herein by reference.

(19)

Filed as an exhibit to Amendment 1 to Registrant's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2003, and incorporated herein by reference.

(20)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2004, and incorporated herein by reference.

(21)

Filed on Form 8-K dated February 5, 2010, and incorporated herein by reference.

(22)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2005, and incorporated herein by reference.

(23)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2005, and incorporated herein by reference.

(24)

Filed as an exhibit on Form 8-K dated May 30, 2008 and incorporated herein by reference.

(25)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference.

(26)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended March 31, 2007, and incorporated herein by reference.

(27)

Filed as an exhibit on Form 8-K dated May 29, 2007, and incorporated herein by reference.

(28)

Filed as an exhibit on Form 8-K dated June 8, 2007, and incorporated herein by reference.

(29)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2007, and incorporated herein by reference.

(30)

Filed as an exhibit to Registrant's Annual report on Form 10-K for the fiscal year ended December 31, 2007, and incorporated herein by reference.

(31)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2008, and incorporated herein by reference.

(32)

Filed as an exhibit to Registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.

(33)

Filed as an exhibit to Registrant's Quarterly report on form 10-Q for the quarter ended March 31, 2009, and incorporated herein by reference.

(34)

Filed as an exhibit on Form 8-K dated June 10, 2009, and incorporated herein by reference.

(35)

Filed as an exhibit to Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 2009, and incorporated herein by reference.

Note on trademarks used in this report:
Amylin, BYETTA and SYMLIN are registered trademarks of Amylin Pharmaceuticals, Inc. Other brands, names and trademarks contained in this Annual Report on Form 10-K are the property of their respective owners.

68

SIGNATURES

        Pursuant to the requirements of Section 13 or 15(d) 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.

	AMYLIN PHARMACEUTICALS, INC.
Date: February 26, 2010
	By:	/s/ DANIEL M. BRADBURY Daniel M. Bradbury, President and Chief Executive Officer

POWER OF ATTORNEY

        KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Daniel M. Bradbury and Mark G. Foletta, and each of them, as his or her true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for him or her and in his or her name, place, and stead, in any and all capacities, to sign any and all amendments to this Report, and any other documents in connection therewith, and to file the same, with all exhibits thereto, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them or their or his substitute or substituted, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signatures	Title	Date
/s/ DANIEL M. BRADBURY Daniel M. Bradbury	President and Chief Executive Officer(Principal Executive Officer)	February 26, 2010
/s/ MARK G. FOLETTA Mark G. Foletta	Senior Vice President, Finance and Chief Financial Officer(Principal Financial and Accounting Officer)	February 26, 2010
/s/ PAULO F. COSTA Paulo F. Costa	Chairman of the Board	February 26, 2010
/s/ ADRIAN ADAMS Adrian Adams	Director	February 26, 2010

69

Signatures	Title	Date
/s/ STEVEN R. ALTMAN Steven R. Altman	Director	February 26, 2010
/s/ TERESA BECK Teresa Beck	Director	February 26, 2010
/s/ M. KATHLEEN BEHRENS M. Kathleen Behrens	Director	February 26, 2010
/s/ PAUL N. CLARK Paul N. Clark	Director	February 26, 2010
Alexander J. Denner	Director
/s/ KARIN EASTHAM Karin Eastham	Director	February 26, 2010
/s/ JAMES R. GAVIN III, M.D., PHD. James R. Gavin III, M.D., PhD.	Director	February 26, 2010
/s/ JAY S. SKYLER, M.D. Jay S. Skyler, M.D., MACP	Director	February 26, 2010
/s/ JOSEPH P. SULLIVAN Joseph P. Sullivan	Director	February 26, 2010

70

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm	F-1
Consolidated Balance Sheets as of December 31, 2009 and 2008	F-2
Consolidated Statements of Operations for the years ended December 31, 2009, 2008 and 2007	F-3
Consolidated Statements of Stockholders' Equity for the years ended December 31, 2009, 2008 and 2007	F-4
Consolidated Statements of Cash Flows for the years ended December 31, 2009, 2008 and 2007	F-5
Notes to Consolidated Financial Statements	F-6
Schedule II: Valuation Accounts	F-44

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of Amylin Pharmaceuticals, Inc.

        We have audited the accompanying consolidated balance sheets of Amylin Pharmaceuticals, Inc. as of December 31, 2009 and 2008, and the related consolidated statements of operations, stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2009. Our audits also included the financial statement schedule listed in the Index at Item 15(a)(2). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits.

        We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Amylin Pharmaceuticals, Inc., at December 31, 2009 and 2008, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2009, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

        As discussed in Note 1 to the consolidated financial statements, the Company adopted Financial Accounting Standards Board Staff Position No. APB 14-1, Accounting for Convertible Debt Instruments That May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement) (FSP APB 14-1) (codified in FASB ASC Topic 470, Debt with Conversions and Other Options) effective as of January 1, 2009 and also changed the classification of reimbursements of research and development expenses under collaborative arrangements from revenue under collaborative arrangements to research and development expense. The Company has retroactively adjusted all periods presented in the consolidated financial statements for these changes.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Amylin Pharmaceuticals, Inc's internal control over financial reporting as of December 31, 2009, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26, 2010 expressed an unqualified opinion thereon.

/S/ Ernst & Young LLP

San Diego, California
February 26, 2010

F-1

AMYLIN PHARMACEUTICALS, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

		December 31,
		2009			2008(1)
ASSETS
Current assets:
	Cash and cash equivalents	$	120,825		$	237,263
	Short-term investments		546,944			579,575
	Accounts receivable, net		60,732			62,369
	Inventories, net		99,700			115,823
	Other current assets		78,481			41,038
Total current assets			906,682			1,036,068
Property, plant and equipment, net			780,058			655,444
Debt issuance costs			8,742			11,786
Other long-term assets			30,937			23,755
		$	1,726,419		$	1,727,053
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
	Accounts payable	$	39,146		$	39,467
	Accrued compensation		70,961			65,145
	Payable to collaborative partner		49,645			60,470
	Restructuring liability, current portion		9,204			24,235
	Notes payable, current portion		93,750			31,250
	Deferred revenue, current portion		7,500			3,086
	Other current liabilities		95,163			90,125
Total current liabilities			365,369			313,778
Deferred revenue, net of current portion			66,250			—
Long-term deferred credit			125,000			125,000
Deferred collaborative profit-sharing			54,570			—
Restructuring liability, net of current portion			22,776			22,503
Notes payable, net of current portion			—			93,750
Convertible senior notes, net			643,762			621,021
Other long-term obligations, net of current portion			26,158			31,724
Commitments and contingencies
Stockholders' equity:
	Preferred stock, $.001 par value, 7,500 shares authorized, none issued and outstanding at December 31, 2009 and 2008		—			—
	Common stock, $.001 par value, 450,000 shares authorized, 141,747 and 137,623 issued and outstanding at December 31, 2009 and 2008		142			138
	Additional paid-in capital		2,371,939			2,291,762
	Accumulated deficit		(1,947,867	)		(1,761,611	)
	Accumulated other comprehensive loss		(1,680	)		(11,012	)
Total stockholders' equity			422,534			519,277
		$	1,726,419		$	1,727,053

(1)

Adjusted for the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1).

See accompanying notes to consolidated financial statements.

F-2

AMYLIN PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

		Year ended December 31,
		2009			2008(1)			2007(1)
Revenues:
	Net product sales	$	753,993		$	765,342		$	701,450
	Revenues under collaborative agreements		4,426			4,286			19,286
Total revenues			758,419			769,628			720,736
Costs and expenses:
	Cost of goods sold		82,999			91,596			65,457
	Selling, general and administrative		343,864			395,112			390,982
	Research and development		185,062			222,614			216,339
	Collaborative profit-sharing		302,861			302,600			290,934
	Restructuring		16,980			54,926			—
Total costs and expenses			931,766			1,066,848			963,712
Operating loss			(173,347	)		(297,220	)		(242,976	)
Interest and other income			7,768			26,561			46,969
Interest and other expense			(19,300	)		(36,339	)		(20,479	)
Loss on impairment of investments			(1,377	)		(14,943	)		—
Net loss		$	(186,256	)	$	(321,941	)	$	(216,486	)
Net loss per share—basic and diluted		$	(1.32	)	$	(2.35	)	$	(1.63	)
Shares used in computing net loss per share, basic and diluted			140,702			137,006			132,621

(1)

Adjusted for the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion and the change in our method of accounting for reimbursed research and development costs under collaborative arrangements (Note 1).

See accompanying notes to consolidated financial statements.

F-3

AMYLIN PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

For the years ended December 31, 2009, 2008 and 2007

(in thousands)

	Common stock									Accumulated other comprehensive (loss) income
					Additional paid-in capital		Accumulated deficit						Total stockholders' equity
	Shares		Amount
Balance at December 31, 2006		130,458	$	130	$	1,857,194	$	(1,223,184	)	$	1,151		$	635,291
Comprehensive loss:
Net loss(1)		—		—		—		(216,486	)		—			(216,486	)
Unrealized loss on available-for-sale securities		—		—		—		—			(1,601	)		(1,601	)
Comprehensive loss														(218,087	)
Issuance of common stock upon exercise of options, net		2,547		3		37,396		—			—			37,399
Issuance of common stock upon exercise of warrants		1,604		2		18,370		—			—			18,372
Issuance of common stock for other employee benefit plans		435		—		14,735		—			—			14,735
Employee stock-based compensation		—		—		59,064		—			—			59,064
Non-employee stock-based compensation		—		—		694		—			—			694
Net debt discount recorded as a result of the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion(1)		—		—		180,289		—			—			180,289
Balance at December 31, 2007		135,044		135		2,167,742		(1,439,670	)		(450	)		727,757
Comprehensive loss:
Net loss(1)		—		—		—		(321,941	)		—			(321,941	)
Unrealized loss on available-for-sale securities		—		—		—		—			(10,562	)		(10,562	)
Comprehensive loss														(332,503	)
Issuance of common stock upon exercise of options, net		528		—		7,260		—			—			7,260
Issuance of common stock upon milestone conversion		790		1		29,999		—			—			30,000
Issuance of common stock for other employee benefit plans		578		1		13,717		—			—			13,718
Issuance of common stock for employee stock ownership plan		683		1		16,995		—			—			16,996
Employee stock-based compensation		—		—		55,901		—			—			55,901
Non-employee stock-based compensation		—		—		148		—			—			148
Balance at December 31, 2008		137,623		138		2,291,762		(1,761,611	)		(11,012	)		519,277
Comprehensive loss:
Net loss		—		—		—		(186,256	)		—			(186,256	)
Unrealized gain on available-for-sale securities		—		—		—		—			9,332			9,332
Comprehensive loss														(176,924	)
Issuance of common stock upon exercise of options, net		599		1		4,556		—			—			4,557
Issuance of common stock for other employee benefit plans		1,280		1		11,508		—			—			11,509
Issuance of common stock for employee stock ownership plan		2,245		2		20,248		—			—			20,250
Employee stock-based compensation		—		—		43,762		—			—			43,762
Non-employee stock-based compensation		—		—		103		—			—			103
Balance at December 31, 2009		141,747	$	142	$	2,371,939	$	(1,947,867	)	$	(1,680	)	$	422,534

(1)

Adjusted for the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1).

See accompanying notes to consolidated financial statements.

F-4

AMYLIN PHARMACEUTICALS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

		Years ended December 31,
		2009			2008(1)			2007(1)
Operating activities:
Net loss		$	(186,256	)	$	(321,941	)	$	(216,486	)
Adjustments to reconcile net loss to net cash used in operating activities:
	Depreciation and amortization		38,197			29,552			19,329
	Amortization of debt discount and debt issuance costs		8,209			10,332			7,584
	Stock-settled compensation accruals		20,161			25,097			21,696
	Employee stock-based compensation		43,762			55,115			59,064
	Loss on impairment of investments		1,377			14,943			—
	Restructuring (including $0 and $786 of employee stock-based compensation unpaid at December 31, 2009 and 2008, respectively)		—			9,483			—
	Other non-cash expenses		10,548			5,718			3,028
Changes in operating assets and liabilities:
	Accounts receivable, net		1,637			11,210			(15,490	)
	Inventories, net		16,123			(15,609	)		(40,915	)
	Other current assets		(35,749	)		(13,005	)		(10,016	)
	Long-term prepaid assets		(8,754	)		—			—
	Accounts payable and accrued liabilities		5,574			8,641			28,101
	Accrued compensation		11,009			4,900			1,300
	Payable to collaborative partner		(10,825	)		(5,646	)		13,778
	Deferred revenue		70,664			(4,286	)		(4,286	)
	Long-term deferred credit		—			125,000			—
	Deferred collaborative profit-sharing		54,570			—			—
	Restructuring liabilities		(14,758	)		46,738			—
	Other assets and liabilities, net		(5,566	)		(5,752	)		8,153
Net cash provided by (used for) operating activities			19,923			(19,510	)		(125,160	)
Investing activities:
Purchases of short-term investments			(794,008	)		(1,015,811	)		(392,155	)
Sales and maturities of short-term investments			832,900			1,132,017			383,076
Purchases of property, plant and equipment			(152,051	)		(295,060	)		(268,674	)
Increase in other long-term assets			(2,913	)		(3,299	)		(18,348	)
Net cash used for investing activities			(116,072	)		(182,153	)		(296,101	)
Financing activities:
Proceeds from issuance of common stock, net			10,961			16,694			64,687
Proceeds from issuance of convertible debt, net			—			—			558,670
Proceeds from long-term note payable			—			—			123,496
Proceeds from contingent share settled obligation			—			—			30,000
Repayment of notes payable			(31,250	)		—			—
Net cash (used for) provided by financing activities			(20,289	)		16,694			776,853
(Decrease) increase in cash and cash equivalents			(116,438	)		(184,969	)		355,592
Cash and cash equivalents at beginning of year			237,263			422,232			66,640
Cash and cash equivalents at end of year		$	120,825		$	237,263		$	422,232
Supplemental disclosures of cash flow information:
Interest paid, net of interest capitalized		$	13,218		$	17,701		$	9,477
Interest capitalized		$	33,280		$	25,766		$	9,049
Property, plant and equipment additions in other current liabilities at year end		$	10,123		$	6,057		$	15,559
Non-cash financing activities:
Issuance of common stock upon milestone conversion		$	—		$	30,000		$	—
Shares contributed as employer 401(k) match		$	5,105		$	4,284		$	5,819
Issuance of common stock for employee stock ownership plan		$	20,250		$	16,996		$	—

(1)

Adjusted for the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1).

See accompanying notes to consolidated financial statements.

F-5

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

Organization

        Amylin Pharmaceuticals, Inc. (referred to as we, us, or Amylin) is a biopharmaceutical company engaged in the discovery, development and commercialization of drug candidates for the treatment of diabetes, obesity and other diseases. We were incorporated in Delaware on September 29, 1987.

Basis of Presentation

        Our consolidated financial statements include the accounts of our wholly owned subsidiaries, Amylin Ohio, LLC, and Amylin Investments, LLC. All significant intercompany transactions and balances have been eliminated in consolidation.

        In June 2009, the FASB issued authoritative guidance that provides for the FASB Accounting Standards Codification ^TM (the "Codification") to become the single official source of authoritative, non-governmental U.S. generally accepted accounting principles (GAAP). The Codification did not change GAAP but reorganizes the literature and is effective for interim and annual periods ending after September 15, 2009. These consolidated financial statements and notes to consolidated financials statements have been conformed to the presentation required by the Codification.

Change in Accounting Policy

        During the fourth quarter of 2009, we changed our method of accounting for reimbursed research and development costs under collaborative arrangements from reporting them as revenue to reporting them as a reduction to research and development costs. We believe this method is consistent with industry practice for companies whose primary focus is the commercialization of pharmaceutical products. This change in accounting had no effect on operating loss or net loss.

        Consistent with the accounting guidance addressing accounting changes and error corrections, the effect of the change in accounting method has been made retroactive to the beginning of the earliest period presented with the accompanying 2009 consolidated financial statements. Our unaudited historical quarterly financial data presented in Note 13 has been adjusted to reflect the period-specific effects of applying the new method.

        The following tables summarize the impact of the change in accounting for reimbursed research and development costs on the consolidated statements of operations for the years ended December 31, 2008 and December 31, 2007. Only the line items affected by the change in accounting are reflected in the tables below (in thousands):

	Year ended December 31, 2008				Year ended December 31, 2007
	As originally reported		As adjusted		As originally reported		As adjusted
Revenues under collaborative agreements	$	74,767	$	4,286	$	79,547	$	19,286
Research and development	$	293,095	$	222,614	$	276,600	$	216,339

F-6

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Adoption of New Accounting Guidance for Convertible Debt Instruments that may be Settled in Cash upon Conversion

        Effective January 1, 2009, we adopted the new authoritative guidance for accounting for convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement). The new guidance requires that the liability and equity components of convertible debt instruments that may be settled in cash upon conversion shall be separately accounted for in a manner that will reflect the entity's nonconvertible debt borrowing rate when interest cost is recognized in subsequent periods. The carrying amount of the liability component of the convertible debt instrument is determined by measuring the fair value of a similar liability that does not have an associated equity component. The carrying value of the equity component is determined by deducting the fair value of the liability component from the initial proceeds ascribed to the convertible debt instrument as a whole. Related transaction costs are allocated to the liability and equity components in proportion to the allocation of proceeds and accounted for as debt issuance costs and equity issuance costs, respectively. The excess of the principal amount of the liability component over its carrying amount is amortized to interest expense using the interest method. The new guidance is applied retrospectively to the years ended December 31, 2008 and 2007. The $575 million Senior Convertible Notes issued in June 2007 (the 2007 Notes) are within the scope of the new guidance because we have the option to elect net-share settlement upon conversion. The $200 million Convertible Senior Notes issued in 2004 (the 2004 Notes) are not within the scope of the new guidance as they may only be settled in shares of our common stock upon conversion.

        Upon adoption, we recorded a cumulative debt discount on the 2007 Notes of $185.6 million at inception, and an increase of $180.3 million to stockholders' equity representing the gross value of the equity component of $185.6 million net of allocated transaction costs of $5.3 million. The debt discount is being amortized to interest expense over the term of the 2007 Notes, net of interest capitalized. There was no cumulative effect on accumulated deficit of the change in accounting principle as of January 1, 2007 as the 2007 Notes were not issued until June 2007. As required by the provisions of the new guidance we are retroactively adjusting our 2007 and 2008 financial statements.

        Our net loss for the year ended December 31, 2009 of $186.3 million, or $1.32 per share, includes $4.3 million, or $0.03 per share, of incremental interest and other expense due to the adoption of the new guidance.

        The following table sets forth the effect of the retroactive adjustment of the applicable line items within the accompanying consolidated balance sheet as of December 31, 2008 (in thousands):

	As previously reported			Implementation adjustments			As adjusted
Property, plant and equipment, net	$	636,922		$	18,522		$	655,444
Debt issuance costs	$	15,884		$	(4,098	)	$	11,786
Convertible senior notes	$	775,000		$	(153,979	)	$	621,021
Additional paid-in capital	$	2,111,473		$	180,289		$	2,291,762
Accumulated deficit	$	(1,749,725	)	$	(11,886	)	$	(1,761,611	)

F-7

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

        The following tables set forth the effect of the retroactive adjustment of the applicable line items within the accompanying consolidated statement of operations for the twelve months ended December 31, 2008 and 2007 (in thousands, except per share amounts):

	Year ended December 31, 2008
	As previously reported			Implementation adjustments			As adjusted
Interest and other expense	$	(29,803	)	$	(6,536	)	$	(36,339	)
Net loss	$	(315,405	)	$	(6,536	)	$	(321,941	)
Net loss per share	$	(2.30	)	$	(0.05	)	$	(2.35	)

	Year ended December 31, 2007
	As previously reported			Implementation adjustments			As adjusted
Interest and other expense	$	(15,129	)	$	(5,350	)	$	(20,479	)
Net loss	$	(211,136	)	$	(5,350	)	$	(216,486	)
Net loss per share	$	(1.59	)	$	(0.04	)	$	(1.63	)

        The following tables set forth the effect of the retroactive adjustment of the applicable line items within the accompanying consolidated statement of cash flows for the twelve months ended December 31, 2008 and 2007 (in thousands):

	Year ended December 31, 2008
	As previously reported			Implementation adjustments			As adjusted
Net loss	$	(315,405	)	$	(6,536	)	$	(321,941	)
Amortization of debt discount and debt issuance costs	$	3,796		$	6,536		$	10,332

	Year ended December 31, 2007
	As previously reported			Implementation adjustments			As adjusted
Net loss	$	(211,136	)	$	(5,350	)	$	(216,486	)
Amortization of debt discount and debt issuance costs	$	2,234		$	5,350		$	7,584

Use of Estimates

        The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

F-8

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Revenue Recognition

Net Product Sales

        We sell BYETTA® (exenatide) injection for the treatment of type 2 diabetes and SYMLIN® (pramlintide acetate) injection for the treatment of type 1 and type 2 diabetes primarily to wholesale distributors, who, in turn, sell to retail pharmacies and government entities. Product sales are recognized when delivery of the products has occurred, title has passed to the customer, the selling price is fixed or determinable, collectability is reasonably assured and we have no further obligations. We record product sales net of allowances for product returns, rebates, wholesaler chargebacks, wholesaler discounts, and prescription vouchers at the time of sale and report product sales net of such allowances. We must make significant judgments in determining these allowances. If actual results differ from our estimates, we will be required to make adjustments to these allowances in the future. We recorded an allowance related to the Department of Defense's (DOD) Tricare Retail Pharmacy program pursuant to a final rule that was issued in March 2009 and became effective on May 26, 2009. The final rule clarified the DOD's interpretation of the National Defense Authorization Act of 2008, or NDAA, signed into law on January 28, 2008. The final rule changed the process by which rebate obligations for the Tricare Retail Pharmacy program are created such that a contractual agreement is no longer required and that obligation to pay such rebates emanates from the NDAA itself. In consideration of this final rule we recorded an allowance of $8.2 million for such rebates in the twelve months ended December 31, 2009, of which $4.8 million represents a retroactive rebate assessment for sales made during 2008.

        We record all United States BYETTA and SYMLIN product sales. With respect to BYETTA, we have determined that we are qualified as a principal based on our responsibilities under our contracts with Eli Lilly and Company, or Lilly, which include manufacture of product for sale in the United States, responsibility for establishing pricing in the United States, distribution, ownership of product inventory and credit risk from customers.

Revenues Under Collaborative Agreements

        Revenues under collaborative agreements consist of the amortization of product and technology license fees and milestone payments earned. Upfront product and technology license fees under multiple-element arrangements are deferred and recognized over the period of such services or performance if such arrangements require on-going services or performance. Non-refundable amounts received for substantive milestones are recognized upon achievement of the milestone. Any amounts received prior to satisfying these revenue recognition criteria are recorded as deferred revenue.

Collaborative Profit-Sharing

        Collaborative profit-sharing represents Lilly's 50% share of the gross margin for BYETTA sales in the United States (see Note 4).

Shipping and Handling Costs

        Shipping and handling costs incurred for product shipments are included in cost of goods sold in the accompanying consolidated statements of operations.

F-9

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Research and Development Expenses

        Research and development costs are expensed as incurred and include salaries and bonuses, benefits, non-cash stock-based compensation, license fees, milestone payments due under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices; and associated overhead and facilities costs. Reimbursed research and development costs under collaborative arrangements are recorded as a reduction to research and development expenses and are recognized in the period in which the related costs are incurred. Clinical trial costs, including costs associated with third-party contractors, are a significant component of research and development expenses. Invoicing from third- party contractors for services performed can lag several months. We accrue the costs of services rendered in connection with such activities based on our estimate of management fees, site management and monitoring costs, and data management costs. Actual clinical trial costs may differ from estimates and are adjusted in the period in which they become known.

Concentrations of Risk

        We rely on third-party manufacturers for the production of our products and drug candidates. If our third-party manufacturers are unable to continue manufacturing our products and/or drug candidates, or if we lose one of our sole source suppliers used in our manufacturing processes, we may not be able to meet market demand for our products and could be materially and adversely affected.

        We have a collaboration agreement with Lilly under which Lilly provides funding for development and commercialization expenses for BYETTA and exenatide once weekly at various cost sharing percentages depending upon whether the product is to be utilized in the United States or outside the United States. Lilly co-promotes the product with us in the United States, is responsible for commercializing the product outside the United States and manufactures pen devices for the administration of BYETTA. See Note 4 for more detailed information regarding this collaboration. If Lilly is unable to perform these activities we may be unable to meet market demand for our products and could be materially and adversely affected.

        We have a collaboration agreement with Takeda Pharmaceutical Company Limited (Takeda) for the development and commercialization of pharmaceutical products for obesity and related indications. Under this agreement Takeda will provide funding for development and commercialization expenses. If Takeda is unable to perform these activities or were to terminate our collaboration with them, we would likely need to find a third party collaborator to continue developing our obesity program, which we may be unable to do.

        We are also subject to credit risk from our accounts receivable related to product sales. We sell our products in the United States primarily to wholesale distributors. Our top four customers represented approximately 95% of net product sales in 2009 and 94% of the accounts receivable balance at December 31, 2009. We evaluate the credit worthiness of our customers and generally do not require collateral. We have not experienced any material losses on uncollectible accounts receivable to date.

        Net product sales for the years ended December 31, 2009, 2008 and 2007 were $754.0 million, $765.3 million and $701.5 million, respectively, and consisted of sales of BYETTA and SYMLIN, less allowances for product returns, rebates and wholesaler chargebacks, wholesaler discounts, and prescription vouchers.

F-10

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

        The following table provides information regarding net product sales by product (in millions):

	Year ended December 31,
	2009		2008		2007
BYETTA	$	667.6	$	678.5	$	636.0
SYMLIN		86.4		86.8		65.5
	$	754.0	$	765.3	$	701.5

        Three of our customers each accounted for more than 10% of total net product sales for the years ended December 31, 2009 and 2008 and two of our customers each accounted for more than 10% of total net product sales for the year ended December 31, 2007. The following table summarizes the percent of our total net product sales that were attributed to each of these three customers (as a % of net product sales):

	Year ended December 31,
	2009			2008			2007
McKesson Corporation		38	%		38	%		40	%
Cardinal Health, Inc.		35	%		36	%		35	%
Medco Health Solutions		12	%		12	%		*

*

Less than 10%

        We invest our excess cash in U.S. Government securities, securities of agencies sponsored by the U.S. Government, asset-backed securities, mortgage-backed securities, and debt instruments of financial institutions and corporations with investment-grade credit ratings. We have established guidelines relative to diversification and maturities that maintain safety and liquidity. The primary goal of these guidelines is to safeguard principal and they are periodically reviewed. These guidelines prohibit investments in auction rate securities. Financial instruments that potentially subject us to significant credit risk consist principally of cash equivalents and short-term investments.

Cash and Cash Equivalents

        We consider instruments with a maturity date of less than 90 days from the date of purchase to be cash equivalents. Cash and cash equivalents include cash collateral for derivative financial instruments of $3.5 million at both December 31, 2009 and 2008, respectively.

Fair Value Measurements

        The authoritative guidance for fair value measurements 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 the most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Market participants are buyers and sellers in the principal

F-11

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

market that are (i) independent, (ii) knowledgeable, (iii) able to transact, and (iv) willing to transact. The guidance prioritizes the inputs used in measuring fair value into the following hierarchy:

Level 1	Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2	Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable; and
Level 3	Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing.

Short-Term Investments

        Our short-term investments, consisting principally of debt securities, are classified as available-for-sale and are stated at fair value based upon observed market prices (Level 1 in the fair value hierarchy). Unrealized holding gains or losses on these securities are included in other comprehensive loss. The amortized cost of debt securities in this category is adjusted for amortization of premiums and accretion of discounts to maturity. For investments in mortgage-backed securities, amortization of premiums and accretion of discounts are recognized in interest income using the interest method, adjusted for anticipated prepayments as applicable. Estimates of expected cash flows are updated periodically and changes are recognized in the calculated effective yield prospectively as appropriate. Such amortization is included in interest income. Realized gains and losses are included in interest income and declines in value judged to be other-than-temporary on available-for-sale securities are included in impairment loss on investments. In assessing potential impairment of our short-term investments, we evaluate the impact of interest rates, potential prepayments on mortgage-backed securities, changes in credit quality, the length of time and extent to which the market value has been less than cost, and our intent and ability not to sell the security in order to allow for an anticipated recovery in fair value. The cost of securities sold is based on the specific-identification method.

Accounts Receivable

        Trade accounts receivable are recorded net of allowances for cash discounts for prompt payment, doubtful accounts, product returns and chargebacks. Allowances for rebate discounts and distribution fees are included in other current liabilities in the accompanying consolidated balance sheets. Estimates for allowances for doubtful accounts are determined based on existing contractual obligations, historical payment patterns and individual customer circumstances. The allowance for doubtful accounts was $0.7 million and $0.6 million at December 31, 2009 and 2008, respectively.

Inventories, net

        Inventories are stated at the lower of cost (FIFO) or market and net of a valuation allowance for potential excess and/or obsolete material of $0.3 million and $5.1 million at December 31, 2009 and December 31, 2008, respectively. Raw materials consist of bulk drug material for BYETTA and SYMLIN. Work-in-process inventories consist of in-process BYETTA cartridges, in-process SYMLIN cartridges and in-process SYMLIN vials. Finished goods inventories consist of BYETTA drug product

F-12

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

in a disposable pen/cartridge delivery system, finished SYMLIN drug product in vials for syringe administration and finished SYMLIN drug product in a disposable pen/cartridge delivery system.

        We expense costs relating to the purchase and production of pre-approval inventories as research and development expense in the period incurred until such time as we believe future commercialization is probable and future economic benefit is expected to be recognized. As of December 31, 2009 and 2008 we have not capitalized any costs associated with pre-launch inventory for exenatide once weekly.

Property, plant and Equipment

        Property, plant and equipment is recorded at cost. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets as follows:

Land improvements	Lesser of the lease term or the useful life
Laboratory equipment	5 to 10 years
Leasehold improvements	Lesser of the lease term or the useful life
Production equipment	10 years
Office equipment, furniture and computer software	3 to 5 years
Buildings	15 to 40 years

        We recorded depreciation expense of $37.8 million, $29.2 million, and $19.0 million in the years ended December 31, 2009, 2008 and 2007, respectively.

        Interest costs incurred during the construction of major capital projects are capitalized until the underlying asset is ready for its intended use, at which point the interest cost is amortized as depreciation expense over the estimated useful life of the asset.

        FDA validation costs, which to date relate to our manufacturing facility for exenatide once weekly, are capitalized as part of the effort required to acquire and construct long-lived assets, including readying them for their initial intended use, and are amortized over the estimated useful life of the asset.

        We record impairment losses on property, plant and equipment used in operations when events and circumstances indicate that assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. We are subject to regulatory requirements with respect to our currently approved products and product candidates that can result in us not obtaining approval for product candidates in development or even discontinuance of the ability to sell our existing products. Therefore, we must regularly evaluate our ability to realize assets associated with our products and product candidates. As of December 31, 2009 there are no indicators of impairment associated with such assets. We also record assets to be disposed of at the lower of their carrying amount or fair value less cost to sell. For the year ended December 31, 2008, we recorded $8.8 million in asset impairments related to impaired leasehold improvements associated with facility leases we will no longer use in our operations as part of our restructuring discussed in Note 5. While we have a history of operating and cash flow losses, we believe the expected future cash flows to be received support the carrying value of our long-lived assets and accordingly, we have not recognized any material impairment losses as of December 31, 2009.

F-13

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Computer Software Costs for Internal Use

        We capitalize costs of computer software developed or obtained for internal use. Capitalized computer software costs are amortized as depreciation expense on a straight-line basis over the estimated useful life of software, generally three years.

Investments in Unconsolidated Entities

        We use the equity method of accounting for investments in other companies that are not controlled by us and in which our interest is generally between 20% and 50% of the voting shares or we have significant influence over the entity, or both. Our share of the income or losses of these entities is included in interest and other expense, and the investments, which have a net book value of $3.2 million and $4.7 million at December 31, 2009 and December 31, 2008, respectively, are included in other long-term assets. We recorded $4.0 million, $4.5 million and $1.8 million of equity method investee losses during the years ended December 31, 2009, 2008 and 2007, respectively. We recognized an impairment loss of $9.0 million in 2008 on one of our equity method investments after assessing the financial and technical performance of the entity in which the investment was made as well as the entity's ability to raise additional capital in significantly deteriorated financial markets to fund ongoing operations. There were no such impairments during the year ended December 31, 2009.

Patents

        We have filed a number of patent applications with the United States Patent and Trademark Office and in foreign countries. Certain legal and related costs incurred in connection with pending patent applications have been capitalized. Costs related to successful patent applications are amortized over the lesser of the remaining useful life of the related technology or the remaining patent life, commencing on the date the patent is issued. Gross capitalized patent costs were approximately $5.9 million and $5.5 million at December 31, 2009 and 2008, respectively. Accumulated amortization was approximately $3.1 million and $2.6 million at December 31, 2009 and 2008, respectively. Patents are classified as other long-term assets in the accompanying consolidated balance sheets. We recorded patent amortization expense of $0.4 million, $0.4 million and $0.3 million in the years ended December 31, 2009, 2008 and 2007, respectively. Capitalized costs related to patent applications are expensed as a selling, general and administrative expense in the period during which a determination not to pursue such applications is made. Such expenses were not material in the years ended December 31, 2009, 2008 and 2007, respectively.

F-14

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Net Loss Per Share

        Basic and diluted net loss applicable to common stock per share is computed using the weighted average number of common shares outstanding during the period. Shares used in calculating basic and diluted net loss per common share exclude the following common share equivalents (in thousands):

	Years ended December 31,
	2009		2008		2007
Antidilutive options to purchase common stock		209		2,957		6,767
Antidilutive shares underlying convertible senior notes		15,238		15,238		11,136
		15,447		18,195		17,903

In future periods, if we report net income and the common share equivalents for our convertible senior notes are dilutive, the common stock equivalents will be included in the weighted average shares computation and interest expense related to the notes will be added back to net income to calculate diluted earnings per share.

Derivative Financial Instruments

        We mitigate certain financial exposures, including currency risk and interest rate risk, through a controlled program of risk management that includes the use of derivative financial instruments. Derivatives are recorded on the balance sheet at fair value, with changes in value being recorded in interest and other income and interest and other expense. The fair value of our derivative financial instruments was a net liability of $2.9 million and $4.8 million at December 31, 2009 and 2008, respectively. We have determined that our derivative financial instruments are defined as Level 2 in the fair value hierarchy. We recognized unrealized gains on derivative financial instruments of $1.9 million for the year ended December 31, 2009 and unrealized losses on derivative financial instruments of $4.9 million and $0.1 million for the years ended December 31, 2008 and 2007, respectively.

        The following table summarizes the fair value and balance sheet classification of our derivative financial instruments (in thousands):

	December 31, 2009				December 31, 2008
	Fair Value			Balance sheet location	Fair Value			Balance sheet location
Foreign currency derivative contracts	$	(100	)	Other current liabilities	$	160		Other current assets
Interest rate derivative contract (Note 8)		(2,813	)	Other long-term obligations, net of current portion		(4,991	)	Other long-term obligations, net of current portion
	$	(2,913	)		$	(4,831	)

F-15

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

Comprehensive Loss

        Comprehensive loss includes net loss and unrealized gains and losses on investments. We disclose the accumulated balance of other comprehensive loss as a separate component of stockholder's equity.

Accounting for Stock-Based Compensation

        We utilize the fair value method of accounting for stock-based compensation arrangements. Accordingly, we expense the estimated fair value of non-cash stock awards granted to our employees, including the effect of estimated forfeitures, over the requisite employee service period, which is generally the vesting period. The fair value method of accounting applies to awards granted subsequent to January 1, 2006, the date the fair value method of accounting for stock-based compensation arrangements became effective, and to awards that were outstanding on the effective date and subsequently modified or cancelled. Estimated non-cash compensation expense for awards outstanding as of January 1, 2006 is being recognized over the remaining service period of the award using the compensation cost calculated for pro-forma disclosure purposes under the former guidance.

        We use the Black-Scholes model to estimate the fair value of non-cash, stock-based payments granted to employees. The assumptions used for the specified reporting periods and the resulting estimates of weighted-average estimated fair value per share of options granted and employee stock purchase rights during those periods are as follows:

	Years ended December 31,
	2009			2008			2007
Volatility—Stock option plans		80.9	%		46.5	%		44.2	%
Volatility—Employee stock purchase rights		97.9	%		56.8	%		27.9	%
Expected life in years—Stock option plans		4.3			4.2			5.4
Expected life in years—Employee stock purchase rights		0.5			0.5			0.5
Risk-free interest rate—Stock option plans		1.6	%		3.4	%		4.7	%
Risk-free interest rate—Employee stock purchase rights		0.4	%		1.9	%		4.9	%
Dividend yield		—	%		—	%		—	%
Weighted average estimated fair value per share of stock options granted	$	5.73		$	10.43		$	18.01
Weighted average estimated fair value per share of employee stock purchase rights granted	$	4.04		$	7.14		$	10.01

        We estimate volatility based upon the historical volatility of our common stock for a period corresponding to the expected term of our employee stock options and the implied volatility of market-traded options on our common stock with various maturities between six months and two years. The determination to use implied volatility in addition to historical volatility was based upon the availability of actively traded options on our common stock and our assessment that the addition of implied volatility is more representative of future stock price trends than historical volatility alone.

        The expected life of our employee stock options represents the weighted-average period of time that options granted are expected to be outstanding in consideration of historical exercise patterns and the assumption that all outstanding options will be exercised at the mid-point of the then current date and their maximum contractual term.

F-16

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

        The risk-free interest rates are based on the yield curve of U.S. Treasury strip securities in effect at the time of grant for periods corresponding with the expected life of our employee stock options. We have never paid dividends and do not anticipate doing so for the foreseeable future. Accordingly, we have assumed no dividend yield for purposes of estimating the fair value of our stock-based payments to employees.

        Stock-based compensation expense recognized is based on awards ultimately expected to vest, and therefore is reduced by expected forfeitures. We estimate forfeitures based upon historical forfeiture rates, and will adjust our estimate of forfeitures if actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative adjustment in the period of the change and will also impact the amount of stock-based compensation expense in future periods.

        Total employee non-cash stock-based compensation expense by operating statement classification is presented below (in thousands):

	Year ended December 31,
	2009		2008		2007
Selling, general and administrative expenses	$	28,351	$	33,977	$	35,420
Research and development expenses		15,411		21,138		23,644
Restructuring		—		786		—
Total	$	43,762	$	55,901	$	59,064
Employee non-cash, stock-based compensation expense per share, basic and diluted	$	0.31	$	0.41	$	0.45

        Stock-based compensation expense capitalized as part of inventory and fixed assets was negligible and did not impact our reported cash flows for the years ended December 31, 2009, 2008 and 2007.

        We also record non-cash expense associated with our Employee Stock Ownership Plan, or ESOP. Total non-cash ESOP expense by operating statement classification is presented below (in thousands):

	Year ended December 31,
	2009		2008		2007
Selling, general and administrative expenses	$	9,359	$	11,267	$	10,022
Research and development expenses		6,886		8,529		7,269
Restructuring		—		417		—
Total	$	16,245	$	20,213	$	17,291

Recently Issued Accounting Standards

        In April 2009, the FASB issued a new accounting standard providing guidance for the accounting of assets acquired and liabilities assumed in a business combination that arise from contingencies. This guidance amends and clarifies previous accounting standards to address application issues regarding the initial recognition and measurement, subsequent measurement and accounting, and disclosure of assets and liabilities arising from contingencies in a business combination. Due to the fact that this guidance

F-17

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

is applicable to acquisitions completed after January 1, 2009 and we did not have any business combinations during 2009, the adoption of this standard did not have a material effect on our financial position, results of operations or cash flows.

        In June 2009, the FASB issued authoritative guidance that prescribes the information that a reporting entity must provide in its financial reports about a transfer of financial assets; the effects of a transfer on its financial position, financial performance, and cash flows; and a transferor's continuing involvement in transferred financial assets. Specifically, among other aspects, this standard amends previously issued accounting guidance, modifies the financial-components approach and removes the concept of a qualifying special purpose entity when accounting for transfers and servicing of financial assets and extinguishments of liabilities, and removes the exception from applying the general accounting principles for the consolidation of variable interest entities that are qualifying special-purpose entities. This new accounting standard is effective for transfers of financial assets occurring on or after January 1, 2010. The adoption of this standard will not have an impact on our financial position or results of operations.

        In June 2009, the FASB issued authoritative guidance that amends previously issued accounting guidance for the consolidation of variable interest entities to require an enterprise to determine whether its variable interest or interests give it a controlling financial interest in a variable interest entity. This amended consolidation guidance for variable interest entities also replaces the existing quantitative approach for identifying which enterprise should consolidate a variable interest entity, which was based on which enterprise is exposed to a majority of the risks and rewards, with a qualitative approach, based on which enterprise has both (1) the power to direct the economically significant activities of the entity and (2) the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Under this revised guidance, more entities may meet the definition of a variable interest entity, and the determination about whether an enterprise should consolidate a variable interest entity is required to be evaluated continuously. This standard is effective for us for interim and annual periods beginning after January 1, 2010. The adoption of this standard will not have an impact on our financial position or results of operations.

        In August 2009, the FASB issued new authoritative guidance for the fair value measurement of liabilities when a quoted price in an active market is not available. The new guidance is effective for reporting periods beginning after August 28, 2009, which means that it became effective for our fourth quarter beginning October 1, 2009. The adoption of this new guidance did not have a material effect on our financial position, results of operations or cash flows.

        In September 2009, the FASB issued authoritative guidance that provides additional guidance on using the net asset value per share, provided by an investee, when estimating the fair value of an alternate investment that does not have a readily determinable fair value and enhances the disclosures concerning these investments. Examples of alternate investments that fall within the scope of this standard include investments in hedge funds and private equity, real estate, and venture capital partnerships. This Standard is effective for interim and annual periods ending after December 15, 2009. As of December 31, 2009, we do not have any investments that fall within the scope of this new guidance and therefore we do not anticipate that this standard will have a material impact on our consolidated financial statement disclosures.

F-18

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

1. Summary of Significant Accounting Policies (Continued)

        In October 2009, the FASB issued authoritative guidance that amends existing revenue recognition accounting pronouncements related to multiple-deliverable revenue arrangements. The new guidance provides accounting principles and application guidance on whether multiple deliverables exist, how the arrangement should be separated, and how the consideration should be allocated. This guidance eliminates the requirement to establish the fair value of undelivered products and services and instead provides for separate revenue recognition based upon management's estimate of the selling price for an undelivered item when there is no other means to determine the fair value of that undelivered item. The new guidance is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010. Earlier application is permitted as of the beginning of a fiscal year. We are currently evaluating the potential impact of this standard on our financial position and results of operations.

2. Investments

        The following is a summary of our short-term investments as of December 31, 2009 and 2008 (in thousands):

	Available-for-Sale Securities
	Amortized Cost		Gross Unrealized Gains(1)		Gross Unrealized Losses(1)			Estimated Fair Value
December 31, 2009
U.S. Treasury securities	$	187,892	$	66	$	(2	)	$	187,956
Obligations of U.S. Government-sponsored enterprises		60,280		47		(453	)		59,874
Corporate debt securities		278,872		917		(99	)		279,690
Asset backed securities		19,963		37		(576	)		19,424
Total	$	547,007	$	1,067	$	(1,130	)	$	546,944
December 31, 2008
U.S. Treasury securities	$	130,193	$	449	$	—		$	130,642
Obligations of U.S. Government-sponsored enterprises		129,197		656		(1,494	)		128,359
Corporate debt securities		294,805		175		(4,090	)		290,890
Asset backed securities		33,081		4		(3,401	)		29,684
Total	$	587,276	$	1,284	$	(8,985	)	$	579,575

(1)

Other comprehensive loss included unrealized losses of $1.6 million and $3.3 million on investments underlying our 2001 Non-Qualified Deferred Compensation Plan at December 31, 2009 and 2008, respectively.

        The gross realized gains on sales of available-for-sale securities totaled approximately $0.7 million, $2.6 million and $1.1 million and the gross realized losses totaled $0.6 million, $4.6 million and $0.8 million for the years ended December 31, 2009, 2008 and 2007, respectively.

F-19

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

2. Investments (Continued)

        Contractual maturities of short-term investments at December 31, 2009 were as follows (in thousands):

	Fair Value
Due within 1 year	$	465,263
After 1 but within 5 years		53,224
After 5 but within 10 years		1,437
After 10 years		27,020
Total	$	546,944

        For purposes of these maturity classifications, the final maturity date is used for securities not due at a single maturity date. Securities not due at a single maturity date include mortgage-backed securities, which are included in Obligations of U.S Government-sponsored enterprises in the table above, and asset-backed securities.

        The following table shows the gross unrealized losses and fair value of our investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2009 (in thousands):

	Less than 12 Months					12 Months or Greater					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
U.S. Treasury securities	$	10,635	$	(2	)	$	—	$	—		$	10,635	$	(2	)
Obligations of U.S Government-sponsored enterprises		17,166		(118	)		17,629		(335	)		34,795		(453	)
Corporate debt securities		25,420		(42	)		12,498		(57	)		37,918		(99	)
Asset backed securities		2,560		(52	)		15,567		(524	)		18,127		(576	)
Mortgage-backed securities		—		—			—		—			—		—
	$	55,781	$	(214	)	$	45,694	$	(916	)	$	101,475	$	(1,130	)

        During the year ended December 31, 2009 we recognized a $1.4 million other-than-temporary impairment loss for credit-related losses associated with two securities in our portfolio. The impairment loss was based upon the difference between the amortized cost basis and the observed market prices for the securities. During the year ended December 31, 2008 we recognized a $5.9 million other-than-temporary impairment loss on an investment in a corporate debt security based upon an assessment of the impact of bankruptcy proceedings of the debt issuer on the recoverability of our investment. The unrealized losses on our remaining investments are due to the increased volatility in the markets impacting the classes of securities we invest in and are not due to a deterioration in credit ratings. Our investments have a short effective duration, and since we have the ability and intent not to sell these investments until a recovery of fair value, which may be maturity, we do not consider these investments to be other-than-temporarily impaired at December 31, 2009.

F-20

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. Other Financial Information

        Inventories consist of the following (in thousands):

	At December 31,
	2009		2008
Raw materials	$	67,446	$	74,140
Work-in process		18,335		21,382
Finished goods		13,919		20,301
	$	99,700	$	115,823

        Other current assets consist of the following (in thousands):

	At December 31,
	2009		2008
Prepaid expenses	$	58,032	$	30,335
Interest and other receivables		13,740		3,681
Other current assets		6,709		7,022
	$	78,481	$	41,038

        Property, plant and equipment consist of the following (in thousands):

	At December 31,
	2009			2008
Land and land improvements	$	12,196		$	11,876
Laboratory equipment		57,354			34,275
Leasehold improvements		71,969			71,379
Production equipment		78,605			13,610
Office equipment, furniture and computer software		88,369			82,852
Buildings		154,860			51,278
Construction in progress		436,959			474,125
		900,312			739,395
Less accumulated depreciation and amortization		(120,254	)		(83,951	)
	$	780,058		$	655,444

        Construction in progress includes costs associated with our manufacturing facility for exenatide once weekly, which is currently under construction in Ohio (see Note 4) and costs associated with the exenatide once weekly pen device. During 2009 we placed into service bulk manufacturing components. Construction in progress as of December 31, 2008 has been adjusted to include additional capitalized interest of $18.5 million as a result of the required retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1).

F-21

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

3. Other Financial Information (Continued)

        Other current liabilities consist of the following (in thousands):

	At December 31,
	2009		2007
Accrued rebate discounts	$	40,735	$	28,575
Accrued expenses		34,789		43,482
Other current liabilities		19,639		18,068
	$	95,163	$	90,125

4. Collaborative Agreements

        We have entered into various collaborative agreements which provide us with rights to develop, produce and market products using certain know-how, technology and patent rights maintained by our collaborative partners. Terms of the various collaboration agreements may require us to make and/or receive milestone payments upon the achievement of certain product research and development objectives and pay and/or receive royalties on future sales, if any, of commercial products resulting from the collaboration.

        Effective January 1, 2009, we implemented new authoritative guidance related to accounting for collaborative arrangements. The new guidance requires that certain transactions between collaborators be recorded in the income statement on either a gross or net basis, depending on the characteristics of the collaboration relationship, and provides for enhanced disclosure of collaborative relationships. We evaluated our collaborative agreements for proper statement of operations classification based on the nature of the underlying activity. If payments to and from our collaborative partners are not within the scope of other authoritative accounting literature, the statement of operations classification for the payments is based on a reasonable, rational analogy to authoritative accounting literature that is applied in a consistent manner. Amounts due from our collaborative partners related to development activities are generally reflected as a reduction of research and development expenses and amounts due to our collaborative partners related to sharing of commercialization expenses are generally reflected as selling, general and administrative expenses. Milestone payments and up-front payments received are generally reflected as collaborative revenue as discussed above in Note 1, and milestone payments and up-front payments made are generally recorded as research and development expenses if the payments relate to drug candidates that have not yet received regulatory approval. Milestone payments and up-front payments made related to approved drugs (of which there have been none to date) will generally be capitalized and amortized to cost of goods sold over the economic life of the product. Royalties received (of which there have been none to date) will generally be reflected as collaborative revenues and royalties paid are generally reflected as cost of goods sold. The adoption of the new guidance related to accounting for collaborative arrangements did not affect our financial position or results of operations.

        For collaborations with commercialized products, if we are the principal we record revenue and the corresponding operating costs in their respective line items within our statement of operations based on the nature of the shared expenses. If we are not the principal, we record operating costs as a reduction of revenue. The principal is the party who is responsible for delivering the product or service to the customer, has latitude with establishing price and has the risks and rewards of providing product or service to the customer, including inventory and credit risk.

F-22

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

Collaboration with Eli Lilly and Company

        In September 2002, we and Lilly entered into a Collaboration Agreement for the global development and commercialization of exenatide (the "agreement"). The agreement was amended in 2006 and in 2009.

        This agreement includes BYETTA and any sustained release formulations of exenatide such as once weekly exenatide, our once-weekly formulation of exenatide for the treatment of type 2 diabetes. Under the terms of the agreement, operating profits from products sold in the United States are shared equally between us and Lilly. In 2005, we received United States Food and Drug Administration (FDA) approval for the twice-daily formulation of exenatide, which is marketed in the United States under the trade name BYETTA. The agreement provides for tiered royalties payable to us by Lilly based upon the annual gross margin for all exenatide product sales, including any long-acting release formulations, outside of the United States. Royalty payments for exenatide product sales outside of the United States will commence after a one-time cumulative gross margin threshold amount has been met. Lilly is responsible for 100% of the costs related to development of exenatide once weekly and BYETTA for sale outside of the United States. Lilly is responsible for 100% of the costs related to commercialization of all exenatide products for sale outside of the United States.

        At signing, Lilly made initial non-refundable payments to us totaling $80 million, of which $50 million was amortized to revenues under collaborative agreements prior to 2004. The remaining $30 million was amortized to revenues ratably over a seven-year period which ended in 2009 and represented our estimate of the period of our performance of significant development activities under the agreement.

        In addition to these up-front payments, Lilly agreed to make future milestone payments of up to $85 million upon the achievement of certain development milestones, including milestones relating to both twice daily and sustained release formulations of exenatide such as exenatide once weekly, of which $75 million have been paid through December 31, 2009. No additional development milestones may be earned under the collaboration agreement. In December 2007, we received milestone payments of $30 million associated with the results of a thirty week comparator study of exenatide once weekly and BYETTA in patients with type 2 diabetes. Since the New Drug Application filing for exenatide once weekly did not occur by December 31, 2007, Lilly was entitled to convert the milestones into shares of our common stock at a conversion price equal to the immediately preceding twenty day average closing market price of our common stock on December 31, 2007. In February 2008 Lilly elected to convert the milestones into common stock and received 0.8 million shares of our common stock at a conversion price equal to $37.9535.

        Lilly also agreed to make additional future milestone payments of up to $130 million contingent upon the commercial launch of exenatide in selected territories throughout the world, including both twice-daily and sustained release formulations, of which $40 million have been paid and recorded as revenue through December 31, 2009. Remaining milestones relate primarily to the commercial launch of exenatide once weekly in selected territories throughout the world, including $40 million for the launch in the United States.

        In October 2008, we and Lilly entered into an Exenatide Once Weekly Supply Agreement (the "supply agreement") pursuant to which we will supply commercial quantities of exenatide once weekly for sale in the United States, if approved by the United States Food and Drug Administration, or FDA.

F-23

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

In addition, if Lilly receives approval to market the product in jurisdictions outside the United States, we will be required to manufacture the product intended for commercial sale by Lilly in those jurisdictions.

        Under the terms of the exenatide once weekly supply agreement, Lilly made a cash payment of $125 million to us, which represents an amount to compensate us for the estimated past and future cost of carrying Lilly's share of the capital investment made in our manufacturing facility in Ohio, that otherwise would have been included in the cost of product produced at the facility and charged to Lilly through our arrangements with them. In addition to this cash payment, we will recover Lilly's share of the capital investment in the facility through an allocation of depreciation expense in cost of goods as discussed below. Under the terms of the supply agreement, we have agreed not to charge Lilly for Lilly's share of the interest costs capitalized to the facility or any future financing cost that may be related to financing the facility. Accordingly we have determined that a portion of the $125 million payment, amounting to $37.7 million at December 31, 2009, represents a reimbursement to us of Lilly's share of interest costs capitalized to the facility that will be credited to Lilly for its share of the capitalized interest included in the cost of goods sold for exenatide once weekly as incurred. We have concluded that any excess amount represents deferred collaborative revenue for services to be provided to Lilly under the supply agreement that will be amortized ratably over the economic useful life of the exenatide once weekly product following its commercial launch. The ultimate allocation of the $125 million payment, which is classified as a long-term deferred credit in the accompanying Consolidated Balance Sheets at December 31, 2009, will be dependent upon the total amount of interest costs capitalized to the facility when it is placed in service. Under certain circumstances, including upon an impairment of the exenatide once weekly manufacturing facility, Lilly may receive a credit for the unearned portion of the $125 million payment which will be applied against Lilly's share of the impairment charge. The $125 million payment is not refundable to Lilly if exenatide once weekly does not receive regulatory approval unless such non-approval results in an impairment as discussed above.

        In addition to the $125 million cash payment, we will recover Lilly's share of the over $500 million initial capital investment in the facility through an allocation of depreciation to cost of goods sold in accordance with the collaboration agreement. Subsequent capital investments, including those for the exenatide once weekly pen device, are subject to separate cost sharing terms, as described below. We retain ownership of the facility and Lilly's share of the capital investment to be recovered through the sharing of cost of goods sold is initially estimated to be 55% subject to adjustment based upon the allocation of the proportion of product supplied for sale in the United States, the cost of which is shared equally by the parties, and the proportion of product supplied for sale outside of the United States, the cost of which is paid for 100% by Lilly.

        In October 2008, we and Lilly also entered into a loan agreement pursuant to which Lilly made available to us a $165 million unsecured line of credit that we can draw upon from time to time beginning on December 1, 2009 and ending on June 30, 2011. Any interest due under the credit facility will bear interest at the five-day average three-month LIBOR rate immediately prior to the date of the advance plus 5.25% and shall be due and payable quarterly in arrears on the first business day of each quarter. All outstanding principal, together with all accrued and unpaid interest shall be due and payable the earlier of 36 months following the date on which the loan commitment is fully advanced or June 30, 2014. As of December 31, 2009 we have not drawn upon this credit facility.

F-24

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

        In April 2009, we and Lilly announced the restructuring of the exenatide operations in order to improve alliance effectiveness, increase financial and operational efficiencies and maximize the value of BYETTA and exenatide once weekly. Additionally, we and Lilly amended our collaboration agreement to require one year's notice should Lilly terminate the agreement without cause. Previously, the agreement required nine-month's notice. In addition, we and Lilly also agreed that internal marketing costs, which were previously not shared, are now shared within the alliance.

        In May 2009, we and Lilly entered into a Cost Allocation Agreement (the "cost allocation agreement") which amends the exenatide development and commercialization cost-sharing provisions contained in the companies' Collaboration Agreement and Exenatide Once Weekly Supply Agreement, or the Agreements.

        Under the terms of the Cost Allocation Agreement, the following changes will be applied with respect to the cost-sharing provisions of the Agreements retroactively as of January 1, 2009:

•

Lilly will be responsible for 53% of shared exenatide global development and commercialization expenses that generate utility both in the United States and outside the United States, including global manufacturing development expenses. We will be responsible for 47% of these expenses;

•

Lilly will assume 100% of all exenatide development and commercialization expenses that generate utility predominantly outside the United States. Under the previous cost-sharing arrangement, we were responsible for 20% of some of these expenses; and

•

The royalty structure for exenatide revenues generated outside the United States has been modified to reflect Lilly's revised expense burden, with a reduction in Lilly's royalty payments to us.

        The companies will continue to equally share all exenatide development and commercialization expenses that generate utility predominately in the United States.

        In May 2009, we and Lilly entered into a joint supply agreement for an exenatide once weekly pen device. We and Lilly agreed to cooperate in the development, manufacturing and marketing of exenatide once weekly in a dual chamber cartridge pen configuration. We and Lilly will share the capital and development costs of the pen, including the estimated total capital investment of approximately $216 million which is expected to be incurred over the next few years. We and Lilly have agreed that the estimated cost of the total capital investment will be allocated 60% to Lilly and 40% to us, with Lilly funding its share as the capital expenditures are incurred. Through December 31, 2009, we have incurred $97.7 million in capital expenditures associated with the exenatide once weekly pen, which amount is included in construction in progress. We have billed Lilly $54.6 million for these expenditures, of which $46.6 million has been received by us. Capital reimbursements from Lilly, which are included in deferred collaborative profit-sharing in the accompanying consolidated balance sheet, are being deferred and will be amortized to collaborative profit sharing for Lilly's share of the depreciation included in cost of goods sold for the exenatide once weekly pen device as incurred.

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AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

        The following table summarizes the milestones received during the years ended December 31, 2009, 2008 and 2007 and the manner of recognition in the accompanying consolidated financial statements:

Amount	Year Received		Milestone event	Manner of recognition	Type
$5 million		2007	Results of clinical study comparing BYETTA to insulin-glargine.	Recognized as revenue under collaborative agreements upon receipt.	Development
$10 million		2007	Commercial launch of BYETTA in the EU.	Recognized as revenue under collaborative agreements upon commercial launch of BYETTA in 2007.	Commercial
$30 million		2007	Completion of Phase 3 trial for once weekly exenatide.	Deferred upon receipt until stock conversion rights contingency finalized.(1)	Development

(1)

In February 2008, Lilly elected to convert these milestones into shares of our common stock.

        We recorded revenue under this collaborative agreement of $3.1 million, $4.3 million and $19.3 million in the years ended December 31, 2009, 2008 and 2007, respectively. We recorded $66.6 million, $69.3 million and $60.3 million of cost-sharing payments due from Lilly for the twelve months ended December 31, 2009, 2008 and 2007, respectively, related to the sharing of BYETTA and exenatide once weekly development expenses, which are included as a reduction of research and development expenses in the accompanying consolidated statements of operations. We recorded expense of $5.3 million, $2.5 million and $22.0 million for the twelve months ended December 31, 2009, 2008 and 2007, respectively, for amounts due to Lilly for shared sales force expenses, marketing expenses and other commercial support, which are included in selling, general and administrative expenses.

Collaboration with Alkermes, Inc.

        In May 2000, we signed an agreement with Alkermes, Inc., a company specializing in the development of products based on proprietary drug delivery technologies, for the development, manufacture and commercialization of an injectable long-acting formulation of exenatide, or exenatide once weekly.

        Under the terms of the agreement, Alkermes has granted us an exclusive, worldwide license to its Medisorb® technology for the development and commercialization of injectable sustained release formulations of exendins, such as exenatide, and other related compounds that we may develop. In exchange, Alkermes receives funding for research and development and may earn future milestone payments upon achieving specified development and commercialization goals. Alkermes will also receive royalties on any future product sales.

        In October 2005, we and Alkermes Controlled Therapeutics II, a wholly owned subsidiary of Alkermes, Inc., entered into an Amendment to Development and License Agreement (the

F-26

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

"Amendment"), which amends the Development and License Agreement between the parties dated May 15, 2000. Under the terms of the Amendment, we will be responsible for manufacturing for commercial sale the once weekly dosing formulation of exenatide once weekly, if approved. The royalty to be paid from us to Alkermes for commercial sales of exenatide once weekly was adjusted to reflect the new manufacturing arrangement.

        In December 2005, our wholly-owned subsidiary, Amylin Ohio LLC, purchased an existing building and land to house our manufacturing facility in Ohio and we are responsible for all costs and expenses associated with the design, construction, validation and utilization of the facility. At December 31, 2009 we had capitalized $701.9 million associated with the construction and validation of this facility, including $97.7 million in capital expenditures associated with the exenatide once weekly pen device.

Collaboration with Takeda Pharmaceutical Company, Ltd

        On October 30, 2009, we and Takeda Pharmaceutical Company Limited, or Takeda, entered into a License, Development and Commercialization Agreement, or the development agreement, pursuant to which the companies will co-develop and commercialize pharmaceutical products containing compounds specified in the development agreement for the treatment of human indications including, but not limited to, (i) weight management and/or obesity, (ii) glycemic control and (iii) cardiovascular disease. We received a one-time, nonrefundable cash payment of $75 million from Takeda in connection with the execution of the development agreement. We recorded the up-front payment as deferred revenue in our consolidated balance sheets and will recognize the revenue over the estimated development period of ten years. As of December 31, 2009 deferred revenue associated with the Takeda collaboration equaled $73.8 million, of which $66.3 is classified as long-term.

        We will also receive certain payments upon the achievement of milestone events including: (i) up to $200 million for achieving development milestones with respect to two specific products and up to $50 million for achieving development milestones with respect to any additional products; (ii) up to $140 million per product for achieving commercial milestones related to the first sale of a product in various territories; and (iii) up to $800 million per product for the achievement of certain sales based milestones. Takeda will also pay us double digit tiered royalties based on total annual sales of products.

        We will be responsible for executing all development activities for each product through the completion of all phase 2 clinical trials of such products for the purpose of obtaining regulatory approval in the United States. We will also be responsible for certain third party royalties. Takeda will be responsible for the execution of all other development activities for the purpose of obtaining regulatory approval in and outside the United States. Throughout the term of the development agreement, Takeda will generally be responsible for 80% of the development costs associated with obtaining approval for the products in the United States and we will be responsible for 20% of such costs, except for certain clinical safety trial costs for which we will have additional cost-sharing responsibility. Takeda will be responsible for 100% of all development costs associated with obtaining approval for the products outside the United States.

        Takeda will be responsible for commercializing the products in and outside the United States and will be responsible for all commercialization costs associated with the products. We will have the option to co-commercialize the first 2 approved products containing different clinically active ingredients and any follow-on products containing the identical ingredients. The development agreement will terminate at Takeda's election or upon the expiration of all Takeda payment obligations to Amylin.

F-27

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

4. Collaborative Agreements (Continued)

        Either party may terminate the agreement for cause, including the commencement of insolvency, bankruptcy, reorganization or other similar proceeding by a party or if the other party breaches any material provision of the development agreement including breaches of payment or commercially reasonable efforts obligations. Further, either party may terminate the development agreement for safety issues or failure to obtain any necessary third party license.

        We recorded revenue under this collaborative agreement of $1.3 million for the amortization of the up-front payment. We recorded $1.5 million of cost-sharing payments due from Takeda for the twelve months ended December 31, 2009, which are included as a reduction of research and development expenses in the accompanying consolidated statements of operations.

Other Collaborations

        In connection with our strategic equity investments, we have entered into collaborative agreements with certain of our equity method investees. We received research and development cost-sharing reimbursements under these collaborative agreements of $2.5 million, $1.2 million and $0.7 million in the years ended December 31, 2009, 2008 and 2007, respectively. The cost sharing reimbursements were recorded as a reduction to research and development costs.

5. Restructuring

        On November 10, 2008, we announced a corporate restructuring, or the 2008 Restructuring that reduced our San Diego work force by approximately 25 percent or 330 employees. In connection with the 2008 Restructuring, we recorded restructuring charges of $54.9 million which are reported as a separate line item in the accompanying Consolidated Statement of Operations for the year ended December 31, 2008.

        In May 2009, we announced a restructuring of our sales force to merge our existing primary care and specialty sales forces into a single organization or the 2009 Restructuring. The 2009 Restructuring reduced the total number of Amylin sales representatives by approximately 200 employees. We recorded restructuring charges of $17.0 million during the year ended December 31, 2009 consisting of employee separation costs and facilities related charges.

F-28

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. Restructuring (Continued)

        The following table summarizes the components of the restructuring charges (in thousands):

	Year ended December 31,
	Accruals		Non-cash items			Total
2008 Activity
Facilities related charges	$	38,447	$	(7,156	)	$	31,291
Employee separation costs		13,118		786			13,904
Asset impairments		—		8,796			8,796
Other restructuring charges		935		—			935
Balance as of December 31, 2008:	$	52,500	$	2,426		$	54,926
2009 Activity
Facilities related charges		5,391		213			5,604
Employee separation costs		10,629		281			10,910
Other restructuring charges		466		—			466
Balance as of December 31, 2009:	$	16,486	$	494		$	16,980

        Facility related charges consist of estimated losses associated with certain facility leases in our San Diego campus which we no longer use in our operations and which we ceased using in the quarter ended December 31, 2008. These losses represent the remaining lease payments and other costs due under the lease and costs associated with obtaining sub-leases, net of sub-lease income under executed sub-leases. To the extent sub-leases have not yet been signed, we assumed reasonably expected sub-lease income which we determined based upon our assessment of market conditions for similar rental properties in our geographic area, both of which are discounted at a credit-adjusted risk-free rate of 10%. During the year ended December 31, 2009 we revised the estimated losses associated with the facility leases we ceased using in 2008 based upon recently executed sub-lease agreements and a related reassessment of current market conditions and recorded an additional loss of $5.6 million, bringing the total facilities related charges for the two years ended December 31, 2009 to $36.9 million. As of the year ended December 31, 2009, the estimated losses associated with the facilities with executed sub-leases accounted for approximately $19.9 million of the total facility related charges of $36.9 million. We expect to incur approximately $11.4 million of accretion expense over the remaining term of the leases, which have expiration dates from 2015 to 2018.

        Employee separation costs for the 2008 Restructuring consist primarily of salaries and benefits earned during the minimum notification period prescribed by law and severance costs associated with the reduction in our workforce. Employee separation costs for the 2009 Restructuring consist primarily of severance costs. Asset impairments primarily relate to impaired leasehold improvements associated with the facility leases discussed above. Other restructuring charges consist of incremental direct costs associated with the 2008 and 2009 Restructuring.

F-29

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

5. Restructuring (Continued)

        The following table sets forth activity in the restructuring liability (in thousands):

	Employee separation costs			Facilities related charges			Other restructuring charges			Total
Balance at December 31, 2007	$	—		$	—		$	—		$	—
Accruals		13,118			38,447			935			52,500
Payments		(4,827	)		—			(935	)		(5,762	)
Balance at December 31, 2008	$	8,291		$	38,447		$	—		$	46,738
Accruals		10,629			5,391			466			16,486
Payments		(18,920	)		(14,826	)		(466	)		(34,212	)
Accretion of sub-lease expense		—			2,968			—			2,968
Balance at December 31, 2009	$	—		$	31,980		$	—		$	31,980

        We have substantially completed all of the activities included in the restructuring plans for both 2008 and 2009. All of the costs associated with the 2008 and 2009 Restructurings were incurred during the years ended December 31, 2009 and 2008.

6. Commitments and Contingencies

Lease Commitments

        We lease our facilities under operating leases, with various terms, the majority of which expire between 2015 and 2019. The minimum annual rent on our facilities is subject to increases based on stated rental adjustment terms of certain leases, taxes, insurance and operating costs. For financial reporting purposes, rent expense is recognized on a straight-line basis over the term of the leases. Accordingly, rent expense recognized in excess of rent paid is reflected as deferred rent. Deferred rent totaled $8.7 million and $8.3 million at December 31, 2009 and 2008, respectively, of which $7.9 million and $7.6 million is included in other long-term obligations, net of current portion in the accompanying Consolidated Balance Sheets at December 31, 2009 and 2008, respectively. Certain of our facility leases contain incentives in the form of reimbursement from the landlord for a portion of the costs of leasehold improvements we have incurred. These incentives are recognized as a reduction of rental expense on a straight-line basis over the term of the respective leases. Unamortized leasehold improvement incentives totaled $9.0 million for both years ended December 31, 2009 and 2008, of which $7.8 million and $7.9 million is included in other long-term obligations, net of current portion in the accompanying consolidated balance sheets at December 31, 2009 and 2008, respectively.

        We lease vehicles for our field force under operating leases, with lease terms up to four years, of which the first year is non-cancellable. Minimum future payments for the non-cancellable term of these leases are $0.1 million at December 31, 2009.

F-30

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

6. Commitments and Contingencies (Continued)

        Minimum future annual obligations for facility and vehicle operating leases for years ending after December 31, 2009 are as follows (in thousands):

2010	$	23,234
2011		23,790
2012		24,430
2013		25,055
2014		25,731
Thereafter		65,295
Total minimum lease payments	$	187,535

        Rent expense for the years ended December 31, 2009, 2008 and 2007, was $12.5 million, $18.9 million and $16.2 million, respectively.

Other Commitments

        We have committed to make potential future milestone payments to third parties as part of in-licensing and development programs primarily related to research and development agreements. Potential future payments generally become due and payable only upon the achievement of certain developmental, regulatory and/or commercial milestones, such as achievement of regulatory approval, successful development and commercialization of products, and subsequent product sales. Because the achievement of these milestones is neither probable nor reasonably estimable, we have not recorded a liability on the balance sheet for any such contingencies.

        As of December 31, 2009, if all such milestones are successfully achieved, the potential future milestone and other contingency payments due under certain contractual agreements are approximately $260.0 million in aggregate, of which $9.5 million is expected to be paid over the next twelve months.

        We have committed to make future minimum payments to third parties for certain inventories in the normal course of business. The minimum contractual purchase commitments total $78.1 million as of December 31, 2009, the majority of which relate to exenatide once weekly and BYETTA, including minimum inventory purchases for exenatide once weekly of $37.6 million that are contingent upon FDA approval of exenatide once weekly.

        As of December 31, 2009, commitments to complete construction of our exenatide once weekly manufacturing facility in Ohio are $2.7 million and commitments associated with capital investments on the exenatide once weekly pen device are $46.1 million.

7. Convertible Senior Notes

        In April 2004, we issued $200 million aggregate principal amount of 2.5% convertible senior notes due April 15, 2011 in a private placement, referred to as the 2004 Notes. The 2004 Notes have been registered under the Securities Act of 1933, as amended, or the Securities Act, to permit registered resale of the 2004 Notes and of the common stock issuable upon conversion of the 2004 Notes. The 2004 Notes bear interest at 2.5% per year, payable in cash semi-annually and are convertible into a total of up to 5.8 million shares of common stock at a conversion price of $34.35 per share, subject to customary adjustments for stock dividends and other dilutive transactions. We incurred debt issuance

F-31

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. Convertible Senior Notes (Continued)

costs of $6.4 million in connection with the issuance of the 2004 Notes, which are being amortized to interest expense over the term of the 2004 Notes and had a net book value of $1.2 million and $2.1 million at December 31, 2009 and 2008, respectively. Amortization expense associated with these debt issuance costs was approximately $0.9 million for each of the years ended December 31, 2009, 2008 and 2007. The fair value of the 2004 Notes, determined by observed market prices, was $192.1 million and $150.0 million at December 31, 2009 and 2008, respectively.

        Upon a change in control, the holders of the 2004 Notes may elect to require us to re-purchase the 2004 Notes. We may elect to pay the purchase price in common stock instead of cash, or a combination thereof. If paid with common stock the number of shares of common stock a holder will receive will be valued at 95% of the average closing prices of our common stock for the five-day trading period ending on the third trading day before the purchase date.

        In June 2007, we issued the 2007 Notes in a private placement, which have an aggregate principal amount of $575 million, and are due June 15, 2014. The 2007 Notes are senior unsecured obligations and rank equally with all other existing and future senior unsecured debt. The 2007 Notes bear interest at 3.0% per year, payable in cash semi-annually, and are initially convertible into a total of up to 9.4 million shares of common stock at a conversion price of $61.07 per share, subject to the customary adjustment for stock dividends and other dilutive transactions. In addition, if a "fundamental change" (as defined in the associated indenture agreement) occurs prior to the maturity date, we will in some cases increase the conversion rate for a holder of notes that elects to convert our notes in connection with such fundamental change. The maximum conversion rate is 22.9252 ($43.62 per share), which would result in a maximum issuance 13.2 million shares of common stock if all holders converted at the maximum conversion rate.

        The 2007 Notes will be convertible into shares of our common stock unless we elect net-share settlement. If we elect net-share settlement, we will satisfy the accreted value of the obligation in cash and will satisfy the excess of conversion value over the accreted value in shares of our common stock based on a daily conversion value, determined in accordance with the associated indenture agreement, calculated on a proportionate basis for each day of the relevant 20-day observation period. Holders may convert the 2007 Notes only in the following circumstances and to the following extent: (1) during the five business-day period after any five consecutive trading day period (the measurement period) in which the trading price per note for each day of such measurement period was less than 97% of the product of the last reported sale price of our common stock and the conversion rate on each such day; (2) during any calendar quarter after the calendar quarter ending March 31, 2007, if the last reported sale price of our common stock for 20 or more trading days in a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the applicable conversion price in effect on the last trading day of the immediately preceding calendar quarter; (3) upon the occurrence of specified events; and (4) the 2007 Notes will be convertible at any time on or after April 15, 2014 through the scheduled trading day immediately preceding the maturity date.

        Subject to certain exceptions, if we experience a "designated event" (as defined in the associated indenture agreement) including a "fundamental change," including if a majority of our Board of Directors ceases to be composed of a majority of the existing directors or other individuals approved by a majority of the existing directors, holders of the 2007 Notes will, for the duration of the notes, have the option to require us to repurchase all or any portion of their 2007 Notes. The designated event

F-32

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

7. Convertible Senior Notes (Continued)

repurchase price will be 100% of the principal amount of the 2007 Notes to be purchased plus any accrued interest up to but excluding the relevant repurchase date. We will pay cash for all notes so repurchased. We may not redeem the Notes prior to maturity.

        The 2007 Notes have been registered under the Securities Act of 1933, as amended, to permit registered resale of the 2007 Notes and of the common stock issuable upon conversion of the 2007 Notes. Subject to certain limitations, we will be required to pay the holders of the 2007 Notes special interest on the 2007 Notes if we fail to keep such registration statement effective during specified time periods. The 2007 Notes pay interest in cash, semi-annually in arrears on June 15 and December 15 of each year, which began on December 15, 2007. We incurred debt issuance costs of $16.3 million in connection with the issuance of the 2007 Notes. As a result of our adoption of the new accounting guidance for convertible debt instruments (Note 1), we retrospectively allocated a portion of the debt issuance costs to equity which resulted in total revised debt issuance costs of $11.1 million and recorded a debt discount of $180.3 million. The debt discount and issuance costs are being amortized to interest expense over the term of the 2007 Notes. The effective interest rate on the net carrying value of the 2007 Notes was 9.3% for year ended December 31, 2009.

        The net book value of debt issuance costs as of December 31, 2009 was $7.0 million. After giving effect to the aforementioned retrospective adjustment, the debt issuance costs had a net book value of $8.6 million and $10.2 million at December 31, 2008 and 2007, respectively. Amortization expense associated with these debt issuance costs was $1.6 million for both of the years ended December 31, 2009 and 2008 and $0.9 million for the year ended December 31, 2007. The fair value of the 2007 Notes, determined by observed market prices, was $453.0 and $260.4 million at December 31, 2009 and 2008 respectively.

        As discussed in Note 1, the 2007 Notes are within the scope of the new authoritative guidance for accounting for convertible debt instruments that may be settled in cash upon conversion because we have the option to elect net-share settlement upon conversion.

        The carrying amount of the equity component of the 2007 Notes was $180.3 million at both December 31, 2009 and 2008. At December 31, 2009, the unamortized balance of the debt discount will be amortized over the remaining life of the 2007 Notes, approximately five years.

8. Long-Term Note Payable

        In December 2007, we entered into a $140 million credit agreement with Bank of America, N.A., as administrative agent, collateral agent and letter of credit issuer, Silicon Valley Bank and RBS Asset Finance, Inc., as syndication agents, and Comerica Bank and BMO Capital Markets Financing, Inc., as documentation agents. The credit agreement provides for a $125 million term loan and a $15 million revolving credit facility. The revolving credit facility also provides for the issuance of letters of credit and foreign exchange hedging up to the $15 million borrowing limit. At December 31, 2009 we had an outstanding balance of $93.8 million under the term loan and had issued $8.9 million of standby letters of credit under the revolving credit facility, primarily in connection with office leases.

F-33

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. Long-Term Note Payable (Continued)

        Our domestic subsidiaries, Amylin Ohio LLC and Amylin Investments LLC, are co-borrowers under the credit agreement. The loans under the revolving credit facility are collateralized by substantially all of our (including the two domestic subsidiaries) assets (other than intellectual property and certain other excluded collateral). The term loan is repayable on a quarterly basis, with no payments due quarters one through four, 6.25% of the outstanding principal due quarters five through eleven, and 56.25% of the outstanding principal due in quarter 12. Interest on the term loan will be paid quarterly on the unpaid principal balance at 1.75% above the London Interbank Offered Rate, or LIBOR, based on our election of either one, two, three, or six months LIBOR term, and payable at the end of the selected interest period but no less frequently than quarterly as of the first business day of the quarter prior to the period in which the quarterly installment is due. We have elected to use the three month LIBOR, which was 0.25% at December 31, 2009. Interest periods on the revolving credit facility may be either one, two, three, or six months, and payable at the end of the selected interest period but no less frequently than quarterly, and the interest rate will be either LIBOR plus 1.0% or the Bank of America prime rate, as selected by us. Both loans have a final maturity date of December 21, 2010.

        The credit agreement contains certain covenants, including a requirement to maintain minimum unrestricted cash and cash equivalents balances, as defined in the agreement, in excess of $400 million, below which certain limitations provided for in the agreement become effective. The credit agreement also contains certain events of default including unrestricted cash and cash equivalents balances, as defined in the agreement, falling below $280 million, nonpayment of principal, interest, fees or other amounts, violation of covenants, inaccuracy of representations and warranties and default under other indebtedness that would permit the administrative agent to accelerate our outstanding obligations if not cured within applicable grace periods. In addition, the credit agreement provides for automatic acceleration upon the occurrence of bankruptcy, other insolvency events and a change in control as defined in the credit agreement, including if a majority of our Board of Directors ceases to be composed of the existing directors or other individuals approved by a majority of the existing directors. There is an annual commitment fee associated with the revolving credit facility of 0.25%.

        Maturities of long-term debt for years ending after December 31, 2009 are as follows (in thousands):

2010	$	93,750
Thereafter		—
Total minimum long-term debt payments	$	93,750

        We incurred debt issuance costs of $1.7 million in connection with the credit agreement, which are being amortized to interest expense on a straight-line basis over the term of the credit agreement and had a net book value of $0.5 million and $1.1 million at December 31, 2009 and 2008, respectively. Amortization expense associated with these debt issuance costs was $0.6 million for both of the years ended December 31, 2009 and 2008 and $15.3 thousand for the year ended December 31, 2007.

        In connection with the execution of the Term Loan, we entered into an interest rate swap with an initial notional amount of $125 million on December 21, 2007 that has resulted in a fixed rate of 5.717% and matures on December 21, 2010. We determined that the interest rate swap agreement is defined as Level 2 in the fair value hierarchy. As of, and for the year ended, December 31 2009 the

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AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

8. Long-Term Note Payable (Continued)

fair value of the interest rate swap agreement was a liability of $2.8 million and the recognized gain on the interest rate swap was $2.2 million. As of, and for the year ended, December 31, 2008 the fair value of the interest rate swap was a liability of $5.0 million and the recognized loss on the interest rate swap was $4.6 million. Recognized gains and losses on the interest rate swap are included in interest and other expense.

9. Stockholders' Equity

Stock-based Compensation Plans

Stock Option Plans

        We have two stock option plans under which we currently grant stock options: the 2009 Equity Incentive Plan, or the 2009 Plan, and the 2003 Non-Employee Directors' Stock Option Plan, or the 2003 Directors' Plan. The 2009 Plan replaced the 2001 Stock Option Plan, or the 2001 Plan. Options granted under the 2001 Plan remain outstanding until exercised or cancelled. Under the 2003 Directors' Plan, non-qualified stock options and restricted stock may be granted to our non-employee directors. The 2003 Directors' Plan provides for automatic stock option grants to non-employee directors upon their initial appointment or election to our Board of Directors which are issued from shares authorized under the 2009 Plan.

        To date, stock-based compensation awards under the 2001 Plan, the 2003 Directors' Plan and the 2009 Plan consist primarily of incentive and non-qualified stock options. Stock options granted under the each of the plans must have an exercise price equal to at least 100% of the fair market value of our common stock on the date of grant and generally vest over four years. Stock options granted prior to October 10, 2007 have a maximum contractual term of ten years and stock options granted after October 10, 2007 have a maximum contractual term of seven years. At December 31, 2009, an aggregate of 28.5 million shares were reserved for future issuance under our stock option plans, of which 11.3 million shares were available for future grants.

        A summary of stock option transactions for all stock option plans is presented below:

	Shares (thousands)			Weighted-Average Exercise Price		Weighted- Average Remaining Contractual Term (years)		Aggregate Intrinsic Value (thousands)
Options outstanding at December 31, 2008		18,605		$	27.39
Granted		3,687		$	9.39
Exercised		(626	)	$	7.83
Cancelled/Forfeited		(4,433	)	$	26.60
Options outstanding at December 31, 2009		17,233		$	24.45		5.29	$	18,918
Options exercisable at December 31, 2009		11,582		$	27.34		4.90	$	2,683
Options vested and expected to vest		16,872		$	24.68		5.27	$	17,562

        The total intrinsic value of stock options exercised was $2.8 million, $8.4 million and $72.9 million during the years ended December 31, 2009, 2008 and 2007, respectively. We received cash from the exercise of stock options of $4.6 million, $7.3 million and $37.4 million during the years ended

F-35

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

9. Stockholders' Equity (Continued)

December 31, 2009, 2008 and 2007, respectively. We did not record any tax benefits related to the exercise of employee stock options due to our net loss position. Upon option exercise, we issue new shares of our common stock.

        At December 31, 2009, total unrecognized estimated non-cash, stock-based compensation expense related to nonvested stock options granted prior to that date was $49.4 million, with a weighted-average amortization period of 2.1 years. We record non-cash, stock-based compensation expense for options with pro-rata vesting on a straight-line basis over the awards' vesting period.

Employee Stock Purchase Plan

        Our 2001 Employee Stock Purchase Plan, or the 2001 Purchase Plan, enables participants to contribute up to 15% of their eligible compensation for the purchase of our common stock at the lower of 85% of the fair market value of our common stock (i) on the employee's enrollment date or (ii) the purchase date. The terms of any offerings under the 2001 Purchase Plan are established by the Compensation and Human Resources Committee of the Board of Directors. In May 2008, the Compensation and Human Resources Committee approved a series of four consecutive six-month offerings commencing on September 1, 2008. As of December 31, 2009, 1.6 million shares were reserved for future issuance under the 2001 Purchase Plan.

        The total intrinsic value of purchase rights exercised was $1.1 million, $1.7 million and $1.5 million during the years ended December 31, 2009, 2008 and 2007, respectively. At December 31, 2009, total unrecognized non-cash, compensation expense for nonvested purchase rights granted prior to that date was $0.4 million, with a weighted-average amortization period of 0.2 years.

Shares Reserved for Future Issuance

        The following shares of common stock are reserved for future issuance at December 31, 2009 (in thousands):

Stock Option Plans	28,543
Employee Stock Purchase Plan	1,605
Convertible Senior Notes	15,238
	45,386

Shareholder Rights Plan

        In June 2002, we adopted a Preferred Share Purchase Rights Plan (the "Rights Plan"). The Rights Plan provides for a dividend distribution of one preferred stock purchase right (a "Right") for each outstanding share of our common stock, par value $0.001 per share, held of record at the close of business on June 28, 2002. The Rights are not currently exercisable. Under certain conditions involving an acquisition or proposed acquisition by any person or group of 15% or more of our common stock, the Rights permit the holders (other than the 15% holder) to purchase one one-hundredth of a share of Series A Junior Participating Preferred Stock, par value $0.001 per share (the "Preferred Shares") at a price of $100 per one one-hundredth of a Preferred Share, subject to adjustment. Each one one-hundredth of a share of Preferred Shares has designations and powers, preferences and rights and the qualifications, limitations and restrictions which make our value approximately equal to the value of

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AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

9. Stockholders' Equity (Continued)

one share of our common stock. Under certain conditions, the Rights are redeemable by our Board of Directors in whole, but not in part, at a price of $0.001 per Right.

10. Benefit Plans

Defined Contribution 401(k) Plan

        We have a defined contribution 401(k) plan for the benefit of all eligible employees. Discretionary matching contributions are based on a percentage of employee contributions and are funded by newly issued shares of our common stock. We recorded expense of $3.9 million, $4.9 million and $4.4 million for matching contributions in the years ended December 31, 2009, 2008 and 2007, respectively.

Deferred Compensation Plans

        In August 1997, we adopted a Non-Employee Directors' Deferred Compensation Plan (the "Directors' Deferral Plan") that permits participating non-employee directors to elect, on an annual basis, to defer all or a portion of their cash compensation in a deferred stock account, pursuant to which the deferred fees are credited in the form of phantom shares of our common stock, based on the market price of the stock at the time the fees are earned. Deferred amounts are valued at the fair market value of our common stock at each reporting date and are included in accrued compensation in the accompanying consolidated balance sheets. Upon termination of service the director's account is settled in either cash or stock, at our discretion. In connection with this plan we recorded an expense of $0.9 million for the year ended December 31, 2009, a credit of $0.6 million for the year ended December 31, 2008 and an expense of $0.8 million for the year ended December 31, 2007.

        We adopted a Deferred Compensation Plan in April 2001 which allows officers to defer up to 80% and directors to defer up to 100% of their eligible annual compensation. The trust assets, consisting of primarily cash, mutual funds and equity securities are recorded at current market prices. The company-owned assets are placed in a "rabbi trust" and are included in other current assets in the accompanying consolidated balance sheets. The trust assets had a fair value of $6.7 million and $6.5 million at December 31, 2009 and 2008, respectively, including unrealized losses of approximately $1.6 million and $3.3 million at December 31, 2009 and 2008, respectively. Unrealized gains and losses on the trust assets are included in accumulated other comprehensive loss in the accompanying consolidated balance sheets. The corresponding liability was $6.7 million and $6.5 million at December 31, 2009 and 2008, respectively, of which $6.7 million and $6.3 million are included in other long-term liabilities, net of current portion in the accompanying consolidated balance sheets at December 31, 2009 and 2008, respectively. The current portion of the corresponding liability is included in accrued compensation in the accompanying consolidated balance sheets at December 31, 2009 and 2008. Total contributions to this plan, consisting solely of compensation deferred by participants, were $1.7 million, $1.7 million and $3.0 million for the years ended December 31, 2009, 2008 and 2007, respectively.

Employee Stock Ownership Plan

        In December 2007, we adopted the Employee Stock Ownership Plan, or ESOP. Active employees who are at least 18 years old and have met minimum service requirements and are not otherwise disqualified under the terms of the ESOP are eligible to participate. Each participant has an ESOP account into which we make mandatory annual contributions in the form of shares of our common stock equal to 10% of a participant's plan year eligible compensation. We may make additional

F-37

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

10. Benefit Plans (Continued)

discretionary contributions for any plan year, and total contributions are limited to the lesser of 100% of a participant's plan year eligible compensation and limitations established by the Internal Revenue Service Code (IRS Code). A participant's eligible compensation primarily includes wages and bonus.

        Participants vest in their accounts over four years of service, at 25% for more than one year of service but less than two years, at 50% for more than two years of service but less than three years, at 75% for more than three years of service but less than four years, and 100% for more than four years of service. Any forfeitures of non-vested amounts shall be used to restore any rehired employees who previously forfeited their nonvested balance under certain circumstances, or shall be used to reduce future employer contributions and shall be allocated to the participant accounts. Distributions generally are made only upon termination of employment and as necessary by regulatory requirements.

        Shares committed to be released or that have been allocated to participant accounts are treated as outstanding shares for calculating earnings per share. The ESOP held 2.7 million shares at December 31, 2009, of which 0.8 million were unvested and had a fair value of $11.8 million. We recorded ESOP expense of $16.3 million, $19.8 million and $17.3 million for the years ended December 31, 2009, 2008 and 2007, respectively, for our contribution.

11. Litigation

        From time to time in the ordinary course of business, we become involved in various lawsuits, claims and proceedings relating to the conduct of our business, including those pertaining to product liability, patent infringement and employment claims. Since August 2008, we and Lilly have been named as defendants in 55 separate product liability cases involving approximately 340 plaintiffs in various courts in the United States. These cases have been brought by individuals who allege they have used BYETTA. They generally seek compensatory and punitive damages for alleged injuries, consisting primarily of pancreatitis, and in some cases, wrongful death. Most of the cases are pending in California state court, where the Judicial Council has granted our petition for a "coordinated proceeding" for all California state court cases alleging harm allegedly as a result of BYETTA use. We also have received notice from plaintiff's counsel of additional claims by individuals who have not filed suit. These matters are at an early stage and, as a result, we cannot reasonably estimate potential losses, if any, at this time. While we cannot predict the outcome of any lawsuit, claim or proceeding, we and Lilly intend to vigorously defend these matters. However, if we are unsuccessful in our defense, these matters could result in a material adverse impact to our financial position and results of operations.

12. Income Taxes

        We have net deferred tax assets relating primarily to net operating loss carryforwards and research and development tax credit carryforwards. Subject to certain limitations, these deferred tax assets may be used to offset taxable income in future periods. Since we have been unprofitable since inception and the likelihood of future profitability is not assured, we have provided a valuation allowance for most of these deferred tax assets in our consolidated balance sheets at December 31, 2009 and 2008, respectively. If we determine that we are able to realize a portion or all of these deferred tax assets in the future, we will record an adjustment to increase their recorded value and a corresponding adjustment to increase income or additional paid in capital, as appropriate, in that same period.

        We recognize the impact of a tax position in our financial statements only if that position is more likely than not of being sustained upon examination by taxing authorities, based on the technical merits

F-38

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Income Taxes (Continued)

of the position. We provide estimates for unrecognized tax benefits which relate primarily to issues common among corporations in our industry. We apply a variety of methodologies in making these estimates which include advice from industry and subject experts, evaluation of public actions taken by the Internal Revenue Service and other taxing authorities, as well as our own industry experience. If our estimates are not representative of actual outcomes, our results could be materially impacted.

        The provision (benefit) for income taxes includes the following (in thousands):

			Years ended December 31,
			2009			2008			2007
Current (benefit) provision:
	Federal		$	(2,027	)	$	(657	)	$	—
	State			34			38			38
	Foreign			—			18			30
		Total current (benefit) provision		(1,993	)		(601	)		68
Deferred (benefit) provision:
	Federal			—			—			—
	State			26			26			(1,117	)
	Foreign			—			—			—
		Total deferred (benefit) provision		26			26			(1,117	)
		Total (benefit) provision	$	(1,967	)	$	(575	)	$	(1,049	)

        These amounts are included in interest and other expense in the accompanying consolidated statements of operations.

        The current Federal income tax benefit reflects refundable research credits and the refund of 2008 alternative minimum taxes from the carryback of the current year loss. The Housing and Economic Recovery Act of 2008 (P.L. 110-289), enacted on July 30, 2008, and extended through 2009 by the American Recovery and Reinvestment Act of 2009, provides for the acceleration of a portion of unused pre-2006 research credits and alternative minimum tax credits in lieu of claiming the 50% bonus depreciation allowance enacted in the Economic Stimulus Act of 2008. Amylin is electing to refund approximately $1.4 million of research credit carryovers in 2009. $1.6 million of accelerated research credits have been reflected in the current income tax benefit including an additional benefit related to last year's actual refundable credits. A refund of $0.4 million from the carryback of 2009 net operating losses to 2008 has also been reflected in the current income tax benefit.

        The deferred state income tax benefit in 2007 reflects the Texas margin tax (TMT) credit available to offset future margin taxes over the next 18 years. We estimate that our future TMT liability will be based on our gross revenues in Texas, rather than our apportioned taxable income. Therefore, it is more likely than not that our TMT credit will be recovered and, accordingly, we have not established a valuation allowance against this asset.

        Deferred income taxes reflect the temporary differences between the carrying amounts of assets and liabilities for financial statement purposes and the amounts used for income tax purposes and the net tax effects of net operating loss and credit carryforwards. Significant components of our deferred tax assets as of December 31, 2009 and 2008 are shown below (in thousands). The components of our deferred tax assets as of December 31, 2008 have been adjusted for the required retroactive adoption

F-39

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Income Taxes (Continued)

of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1). A valuation allowance of $661.7 million was recognized at December 31, 2009 to offset the deferred tax assets, as realization of such assets has not met the more likely than not threshold required under current accounting guidance. Included in the gross deferred tax assets below are pre-January 1, 2006 stock option deductions that, when recognized, are estimated to increase additional paid in capital by $21.5 million (in thousands).

		2009			2008
Deferred tax assets:
	Net operating loss carryforwards	$	418,807		$	409,376
	Research tax credits		59,531			61,839
	Capitalized research and development expenses		64,650			83,564
	Accrued expenses		68,164			58,242
	Deferred revenue		73,417			49,192
	Stock-based compensation expense		29,667			27,440
	Other, net		—			166
Total deferred tax assets			714,236			689,819
	Valuation allowance for deferred tax assets		(661,698	)		(629,600	)
	Total deferred tax assets after valuation allowance		52,538			60,219
Deferred tax liabilities:
	Convertible debt discount		(48,479	)		(59,128	)
	Other, net		(2,993	)		—
Total deferred tax liabilities			(51,472	)		(59,128	)
Net deferred tax asset after valuation allowance		$	1,066		$	1,091

The net deferred tax assets are included in other long-term assets in the accompanying consolidated balance sheets.

        Following is a summary of our Federal net operating loss carryforwards, Federal research tax credit carryforwards and California net operating loss carryforwards at December 31, 2009 (in thousands):

	Federal net operating loss carryforwards		California net operating loss carryforwards		Federal research and development tax credit carryforwards
Expiring within one year	$	—	$	—	$	636
After 1 but within 5 years		717		151,172		2,670
After 5 but within 10 years		72,038		395,732		3,405
After 10 years		1,147,481		66,131		53,647
	$	1,220,236	$	613,035	$	60,358

        We experienced changes in control that triggered the limitations of Section 382 of the Internal Revenue Code on our net operating loss carryforwards. The Section 382 limitations were immaterial to our total net operating losses and are reflected in the net operating loss of $1.2 billion presented above.

F-40

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Income Taxes (Continued)

        At December 31, 2009, we had Federal net operating loss carryforwards of approximately $1.2 billion, which begin to expire at the end of 2011. We also have California net operating loss carryforwards of $613.0 million, which begin to expire at the end of 2011, and other state net operating loss carryforwards of approximately $225.0 million, which begin to expire at the end of 2010. The difference between the Federal and California tax loss carryforwards is attributable to the capitalization of research and development expenses for California tax purposes, the prior years' limitation on California loss carryforwards and apportionment of losses to other states. We have Federal research tax credit carryforwards of $60.4 million, which began to expire at the end of 2009, and California research tax credit carryforwards of $29.2 million, which carry forward indefinitely.

        The reconciliation between our effective tax rate and the federal statutory rate is as follows:

	Tax rate for the years ended December 31,
	2009			2008			2007
Federal statutory rate applied to net loss before income tax (benefit) provision		(35.0	)%		(35.0	)%		(35.0	)%
State taxes		2.4	%		(1.6	)%		—
Research and development tax credits		0.1	%		(0.8	)%		(3.0	)%
Stock-based compensation		6.4	%		3.1	%		4.2	%
Expiring federal net operating losses		5.4	%		—			—
Increase in valuation allowance		17.1	%		34.5	%		30.9	%
Other		2.6	%		(0.4	)%		2.4	%
Effective tax rate		(1.0	)%		(0.2	)%		(0.5	)%

        The state tax effects during 2009 include a 5.4% increase in the effective state tax rate (fully offset by a decrease in valuation allowance) relating to a decrease to certain deferred tax assets as a result of a California tax law change that was enacted in February 2009. This change allows an elective single sales factor for state apportionment for taxable years beginning on or after January 1, 2011. We expect to benefit from the California single sales factor election for apportioning income for years 2011 and beyond. As a result of our anticipated election of the single sales factor, we have re-measured our deferred tax assets taking into account the expected reduced California apportionment factor under the elective single sales factor. The state tax effects during 2007 include the expiration of state net operating loss carryforwards.

        Because we adopted the provisions of fair value method of accounting for stock-based compensation arrangements effective January 1, 2006, we recognize windfall tax benefits associated with stock-based compensation directly to stockholders' equity only when realized. Accordingly, deferred tax assets are not recognized for net operating loss carryforwards resulting from windfall tax benefits occurring from January 1, 2006 onward. A windfall tax benefit occurs when the actual tax benefit realized upon an employee's disposition of a stock-based award exceeds any existing deferred tax asset associated with the award. At December 31, 2009, deferred tax assets do not include $45 million of excess tax benefits from stock-based compensation.

        Income taxes paid during the years ended December 31, 2009, 2008 and 2007 totaled $43 thousand, $63 thousand and $30 thousand, respectively.

F-41

AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

12. Income Taxes (Continued)

        The reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the years ended December 31, 2009, 2008 and 2007 is as follows (in thousands):

	December 31,
	2009		2008			2007
Reconciliation of unrecognized tax benefits:
Unrecognized tax benefits related to reductions in tax losses and credits as of the beginning of the year	$	22,441	$	29,913		$	23,645
Increase (decrease) in unrecognized tax benefits related to reductions in tax losses and credits as a result of tax positions taken during a prior period		2,752		(11,711	)		339
Increase in unrecognized tax benefits related to reductions in tax losses and credits as a result of tax positions taken during the current period		11,112		4,239			5,929
Unrecognized tax benefits related to reductions in tax losses and credits as of the end of the year	$	36,305	$	22,441		$	29,913

        The balance of unrecognized tax benefits at December 31, 2009 of $36.3 million are tax benefits that, if recognized, would not affect our effective tax rate as long as they remain subject to a full valuation allowance. The net effect on the deferred tax assets and corresponding decrease in the valuation allowance at December 31, 2009, 2008 and 2007 resulting from unrecognized tax benefits is $28.3 million, $15.1 million and $19.4 million, respectively. We have not recognized any accrued interest and penalties related to unrecognized tax benefits during the years ended December 31, 2009, 2008 and 2007. We are subject to taxation in the United States and various states and foreign jurisdictions. Effectively all of our historical tax years are subject to examination by the Internal Revenue Service and various state and foreign jurisdictions due to the generation of net operating loss and credit carryforwards. We do not foresee any material changes to unrecognized tax benefits within the next twelve months. We will elect a treatment for interest and penalties when they occur.

13. Quarterly Financial Data (Unaudited)

        The following financial information reflects all normal recurring adjustments, which are, in the opinion of management, necessary for a fair statement of the results of the interim periods.

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AMYLIN PHARMACEUTICALS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

13. Quarterly Financial Data (Unaudited) (Continued)

Summarized quarterly data for fiscal 2009 and 2008 are as follows (in thousands, except per share data):

	For the quarters ending
	March 31(2)			June 30(2)			September 30(2)			December 31(2)
2009:
Net product sales	$	179,332		$	197,497		$	192,887		$	184,277
Revenues under collaborative agreements		1,070			1,072			1,034			1,250
Gross profit from product sales		160,700			173,204			170,263			166,827
Restructuring		—			11,376			—			5,604
Net loss		(46,954	)		(62,372	)		(26,659	)		(50,271	)
Basic and diluted net loss per share(1)	$	(0.34	)	$	(0.44	)	$	(0.19	)		(0.35	)
2008:
Net product sales	$	178,721		$	200,335		$	201,364		$	184,922
Revenues under collaborative agreements		1,071			1,072			1,071			1,072
Gross profit from product sales		156,697			175,653			177,969			163,427
Restructuring		—			—			—			54,926
Net loss		(71,099	)		(66,591	)		(79,023	)		(105,228	)
Basic and diluted net loss per share(1)		(0.52	)		(0.49	)		(0.58	)		(0.76	)

(1)

Net loss per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly per-share calculations will not necessarily equal the annual per share calculation.

(2)

Operating results have been revised to conform to the current presentation with regard to the Company's change in method of accounting for reimbursed research and development costs under collaborative arrangements , see Note 1, "Summary of Significant Accounting Policies". Revenues under collaborative arrangements (in thousands) have been reduced by $17,445, $20,612, $15,927, $16,497, $13,272, $10,803, $17,314, for each of the quarterly periods presented above from the quarter ended March 31, 2008 through the quarter ended September 30, 2009. There was no change to net loss as a result of this revision.

(3)

Net loss and basic and diluted net loss per share for each of the quarterly periods in 2008 have been adjusted for the retroactive adoption of authoritative guidance related to convertible debt instruments that may be settled in cash upon conversion (Note 1).

F-43

Schedule II

AMYLIN PHARMACEUTICALS, INC

Schedule II: Valuation Accounts

(in thousands)

	Balance at beginning of period		Additions		Deductions		Balance at end of period
Year ended December 31, 2009
Inventory reserve	$	5,101		1,007		5,811	$	297
Accounts receivable allowances(1)	$	15,041		44,783		39,529	$	20,295
Year ended December 31, 2008
Inventory reserve	$	5,327		7,196		7,422	$	5,101
Accounts receivable allowances(1)	$	12,769		34,996		32,724	$	15,041
Year ended December 31, 2007
Inventory reserve	$	385		7,637		2,695	$	5,327
Accounts receivable allowances(1)	$	6,558		27,787		21,576	$	12,769

(1)

Allowances for prompt payment, product returns, doubtful accounts and wholesaler chargebacks.

F-44

EX-10.10

Exhibit 10.10

AMYLIN PHARMACEUTICALS, INC.
2003 NON-EMPLOYEE DIRECTORS’ STOCK OPTION PLAN

STOCK OPTION AGREEMENT
(NONSTATUTORY STOCK OPTION)

Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this Stock Option Agreement, Amylin Pharmaceuticals, Inc. (the “Company”) has granted you an option pursuant to the Company’s 2003 Non-Employee Directors’ Stock Option Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Grant Notice at the exercise price indicated in your Grant Notice.  Options granted under the Plan are issued under the Company’s 2009 Equity Incentive Plan or any successor equity incentive plan thereto (the “Incentive Plan”), and any shares of the Company’s Common Stock issued upon exercise of your option will be issued out of shares reserved for issuance under the Incentive Plan.  Defined terms not explicitly defined in this Stock Option Agreement but defined in the Incentive Plan shall have the same definitions as in the Incentive Plan except to the extent otherwise defined in the Plan.

The details of your option are as follows:

1.             VESTING.  Subject to the limitations contained herein, your option will vest as set forth in the Plan, provided that vesting will cease upon the termination of your Continuous Service.

2.             NUMBER OF SHARES AND EXERCISE PRICE.  The number of shares of Common Stock subject to your option and your exercise price per share referenced in your Grant Notice may be adjusted from time to time for capitalization adjustments, as provided in the Plan.

3.             METHOD OF PAYMENT.  Payment of the exercise price is due in full upon exercise of all or any part of your option.  You may elect to make payment of the exercise price in cash or by check or in any other manner permitted by your Grant Notice, which may include one or more of the following:

(a)           In the Company’s sole discretion at the time your option is exercised and provided that at the time of exercise the Common Stock is publicly traded and quoted regularly in The Wall Street Journal, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds.

(b)           Provided that at the time of exercise the Common Stock is publicly traded and quoted regularly in The Wall Street Journal, by delivery of already-owned shares of Common Stock either that you have held for the period required to avoid a charge to the Company’s reported earnings (generally six months) or that you did not acquire, directly or indirectly from the Company, that are owned free and clear of any liens, claims, encumbrances or security interests, and that are valued at Fair Market Value on the date of exercise.  “Delivery”

1

for these purposes, in the sole discretion of the Company at the time you exercise your option, shall include delivery to the Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company.  Notwithstanding the foregoing, you may not exercise your option by tender to the Company of Common Stock to the extent such tender would violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock.

(c)           Pursuant to the following deferred payment alternative:

(i)            Not less than one hundred percent (100%) of the aggregate exercise price, plus accrued interest, shall be due (i) on the date designated by the Company in its sole and absolute discretion but not to exceed four (4) years from date of exercise, or (ii) at the Company’s election, upon termination of your Continuous Service.

(ii)           Interest shall be compounded at least annually and shall be charged at the market rate of interest necessary to avoid a charge to earnings for financial accounting purposes.

(iii)         At any time that the Company is incorporated in Delaware, payment of the Common Stock’s “par value,” as defined in the Delaware General Corporation Law, shall be made in cash and not by deferred payment.

(iv)          In order to elect the deferred payment alternative, you must, as a part of your written notice of exercise, give notice of the election of this payment alternative and, in order to secure the payment of the deferred exercise price to the Company hereunder, if the Company so requests, you must tender to the Company a promissory note and a security agreement covering the purchased shares of Common Stock, both in form and substance satisfactory to the Company, or such other or additional documentation as the Company may request.

4.             WHOLE SHARES.  You may exercise your option only for whole shares of Common Stock.

5.             SECURITIES LAW COMPLIANCE.  Notwithstanding anything to the contrary contained herein, you may not exercise your option unless the shares of Common Stock issuable upon such exercise are then registered under the Securities Act or, if such shares of Common Stock are not then so registered, the Company has determined that such exercise and issuance would be exempt from the registration requirements of the Securities Act.  The exercise of your option must also comply with other applicable laws and regulations governing your option, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations.

6.             TERM.  You may not exercise your option before the commencement of its term or after its term expires.  The term of your option commences on the Date of Grant and expires upon the earliest of the following:

(a)           subject to Section 6(f), three (3) months after the termination of your Continuous Service for any reason other than your Disability or death, provided that if during

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any part of such three (3) month period your option is not exercisable solely because of the condition set forth in the preceding paragraph relating to “Securities Law Compliance,” your option shall not expire until the earlier of the Expiration Date or until it shall have been exercisable for an aggregate period of three (3) months after the termination of your Continuous Service;

(b)           subject to Section 6(f), twelve (12) months after the termination of your Continuous Service due to your Disability;

(c)           subject to Section 6(f), twelve (12) months after your death if you die either during your Continuous Service or within three (3) months after your Continuous Service terminates;

(d)           the Expiration Date indicated in your Grant Notice;

(e)           the day before the seventh (7th) anniversary of the Date of Grant; or

(f)            in the event that your Continuous Service terminates without Cause (as defined below) or because of your Disability or death, in any such case at a time when you are 55 years old or older and have Continuous Service of 5 years or more, then, to the extent you were entitled to exercise your option at the date of such termination, your option will expire upon the earliest of the fifth anniversary of such date, the Expiration Date indicated in your Grant Notice, or the day before the tenth (10th) anniversary of the Date of Grant.

For purposes of this Section 6(f) only, “Cause” means that, in the reasonable determination of the Company, you have (i) been convicted of or pleaded guilty or nolo contendere to a felony or any crime involving moral turpitude or dishonesty; (ii) participated in a fraud or act of dishonesty against the Company; (iii) willfully and materially breached a Company policy; (iv) intentionally damaged the Company’s property; (v) willfully and materially breached your Proprietary Information and Inventions Agreement with the Company; (vi) engaged in conduct that, in the reasonable determination of the Company, demonstrates gross unfitness to serve; or (vii) repeatedly failed to satisfactorily perform job duties to which you previously agreed in writing.  The conduct described under clauses (iii), (vi) and (vii) above will only constitute Cause if such conduct is not cured within 90 days after your receipt of written notice from the Company or the Board specifying the particulars of the conduct that may constitute Cause.

7.             EXERCISE.

(a)           You may exercise the vested portion of your option during its term by delivering a Notice of Exercise (in a form designated by the Company) together with the exercise price to the Secretary of the Company, or to such other person as the Company may designate, during regular business hours, together with such additional documents as the Company may then require.

(b)           By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you to enter into an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (1) the exercise of your option, (2) the lapse of any substantial risk of forfeiture to

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which the shares of Common Stock are subject at the time of exercise, or (3) the disposition of shares of Common Stock acquired upon such exercise.

8.             TRANSFERABILITY.  Your option is not transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you.  Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to exercise your option.

9.             OPTION NOT A SERVICE CONTRACT.  Your option is not a service contract, and nothing in your option shall be deemed to create in any way whatsoever any obligation on your part to continue in the service of the Company as a Director, or of the Company to continue your service as a Director.  Nothing in your option shall obligate the Company or an Affiliate, their respective stockholders, Boards of Directors, Officers or Employees to continue your relationship with the Company as a Director.

10.          WITHHOLDING OBLIGATIONS.

(a)           At the time you exercise your option, in whole or in part, or at any time thereafter as requested by the Company, you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a “cashless exercise” pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with your option.

(b)           Upon your request and subject to approval by the Company, in its sole discretion, and compliance with any applicable conditions or restrictions of law, the Company may withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your option a number of whole shares of Common Stock having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount of tax required to be withheld by law.  If the date of determination of any tax withholding obligation is deferred to a date later than the date of exercise of your option, share withholding pursuant to the preceding sentence shall not be permitted unless you make a proper and timely election under Section 83(b) of the Code, covering the aggregate number of shares of Common Stock acquired upon such exercise with respect to which such determination is otherwise deferred, to accelerate the determination of such tax withholding obligation to the date of exercise of your option.  Notwithstanding the filing of such election, shares of Common Stock shall be withheld solely from fully vested shares of Common Stock determined as of the date of exercise of your option that are otherwise issuable to you upon such exercise.  Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility.

(c)           You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied.  Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company shall have no

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obligation to issue a certificate for such shares of Common Stock or release such shares of Common Stock from any escrow.

11.          NOTICES.  Any notices provided for in your option or the Plan shall be given in writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by mail by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the Company.

12.          GOVERNING PLAN DOCUMENT.  Your option is subject to all the provisions of the Incentive Plan except to the extent otherwise provided for in the Plan, the respective provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Incentive Plan except to the extent otherwise provided for in the Plan or any amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan.  In the event of any conflict between the provisions of your option and those of the Incentive Plan or the Plan, as applicable, the provisions of the Incentive Plan or the Plan shall control, as the case may be.

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EX-10.26

Exhibit 10.26

Summary Description of Named Executive Officer
Oral At-Will Employment Agreement

With the exception of Daniel M. Bradbury, our President and Chief Executive Officer, with whom we have a written employment agreement, we maintain oral at-will employment relationships with each of our other currently-serving named executive officers: Mark G. Foletta, Orville G. Kolterman, M.D., Marcea Bland Lloyd and Vincent Mihalik. Each of these executive officers receives our normal and customary employment benefits, generally on the same terms as all of our employees. The benefits include the right to (i) participate in our 401(k) Plan and our Employee Stock Purchase Plan, (ii) receive 10% of eligible compensation in the form of Amylin common stock under our Employee Stock Ownership Plan and (iii) receive stock option grants under our Equity Incentive Plan and cash bonuses under our cash bonus plan. Each of these executive officers is also eligible, along with all of our employees holding the title of vice-president and above, to participate in our Deferred Compensation Plan and our Officer Change in Control Severance Benefit Plan. The Change in Control Plan provides each participant with certain benefits in the event such employee ceases employment with Amylin without cause or under certain specified circumstances and within 90 days prior to, or within 13 months following specified change of control transactions.  In such event, (i) the president and chief executive officer would receive salary continuation for 36 months and three times his annual target bonus; (ii) executive officers would receive salary continuation for 24 months and two times their annual target bonus, and (iii) non-executive officers would receive 18 months salary continuation and an amount equal to their annual target bonus.  Under the Change in Control Plan, officers would also receive 18 months of certain COBRA payment reimbursement.  We also have customary indemnification agreements with our officers, including these executive officers. In addition, the Compensation and Human Resources Committee of our Board of Directors reviews the salaries of our executive officers from time to time.  Mr. Bradbury’s annual salary is currently set at $675,000. Annual salaries for each of our other named executives are currently set as follows:  Dr. Kolterman - - $440,000, Mr. Foletta - $419,750, Ms. Lloyd - $400,125 and Mr. Mihalik - - $375,000.

EX-10.52

EXHIBIT 10.52

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Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

BY AND BETWEEN

AMYLIN PHARMACEUTICALS, INC.

AND

TAKEDA PHARMACEUTICAL COMPANY LIMITED

DATED:   OCTOBER 30, 2009

***Text Omitted and Filed Separately with the Securities and Exchange

Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

TABLE OF CONTENTS

1.		DEFINITIONS		1
	2.		GOVERNANCE		17
	3.		DEVELOPMENT		23
	4.		REGULATORY		31
	5.		COMMERCIALIZATION		33
	6.		MANUFACTURING		35
	7.		GRANT OF RIGHTS		36
	8.		PAYMENTS		41
	9.		PAYMENT; RECORDS; AUDITS		46
	10.		CONFIDENTIALITY AND PUBLICATIONS		48
	11.		REPRESENTATIONS, WARRANTIES AND COVENANTS; DISCLAIMER		51
	12.		INTELLECTUAL PROPERTY		56
	13.		TERM; TERMINATION		61
	14.		INDEMNIFICATION		68
	15.		DISPUTE RESOLUTION		70
	16.		MISCELLANEOUS		72
	EXHIBIT A		AMYLIN PATENTS AS OF THE EFFECTIVE DATE		A-1
	EXHIBIT B		DEVELOPMENT PLAN THROUGH [***]		B-1
	EXHIBIT C		ANALOGS OF METRELEPTIN		C-1
	EXHIBIT D		CO-COMMERCIALIZATION AGREEMENT TERMS		D-1
	EXHIBIT E		TAKEDA Y-FAMILY AGONISTS		E-1
	EXHIBIT F		IN-LICENSE AGREEMENTS		F-1
	EXHIBIT G		ROYALTY CALCULATION EXAMPLE		G-1

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Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

THIS LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the “Agreement”) is entered into as of October 30, 2009 (the “Effective Date”) by and between TAKEDA PHARMACEUTICAL COMPANY LIMITED, a company organized under the laws of Japan (“Takeda”), having a place of business at 1-1, Doshomachi 4-chome, Chuo-ku, Osaka 540-8645 Japan, and AMYLIN PHARMACEUTICALS, INC., a Delaware corporation (“Amylin”), having a place of business at 9360 Towne Centre Drive, San Diego, CA 92121 U.S.A. Takeda and Amylin may be referred to herein individually as a “Party” or collectively as the “Parties.”

RECITALS

WHEREAS, Amylin is engaged in research, development, manufacture and commercialization of pharmaceutical products, and is currently engaged in the development of compounds for treatment of obesity and diabetes in humans;

WHEREAS, Takeda is engaged in the research, development and commercialization of pharmaceutical products; and

WHEREAS, Takeda and Amylin desire to enter into a collaborative relationship to further develop and commercialize Products in the Field (as such terms are defined below), subject to the terms and conditions set forth herein.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants herein contained, the Parties hereby agree as follows:

1.DEFINITIONS

Unless specifically set forth to the contrary herein, the following terms, whether used in the singular or plural, shall have the respective meanings set forth below.

1.1          “Affiliate” shall mean any Person controlled by, controlling, or under common control with a Party.  For the purposes of this definition, the term “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to a Party shall mean the possession, directly or indirectly, of more than fifty percent (50%) of the outstanding voting securities of a corporation, or comparable equity interest in any other type of entity, or otherwise having the power to govern the financial and the operating policies or to appoint the management of such entity.  Notwithstanding the foregoing, Takeda Thailand, Ltd. shall be considered an Affiliate of Takeda.

1.2          “Alliance Manager” shall have the meaning set forth in Section 2.4.

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Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

1.3          “Alternative Delivery System” shall mean a method for administration of Product to humans other than injectable administration (e.g., pump, nasal, transdermal, sublingual, or oral administration).

1.4          “Amgen Agreement” shall mean that certain License Agreement between Amgen Inc. (“Amgen”) and Amylin, dated February 7, 2006, as amended.

1.5          “Amylin Compound Related Inventions” shall have the meaning set forth in Section 12.1.1.

1.6          “Amylin Indemnitee” shall have the meaning set forth in Section 14.1.

1.7          “Amylin Know-How” shall mean Information not included in the Amylin Patents that Amylin Controls on the Effective Date or during the Term, which Information is necessary or useful to develop, make, have made, distribute, use, offer for sale, sell, import, export or otherwise Commercialize the Amylin Licensed Compounds and Products in the Field in the Territory, including any replication or any part of such Information and including information and know-how that Amylin Controls on the Effective Date or during the Term which is necessary or useful to conduct research on the Licensed Compounds and Products in the Field in the Territory in support of Development and Commercialization activities as contemplated by this Agreement (but excluding assays, computer programs, materials or other research tools).

1.8          “Amylin Licensed Compound” shall mean any of the following compounds: (i) Pramlintide (AC137); (ii) Metreleptin (AC164594) and the analogs thereof listed on Exhibit C; (iii) Davalintide (AC2307); (iv) OPT (AC163954); and (v) any Option Compound.

1.9          “Amylin Patents” shall mean all Patents that Amylin Controls as of the Effective Date or during the Term, which Patents are necessary or useful to research, develop, make, have made, distribute, use, offer for sale, sell, import, export or otherwise Commercialize the Amylin Licensed Compounds and Products in the Field in the Territory, but excluding Joint Patents.  The Amylin Patents as of the Effective Date are set forth on Exhibit A.

1.10        “Amylin Technology” shall mean the Amylin Know-How and Amylin Patents.

1.11        “Analog” shall mean, with respect to any Amylin Licensed Compound identified in Section 1.8(i), (ii), (iii) or (iv) or any Takeda Y-family Agonist, as applicable, any peptide that meets each of the following conditions: (i) the sequence of such peptide was derived from such Amylin Licensed Compound or Takeda Y-family Agonist by insertions of, or substitutions by, one or more naturally-occurring amino acids and/or by deletions from the amino acid sequence of such Amylin Licensed Compound or Takeda Y-family Agonist, and such peptide maintains [***] sequence identity with the amino acid sequence of such Amylin Licensed Compound or Takeda Y-family Agonist, as applicable; and (ii) (a) with regard to any such Amylin Licensed Compounds that are Y-family analogs or any Takeda Y-family Agonist, such peptide binds to any of the [***], (b) with regard to any such Amylin Licensed Compounds that are amylin family analogs, such peptide binds to any of the [***], and (c) with regard to any such Amylin Licensed Compounds that are metreleptin analogs, such peptide binds to the [***]. Notwithstanding the foregoing, Analogs shall not include (1) any peptide hybrid molecule that

*** Confidential Treatment Requested

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Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

combines two (2) or more peptide modalities, which peptide modalities elicit their pharmacological effects through distinctly different receptors or receptor families, into a single molecular entity, or (2) [***]  as of the Effective Date; provided, however, both Parties agree that to the extent additional Analogs may be selected for development under the [***], such Analogs shall be included in this Section 1.11 and subject to the terms and conditions of this Agreement.

1.12        “Applicable Laws” shall mean all applicable statutes, ordinances, regulations, rules, or orders of any kind whatsoever of any governmental authority, including the U.S. Food, Drug and Cosmetic Act, (21 U.S.C. §301 et seq.), Prescription Drug Marketing Act, the Generic Drug Enforcement Act of 1992 (21 U.S.C. §335a et seq.), U.S. Patent Act (35 U.S.C. §1 et seq.), Federal Civil False Claims Act (31 U.S.C. §3729 et seq.), and the Anti-Kickback Statute (42 U.S.C. §1320a-7b et seq.), all as amended from time to time, together with any rules, regulations, and compliance guidance promulgated thereunder.

1.13        “Auditor” shall have the meaning set forth in Section 3.12.

1.14        “Bankruptcy Laws” shall have the meaning set forth in Section 13.6.

1.15        “BID Product” shall mean any Product formulated for twice daily (BID) injectable administration in a single injection delivery mechanism.

1.16        “Binding Budget” shall mean a Development Budget that is intended to be binding upon the Parties.

1.17        “Cardiovascular Indication” shall mean any indication included in Section 1.51(iii).

1.18        “cGCP” shall mean the then current good clinical practices as defined in U.S. Regulations 21 CFR §§ 50, 54, 56, 312 and 314, (or in the case of jurisdictions outside the United States, comparable regulatory standards), and in any successor regulation.

1.19        “cGLP” shall mean the then current good laboratory practice standards promulgated or endorsed by the FDA (or in the case of jurisdictions outside the United States, comparable regulatory standards).

1.20        “cGMP” or “GMP” shall mean current good manufacturing practices for pharmaceuticals as described in regulations promulgated by Regulatory Authorities applicable to the manufacture of a Licensed Compound or Product, as such regulations are in effect at the time of manufacturing such Licensed Compound or Product, including current Good Manufacturing Practices as defined under 21 CFR part 210 and 211, and Volume 4 Rules Governing Medicinal Products in the EU Part I and II (or in the case of jurisdictions outside the United States and European Union, comparable regulatory standards), as amended from time to time.

1.21        “Change of Control” shall have the meaning set forth in Section 16.3(b).

1.22        “Claim” shall have the meaning set forth in Section 14.1.

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***Text Omitted and Filed Separately with the Securities and Exchange

Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

1.23        “Clinical Trial” shall mean a clinical research trial in humans in any country that is a Phase 1 Clinical Trial, Phase 2 Clinical Trial, Phase 3 Clinical Trial, Phase 4 Clinical Trial, Post-Approval Clinical Trial or Regulatory Approval Clinical Trial.

1.24        “Combination Product” shall have the meaning set forth in Section 1.80.

1.25        “Co-Commercialization Agreement” shall have the meaning set forth in Section 5.3.

1.26        “Co-Commercialization Option” shall have the meaning set forth in Section 5.3.

1.27        “Commercialization” or “Commercialize” shall mean the conduct of all activities undertaken before and after Regulatory Approval relating to the promotion, marketing, sale and distribution (including importing, exporting, transporting, customs clearance, warehousing, invoicing, handling and delivering Products to customers) of Products in the Field in the Territory, including: (i) sales force efforts, detailing, advertising, medical education, planning, marketing, sales force training, and sales and distribution; (ii) scientific and medical affairs; (iii) Post-Approval Clinical Trials; (iv) all activities relating to manufacturing Licensed Compounds or Products for commercial sale, including formulation, delivery technologies and devices, bulk production, fill/finish, manufacturing process development, and manufacturing and quality assurance technical support; and (v) all activities relating to maintaining Regulatory Approval of a Product.

1.28        “Commercialization Costs” shall mean those costs and expenses incurred by a Party, or for its account, after the Effective Date related to the Commercialization of Products.  Commercialization Costs include Product-specific Third Party costs and any costs associated with Third Party product liability claims that arise after Regulatory Approval, but do not include: (i) internal personnel costs, other than Amylin’s internal personnel costs as contemplated under Section 5.1 if Amylin performs Commercialization activities at Takeda’s request; (ii) certain costs set forth in Exhibit D (Co-Commercialization Agreement), or in the Co-Commercialization Agreement, if any; (iii) Product Liabilities (as defined in Section 1.100); and (iv) any losses, damages, fees, costs and other liabilities incurred by a Party as a result of such Party’s negligence, gross negligence, willful misconduct or breach of such Party’s representations and warranties made hereunder, and any such losses, damages, fees, costs and other liabilities will be treated as the sole and exclusive responsibility of the Party whose actions or omissions gave rise to such losses, damages, fees, costs and other liabilities.

1.29        “Commercialization Plan” shall have the meaning set forth in Section 5.2.

1.30        “Commercially Reasonable Efforts” shall mean, with respect to the efforts to be expended, or considerations to be undertaken, by a Party or its Affiliate with respect to any objective, activity or decision to be undertaken hereunder, reasonable, good faith efforts to accomplish such objective, activity or decision as such Party would normally use to accomplish a similar objective, activity or decision under similar circumstances, it being understood and agreed that with respect to the Development or Commercialization of a Licensed Compound or Product, such efforts and resources shall be consistent with those efforts and resources commonly used by a Party for a similar pharmaceutical product owned by it or to which it has

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***Text Omitted and Filed Separately with the Securities and Exchange

Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

similar rights, which product is at a similar stage in its development or product life and is of similar market potential taking into account efficacy, safety, approved labeling, the competitiveness of alternative products sold by Third Parties in the marketplace, the patent and other proprietary position of the product, the likelihood of regulatory approval given the regulatory structure involved, the profitability of the product taking into consideration, among other factors, Third Party costs and expenses including the royalties, milestone and other payments payable to licensors of patent or other intellectual property rights, and the pricing and reimbursement relating to the product. Commercially Reasonable Efforts shall be determined on a market-by-market and indication-by-indication basis for a particular Licensed Compound or Product, and it is anticipated that the level of effort will change over time, reflecting changes in the status of the Licensed Compound or Product and the market(s) involved. Notwithstanding the foregoing, neither Party shall be obligated to Develop, seek Regulatory Approval or Commercialize a Licensed Compound or Product: (i) which, in its reasonable opinion after discussion with the other Party, caused or is likely to  cause a fatal, life-threatening or other serious adverse safety event that is reasonably expected, based upon then available data, to preclude obtaining Regulatory Approval for such Product or Licensed Compound, or, if Regulatory Approval of such Product has already been obtained, to preclude continued marketing of such Product; or (ii) in a manner inconsistent with Applicable Laws.

1.31        “Committee” shall have the meaning set forth in Section 2.5.

1.32        “Common Stock” shall have the meaning set forth in Section 16.1(a).

1.33        “Confidential Information” shall have the meaning set forth in Section 10.1.

1.34        “Control,” “Controls”, or “Controlled by” shall mean, with respect to any Information, Patent or other intellectual property right, possession by a Party, including its Affiliates, of the ability (whether by ownership, license or otherwise, but without taking into account any rights granted by one Party to the other Party under the terms of this Agreement) to grant access, a license or a sublicense to such Information or intellectual property right without violating the terms of any agreement or other arrangement with any Third Party as of the time such Party would be first required under this Agreement to grant the other Party such access, license or sublicense.

1.35        “Cost of Goods” shall mean the cost to manufacture a given Licensed Compound or Product in bulk form or final therapeutic form, which shall mean: (i) in the case of products and services acquired from Third Parties, payments made to such Third Parties; and (ii) in the case of manufacturing services performed by a Party or its Affiliates, including manufacturing services to support products and services acquired from Third Parties as contemplated in subsection (i) above,  the actual unit costs of manufacture in bulk form or final therapeutic form, as the case may be, plus the variances and other costs specifically provided for herein.  Actual unit costs shall consist of direct material costs, direct labor costs and manufacturing overhead directly attributable to the Licensed Compound or Product, all calculated in accordance with GAAP.  Direct material costs shall include the costs incurred in purchasing materials, including sales and excise taxes imposed thereon, customs duties and charges levied by government authorities, and all costs of packaging components. Direct labor costs shall include the cost of: (a) employees working in Licensed Compound or Product manufacturing and packaging and

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***Text Omitted and Filed Separately with the Securities and Exchange

Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

engaged in direct manufacturing activities; (b) the acquisition of Third Party manufacturing products and services; and (c) direct or indirect quality control and quality assurance activities.  Manufacturing overhead attributable to a Licensed Compound or Product shall include a reasonable allocation of indirect labor costs (not previously included in direct labor costs), a reasonable allocation of administrative costs and a reasonable allocation of facilities and other overhead costs.

1.36        “Curis Agreement” shall mean that certain License Agreement between Curis Inc. (“Curis”) and Amylin, dated December 4, 2002, as amended.

1.37        “CV Safety Study” shall have the meaning set forth in Section 3.11.1.

1.38        “Database Lock Date” shall have the meaning set forth in Section 3.11.1.

1.39        “Detail” or “Detailing” shall mean, except as otherwise provided in this Section 1.39, a face-to-face meeting, between a Medical Sales Representative of the applicable Party, and a health care professional with prescribing authority, during which a presentation of the Product’s attributes is orally presented in a manner consistent with industry standards and with the quality of similar presentations made by a Party’s Medical Sales Representatives for such Party’s other products, if applicable.  A Detail does not include a sample drop made by a Medical Sales Representative, and the Parties may agree in the Commercialization Plan to include electronic Detailing by means of information technology.

1.40        “Development” shall mean the conduct of all activities that are reasonably required to obtain Regulatory Approval of a Product in the Field in the Territory, or to obtain Regulatory Approval for an additional indication for a Product that has previously obtained Regulatory Approval for an indication, including: (i) toxicology, regulatory activities, pre-clinical studies and Clinical Trials conducted in accordance with the cGLPs, cGCPs and cGMPs, or other designated quality standards, and Applicable Laws; and (ii) all activities relating to manufacturing Licensed Compounds or Products for pre-clinical and feasibility studies and Clinical Trials, other than Post-Approval Clinical Trials, including formulation, delivery technologies and devices, bulk production, fill/finish, manufacturing process development, and manufacturing and quality assurance technical support.

1.41        “Development Budget” shall mean the detailed budget for Development activities that includes estimated headcount and other costs and resource allocations by the Parties for all Development activities proposed for the following [***], or for such longer period as the ODC may determine, and that is included within each Development Plan, as such budget may be amended or updated from time to time in accordance with Article 2.

1.42        “Development Costs” shall mean those costs and expenses incurred by a Party or for its account after the Effective Date in the Development of Products as reasonably required to obtain Regulatory Approval of Products in the Field in the Territory consistent with the Development Plan.  Development Costs include Third Party Development Costs and those costs and expenses incurred for: (i) FTEs; (ii) CMC (chemistry, manufacturing and controls) activities including those relating to Regulatory Approval Clinical Trials, but excluding Post-Approval Clinical Trials; (iii) pre-clinical Development activities; (iv) Clinical Trials including Regulatory

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Approval Clinical Trials, but excluding Post-Approval Clinical Trials and any Phase 2 Clinical Trial for Davalintide that is on-going as of the Effective Date; (v) Cost of Goods allocable to the manufacture of a Licensed Compound or Product for Clinical Trials including Regulatory Approval Clinical Trials, but excluding Post-Approval Clinical Trials, provided that any capital expenses included in the Cost of Goods are directly allocable to the manufacture of Licensed Compounds or Products used in Clinical Trials, and are approved in accordance with Sections 2.2.5 and 2.1.4 and calculated in accordance with GAAP; (vi) distribution costs; (vii) Product Liabilities; (viii) obtaining Regulatory Approval, including NDA filing fees, but excluding costs relating to maintaining Regulatory Approval; and (ix) other costs approved as part of the Development Plan.  Development Costs shall be considered a cost or expense incurred by a Party after the Effective Date, even though the actual payment for such cost or expense is made prior to the Effective Date, if the corresponding work is performed after the Effective Date, and shall be considered a cost or expense that is not incurred by a Party after the Effective Date if the actual payment for such cost or expense is made after the Effective Date, but the corresponding work was performed prior to the Effective Date.  Notwithstanding anything to the contrary contained in this Section 1.42, Development Costs shall not include any internal personnel costs related to Commercialization, or any losses, damages, fees, costs and other liabilities incurred by a Party as a result of such Party’s negligence, gross negligence, willful misconduct or breach of such Party’s representations and warranties made hereunder, and any such losses, damages, fees, costs and other liabilities will be treated as the sole and exclusive responsibility of the Party whose actions or omissions gave rise to such losses, damages, fees, costs and other liabilities.

1.43        “Development Plan” shall mean a written [***] plan for the Development of Products in the Field in the Territory, which plan includes a Development Budget for all Development activities, as such plan may be amended or updated from time to time in accordance with Article 2.  The Development Plan, excluding certain Development activities (e,g., CMC and toxicology) and the Development Budget, is attached hereto as Exhibit B, and [***].

1.44        “Development Program” shall mean the Development activities undertaken by Amylin and Takeda pursuant to the Development Plan.

1.45        “Diabetes Indication” shall mean any indication included in Section 1.51(ii).

1.46        “Dropped Product” shall have the meaning set forth in Section 8.2.1.

1.47        “Effective Date” shall mean October 30, 2009.

1.48        “EMEA” shall mean the European Medicines Agency and any successor thereto.

1.49        “Excluded Products” shall mean: (i) any pharmaceutical product containing or comprising Metreleptin (AC164594), or an Analog of Metreleptin, as its sole active ingredient, including all formulations, line extensions and modes of administration thereof, indicated for [***]

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; and (ii) any pharmaceutical product containing or comprising pramlintide, currently marketed by Amylin as Symlin®, alone or in combination with other compounds that are not Amylin Licensed Compounds, indicated for glycemic control (including Type 1 and Type 2 diabetes) in humans, including treatment, management and prevention of glycemic control (including Type 1 and Type 2 diabetes).

1.50        “FDA” shall mean the U.S. Food and Drug Administration and any successor thereto.

1.51        “Field” shall mean all human indications including, but not limited to: (i) weight management (obesity, including weight loss and weight loss maintenance) and/or treatment or prevention of obesity in humans; (ii) glycemic control (including Type 1 and Type 2 diabetes) in humans, including treatment, management and prevention of any disease or disorder relating to glycemic control (including Type 1 and Type 2 diabetes); and (iii) the treatment, management or prevention of any cardiovascular disease or disorder in humans; provided, however, central nervous system indications, with respect to which Amylin has no right to license or sublicense the Amylin Licensed Compounds or Products to Takeda as of the Effective Date due to restrictions contained in the Psylin Agreement, are excluded from this definition.

1.52        “Filing Party” shall have the meaning set forth in Section 12.3.2.

1.53        “First Commercial Sale” shall mean, with respect to any Product, on a country-by-country basis, the first sale by a Party or a Party’s Affiliate or sublicensee to a Third Party in a country after the Regulatory Authority in such country has granted Regulatory Approval.  For clarification, the first sale by a Party or a Party’s Affiliate or sublicensee to a Third Party for use or consumption of a Product by a patient in a country after Regulatory Approval has been granted,even if such Regulatory Approval contemplates further testing of such Product (e.g., long-term safety testing), will constitute a First Commercial Sale for purposes of this Agreement.

1.54        “First Position Detail” shall mean a Detail where the presentation of a Product during the Detail is the first presentation made and more than [***] percent ([***] %) of the time is spent during such Detail.

1.55        “FTE” shall mean the equivalent of a full-time employee’s work time actually spent on the performance of Development activities over a twelve (12)-month period (including normal vacations, sick days and holidays) based on [***] ([***]) hours worked per twelve (12)-month period. Each employee utilized by a Party in connection with its performance under a Development Plan may be less than or greater than one FTE based on the hours actually worked by such employee. For the avoidance of doubt, FTE only applies to employees of a Party, and does not apply to contractors of a Party.

1.56        “GAAP” shall mean the generally accepted accounting principles of the applicable country or jurisdiction, consistently applied, and shall mean the international financial reporting standards (“IFRS”) at such time as IFRS becomes the generally accepted accounting standard and Applicable Laws require that a Party use IFRS.

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1.57        “Generic Product” shall mean, with respect to any Product, any pharmaceutical product that is introduced in a country by a Person other than Takeda or its Affiliates or sublicensees, which contains the same or equivalent (by the FDA or other Regulatory Authority standards, on a country-by-country basis) active pharmaceutical ingredient(s) as contained in such Product, and for which Regulatory Approval is obtained by an abbreviated NDA or other abbreviated process not requiring the filing of a complete NDA under laws or regulations of the FDA or any other applicable Regulatory Authority, on a country-by-country basis.

1.58        “Group” shall mean a group of related Persons deemed a “person” for purposes of Section 13(d) of the U.S. Securities and Exchange Act of 1934, as amended

1.59        “ICC Rules” shall have the meaning set forth in Section 15.3.

1.60        “IFRS” shall have the meaning set forth in Section 1.56.

1.61        “IND” shall mean an investigational new drug application, clinical trial application, clinical trial exemption, or similar application or submission for approval to conduct human clinical investigations filed with or submitted to a Regulatory Authority in conformance with the requirements of such Regulatory Authority, together with all additions, deletions, and supplements thereto.

1.62        “Indemnifying Party” shall have the meaning set forth in Section 14.3.1.

1.63        “Indemnitee” shall have the meaning set forth in Section 14.3.1.

1.64        “Information” shall mean information, ideas, inventions, discoveries, concepts, compounds, compositions, formulations, formulas, practices, procedures, processes, methods, knowledge, know-how, trade secrets, technology, inventories, machines, techniques, development, designs, drawings, computer programs, skill, experience, documents, apparatus, results, clinical and regulatory strategies, regulatory documentation, information and submissions pertaining to, or made in association with, filings with any Regulatory Authority, data, including pharmacological, toxicological and clinical data, analytical and quality control data, manufacturing data and descriptions, patent and legal data, market data, financial data or descriptions, devices, assays, chemical formulations, specifications, material, product samples and other samples, physical, chemical and biological materials and compounds, and the like, in written, electronic or other form, now known or hereafter developed, whether or not patentable.

1.65        “Initial Royalty Term” shall mean, on a Product-by-Product and country-by-country basis, the period of time commencing on the First Commercial Sale of a Product in a country and ending upon the later of: (i) the earliest date upon which both of the following have occurred: (a) the expiration of the last to expire of all Amylin Patents and Joint Patents, and solely in the case of any Product containing any Takeda Licensed Compound, Takeda Patents, containing a Valid Claim regarding the composition of matter or method of manufacture or use of such Product (or any Licensed Compound therein); provided, however, such Valid Claim shall be considered for purposes of determining the Initial Royalty Term for such Product in such country only if it provides, or the Parties agree (and if the parties are unable to agree, then based upon the opinion of a mutually agreeable independent patent counsel) that it is reasonably likely to provide, sufficient market exclusivity to exclude Generic Products in such country, and (b) the

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expiration of regulatory exclusivity for such Product in such country; or (ii) the first commercial sale of a Generic Product in such country by any Third Party other than a Takeda sublicensee. For the avoidance of doubt, the Parties agree that: (a) if the First Commercial Sale of a Product in a country occurs after the date in Section 1.65(ii) has taken place, there will be no Initial Royalty Term for purposes of calculating royalties pursuant to Section 8.3, and, instead, only the Secondary Royalty Term shall be applicable; and (b) for purposes of Section 1.65(i) above, the Initial Royalty Term will end upon sale of a Generic Product in any country of the Territory, provided that if sales of such Generic Product are terminated thereafter, the Initial Royalty Term will resume and the [***] percent ([***] %) royalty rate will be applied retroactively for the period the Initial Royalty Term was suspended.

1.66        “In-License Agreement” means any of the Amgen Agreement, Curis Agreement, Pacira Agreement or UM Agreement, each of which are listed on Exhibit F.

1.67        “Invention” shall mean any and all inventions, discoveries and developments, whether or not patentable, made, conceived or reduced to practice in the course of performance of development or commercialization of Licensed Compounds or Products, whether made, conceived or reduced to practice solely by one or more employees or contractors of Amylin or its Affiliate, solely by one or more employees or contractors of Takeda or its Affiliate, or jointly by one or more employees or contractors of Amylin or its Affiliate and one or more employees or contractors of Takeda or its Affiliate.

1.68        “Joint Inventions” shall have the meaning set forth in Section 12.1.4.

1.69        “Joint Patents” shall have the meaning set forth in Section 12.1.4.

1.70        “JOPC” shall have the meaning set forth in Section 12.2.

1.71        “Knowledge” as used in Article 11 shall mean that Amylin or Takeda, as the case may be, is deemed to be aware of a particular fact or other matter to the extent a reasonably prudent manager (i.e. a person at the director level or higher) of Amylin or Takeda, as the case may be, with experience in the pharmaceutical industry would or should know of such fact or other matter after reasonable inquiry thereof.

1.72        “Licensed Compound” shall mean any Amylin Licensed Compound or Takeda Licensed Compound.

1.73        “Loan” shall have the meaning set forth in Section 3.11.1.

1.74        “Losses” shall have the meaning set forth in Section 14.1.

1.75        “Manufacturing Information” shall mean all Information Controlled by Amylin as of the Effective Date or during the Term that is included in the Amylin Technology and is necessary for the manufacture of any Amylin Licensed Compound or Product, including but not limited to such Information contained in the chemistry, manufacture and controls section of any applicable Regulatory Materials and trade secrets.

1.76        “Material Activity” shall have the meaning set forth in Section 12.4.2.

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1.77        “Materials” shall have the meaning set forth in Section 3.7.

1.78        “Medical Sales Representative” shall mean personnel hired by either Takeda or Amylin or their Affiliates for the sales promotion of pharmaceutical products who shall be responsible for Detailing the Products.  The term Medical Sales Representatives does not include sales management and/or support staff, and may include personnel employed by a contract sales organization if the Parties mutually agree to use a contract sales organization to perform Details.

1.79        “NDA” shall mean a new drug application (as more fully defined in 21 C.F.R. 314.5 et seq.) filed with the FDA, or the equivalent application filed with any Regulatory Authority outside the United States (including any supra-national agency such as in the European Union), and all amendments and supplements thereto, including all documents, data, and other information concerning a pharmaceutical product, which are necessary for gaining Regulatory Approval to market and sell such pharmaceutical product.

1.80        “Net Sales” shall mean the gross amounts invoiced by Takeda and its Affiliates and sublicensees for sales or other dispositions of Products to Third Parties that are not Affiliates or sublicensees, less the following items, as allocable to such Products (if not previously deducted from the amount invoiced): (i) trade, cash or quantity discounts, credits or allowances actually allowed (provided that such discounts are applied in a normal and customary manner with respect to other similarly situated products of the selling party, and not in a manner which is unreasonably disproportionate to one or more Products when compared to other products of the selling party); (ii) charge back payments, administrative fees, price reductions and rebates allowed or granted to managed care organizations, government agencies or trade customers, including wholesalers and chain and pharmacy buying groups (provided that such discounts are applied in a normal and customary manner with respect to other similarly situated products of the selling party, and not in a manner which is unreasonably disproportionate to one or more Products when compared to other products of the selling party); (ii) credits actually allowed for claims, allowances for damaged goods, retroactive price reductions or returned goods; (iv) prepaid freight, postage, shipping, customs duties and insurance charges; and (v) sales taxes, value added taxes, duties and other governmental charges (including with respect to sales of Products in Japan, sales-based contributions actually made by Takeda or its Affiliates or sublicensees for Contribution for Drug Induced Suffering and Contribution for Measures for Drug Safety in the amount determined by and payable to the Pharmaceuticals and Medical Devices Agency (known as “Kiko”) in Japan, as consistently applied by Takeda to its products), actually paid in connection with the sale, to the extent not reimbursed (but excluding what are commonly known as income taxes).  Such amounts shall be determined in accordance with GAAP, consistently applied, and may include using accrual accounting where applicable.

In the case of any Product that contains any Licensed Compound(s) in combination with any other clinically active ingredient(s) that is not a Licensed Compound, whether packaged together or in the same therapeutic formulation (a “Combination Product”) in any country, Net Sales for such Combination Product in such country shall be calculated by multiplying actual Net Sales of such Combination Product by the fraction A/(A+B) where A is the average invoice price of the Product containing the Licensed Compound(s) as the only active ingredient(s), if sold separately by Takeda, its Affiliates or sublicensees in such country, and B is the average invoice price of the other active ingredient(s) in the Combination Product, if sold separately by Takeda,

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its Affiliates or sublicensees in such country.  If, on a country-by-country basis, the other active ingredient(s) in the Combination Product is not sold separately by Takeda, its Affiliates or sublicensees in such country, Net Sales for the purpose of determining royalties of the Combination Product shall be calculated by multiplying actual Net Sales of such Combination Product by the fraction A/D, where A is the average invoice price of the Product containing the Licensed Compound(s) as the only active ingredient(s), if sold separately by Takeda, its Affiliates or sublicensees in such country, and D is the average invoice price of the Combination Product in such country.  If neither the Product containing the Licensed Compound(s) as the only active ingredient(s) nor the other active ingredient(s) in the Combination Product is sold separately in a given country by Takeda, its Affiliates or sublicensees, the Parties shall determine Net Sales for such Combination Product by mutual agreement based on the relative contribution of the Product and the other active ingredient(s) in the Combination Product.  For clarification, the provisions of this paragraph shall not apply to any Combination Product that contains both an Amylin Licensed Compound and a Takeda Licensed Compound as clinically active ingredients.

For purposes of the preceding paragraph, the invoice price of a Product containing the Licensed Compound(s) as the only active ingredient(s) sold separately for an indication designated as an “Orphan Product” under the U.S. Orphan Drug Act, as amended, shall not be used to calculate Net Sales for any Combination Product, except any such Combination Product that is used for an indication designated as an “Orphan Product” under the U.S. Orphan Drug Act, as amended.

1.81        “New Project” shall have the meaning set forth in Section 3.5.2.

1.82        “Obesity Indication” shall mean any indication included in Section 1.51(i).

1.83        “OCC” shall mean the Obesity Commercialization Committee established under Section 2.3.

1.84        “ODC” shall mean the Obesity Development Committee established under Section 2.2.

1.85        “Option Compound” shall have the meaning set forth in Section 3.3.

1.86        “OSC” shall mean the Obesity Steering Committee established under Section 2.1.

1.87        “Pacira Agreement” shall mean that certain Development and License Agreement between Pacira Pharmaceuticals, Inc. (“Pacira”) and Amylin, dated as of March 31, 2008, as amended.

1.88        “Partial Termination” shall have the meaning set forth in Section 13.2.

1.89        “Patent Challenge” shall have the meaning set forth in Section 13.2.2.

1.90        “Patents” shall mean: (i) all patents, certificates of invention, applications for certificates of invention, priority patent filings and patent applications, including patent applications under the Patent Cooperation Treaty and the European Patent Convention; together with (ii) any renewal, division, continuation (in whole or in part), or request for continued

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examination of any of such patents, certificates of invention and patent applications, and any and all patents or certificates of invention issuing thereon, and any and all reissues, reexaminations, extensions, divisions, renewals, substitutions, confirmations, registrations, revalidations, revisions, and additions of or to any of the foregoing, and any foreign counterparts of any of the foregoing and any other patents and patent applications claiming priority back to any of the foregoing.

1.91        “Payment Report” shall have the meaning set forth in Section 3.11.4.

1.92        “Person” shall mean a natural person, a corporation, a partnership, a trust, a joint venture, a limited liability company, any Regulatory Authority or any other entity or organization.

1.93        “Phase 1 Clinical Trial” shall mean a clinical trial of a Product conducted in a small number of human volunteers in any country designed or intended to establish an initial safety profile, pharmacodynamics, or pharmacokinetics of a Product.

1.94        “Phase 2 Clinical Trial” shall mean a clinical trial of a Product conducted in human patients in any country to determine initial efficacy and dose range finding before embarking on a Phase 3 Clinical Trial.

1.95        “Phase 3 Clinical Trial” shall mean a pivotal clinical trial of a Product conducted in human patients in any country with a defined dose or a set of defined doses of a Product designed to ascertain efficacy and safety of such Product for the purpose of submitting applications for Regulatory Approval to the competent Regulatory Authorities.

1.96        “Phase 4 Clinical Trial” shall mean a clinical trial of a Product conducted in human patients in any country after Regulatory Approval of such Product in such country.

1.97        “Post-Approval Clinical Trials” shall mean Phase 3 Clinical Trials or Phase 4 Clinical Trials in any country of the Territory, the results of which are intended, as of the date each such clinical trial commences, to be used to support an expanded label claim for a Product (and not to obtain Regulatory Approval for an additional indication) in the Territory (even if such expanded label claims are marketed in the Territory under a different marketing authorization or trademark), or otherwise support marketing of a Product in the Territory, regardless of whether such clinical trial is commenced prior to filing of the Regulatory Approval for such Product in the Territory. For the avoidance of doubt, a Post-Approval Clinical Trial shall not include a Phase 3 Clinical Trial or Phase 4 Clinical Trial, the results of which are required by a Regulatory Authority or otherwise intended to be used to support the continued Regulatory Approval of a Product in a given indication in the Field in a country in the Territory, even if such Phase 3 Clinical Trial or Phase 4 Clinical Trial is commenced after Regulatory Approval of such Product in such indication in such country.

1.98        “Primary Detail Equivalent” or “PDE” shall mean a numerical amount that scores the value of Details performed by Medical Sales Representatives as follows: [***] for each First Position Detail, and [***] for each Second Position Detail.

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1.99        “Product” shall mean any formulated, or formulated and packaged (as the context requires), pharmaceutical product containing or comprising: (i) any Licensed Compound as the sole active ingredient; or (ii) any Licensed Compound in combination with one or more other Licensed Compound(s), or clinically active ingredient(s) other than Licensed Compound(s); provided, however, Product shall not include any Excluded Product.  In addition, each separate formulation of a Licensed Compound that: (a) utilizes an Alternative Delivery System; or (b) is administered on a meaningfully different frequency (e.g., BID Product, QD Product and QW Product) shall be considered a separate Product.  As an example, (1) a Product containing Davalintide as the sole active ingredient and a Product containing Davalintide in combination with another clinically active ingredient, such as OPT, would be considered two (2) separate Products; and (2) a Product containing Davalintide in a BID injectable presentation, and a Product containing Davalintide administered via an Alternate Delivery System (e.g., sublingual or transdermal), would also be considered two (2) separate Products. Additionally, for clarification purposes, Davalintide in two (2) different dosage strengths, but not in different frequencies of administration or administered via an Alternate Delivery System, would not be considered separate Products.

1.100      “Product Liabilities” shall mean all losses, damages, fees, costs and other liabilities incurred by a Party or its Affiliates and resulting from human use of  a Licensed Compound or Product in Clinical Trials (including Regulatory Approval Clinical Trials, but excluding Post-Approval Clinical Studies), but excluding all losses, damages, fees, costs and other liabilities that are a result of a Party’s or its Affiliates’ negligence, gross negligence, willful misconduct or breach of such Party’s representations and warranties made hereunder.  For the avoidance of doubt, Product Liabilities include reasonable attorneys’ and experts’ fees and costs relating to any claim or potential claim by any Third Party against a Party or its Affiliates, and all losses, damages, fees, costs and other liabilities associated with the voluntary or involuntary withdrawal of a Product, or seizure of a Product by a Regulatory Authority.

1.101      “Proposing Party” shall have the meaning set forth in Section 3.5.2.

1.102      “Psylin Agreement” shall mean that certain Technology License and Option Agreement between Psylin Neurosciences, Inc. (“Psylin”) and Amylin, dated as of January 25, 2007, as amended.

1.103      “QD Product” shall mean any Product formulated for once daily (QD) injectable administration.

1.104      “Quarterly Report” shall have the meaning set forth in Section 3.11.4.

1.105      “QW Product” shall mean any Product formulated for once weekly (QW) or less frequent injectable administration.

1.106      “Regulatory Approval” shall mean any approval or authorization of any Regulatory Authority in a particular jurisdiction that is necessary for the manufacture, use, storage, import, transport and/or sale of a Product in such jurisdiction in accordance with Applicable Laws.

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1.107      “Regulatory Approval Clinical Trials” shall mean Phase 3 Clinical Trials or Phase 4 Clinical Trials of a specific Product in any country of the Territory, which are: (i) not Post-Approval Clinical Trials; (ii) designed to generate specific safety data; and (iii) required by a Regulatory Authority, (a) as a condition to granting Regulatory Approval for such Product, or (b) to support the continued Regulatory Approval of such Product, even if such Phase 3 Clinical Trials or Phase 4 Clinical Trials are commenced prior to Regulatory Approval of a specific Product in any country of the Territory.

1.108      “Regulatory Authority” shall mean any national or supranational governmental authority, including the FDA and the EMEA, that has responsibility in any country or other regulatory jurisdiction over the Development and/or Commercialization of a Product in the Field in the Territory.

1.109      “Regulatory Materials” shall mean any regulatory submissions, notifications, registrations, approvals and/or other filings, including Clinical Trial master files and drug master files Controlled by a Party, made to or with a Regulatory Authority that may be necessary or reasonably desirable to Develop, manufacture, market, sell or otherwise Commercialize a Product in the Field in the Territory.

1.110      “Secondary Royalty Term” shall mean, on a Product-by-Product and country-by-country basis, the period of time commencing immediately upon the expiration of the Initial Royalty Term for a Product in a country and ending upon the earlier of: (i) the last day of the first calendar quarter in which the total units of a Generic Product sold in such country by one or more parties other than Takeda or its Affiliate or sublicensee equal or exceed the total units of the applicable Product sold in such country by Takeda or its Affiliate or sublicensee during such calendar quarter; or (ii) [***] ([***]) years after expiration of the Initial Royalty Term.

1.111      “Second Position Detail” shall mean a Detail where the presentation of a Product during the Detail is the presentation on which the second most amount of time is spent during such Detail.

1.112      “Shionogi Agreement” shall mean the license agreement between Amylin and Shionogi & Co., Ltd. dated July 8, 2009, as amended.

1.113      “Standstill Period” shall have the meaning set forth in Section 16.1.

1.114      “Takeda Compound Related Inventions” shall have the meaning set forth in Section 12.1.1.

1.115      “Takeda Indemnitee” shall have the meaning set forth in Section 14.2.

1.116      “Takeda Know-How” shall mean Information not included in the Takeda Patents that Takeda or its Affiliates Control on the Effective Date or during the Term, which Information is necessary to develop, make, have made, distribute, use, offer for sale, sell, import, export and otherwise Commercialize the Takeda Licensed Compounds and Products in the Field, including any replication or any part of such Information and including information and know-how that Takeda or any of its Affiliates Controls on the Effective Date or during the Term which is necessary or useful to conduct research on the Licensed Compounds and Products in the Field in

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the Territory in support of Development and Commercialization activities as contemplated by this Agreement (but excluding assays, computer programs, materials or other research tools).

1.117      “Takeda Licensed Compound” shall mean any Takeda Nominated Compound that is nominated by Takeda, and that Amylin agrees to add to this Agreement, pursuant to Section 3.4.

1.118      “Takeda Nominated Compound” shall have the meaning set forth in Section 3.4.

1.119      “Takeda Patents” shall mean all Patents that Takeda Controls as of the Effective Date or during the Term, which Patents are necessary to research, develop, make, have made, distribute, use, offer for sale, sell, import, export and otherwise Commercialize the Takeda Licensed Compound and Products in the Field, but excluding Joint Patents.

1.120      “Takeda Technology” shall mean the Takeda Know-How and Takeda Patents.

1.121      Takeda Y-family Agonists” shall mean: (i) the Analogs of Y-family agonists Controlled by Takeda as of the Effective Date and listed on Exhibit E; and (ii) the Analogs of any of the compounds identified in Section 1.121(i) that may come under the Control of Takeda or its Affiliates during the Term.

1.122      “Term” shall have the meaning set forth in Section 13.1.

1.123      “Terminated Country” shall have the meaning set forth in Section 13.3.1.

1.124      “Terminated Product” shall have the meaning set forth in Section 13.3.1.

1.125      “Territory” shall mean all the countries of the world.

1.126      “Third Party” shall mean a Person other than Takeda and its Affiliates and Amylin and its Affiliates.

1.127      “Third Party Agreement” shall have the meaning set forth in Section 16.1.

1.128      “Third Party Development Costs” shall mean costs and expenses for the Development of Licensed Compounds or Products paid or payable by a Party, or for its account, to a Third Party relating to: (i) professional services; (ii) contract research services; (iii) research grants; (iv) clinical grants; (v) consultants; (vi) clinical investigation start-up meetings; (vii) Clinical Trials, including Regulatory Approval Clinical Trials, but excluding Post-Approval Clinical Trials and any Phase 2 Clinical Trial for Davalintide that is on-going as of the Effective Date; (viii) contract labor; (ix) obtaining Regulatory Approval, but excluding costs relating to maintaining Regulatory Approval; and (x) other activities approved by the Parties in the Development Plan.

1.129      “Third Party Standstill Provisions” shall have the meaning set forth in Section 16.1.

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1.130      “Tier 1 Product” shall have the meaning set forth in Section 8.3.1.

1.131      “Tier 2 Product” shall have the meaning set forth in Section 8.3.2.

1.132      “Tier 3 Product” shall have the meaning set forth in Section 8.3.3.

1.133      “UM Agreement” means that certain Confidential Agreement and Release of All Claims among the University of Minnesota and Per Westermark (collectively, “UM”) and Amylin, dated October 21, 1998, as amended.

1.134      “United States” or “U.S.” shall mean the United States of America, its territories and possessions including Puerto Rico and the District of Columbia.

1.135      “U.S. Development Costs” shall mean those Development Costs incurred by a Party, or for its account, in connection with Development activities necessary for or intended to support obtaining Regulatory Approval of Products in the Field in the United States, which Development activities are consistent with the Development Plan and calculated in accordance with Section 3.11, even if such Development activities also support obtaining Regulatory Approvals in countries in the Territory other than the United States.  For the avoidance of doubt, Development Costs relating to Development activities that take place outside the United States, but are necessary for or intended to support obtaining Regulatory Approval of Products in the Field in the United States, shall be considered U.S. Development Costs.

1.136      “Valid Claim” shall mean a claim of an issued patent within the Amylin Patents, Takeda Patents, or Joint Patents which has not expired, been disclaimed, been cancelled or superseded (or if cancelled or superseded, has been reinstated) or been revoked, held invalid, or otherwise declared unenforceable or not allowable by a tribunal or patent authority of competent jurisdiction over such claim in such country from which no further appeal has or may be taken.

1.137      “Withdrawal Notice” shall have the meaning set forth in Section 2.5.

2.             GOVERNANCE

2.1          Obesity Steering Committee.  The Parties will establish the OSC to oversee the activities of the Parties pursuant to this Agreement.

2.1.1       Composition.  The OSC will be comprised of an equal number of members appointed by each of Takeda and Amylin, each of whom shall be senior enough within the applicable Party’s organization to have decision-making authority with respect to Development or Commercialization of the Licensed Compounds and Products as if such Licensed Compounds and Products were proprietary to such Party.  Each Party shall designate [***] ([***]) OSC representatives promptly after the Effective Date.  The Parties, through the OSC, may later change the number of OSC members as long as an equal number of members from each of Takeda and Amylin is maintained.  Each Party may change its OSC members at any time by written notice to the other Party, which may be delivered at a scheduled meeting of the OSC.  Each Party shall designate one of its representatives on the OSC as a co-chair of the OSC. The chairmanship of the OSC shall alternate between the Parties for each consecutive [***] period following the Effective Date, and the first chairman of the OSC shall be a

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representative of Takeda.  The role of the chairman shall be to convene and preside at meetings of the OSC, but the chairman shall not be entitled to prevent items from being discussed or to cast any tie breaking vote.

2.1.2       Responsibilities.  The OSC shall be responsible for setting the overall strategic direction relating to the global Development and Commercialization of Licensed Compounds and Products in the Field in the Territory.  The specific responsibilities of the OSC shall be:

(a)           Reviewing and approving the Development Plan and Development Budget for the United States, and any amendments thereto, submitted by the ODC; provided, further, the OSC shall approve the designation of, or designate, as applicable, those Development Costs which are U.S. Development Costs;

(b)           Reviewing, but not approving, the Development Plan and Development Budget for countries in the Territory other than the United States;

(c)           If Amylin exercises the Co-Commercialization Option, reviewing and approving the Commercialization Plan for the United States and any amendments thereto submitted by the OCC;

(d)           If Amylin does not exercise, or has not yet exercised, the Co-Commercialization Option, reviewing, but not approving, the Commercialization Plan for the United States and any amendments thereto submitted by the OCC.

(e)           Reviewing, but not approving, the Commercialization Plan for countries in the Territory other than the United States, and any amendments thereto submitted by the OCC.

(f)            Establishing such joint teams and subcommittees as it deems necessary to fulfill this Agreement;

(g)           Resolving any disputes among such joint teams or subcommittees, including the ODC, subject to the terms of this Agreement;

(h)           Developing and implementing  reporting mechanisms for the ODC and OCC; and

(i)            Approving and/or deciding such other matters as may be provided elsewhere in this Agreement.

The OSC shall periodically, but no less than [***], review the results of the Development Plan and Commercialization Plan with respect to Products in the Field in the Territory to ensure, to the extent reasonably practical, that the Parties are meeting their commitments for both human and financial support and are each fulfilling all of their respective contractual obligations.  The OSC shall resolve any disputes referred to it in accordance with Section 2.1.4 below.

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2.1.3       Meetings.  The OSC will hold an in-person organizational meeting at Amylin’s offices in San Diego, California to establish the OSC’s operating procedures.  After such initial meeting, the OSC will meet at such other times as are agreeable to a majority of the OSC members, but no less than once each calendar quarter.  Such meetings may be in-person, via videoconference, or via teleconference.  Meetings may only be held if at least [***] ([***]) OSC members from each Party are present and participating. After the initial meeting above, the location of in-person OSC meetings will alternate between San Diego, California and Chicago, Illinois, unless the Parties otherwise agree.  Each Party will bear the expense of its respective OSC members’ participation in OSC meetings. With the prior consent of the other Party’s members, (such consent not to be unreasonably withheld or delayed), each Party may invite non-members to participate in the discussions and meetings provided that such participants shall have no voting rights or powers and shall be subject to the confidentiality provisions in Article 10. Additional meetings of the OSC may also be held to resolve any dispute referred to the OSC. Meetings to resolve disputes shall be held within [***] following referral to the OSC or as soon as reasonably practical.  All agenda items proposed by a Party for discussion or decision at a meeting must be provided to the Alliance Manager responsible for the agenda for the next meeting, together with appropriate information related thereto, at least [***] in advance of the meeting.  Material decisions reached at a meeting will be documented by both Parties before the meeting ends.  Reasonably detailed written minutes will be kept of all OSC meetings and will reflect material decisions made at such meetings.  The Alliance Manager of the same Party as the acting chairman of the OSC shall be responsible for (i) preparing and circulating an agenda for each upcoming OSC meeting, and (ii) preparing and issuing the meeting minutes to each member of the OSC for review and approval within [***] after such meeting.  Minutes will be deemed approved unless a member of the OSC objects to the accuracy of such minutes within [***] of receipt.

2.1.4       Decisions.  All OSC decisions will be made by unanimous vote, with the representatives of Amylin on the OSC collectively having one vote and the representatives of Takeda on the OSC collectively having one vote; provided, however, that in no event shall the OSC have the right or power to resolve any such matter in a manner that conflicts with the provisions of this Agreement or to unilaterally amend or modify this Agreement.  [***].  If the OSC is unable to decide or resolve unanimously any other matter within [***] following the presentation of such matter to the OSC (or such longer period as agreed by the OSC), including any matter that may result in U.S. Development Costs, the matter shall be submitted for resolution in accordance with the dispute resolution provisions set forth in Article 15; provided, however, notwithstanding the foregoing, failure of the OSC to unanimously approve the following activities will not be subject to the provisions of Sections 15.2 and 15.3: [***]. For clarification, the determination by

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either Party that a safety issue exists permitting termination of this Agreement under Section 13.2.3(a) shall not be subject to the dispute resolution provisions contained in Sections 15.2 and 15.3; provided, however, if a Party believes in good faith that the election by the other Party to terminate this Agreement under Section 13.2.3(a) was a breach of this Agreement because the electing Party had not in fact determined that a safety issue permitting such termination existed, then such dispute shall be subject to the dispute resolution provisions contained in Sections 15.2 and 15.3.

2.2          Obesity Development Committee.  The Parties will establish the ODC to create and implement the Development Plan and oversee the Development activities performed pursuant to this Agreement.

2.2.1       Composition.  The ODC will be comprised of an equal number of members appointed by each of Takeda and Amylin.  Each Party shall designate [***] ([***]) ODC representatives within [***] after the Effective Date. The ODC may later change the number of ODC members as long as an equal number of members from each of Takeda and Amylin is maintained.  Each Party may change its ODC members at any time by written notice to the other Party, which may be delivered at a scheduled meeting of the ODC.  Each ODC representative shall have appropriate expertise regarding the clinical development of pharmaceutical products, and each Party shall designate one of its representatives on the ODC as a co-chair of the ODC. The chairmanship of the ODC shall alternate between the Parties for each consecutive [***]  following the Effective Date, and the first chairman of the ODC shall be a representative of Amylin.  The role of the chairman shall be to convene and preside at meetings of the ODC, but the chairman shall not be entitled to prevent items from being discussed or to cast any tie breaking vote.

2.2.2       Responsibilities.  The ODC will be responsible for the creation and implementation of the Development Plan and corresponding Development Budget, including designating in the Development Budget those Development Costs which constitute U.S. Development Costs, and for overseeing the Parties’ performance of the activities pursuant to the Development Plan in accordance with Section 3.1, and recommending such Development Plan and Development Budget to the OSC for approval.  The ODC shall at all times coordinate the efforts of the Parties with respect to the conduct of the Development Plan; provided that the Party responsible for carrying out activities assigned to it under the Development Plan will have decision-making rights with regard to day-to-day conduct of such activities.  The ODC will also be responsible for determining whether to recommend to the OSC for approval any amendments to the Development Plan or Development Budget proposed by either Party.  The ODC will provide to the Parties copies of any recommended Development Plan or Development Budget before submission to the OSC.

2.2.3       Operation.  At least quarterly, a member of the ODC for each Party shall provide to the other Party a reasonably detailed summary of the Development activities conducted by such Party, including reconciliation of the expenses against the Development Budget, and the co-chairs of the ODC shall discuss the results of such activities, either in person or by telephone or videoconference.  The co-chairs of the ODC will jointly prepare and provide to the OSC, on at least a quarterly basis a report, via e-mail, regarding the status of Development activities hereunder.  The ODC will review the progress of the activities carried out pursuant to

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the Development Plan, including whether such activities are in compliance with the Development Budget.

2.2.4       Meetings.  So long as the Parties continue to conduct Development activities, the ODC will meet on a regular basis, but at least once per [***], unless otherwise agreed by the Parties.  Such meetings may be in-person, via videoconference, or via teleconference.  Meetings may be held only if at least [***] ([***]) members from each Party are present and participating.  The location of in-person ODC meetings will alternate between San Diego, California and Chicago, Illinois, unless the Parties otherwise agree.  With the prior consent of the other Party’s members (such consent not to be unreasonably withheld or delayed), each Party may invite non-members to participate in the discussions and meetings provided that such participants shall have no voting rights or powers and shall be subject to the confidentiality provisions in Article 10.  At least [***] prior to each ODC meeting, each Party shall provide written notice to the Alliance Manager of the Party chairing the meeting of agenda items proposed by such Party for discussion or decision at such meeting, together with appropriate information related thereto.  Material decisions reached at a meeting will be documented before the meeting ends.  Reasonably detailed written minutes will be kept of all ODC meetings and will reflect material decisions made at such meeting.  The Alliance Manager of the same Party as the acting chairman of the ODC shall be responsible for: (i) preparing and circulating an agenda for each upcoming OSC meeting; and (ii) preparing and issuing the meeting minutes which will be sent to each member of the ODC for review and approval within [***] after such meeting.  Minutes will be deemed approved unless a member of the ODC objects to the accuracy of such minutes within [***] of receipt.

2.2.5       Decisions.  All ODC decisions that may result in U.S. Development Costs will be made by unanimous vote, with the representatives of Amylin on the ODC collectively having one (1) vote and the representatives of Takeda on the ODC collectively having one (1) vote. Takeda will have sole decision making authority regarding Development activities for the Territory outside of the United States, provided Takeda consider in good faith input from Amylin with respect to such activities.  In the event of a dispute on any matter within the responsibilities of the ODC regarding Development activities that may result in U.S. Development Costs, such matter shall be referred to the OSC for resolution in accordance with the procedures set forth in Section 2.1.4.  In no event shall the ODC have the right or power to resolve any such matter in a manner that conflicts with the provisions of this Agreement or to unilaterally amend or modify this Agreement.

2.2.6       Subcommittees.  The ODC may establish such subcommittees as it may deem desirable.  All such subcommittees shall have equal representation from each Party unless the Parties expressly agree otherwise.  A subcommittee chairman shall be appointed by each Party, which subcommittee chairman shall report to the ODC as needed or required by the ODC.

2.3          Obesity Commercialization Committee.  The Parties will establish the OCC to review the conduct and progress of Commercialization of Products in the Field in the Territory.

2.3.1       Composition.  The OCC will be comprised of an equal number of members appointed by each of Takeda and Amylin. Each Party shall designate [***] ([***]) OCC representatives within [***] after the Effective Date.  The Parties, through the OCC,

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may later change the number of OCC members as long as an equal number of members from each of Takeda and Amylin is maintained.  Each Party may change its OCC members at any time by written notice to the other Party, which may be delivered at a scheduled meeting of the OCC.  Takeda shall designate one of its representatives on the OCC as the chairman of the OCC. The chairman will be responsible to convene and preside at meetings of the OCC, and the Takeda Alliance Manager shall be responsible for preparing and issuing the minutes of each such meeting and preparing and circulating an agenda for each upcoming meeting, but neither the Alliance Manager nor the chairman shall have any special authority over the other members of the OCC and shall not be entitled to prevent items from being discussed.

2.3.2       Responsibilities.  The OCC will provide a forum for the Parties to review the conduct and progress of the Commercialization of the Products in the Field in the Territory and for Amylin to provide input to Takeda regarding the Commercialization Plan prepared by Takeda and such Commercialization activities. Takeda will take Amylin’s input into consideration in good faith.  In addition, an OCC representative(s) shall be responsible for providing input at ODC meetings, as necessary.

2.3.3       Meetings.  The OCC will meet on a regular basis as determined by the Parties, but at least once per [***]. Such meetings may be in-person, via videoconference, or via teleconference.  The location of in-person OCC meetings will alternate between San Diego, California and Chicago, Illinois, unless the Parties otherwise agree.  Each Party will bear the expense of its respective OCC members’ participation in OCC meetings.  At least [***]  prior to each OCC meeting, each Party shall provide written notice to Takeda’s Alliance Manager of agenda items proposed by such Party for discussion or decision at such meeting, together with appropriate information related thereto.  Material decisions reached at a meeting will be documented before the meeting ends.  Reasonably detailed written minutes will be kept of all OCC meetings and will reflect material decisions made at such meeting.  Meeting minutes will be sent to each member of the OCC for review and approval within [***] after a meeting.  Minutes will be deemed approved unless a member of the OCC objects to the accuracy of such minutes within [***] of receipt.

2.3.4       Decisions.  All OCC decisions will be made by Takeda after considering in good faith input from Amylin, including OCC decisions made after Amylin exercises the Co-Commercialization Option with respect to a Product.  In no event shall the OCC have the right or power to resolve any matter in a manner that conflicts with the provisions of this Agreement, or to unilaterally amend or modify this Agreement. For purposes of clarification only, and without limiting the foregoing, the OCC shall not have the right or power to make any decision that would result in U.S. Development Costs, unless such U.S. Development Costs are approved by the ODC in accordance with Section 2.2.5, and the OSC in accordance with Section 2.1.4.

2.3.5       Subcommittees.  The OCC may establish such committees as it deems desirable.  All such subcommittees shall have equal representation from each Party, unless the Parties specifically agree otherwise.

2.4          Alliance Managers.  Within [***] after the Effective Date, Amylin and Takeda each shall appoint a person from within their respective organizations (an “Alliance

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Manager”) to coordinate and facilitate the interaction and cooperation of the Parties pursuant to this Agreement.  The Alliance Managers shall be the primary contact between the Parties with respect to the activities conducted pursuant to this Agreement.  Each Party shall notify the other Party promptly of any change in the identity of the Alliance Manager.

2.5          Withdrawal.  At any time during the Term and for any reason, Amylin shall have the right to withdraw from participation in the OSC, ODC and/or OCC (each, a “Committee”) upon written notice to Takeda, which notice shall be effective immediately upon receipt (the “Withdrawal Notice”). Following the issuance of a Withdrawal Notice and subject to this Section 2.5, Amylin’s representatives to the applicable Committee shall not participate in any meetings of the applicable Committee, nor shall Amylin have any right to vote on decisions within the authority of the applicable Committee.  If, at any time, following the issuance of a Withdrawal Notice, Amylin wishes to resume participation in the applicable Committee, Amylin shall notify Takeda in writing and, thereafter, Amylin’s representatives to the applicable Committee shall be entitled to attend any subsequent meeting of such Committee and to participate in the activities of, and decision-making by, such Committees as provided in this Article 2 as if a Withdrawal Notice had not been issued by Amylin; provided, further, if Amylin returns to a particular Committee and again withdraws from such Committee in accordance with this Section 2.5, it may return to such Committee only upon receipt of prior written consent from Takeda.  Following Amylin’s issuance of a Withdrawal Notice, unless and until Amylin resumes participation in the applicable Committee in accordance with this Section 2.5: (i) all meetings of the applicable Committee shall be held at Takeda’s facilities; (ii) Takeda shall have the right to make the final decision on all matters within the scope of authority of such Committee; and (iii) Amylin shall have the right to continue to receive the minutes of such Committee meetings, but shall not have the right to approve the minutes for any such Committee meeting held after Amylin’s issuance of a Withdrawal Notice.

3.             DEVELOPMENT

3.1          Development Plan.  The Development of Products in the Field in the Territory shall be governed by a comprehensive Development Plan, including a Development Budget.  The ODC shall coordinate with the OCC to ensure that the Development Plan appropriately supports Commercialization efforts with regard to Products in the Field in the Territory.  The Parties through the ODC shall update and amend the [***] Development Plan within [***]  after the Effective Date, which such updated Development Plan shall include: (i) all clinical and non-clinical Development activities (e.g., CMC and toxicology); and (ii) the Development Budget.  Thereafter, for each calendar year during the Term, the Parties through the ODC shall update and amend the [***] Development Budget no later than [***] ([***]) of [***], which updates shall cover the ensuing [***] and include a [***] plan for the [***] of the [***] period.  The [***]  of each approved [***] Development Budget shall be a Binding Budget, unless otherwise mutually agreed upon by the Parties in the Development Plan.  The [***] of such approved [***] Development Budget will be a Binding Budget at [***] percent ([***] %) of the levels indicated, unless otherwise mutually agreed upon by the Parties in the Development Plan.  The [***]  of such approved Development Budget will be a good faith forecast and not a Binding Budget.  At least [***] ([***]) times per [***], the ODC will review the existing [***] Development Budget in

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order to update at least the first [***] of the forecast to reflect significant changes to the operating assumptions based on, among other factors, the most current data from Clinical Trials and Regulatory Authority guidance.  This [***] forecast will serve as the basis for the construction of the Binding Budget in the following year.  If the ODC cannot agree on a Binding Budget for the succeeding calendar year (and the OSC cannot resolve any such disagreement), the Parties agree to fund only [***] until such time as the Parties have resolved any such disagreement pursuant to Article 15.

3.2          Development Activities. Each of Amylin and Takeda shall use Commercially Reasonable Efforts to execute and perform its responsibilities, and cooperate with the other Party in its efforts to execute and perform its responsibilities, under the Development Plan including the Development Plan attached hereto as Exhibit B.  Subject to the terms and conditions of this Agreement, and except as otherwise agreed by the Parties in the Development Plan: (i) Amylin shall be responsible for the execution of all Development activities for each Product through the completion of all Phase 2 Clinical Trials of such Product for the purpose of obtaining Regulatory Approval in the United States; and (ii) Takeda shall be responsible for the execution of all other Development activities for the purpose of obtaining Regulatory Approval in the United States and in other countries of the Territory, in each case as set forth in the Development Plan and Development Budget for each Product; provided, further, for the avoidance of doubt, Takeda shall be responsible for the execution of all Phase 3 Clinical Trials, Post-Approval Clinical Trials and Regulatory Approval Clinical Trials of Products.  The ODC shall determine and set forth in the Development Plan the respective responsibilities of each of the Parties with respect to all Development activities other than the Development activities otherwise described in this Section 3.2, and in Section 6.1 regarding the manufacture and provision of clinical supplies for use in Development activities.

3.3          Option Compounds.  Amylin shall have: (i) other than for Analogs of Amylin Licensed Compounds subject to the terms and conditions of Section 3.3(ii), the right, but not the obligation, to nominate any analog of any of the Amylin Licensed Compounds listed in Section 1.8(i)—(iv), provided such analog is not already an Amylin Licensed Compound and/or listed on Exhibit C, to be added as an Amylin Licensed Compound under this Agreement; and (ii) the obligation to nominate as an additional Amylin Licensed Compound under this Agreement, within a timeframe commencing [***] prior to and ending [***] after the commencement of IND-enabling activities (e.g., GLP toxicity studies) by Amylin, any Analog of any of the Amylin Licensed Compounds listed in Section 1.8(i)—(iv), which Analog demonstrates as a monotherapy, or as a combination therapy with a Licensed Compound or another Analog of any Licensed Compound (provided such combination therapy demonstrates a greater weight loss effect than either the Licensed Compound or Analog thereof as a monotherapy), weight loss that is equal to or exceeds [***] percent ([***] %) in a composite of pre-clinical studies and/or animal models, or any clinical trial.  If Amylin nominates any analog or Analog to be added as an Amylin Licensed Compound pursuant to Section 3.3(i) or (ii) above, it will provide a written notice to Takeda identifying such analog or Analog, and provide such other information, including applicable pre-clinical study results and clinical trial results, as may be reasonably necessary for Takeda to determine whether to add such analog or Analog as an Amylin Licensed Compound.  Takeda shall have [***] from the date of receipt of such written notice to inform Amylin it desires to add such analog or Analog as an Amylin

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Licensed Compound.  If Takeda informs Amylin in writing within such [***] ([***]) day time period that it does desire to add such analog or Analog as an Amylin Licensed Compound, then: (a) such analog or Analog shall immediately become an “Option Compound” and be considered an Amylin Licensed Compound hereunder; and (b) the ODC shall modify the Development Plan to provide for Development of the Option Compound.  If Takeda informs Amylin in writing that it does not desire to add such analog or Analog as an Amylin Licensed Compound, or otherwise fails to respond to such written notice from Amylin within such [***] ([***]) day time period, then such analog or Analog shall not be an Option Compound and shall not be added as an Amylin Licensed Compound, and Amylin shall be free to develop such analog or Analog independently at its own expense; provided, however, if Amylin subsequently develops in the Field any analog or Analog that was subject to the procedures set forth in this Section 3.3 but was not added as an Amylin Licensed Compound, such analog or Analog shall be subject to the provisions of Section 3.5.2 regarding the right of Takeda to opt-in to the Development of such analog or Analog (as if references to “Licensed Compound or Product” in Section 3.5.2 referred instead to “analog or Analog of Amylin Licensed Compound”).

3.4          Takeda Y-family Agonists and Takeda Nominated Compounds.  Takeda shall have: (i) other than for any Takeda Y-family Agonist subject to the terms and conditions of Section 3.4(ii), the right, but not the obligation, to nominate any analog of a Takeda Y-family Agonist to be added as a Takeda Licensed Compound under this Agreement; and (ii) the obligation to nominate as an additional Takeda Licensed Compound under this Agreement, within a timeframe commencing [***] prior to and ending [***] after commencement of IND-enabling activities (e.g., GLP toxicity studies) by Takeda, a Takeda Y-family Agonist if such Takeda Y-family Agonist demonstrates as a monotherapy, or as a combination therapy with a Licensed Compound or an Analog of a Licensed Compound (provided such combination therapy demonstrates a greater weight loss effect than either the Licensed Compound or Analog thereof as a monotherapy), weight loss that is equal to or exceeds [***] ([***] %) in a composite of pre-clinical studies and/or animal models, or any clinical trial. If Takeda nominates any analog of a Takeda Y-family Agonist under Section 3.4(i) or a Takeda Y-family Agonist under Section 3.4(ii) (any of the foregoing, a “Takeda Nominated Compound”) to be added as a Takeda Licensed Compound under this Agreement, it will provide a written notice to Amylin, identifying such Takeda Nominated Compound, and provide such other information, including applicable pre-clinical study results and clinical trial results, as may be reasonably necessary for Amylin to determine whether to add such Takeda Nominated Compound as a Takeda Licensed Compound under this Agreement.  Amylin shall have [***] from the date of receipt of such written notice to inform Takeda it desires to add such Takeda Nominated Compound as a Takeda Licensed Compound under this Agreement.  If Amylin informs Takeda in writing within such [***] time period that it does desire to add such Takeda Nominated Compound as a Takeda Licensed Compound under this Agreement, then: (a) such Takeda Nominated Compound shall immediately become a Takeda Licensed Compound hereunder; (b) the ODC shall modify the Development Plan to provide for Development of such Takeda Licensed Compound; and (c) the economic terms applicable to a Product containing such Takeda Licensed Compound shall be determined as set forth in Article 8.   If Amylin informs Takeda in writing that it does not desire to add such Takeda Nominated Compound as a Takeda Licensed Compound under this Agreement, or otherwise fails to respond to such written notice from Takeda within such [***] time period, then such Takeda Nominated Compound shall not be added as a Takeda Licensed Compound under this

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Agreement, and Takeda shall be free to develop such Takeda Nominated Compound independently at its own expense; provided, however, if Takeda subsequently develops in the Field any Takeda Nominated Compound that is a Takeda Y-family Agonist and was subject to the procedures set forth in this Section 3.4 but was not added as a Takeda Licensed Compound, such Takeda Y-family Agonist shall be subject to the provisions of Section 3.5.2 regarding the right of Amylin to opt-in to the Development of such Takeda Y-family Agonist (as if references to “Licensed Compound or Product” in Section 3.5.2 referred instead to “Takeda Y-family Agonist”).

3.5          Additional Development Activities

3.5.1       Collaborative Activities.  Before any Party engages in Development activities that may result in U.S. Development Costs with respect to any Licensed Compound or Product in the Field, and which activities are not included in the then-current Development Plan, such Party shall submit a proposal to the ODC for the Parties to engage jointly in such Development activities with respect to such Licensed Compound or Product.  If the ODC elects to proceed, the activities shall be incorporated into a draft Development Plan to be submitted to the OSC for approval.

3.5.2       Independent Activities.       If either Party (the “Proposing Party”) presents a proposal to the ODC to engage in Development activities that may result in U.S. Development Costs with respect to any Licensed Compound or Product in the Field, which such activities are not included in the then-current Development Plan (each, a “New Project”), and the OSC ultimately fails to approve the proposal due to the objection of the other Party, then the Proposing Party may conduct the New Project independently at its expense, subject to the following provisions:

(a)           If: (i) the New Project is a Phase 3 Clinical Trial for either an Amylin Licensed Compound or Product that contains Davalintide (AC2307), or an Amylin Licensed Compound or Product that contains both Pramlintide (AC137) and Metreleptin (AC164594); (ii) the New Project is not selected for a Phase 3 Clinical Trial pursuant to the Development Plan; and (iii) the other Amylin Licensed Compound or Product referenced in Section 3.5.2(a)(i) is selected for Phase 3 Clinical Trials pursuant to the Development Plan, each Party agrees that Takeda shall have the option, in its sole discretion, to delay the commencement of such New Project (for clarification, the Phase 3 Clinical Trial for the non-selected Amylin Licensed Compound or Product) for a period of up to [***] following the date of the initiation of the first Phase 3 Clinical Trial for such selected Amylin Licensed Compound or Product;

(b)           the Proposing Party shall conduct such activities solely at its expense and substantially in accordance with the plans presented to the OSC, and shall, at least annually, provide a report to the OSC of the results of such efforts, and provide to the other Party such additional information as it may reasonably request;

(c)           Within [***] after the date of database lock for the first Phase 2 Clinical Trial resulting from development activities regarding the New Project, the Proposing Party shall furnish to the OSC and the other Party a written report of the results of

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such trial, together with such other information available to the Proposing Party as the other Party may reasonably request.  The other Party shall then have a period of [***] in which to advise the Proposing Party whether it desires to include the New Project within the Development Plan contemplated by this Agreement.  If the other Party elects to include the New Project within the Development Plan: (i) if such other Party is Takeda, it shall pay to the Proposing Party an amount equal to [***] percent ([***] %) (which represents [***] percent ([***] %) of Takeda’s share of U.S. Development Costs) of the total Development Costs incurred to that date by the Proposing Party on the New Project; (ii) if such other Party is Amylin, it shall pay to the Proposing Party an amount equal to [***] percent ([***] %) (which represents [***] percent ([***] %) of Amylin’s share of U.S. Development Costs) of the total Development Costs incurred to that date by the Proposing Party on the New Project; and (iii) the New Project shall become part of the Development Plan contemplated by this Agreement, with each Party having the same rights and obligations with respect to the New Project as for any Licensed Compound or Product under this Agreement; and

(d)           If the other Party has not elected to include the New Project in the Development Plan pursuant to Section 3.5.2(c), then within [***] after the date of the database lock for the first Phase 3 Clinical Trial resulting from activities on the New Project, the Proposing Party shall furnish to the OSC and the other Party a written report of the results of such trial, together with such other information available to the Proposing Party as the other Party may reasonably request.  The other Party shall then have a period of [***] ([***]) days in which to advise the Proposing Party whether it desires to include the New Project within the Development Plan contemplated by this Agreement.  If the other Party  elects to include the New Project within the Development Plan: (i) if such other Party is Takeda, it shall pay to the Proposing Party an amount equal to [***] percent ([***] %) (which represents [***] percent ([***] %) of Takeda’s share of U.S. Development Costs) of the total Development Costs incurred to that date by the Proposing Party on the New Project, plus any milestones that would have otherwise been due under this Agreement; (ii) if such other Party is Amylin, it shall pay to the Proposing Party an amount equal to [***] percent ([***] %) (which represents [***] percent ([***] %) of Amylin’s share of U.S. Development Costs) of the total Development Costs incurred to that date by the Proposing Party on the New Project; (iii) the New Project shall become part of the Development Plan contemplated by this Agreement, with each Party having the same rights and obligations with respect to the New Project as for any Product under this Agreement.  If the other Party does not select to include the New Project in the Development Plan, the Proposing Party shall be free to develop and commercialize such Licensed Compound or Product independently or together with a Third Party without being subject to the terms of this Agreement.

3.6          Exchange of Information.  Promptly following the Effective Date, and promptly during the Term upon such Amylin Know-How being obtained or generated by Amylin, Amylin shall provide to Takeda, at no additional cost or expense to Takeda, all Amylin Know-How as is necessary to enable Takeda to conduct Development and Commercialization activities assigned to it under the Development Plan and Commercialization Plan or otherwise to practice the licenses granted to it hereunder, to the extent such Amylin Know-How has not previously been provided hereunder.  Promptly during the Term upon such Takeda Know-How being obtained or generated by Takeda, Takeda shall provide to Amylin, at no additional cost or expense to Amylin, all Takeda Know-How as is necessary to enable Amylin to conduct Development

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activities assigned to it under the Development Plan and, if Amylin has exercised its Co-Commercialization Option with respect to a Product, to co-Commercialize such Product in the Field in the United States.

3.7          Materials Transfer.  In order to facilitate the Development activities contemplated by this Agreement through the evaluation of compounds, either Party may provide to the other Party certain biological materials or chemical compounds Controlled by the supplying Party (collectively, “Materials”) for use by the other Party in furtherance of such Development activities.  Except as otherwise provided for under this Agreement, all such Materials delivered to the other Party will remain the sole property of the supplying Party, will be used only in furtherance of the Development activities conducted in accordance with this Agreement, will not be used or delivered to or for the benefit of any Third Party, except for subcontractors pursuant to Section 7.2.2, without the prior written consent of the supplying Party, and will be used in compliance with all Applicable Laws.  The Materials supplied under this Agreement must be used with prudence and appropriate caution in any experimental work because not all of their characteristics may be known. The supplying Party will provide the other Party the most current material safety data sheet for the Materials upon transfer of any Materials. Except as expressly set forth in this Agreement, THE MATERIALS ARE PROVIDED “AS IS” AND WITHOUT ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR ANY PARTICULAR PURPOSE OR ANY WARRANTY THAT THE USE OF THE MATERIALS WILL NOT INFRINGE OR VIOLATE ANY PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.

3.8          Records; Disclosure of Data and Results.  In conformity with standard pharmaceutical industry practices and the terms and conditions of this Agreement, each Party shall prepare and maintain, or shall cause to be prepared and maintained, complete and accurate written records, accounts, notes, reports and data with respect to activities conducted pursuant to the Development Program for a minimum of [***] following the end of the calendar year to which they pertain and, upon the other Party’s written request, shall send legible copies of the aforesaid to the other Party throughout the Term and for a minimum of [***] following the Term.  Upon reasonable advance notice, at the request of the ODC, each Party agrees to make its employees and consultants reasonably available at their respective places of employment to consult with the other Party on issues arising in connection with the Development Program.  In accordance with the reporting format and schedule approved by the ODC, each Party shall promptly and fully disclose to the other Party in writing all data, including preclinical data, Clinical Trial data, formulation data and manufacturing data, generated by or on behalf of such Party with respect to Products in the Field in the Territory.  Without limiting the foregoing, Takeda shall keep Amylin regularly and fully informed regarding the Development of Products in the Field in the Territory by Takeda and its Affiliates and sublicensees, including information regarding the status of Clinical Trials, filing of regulatory filings and receipt of Regulatory Approval with respect to Products in the Field in the Territory.

3.9          Compliance with Laws.  Each Party will conduct its portion of the Development Program using Commercially Reasonable Efforts, in a good scientific manner and in compliance in all material respects with all requirements of Applicable Laws, including cGCPs, cGLPs and cGMPs, to achieve the objectives of the Development Program efficiently and expeditiously.

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3.10        Cooperation.  Each Party will use Commercially Reasonable Efforts to provide the other Party with all reasonable assistance and take all actions reasonably requested by such other Party, without changing the allocation of responsibilities assigned in the Development Plan, that are necessary or desirable to enable the other Party to comply with the terms and intent of this Agreement.  Each Party further agrees to cooperate with any inspection by any Regulatory Authority, including, but not limited to, any inspection prior to Regulatory Approval for any Product in the Field in any country in the Territory.  The Parties will use Commercially Reasonable Efforts to conduct Development of and obtain Regulatory Approval for Products in the Field in the Territory, as provided in the Development Plan, for the purpose of maximizing the commercial value of the Products in the Field in the Territory.

3.11        Development Costs.

3.11.1     Responsibility for Development Costs.  Throughout the Term of this Agreement, Takeda shall bear eighty percent (80%) and Amylin shall bear twenty percent (20%) of all U.S. Development Costs, except in the case of U.S. Development Costs of any Regulatory Approval Clinical Trial that is a cardiovascular safety study that becomes required by the FDA and is not already included in the then-current Development Plan at the time it becomes required by the FDA (a “CV Safety Study”).  With respect to any CV Safety Study, Takeda shall bear [***] percent ([***] %) and Amylin shall bear [***] percent ([***] %) of all such U.S. Development Costs; provided, however, if the U.S. Development Costs of such CV Safety Study exceed, or are anticipated to exceed, [***] Dollars (US $[***]): (i) Takeda shall, upon Amylin’s written request, be obligated to pay all U.S. Development Costs that exceed [***] Dollars (US $[***]); and (ii) Amylin shall, within [***] following the database lock or earlier termination of the CV Safety Study (the “Database Lock Date”), reimburse Takeda an amount equal to [***] percent ([***] %) of such U.S. Development Costs that exceeded [***] Dollars (US $[***]), plus simple interest calculated at three-month LIBOR (the “Loan”). Amylin shall be required to pay at least [***]  ([***] %) of the Loan upon each of the [***] anniversary of the Database Lock Date and the [***] anniversary of the Database Lock Date; provided, however, Takeda shall have the right to set-off, in any calendar year, against any payments due from Takeda to Amylin under this Agreement by the amount that Amylin is obligated to pay Takeda for reimbursement of the Loan during such calendar year.  For the avoidance of doubt, Amylin may reimburse Takeda the full amount of the Loan prior to the due date with no prepayment penalty. Takeda shall bear one hundred percent (100%) of all Development Costs that are not U.S. Development Costs. The ODC shall identify in the Development Plan: (i) U.S. Development Costs; and (ii) Development Costs that are not U.S. Development Costs; provided, however, all Development Costs that are deemed to be necessary for the approval of an NDA filed with the FDA shall be considered U.S. Development Costs.

3.11.2     Calculation of Development Costs.  For purposes of calculating Development Costs, the FTE rate shall be [***] Dollars (US$[***]) per annum. The FTE rate shall be valid through and including [***].  The FTE rate shall be adjusted [***] as of [***]  effective as of [***]  in accordance with the annual percentage change in the [***], except as otherwise agreed by the Parties.  Development Costs shall only include the FTE rates of employees actually performing work under the Development Plan. General management and

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supervisory overhead costs incurred by each Party in connection with the performance of this Agreement shall not be included in the Development Costs (and shall be borne solely by the Party incurring such costs).  The Parties shall establish a mutually agreed upon format for reporting FTEs that are included within Development Costs.

3.11.3     Development Costs Exceeding Binding Budget.  Each Party agrees to use its Commercially Reasonable Efforts to complete the activities contemplated by a Binding Budget and to do so within the amounts budgeted.  The Parties acknowledge that actual expenditures may differ from budgeted amounts, and accordingly agree that the aggregate amount actually spent by a Party may be up to [***] percent ([***] %) higher than the amount specified in the Binding Budget.  In the event a Party’s Development Costs in the aggregate exceed the amount budgeted in any Binding Budget by more than [***] percent ([***] %), the ODC shall determine if such excess amount is reasonable under the circumstances.  If the ODC determines such excess amounts are reasonable, such amounts shall be deemed Development Costs; otherwise, the excess shall be the responsibility of that Party.

3.11.4     Payment.  Within [***] after the end of each calendar quarter, each Party will provide a written report to the other Party setting forth in reasonable detail the recorded Development Costs relating to such quarter (each, a “Quarterly Report”).  Within [***]  after the end of such calendar quarter, the Party responsible for reimbursement of Development Costs to the other Party will provide to the other Party a written report based upon such Quarterly Reports (each, a “Payment Report”) reconciling the Development Costs of each Party and setting forth the amount payable in accordance with this Section 3.11.  The amount due, as set forth in the applicable Payment Report, shall be paid concurrently with providing such Payment Report.

3.11.5     Corrections.  In the event either Amylin or Takeda discover a need for correction in calculating the amount of Development Costs incurred by such Party during any previous calendar quarter, it will promptly notify the other Party of such discovery.  The Parties will then discuss the validity and appropriateness of the correction.  If the Parties agree that such correction should be made and collectively verify the amount to be corrected, then such amounts shall be included in the following quarterly reconciliation between the Parties as set forth in Section 3.11.4 hereof; provided, however, that only corrections for expenses that have occurred in the previous [***] prior to the date of the notice described in the first sentence of this paragraph shall be eligible for correction.  If the Parties do not agree on the validity or appropriateness of the requested correction, then the OSC will be responsible for deciding the issue.

3.12        Audit.  During the period of the Development Program, each Party shall have the right to cause an independent, certified public accounting firm (the “Auditor”) reasonably acceptable to the other Party to audit the other Party’s records relating to Development Costs to confirm the amount of the Development Costs reflected in the Quarterly Reports and Payment Reports contemplated by Section 3.11.4. The audited Party may require such Auditor to sign a confidentiality agreement in form and substance reasonably satisfactory to the Party being audited.  Such audit right may be exercised during normal business hours upon reasonable prior written notice to the audited Party; provided that such audit right may be exercised no more than once in any [***] period and no more than once with regard to any given [***].

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The Auditor will prepare a report of the results of the audit and promptly deliver a copy to each Party. The Parties may make inquiries of the Auditor to clarify the contents of the report and the Auditor’s response will be made to both Parties.  As appropriate, prompt adjustments to payments made pursuant to Section 3.11.4 shall be made by the Parties to reflect the results of such audit. The Party to whom payment is owed will issue an invoice to the other Party. Such invoice will be paid within [***] of receipt. The auditing Party shall bear the full cost of such audit unless such audit discloses an over-reporting by the audited Party of more than [***] percent ([***] %) of the amount of Development Costs for a given calendar quarter, in which case, the audited Party shall bear the full cost of such audit.

4.             REGULATORY

4.1          Conduct of Regulatory Activities.  All regulatory activities for obtaining Regulatory Approval of Products in the Field in the Territory shall be conducted by and on behalf of the Parties in compliance with the provisions of this Agreement.  Takeda shall: (i) be responsible for all activities relating to preparing, making submissions for, owning and maintaining Regulatory Approvals, including supplements and amendments thereto, with respect to Products in the Field in the Territory; (ii) use Commercially Reasonable Efforts to obtain Regulatory Approval of the Products in the Field in the Territory; and (iii) lead discussions and meetings with all Regulatory Authorities regarding Licensed Compounds or Products in the Field in the Territory, subject to the terms of this Section 4.1; provided, however, a representative of Amylin shall be entitled to participate in any such discussions and meetings with Regulatory Authorities, and, if an appropriate Amylin representative is requested by Takeda to attend a discussion or meeting with the FDA regarding Licensed Compounds or Products in the Field in the Territory, Amylin will use Commercially Reasonable Efforts to arrange for such individual to participate in such discussions or meetings.  The ODC shall determine and set forth in the Development Plan the respective responsibilities of each of the Parties for all regulatory activities with respect to Products in the Field in the Territory other than the regulatory activities described in the immediately preceding sentence.  Each Party shall conduct all regulatory activities for which it is the responsible Party in accordance with the Development Plan, using Commercially Reasonable Efforts, and in compliance in all material respects with all Applicable Laws.  Upon request by the Party responsible for the applicable regulatory activities, the other Party shall provide reasonable assistance to such responsible Party with regard to such regulatory activities under this Agreement.  The Party responsible for the applicable regulatory activities agrees to consult with the other Party regarding, and keep the other Party regularly and fully informed of, the preparation, and Regulatory Authority review and approval, of submissions and communications with Regulatory Authorities with respect to Products in the Field in the Territory for which such Party is responsible.  Each Party agrees to consider in good faith any comments or suggestions made by the other Party with respect to such matters.  In addition to the information required to be provided to the other Party in other provisions of this Agreement, each Party shall timely provide the other Party with summaries of its communications and correspondence with the Regulatory Authorities in the Territory, including with respect to Product safety and manufacturing issues.  Amylin shall transfer to Takeda responsibility for regulatory activities with respect to each Product at the next specified phase of development (for example, upon advancement of a Product from Phase 2 Clinical Trials to Phase 3 Clinical Trials). In addition, Amylin shall either: (a) transfer to Takeda its current INDs related to Amylin Licensed Compounds that are not contained in an Excluded Product; or (b) permit Takeda to

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reference Amylin’s INDs related to Amylin Licensed Compounds that are contained in an Excluded Product, in each case pursuant to a mutually agreed upon timeline set forth in the Development Plan, which shall be not later than [***] in advance of the first to occur of (1) the start of the next Clinical Trial for such Amylin Licensed Compound; and (2) a significant meeting with the FDA regarding such Amylin Licensed Compound.

4.2          Right of Cross-Reference.  Takeda hereby grants Amylin the right to access and cross-reference all filings with and submissions to the Regulatory Authorities with respect to Products in the Field in the Territory as may be necessary or useful for Amylin to obtain Regulatory Approval with respect to Excluded Products.  Amylin hereby grants Takeda the right to access and cross-reference all filings with and submissions to the Regulatory Authorities with respect to Excluded Products as may be necessary or useful for Takeda to obtain Regulatory Approval with respect to Products in the Field in the Territory.

4.3          Regulatory Inspection or Audit.

4.3.1       Cooperation.  If a Regulatory Authority desires to conduct an inspection or audit of or sends a communication  to Takeda or Amylin or any Third Party engaged by either Party to perform activities under the Development Plan or Commercialization Plan with regard to any Product or this Agreement, Takeda and Amylin each agrees to cooperate with the Regulatory Authority and the other Party during such inspection or audit, including by allowing, to the extent practicable, a representative of the other Party to be present during the applicable portions of such inspection or audit.  Following receipt of the inspection or audit observations of the Regulatory Authority (a copy of which the Party will immediately provide to the other Party), the responsible Party will prepare the response to any observation that concerned this Agreement.  The other Party agrees to fully cooperate when it prepares such a response, including by providing to the responsible Party, within [***]  after its request, such information and documentation in the Party’s possession as may be necessary for the responsible Party to prepare such response.  Before submitting the response to the Regulatory Authority, the responsible Party agrees to give the other Party an opportunity to comment on it.

4.3.2       Notice.  Each Party (and its Third Party subcontractors) shall notify the other Party within [***] of receipt of notification from a Regulatory Authority of the intention of such Regulatory Authority to audit or inspect a Party’s facilities with respect to any Product, including facilities being used for manufacture of any Product.  Each Party (and its Third Party subcontractors) shall also provide the other Party with copies of any written communications received from Regulatory Authorities with respect to such facilities within [***] of receipt.  Such Party shall provide the other Party with an opportunity to review and provide input on any proposed response by such Party (or Third Party subcontractor) to such communications.

4.4          Pharmacovigilance.  Takeda shall be responsible, at its own expense, for the establishment and maintenance of the global safety database for Products in the Field in the Territory throughout the Development and Commercialization of such Products.  The method and timing of the transfer of legacy safety information for Products in the Field in the Territory Controlled by Amylin shall be agreed upon by the Parties.  Each Party shall cooperate (at its own cost and expense), and shall cause its Affiliates and sublicensees to cooperate, in implementing a

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pharmacovigilance mutual alert process with respect to Products to comply with all Applicable Laws and applicable obligations of Regulatory Authorities.  The Parties shall enter into a pharmacovigilance agreement as soon as reasonably practical after the Effective Date, but no later than [***] prior to the filing of Takeda’s first IND for any Product, on terms no less stringent than those required by ICH guidelines, Applicable Laws and applicable local regulatory requirements, including: (i) providing detailed procedures regarding the maintenance of core safety information and the exchange of safety data relating to Products worldwide within appropriate timeframes and in an appropriate format to enable each Party to meet both expedited and periodic regulatory reporting requirements; and (ii) ensuring compliance with the reporting requirements of all applicable Regulatory Authorities on a worldwide basis for the reporting of safety data in accordance with standards stipulated in the ICH guidelines, and all Applicable Laws and applicable regulatory requirements regarding the management of safety data.

4.5          Recalls and Product Quality and Safety.  The Parties shall mutually agree, on an expedited basis, upon issues that relate to Product quality and safety and any response by the Parties to such issues, including the decision to recall or withdraw a Product from the market, discontinue a Clinical Trial, or make any public statement about a product defect, quality issue or the safety of a Product; provided, however, Takeda will have final decision-making authority if: (i) mutual agreement cannot be reached on a Product quality or safety issue, including (a) a decision to recall or withdraw a Product from the market, or (b) a decision regarding safety issues to be reported to any applicable Regulatory Authority, including individual adverse events or other matters affecting the health, safety or welfare of a patient, or (ii) an immediate response to a Regulatory Authority is required and there is no reasonable opportunity to discuss the response with Amylin.  Any decision made in good faith by a Party pursuant to Section 4.5(i) or (ii) shall not be subject to the dispute resolution provisions set forth in Sections 15.2 and 15.3. For the avoidance of doubt, nothing contained in this Section 4.5 is intended to prevent Amylin from having final decision making authority for: (1) a decision to recall or withdraw an Amylin Licensed Compound contained in an Excluded Product from the market; or (2) a decision regarding a safety issue relating to an Amylin Licensed Compound contained in an Excluded Product to be reported to any applicable Regulatory Authority, including individual adverse events or other matters affecting the health, safety or welfare of a patient.

5.             COMMERCIALIZATION

5.1          Commercialization Activities. Takeda shall be responsible for Commercializing Products in the Field in the Territory, including conducting any Post-Approval Clinical Studies, at its own expense, subject to the terms and conditions of this Agreement and in compliance in all material respects with Applicable Laws. Takeda shall be responsible for all Commercialization Costs. Takeda shall use Commercially Reasonable Efforts to Commercialize Products in the Field in the Territory in accordance with the Commercialization Plan and the terms of this Agreement, subject to Amylin’s co-Commercialization of Products pursuant to Section 5.3, and the terms of any Co-Commercialization Agreement.  Except as otherwise provided for in Section 5.3 and any Co-Commercialization Agreement, Takeda shall have the sole right and responsibility for all activities relating to Commercialization of all Products in the Field in the Territory including, without limitation: (i) booking all sales of Products; (ii) determining the price of all Products; (iii) sale and distribution of all Products, as described in Section 5.4 below; and (iv) conducting all Product marketing activities, including the creation

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and approval of marketing programs and promotional materials; provided, however, that Amylin shall not be required to use any marketing programs or promotional materials that it reasonably believes are not in compliance with Applicable Laws, including any guidelines issued by the Office of Inspector General of the Department of Health and Human Services.  Takeda may request that Amylin perform Commercialization activities. If Amylin agrees to perform such Commercialization activities, Takeda shall reimburse Amylin at the then-current FTE rate (as defined in Section 3.11.2, or at another FTE rate mutually agreed upon by the Parties) for Amylin’s internal personnel costs relating to the performance of such activities (excluding activities necessary to support its Detailing requirements under Section 5.3, if any), plus any costs paid by Amylin to a Third Party in conducting such activities. Takeda shall keep Amylin regularly informed regarding the Commercialization Plan for each Product and all material activities with respect to Products in the Field in the Territory.

5.2          Commercialization Plan.  The Commercialization of Products in the Field in the Territory shall be governed by a comprehensive plan for all proposed Commercialization activities for such Products, which plan shall describe the pre-launch, launch and subsequent Commercialization activities, budget and sales forecasts for each Product (including, if available, advertising, education, planning, marketing, sales force training and allocation, distribution, and pricing and reimbursement to the extent permitted by Applicable Laws) (the “Commercialization Plan”). Takeda shall be responsible for the creation and implementation of the Commercialization Plan, subject to review of the conduct and progress of Commercialization of Products in the Field in the Territory by the OCC pursuant to Section 2.3.  The outline of the first Commercialization Plan shall be completed within [***] after the Effective Date.  Takeda shall submit the Commercialization Plan for each Product and any amendments thereto, to the OCC for review pursuant to Section 2.3. The Commercialization Plan shall be reviewed and, if necessary, amended, no less than annually by Takeda for OCC review.

5.3          Amylin Co-Commercialization Option.  Subject to the terms and conditions contained in this Section 5.3, Takeda hereby grants to Amylin an option to co-Commercialize with Takeda the first two (2) Products containing different clinically active ingredients that have received Regulatory Approval by the FDA in the United States, and any additional Products that receive Regulatory Approval by the FDA, which contain the identical clinically active ingredient(s) as either of the first two (2) Products (the “Co-Commercialization Option”). Amylin may exercise its Co-Commercialization Option with respect to a Product by providing written notice to Takeda no later than [***] following the unblinding of the first Phase 3 Clinical Trial of such Product in the United States. Takeda shall provide Amylin with Takeda’s then current fully-burdened PDE rate upon the unblinding of the first Phase 3 Clinical Trial of such Product in the United States. Upon the timely exercise by Amylin of its Co-Commercialization Option, and within [***] thereafter, the Parties shall negotiate in good faith and enter into a co-Commercialization agreement (the “Co-Commercialization Agreement”) on mutually agreeable terms, including the terms set forth in this Section 5.3 and Exhibit D; provided, however, that if the Parties fail to enter into a Co-Commercialization Agreement within such timeframe, the terms set forth in this Section 5.3 and Exhibit D shall govern the co-Commercialization of such Product as if the Parties had entered into a Co-Commercialization Agreement. The Parties agree that pursuant to the Co-Commercialization Option, and subject to Takeda’s Commercialization rights set forth in Section 5.1: (i) Amylin will be responsible for participating in activities of the OCC, including providing input into the

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development of the Commercialization Plan, performing Details and conducting such other activities necessary to support its PDE requirements; (ii) Amylin will provide no more than [***] percent ([***] %) of the Commercialization effort as measured by PDEs for either Product; (iii) Takeda shall reimburse Amylin for PDEs performed by Amylin at [***] percent ([***] %) of Takeda’s then current fully-burdened cost for a PDE (which fully-burdened PDE cost, as of the Effective Date, is [***] Dollars (US $[***])); and (iv) the term of the Co-Commercialization Agreement shall be [***], with a [***] extension, (a) upon mutual agreement of the Parties, or (b) at Amylin’s option if, during discussions regarding the [***] extension, Takeda expresses its intent to use a contract sales organization during such [***] extension.  Upon exercise of the Co-Commercialization Agreement, or upon agreement by Amylin to perform any Commercialization activities at Takeda’s request and in accordance with Section 5.1, Amylin shall use Commercially Reasonable Efforts to Commercialize the Products in the Field in the United States in accordance with the terms and conditions of this Agreement, the Co-Commercialization Agreement (as applicable), in compliance in all material respects with Applicable Laws, and in accordance with any Amylin manufacturing responsibilities pursuant to Article 6 (including any supply agreements relating thereto).  For purposes of clarification, notwithstanding the exercise of the Co-Commercialization Option or the execution of the Co-Commercialization Agreement, Takeda shall at all times during the Term remain obligated to pay the applicable amounts specified under Article 8 with respect to each Product (whether or not such Product is co-Commercialized by Amylin in the United States).

5.4          Sales and Distribution. Notwithstanding the exercise by Amylin of its Co-Commercialization Option with respect to a Product pursuant to Section 5.3, Takeda shall have the sole right and responsibility for handling all returns, order processing, invoicing and collection, distribution (including importing, exporting, transporting, customs clearance, warehousing, invoicing, handling and delivering Products to customers), and inventory and receivables for the Products in the Field in the Territory. Amylin shall not accept orders for the purchase of a Product from Third Parties, or make sales of Product to Third Parties in the Field in the Territory for its own account or for Takeda’s account.  If Amylin receives any order for a Product in the Field in the Territory, it shall refer such orders to Takeda for acceptance or rejection. Takeda shall have the sole right and responsibility for: (i) negotiating, establishing and/or modifying the terms and conditions regarding the sale of the Product in the Field in the Territory, including any terms and conditions relating to or affecting (a) the price at which the Product shall be sold, (b) discounts available to any Third Party payers (including, without limitation, managed care providers, indemnity plans, unions, self insured entities, and government payer, insurance or contracting programs such as Medicare, Medicaid, or the U.S. Dept. of Veterans Affairs, or similar programs located in other countries of the Territory), (c) discounts attributable to payments on receivables, (d) distribution of the Product, and (e) credits, price adjustments, or other discounts and allowances to be granted or refused; and (ii) all activities relating to government price reporting with respect any Product in the Field in the Territory.

6.             MANUFACTURING

6.1          Manufacture and Supply of Licensed Compounds and Products.  The Development Plan shall include mutually agreed upon plans for manufacture of Products (and

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Licensed Compounds therein) for use in Development activities.  Amylin shall be responsible for the manufacture and provision of clinical supplies for [***]  for each Product; provided, however, Takeda shall have: (i) the option, at any time, to manufacture clinical supplies; and (ii) the right to select (a) the Product formulation and packaging configuration for Phase 3 Clinical Trials, (b) raw material suppliers, and (c) manufacturing and release sites.  The Parties shall negotiate in good faith and enter into a mutually agreed upon manufacturing and supply agreement for the provision of clinical supplies at [***], and a separate quality agreement relating to the provision of clinical supplies, each within [***] after the Effective Date.  The manufacturing and supply agreement for the provision of clinical supplies shall contain terms and conditions relating to capital investments, recalls, product liabilities, and any such other terms and conditions mutually agreeable to the Parties.  Following the Effective Date, Amylin and Takeda shall discuss and determine responsibility for manufacture of Products (and Licensed Compounds therein) for commercial use in the Field in the Territory taking into account capabilities and existing manufacturing relationships.  Within [***] after the Effective Date, or within a timeframe otherwise mutually agreed to by the Parties, the Parties shall negotiate in good faith and enter into a mutually agreed upon manufacture and supply agreement for the provision of commercial Product at [***]  and a separate quality agreement relating to the provision of commercial Product.  Such manufacturing and supply agreement shall contain terms and conditions relating to obsolescence, safety stock, capital investments, recalls, product liabilities, and any such other terms and conditions mutually agreeable to the Parties; provided, further, the price charged for Products (or active pharmaceutical ingredient) supplied by either Party to the other Party shall be equal to the Cost of Goods of such Products (or active pharmaceutical ingredient), without mark-up.   For the avoidance of doubt, the Parties acknowledge that Amylin is not a contract manufacturing organization, and will be entering into contractual agreements with various Third Party contract manufacturing organizations to perform Amylin’s manufacturing and supply responsibilities under this Section 6.1.  Accordingly, the manufacturing and supply agreements to be entered into between Amylin and Takeda pursuant to this Section 6.1 shall be “pass-through” agreements whereby Amylin will pass through the terms and conditions of its manufacturing and supply agreements with Third Party contract manufacturing organizations.  Amylin shall use Commercially Reasonable Efforts to ensure inclusion of the terms and conditions identified in this Section 6.1 in its manufacturing and supply agreements with Third Party contract manufacturing organizations.

7.             GRANT OF RIGHTS

7.1          License Grants.

7.1.1       License to Takeda.  Subject to the terms and conditions of this Agreement, Amylin hereby grants to Takeda an exclusive (even as to Amylin, except as provided in this Section 7.1.1), worldwide, royalty-bearing license, with the right to sublicense in accordance with Section 7.2, under the Amylin Technology to research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import, export and otherwise Commercialize the Licensed Compounds and Products, including the Licensed Compounds and Products relating to any New Project for which Takeda is the Proposing Party under Section 3.5.2, in the Field in the Territory during the Term; provided, however, subject to the terms and conditions of

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this Agreement, Amylin shall retain such rights under the Amylin Technology as are necessary to: (i) research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import and export Excluded Products (and the Licensed Compounds contained therein, solely as they relate to the Excluded Products); (ii) perform its obligations under this Agreement, including the Development (Article 3) and manufacturing (Section 6.1) activities to be performed by Amylin under the Development Plan; (iii) research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import and export Licensed Compounds and Products under any New Project pursuant to Section 3.5.2; and (iv) perform the Commercialization activities of Amylin, if any, under Section 5.1, Section 5.3 and the Co-Commercialization Agreement (Exhibit D).

7.1.2       License to Amylin.  Subject to the terms and conditions of this Agreement including Articles 3 and 4, and Sections 5.1, 5.3, 6.1, 7.4.2, 7.4.3 and 7.4.4(b), Takeda hereby grants to Amylin an exclusive (except as to Takeda), worldwide, royalty-free license, with the right to sublicense to its Affiliates in accordance with Section 7.2, under the Takeda Technology in each case solely to: (i) perform its obligations under this Agreement, including the Development (Article 3) and manufacturing (Section 6.1) activities to be performed by Amylin under the Development Plan; (ii) research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import and export Licensed Compounds and Products under any New Project pursuant to Section 3.5.2; and (iii) perform the Commercialization activities of Amylin, if any, under Sections 5.1 and 5.3, and the Co-Commercialization Agreement (Exhibit D).

7.1.3       Joint Licenses.  Subject to the terms and conditions of this Agreement including Articles 3 and 4, and Sections 5.1, 5.3, 6.1, 7.2.1, 7.4.1, 7.4.2, 7.4.3, Amylin hereby grants to Takeda an exclusive (except as to Amylin), worldwide, royalty-bearing, license, with the right to sublicense to its Affiliates and Third Parties in accordance with Section 7.2, under the Joint Inventions and Joint Patents, and Takeda hereby grants to Amylin an exclusive (except as to Takeda), worldwide, royalty-free, license, with the right to sublicense to its Affiliates in accordance with Section 7.2, under the Joint Inventions and Joint Patents, in each case solely to research, Develop, make, have made, distribute, use, sell, offer for sale, import, export and Commercialize the Licensed Compounds or Products in the Field in the Territory during the Term in accordance with this Agreement. During the Term, either Party may use the Joint Inventions and Joint Patents outside the scope of this Section 7.1.3 upon obtaining the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed.  Upon expiration of the Term, either party may use the Joint Inventions and Joint Patents outside the scope of this Section 7.1.3 without taking any further action.

7.2          Sublicensing; Subcontracting.

7.2.1       Sublicensing.  Each Party shall have the right to grant to its Affiliates sublicenses of the rights granted to such Party under Sections 7.1.1, 7.1.2 and 7.1.3.  Takeda shall have the right to grant to Third Parties sublicenses through multiple tiers of sublicense of the rights granted to Takeda under Section 7.1.1 or 7.1.3; provided, however, that Takeda shall not grant to Third Parties any sublicense of the rights granted to Takeda under Section 7.1.1 or 7.1.3 with respect to any Licensed Compound or Product in the Field in the United States without Amylin’s prior written consent, which consent shall not be unreasonably withheld or delayed.  Except to the extent the Parties otherwise agree in writing, any sublicense agreement

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must be consistent in all material respects with the terms and conditions of this Agreement.  The Party granting a sublicense of the rights granted to it by the other Party under this Agreement shall use Commercially Reasonable Efforts to enforce the terms of such sublicense.  Within [***]  after execution or receipt thereof, as applicable, Takeda shall provide Amylin with a full and complete copy of each sublicense agreement with a Third Party regarding the sublicense of rights granted under Section 7.1.1 or 7.1.3 (provided that Takeda may redact any information contained therein that is not necessary to disclose to ensure compliance with this Agreement), and shall deliver copies of all reports (including reports relating to royalties and other payments) relating to Products received by Takeda from such sublicensees.

7.2.2       Subcontracting.  Except as set forth in Sections 1.78 and 5.3 regarding the use of contract sales organizations, each Party shall also have the right to contract with one or more of its Affiliates or Third Parties to perform certain of its Development obligations or Commercialization obligations; provided such Party shall remain responsible and liable for the performance and payment of such Affiliates and Third Parties.  However, each Party’s right to contract with any Affiliate or Third Party as permitted by this Section 7.2.2 is subject to the following requirements: (i) none of the other Party’s rights hereunder shall be diminished or otherwise adversely affected as a result of such contracting; and (ii) each such Affiliate and Third Party shall undertake in writing obligations of confidentiality, publication and non-use regarding Confidential Information (to the extent Confidential Information will be disclosed to such Affiliate or Third Party), and obligations regarding ownership of Inventions, which are substantially the same as those undertaken by the Parties under this Agreement.

7.3          In-License Agreements.

7.3.1       Generally.  Takeda acknowledges that the rights granted by Amylin to Takeda under this Article 7 with respect to any Amylin Technology licensed or otherwise conveyed to Amylin under an In-License Agreement are subject to the applicable terms and conditions of such In-License Agreement.  Takeda agrees to comply directly with the obligations of Amylin set forth in the In-License Agreements (including the obligations of the following agreements under which sublicenses of intellectual property rights have been granted pursuant to the In-License Agreements: (i) License Agreement between The Rockefeller University and Amgen, Inc., dated April 13, 1995, as amended; and (ii) Non-Exclusive License Agreement between The Regents of the University of California and Amgen, Inc., dated July 13, 2005) that arise as a result of the activities of Takeda and its Affiliates and sublicensees under this Agreement.  In the event that any other party to an In-License Agreement notifies Amylin of a default or breach under the applicable In-License Agreement related to any failure by Takeda or its Affiliates or sublicensees to perform any obligation or covenant under such In-License Agreement, Amylin shall have the right, but not the obligation, to take such actions as reasonably necessary or appropriate to cure such default or breach, and Takeda shall promptly reimburse Amylin for all costs and expenses actually incurred by Amylin solely as a result of such default or breach by Takeda or its Affiliates or sublicensees.  Amylin shall have no liability to Takeda for any termination or modification of any In-License Agreement arising out of or resulting from the failure of Takeda or its Affiliates or Sublicensees to abide by, comply with or perform under the terms, conditions or obligations of such In-License Agreement.

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7.3.2       Covenant Not to Sue Under Amgen Agreement.  Takeda hereby covenants that it and its Affiliates, sublicensees and assignees shall not sue Amgen or its affiliates and assignees for infringement of any Amylin Patents, which are licensed to Amylin by Amgen under the Amgen Agreement, with respect to the non-commercial activities permitted under the Amgen Agreement of Amgen, its Affiliates and its permitted assignees using Amylin Licensed Compounds and Products in the Territory for any human uses, including therapeutic, prophylactic, palliative and diagnostic uses, for impairment of cognition, including Alzheimer’s disease, Down’s syndrome and age-related cognitive decline, on and after the Effective Date.

7.3.3       Agreement Under UM Agreement.  Takeda hereby agrees to enter into an agreement in the form of Exhibit C to the UM Agreement.

7.4          Other Agreements.

7.4.1       Reservation of Rights by Amylin.  Subject to the limitations contained in Section 7.4.3, Amylin hereby expressly reserves the right to practice, and to grant licenses under, the Amylin Technology except to the extent Takeda has been granted an exclusive license (except as to Amylin) under Section 7.1.1.  Without limiting the foregoing, Amylin retains: (i) the exclusive right to research, develop, make, have made, distribute, use, sell, offer for sale, import or export the Excluded Products (and the Amylin Licensed Compounds contained therein, solely as they relate to the Excluded Products); and (ii) [***].

7.4.2       Reservation of Rights by Takeda.  Except with respect to the exclusive license (except as to Takeda) granted to Amylin pursuant to Section 7.1.2, Takeda hereby expressly reserves the right to practice, and to grant licenses under, the Takeda Technology for any and all purposes including use of such rights outside the Field.

7.4.3       Other Amylin Agreements.

(a)           Amylin agrees not to practice any Takeda Technology except pursuant to the exclusive license (except as to Takeda) granted to Amylin pursuant to Section 7.1.2.

(b)           Amylin will not, itself or through its Affiliates, or through the grant of any license under the Amylin Technology to Third Parties by Amylin or its Affiliates: (i) develop, make, have made, distribute, use, sell, offer for sale, import or export any of the Amylin Licensed Compounds or Products in any indication outside the Field (except with respect to central nervous system indications, for which Amylin has no right to license or sublicense the Amylin Licensed Compounds or Products to Takeda as of the Effective Date [***], or as otherwise expressly permitted in this Agreement); (ii) research, develop, make, have made, distribute, use, sell, offer for sale, import or export any Analogs of Licensed Compounds that are not already Licensed Compounds set forth in Exhibit E (except with respect to central nervous system indications, for which Amylin has no right to license or sublicense the Amylin Licensed Compounds, Analogs of Amylin Licensed Compounds, or Products to Takeda as of the Effective Date [***], or except as otherwise permitted under this Section 7.4.3(c) and Sections 3.3

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and Section 3.5.2); or (iii) research, develop, make, have made, distribute, use, sell, offer for sale, import or export any Takeda Y-family Agonist unless and until any of the following have occurred, (A) such Takeda Y-family Agonist has been added as a Takeda Licensed Compound pursuant to Section 3.4, (B) such Takeda Y-family Agonist has become part of the Development Plan pursuant to 3.5.2, or (C) Amylin is free to develop or commercialize the Takeda Y-family Agonist pursuant to the last sentence of Section 3.5.2(d).

(c)           Subject to Amylin’s obligations under Section 3.3 and 3.5.2, Amylin and its Affiliates and sublicensees may research, develop, make, have made, distribute, use, sell, offer for sale, import or export any analogs of Amylin Licensed Compounds and any Analogs of Amylin Licensed Compounds; provided that, for the avoidance of doubt, Amylin has the sole discretion to determine all research and development regarding analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds unless and until any of the following have occurred, (i) such analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds have been added as Amylin Licensed Compounds pursuant to Section 3.3, or (ii) such analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds have become part of the Development Plan pursuant to Section 3.5.2(d).

7.4.4       Other Takeda Agreement.

(a)           Takeda agrees not to practice any Amylin Technology except pursuant to the license expressly granted to Takeda pursuant to Section 7.1.1.

(b)           Takeda will not, itself or through its Affiliates, or through the grant of any license to Third Parties by Takeda or its Affiliates research, develop, make, have made, distribute, use, sell, offer for sale, import or export any analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds: (i) unless and until any of the following have occurred, (A) such analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds have been added as Amylin Licensed Compounds pursuant to Section 3.3, (B) such analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds have become part of the Development Plan pursuant to 3.5.2, or (C) Takeda is free to develop or commercialize the analogs of Amylin Licensed Compounds or Analogs of Amylin Licensed Compounds pursuant to the last sentence of Section 3.5.2(d); or (ii) unless such Analogs of Amylin Licensed Compounds are Takeda Y-family Agonists set forth in Exhibit E.

(c)           Subject to Takeda’s obligations under Section 3.4 and 3.5.2, Takeda, its Affiliates or sublicensees may research, develop, make, have made, distribute, use, sell, offer for sale, import and export Takeda Y-family Agonists; provided that, for the avoidance of doubt, Takeda has sole discretion to determine all research and development regarding Takeda Y-family Agonists, including whether to research and develop Takeda Y-family Agonists in obesity or other therapeutic areas, unless and until such Takeda Y-family Agonists have been added as Takeda Licensed Compounds pursuant to Section 3.4 or have become part of the Development Plan pursuant to Section 3.5.2.

7.5          No Implied Licenses.  No right or license under any Patents or Information of either Party is granted or shall be granted by implication.  All such rights or licenses are or shall be granted only as expressly provided in the terms of this Agreement.

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8.             PAYMENTS

8.1          Upfront Fee.  Takeda shall make a one-time, non-refundable, non-creditable payment to Amylin of Seventy-Five Million Dollars (US$75,000,000) within [***], not including bank holidays in Japan or the United States, after the later of: (i) the Effective Date; or (ii) the date of Takeda’s receipt of Amylin’s invoice and completed tax related documents (Japanese Form 3 (Application Form for Income Tax Convention), Japanese Form 17 (Attachment Form for Limitation on Benefits (US)), and U.S. IRS Form 6166).

8.2          Milestone Payments.

8.2.1       Except as provided in Section 8.2.2 below, within [***] following the first occurrence of each of the events set forth below for each Product (except as expressly noted in the chart below), Takeda shall pay to Amylin each of the non-refundable, non-creditable milestone payments set forth below (whether such milestone is achieved by Takeda, its Affiliate or a sublicensee):

Milestone Event	Milestone Payment
Development Milestones
[***]	US$[***]*
[***]	US$[***]*
[***]	US$[***]
[***]	US$[***]
[***]	US$[***]
[***]	US$[***]

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[***] US$[***]

[***] .Commercial Milestones for BID Products and QD Products:  These milestones are payable only one time for each Product containing identical Licensed Compound(s).

[***]	US$[***]
[***]	US$[***]
[***]	US$[***]

Commercial Milestones for QW Products: These milestones are payable only one time for each Product containing identical Licensed Compound(s).

[***]	US$[***]
[***]	US$[***]
[***]	US$[***]

Sales-Based Milestones

[***]	US$[***]
[***]	US$[***]
[***]	US$[***]
[***]	US$[***]
[***]	US$[***]

Except as otherwise provided in the chart set forth above, each of the milestone payments described in this Section 8.2.1 shall be payable one time for each separate Product, regardless of the number of indications for which such Product is Developed or Commercialized; provided, however, if: (i) a Product is abandoned during Development after one (1) or more of the milestone payments under this Section 8.2.1 has been made for such Product (a “Dropped Product”); and (ii) another Product containing a different Licensed Compound, or combination of different Licensed Compounds, with or without another active ingredient, is Developed for substantially the same indications as a replacement for such Dropped Product, then only those

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milestone payments under this Section 8.2.1 that were not previously made with respect to such Dropped Product shall be payable with respect to the replacement Product.  In the event: (a) a Product is Developed in an Alternative Delivery System; or (b) a BID Product, QD Product or a QW Product is Developed that does not utilize a single-injection delivery system or an Alternative Delivery System, then the Parties shall negotiate in good faith any development, commercial, and sales-based milestone payments and royalty rates for such Product taking into consideration, among other things, the commercial valuation and product profile of the Product; provided, however, if such Product has a similar product profile and commercial valuation as a BID Product, QD Product or QW Product, then the development, commercial, and sales-based milestone payments and royalty rates for such Product shall be similar to those for either a BID Product, QD Product or QW Product. For purposes of clarification, subsection (b) of the preceding sentence is intended to apply to Products with a presentation that requires multiple injections for each dose administration.

8.2.2.      Notwithstanding anything to the contrary contained in Section 8.2.1, the following milestone payments shall apply to Products that contain a Takeda Y-family Agonist, which milestone payments shall be paid by Takeda in accordance with Section 8.2.1:

(a)               With respect to a Product that is a Takeda Y-family Agonist Developed or Commercialized as a single agent, Takeda shall not be obligated to make Development, Commercial or sales-based milestone payments to Amylin.

(b)               With respect to a Product that contains a Takeda Y-family Agonist, and a Licensed Compound for which Development and/or Commercial milestone payments have been made to Amylin pursuant to Section 8.2.1 (with respect to such Licensed Compound only), Takeda shall pay in accordance with Section 8.2.1: (i) [***] ([***] %) of new indication milestones not already paid for by Takeda in connection with such Licensed Compound; and (ii) [***] percent ([***] %) of Commercial and sales-based milestones.

(c)               With respect to a Product that contains a Takeda Y-family Agonist, in combination with OPT or an Analog of another Licensed Compound for which Development and/or Commercial milestone payments have not been made to Amylin pursuant to Section 8.2.1, Takeda shall pay in accordance with Section 8.2.1: (i) [***] percent ([***] %) of all Development, Commercial and sales-based milestones.

(d)               With respect to a Product that contains a Takeda Y-family Agonist, and a Licensed Compound for which Development and/or Commercial milestone payments have not been made to Amylin pursuant to Section 8.2.1, Takeda shall pay in accordance with Section 8.2.1: (i) [***] percent ([***] %) of Development, Commercial and sales-based milestones.

8.2.3.      Each Party agrees that it will not consider the milestone payment obligations set forth in Section 8.2.2 for purposes of making Development decisions when considering and comparing both: (i) a Product referenced in Section 8.2.2 (containing a Takeda Y-family Agonist); and (ii) any other Product that does not contain a Takeda Y-family Agonist.

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8.3Royalties.

8.3.1Royalty on Tier 1 Products.  Takeda shall pay to Amylin royalties based on total annual Net Sales of each Product in the Territory that contains only one or more Amylin Licensed Compounds (other than OPT) as clinically active ingredients (each, a “Tier 1 Product”), at the following rates:

Total Annual Net Sales	Royalty Rate
For that portion of total annual Net Sales that is less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For the portion of aggregate annual Net Sales greater than US$[***]	[***]	%

8.3.2Royalty on Tier 2 Products.  Takeda shall pay to Amylin royalties based on total annual Net Sales of each Product in the Territory that contains: (i) both an Amylin Licensed Compound and either OPT or a Takeda Licensed Compound that is a Takeda Y-family Agonist as clinically active ingredients; provided that, for clarification, in no event shall the calculation with respect to Combination Products set forth in the definition of Net Sales apply to any Product under this Section 8.3.2(i); or (ii) both an Amylin Licensed Compound that is not an Option Compound and an Amylin Licensed Compound that is an Option Compound as clinically active ingredients, provided the Option Compound was nominated by Amylin prior to the completion of a Phase 1 Clinical Trial (each, a “Tier 2 Product”), at the following rates:

Total Annual Net Sales	Royalty Rate
For that portion of total annual Net Sales that is less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For the portion of aggregate annual Net Sales greater than US$[***]	[***]	%

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8.3.3Royalty on Tier 3 Products.  Takeda shall pay to Amylin royalties based on total annual Net Sales of each Product in the Territory that is not a Tier 1 Product or a Tier 2 Product (each, a “Tier 3 Product”) (which Products may include OPT or a Takeda Y-family Agonist as the sole active ingredient) at the following rates:

Total Annual Net Sales	Royalty Rate
For that portion of total annual Net Sales that is less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For that portion of aggregate annual Net Sales that is greater than US$[***] and less than or equal to US$[***]	[***]	%
For the portion of aggregate annual Net Sales greater than US$[***]	[***]	%

8.3.4Royalty Term.  Royalties under this Section 8.3 shall be payable based on total annual Net Sales of each Product on a Product-by-Product and country-by-country basis: (i) at [***] percent ([***] %) of the rates set forth above for a period equal to the Initial Royalty Term for such Product in such country; and (ii) upon expiration of the Initial Royalty Term for such Product in such country, at [***] percent ([***] %) of the royalty rates set forth above until expiration of the Secondary Royalty Term for such Product in such country.  Upon expiration of the Secondary Royalty Term with respect to a Product in any country and payment in full of all amounts owed to Amylin under this Agreement with respect to such Product in such country, the licenses granted in Sections 7.1.1 and 7.1.3 for such Product in such country shall become exclusive (even as to Amylin), perpetual, royalty-free, fully-paid up and irrevocable and shall survive any expiration of this Agreement.  Set forth on Exhibit G is an example of the royalty calculation.

8.4Payments Under In-License Agreements.  Except as set forth in this Section 8.4, Amylin shall be responsible for making all payments due under the In-License Agreements before and after the Effective Date as a result of the Parties’ performance of obligations and exercise of rights under this Agreement; provided, however, with respect to the Pacira Agreement: (i) Amylin shall only be responsible for making payments that relate to Davalintide; and (ii) any additional payments to be made under the Pacira Agreement shall be paid in accordance with Section 8.5.

8.5Payments under Other Third Party License Agreements.  In the event that the Parties elect to take a license, or otherwise acquire rights, to Third Party intellectual property rights for Development and/or Commercialization of Product(s) in the Field in the Territory, other than a license or acquisition of such Third Party intellectual property rights necessary to

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exercise the rights to the Amylin Technology licensed to Takeda hereunder, or exercise the rights to the Takeda Technology licensed to Amylin hereunder, the following shall apply: (i) each Party will pay [***] percent ([***] %) of any up-front license fees and development milestone payments;  (ii) Takeda will pay [***] percent ([***] %) and Amylin will pay [***] percent ([***] %) of any (a) commercial and sales-based milestone payments, (b) royalties on Net Sales of Products, up to a [***] percent ([***] %) royalty rate, and (c) any other costs associated with acquiring such Third Party intellectual property rights; and (iii) the Parties will negotiate in good faith how to share the costs of any royalties on Net Sales of Products that exceed [***] percent ([***] %); provided, further, for the avoidance of doubt, nothing contained in subsections (i), (ii) or (iii) above is intended to apply to Development Costs, including U.S. Development Costs, which shall be allocated in accordance with Section 3.11. If a license or acquisition of rights to Third Party intellectual property is necessary to exercise the rights to the Amylin Technology licensed to Takeda hereunder, each Party shall be responsible for paying [***] percent ([***] %) of the up-front payments, development, commercial and sales-based milestone payments, royalties and any other costs associated with acquiring such Third Party intellectual property rights. If a license or acquisition of rights to Third Party intellectual property is necessary to exercise the rights to the Takeda Technology licensed to Amylin hereunder, Takeda shall be responsible for paying [***] percent ([***] %) of the up-front payments, development, commercial and sales-based milestone payments, royalties and any other costs associated with acquiring such Third Party intellectual property rights.

8.6Bundling. Takeda hereby agrees that it will not, nor, to the extent permitted under Applicable Law, shall it allow its Affiliates or sublicensees to, provide a discount on Products as part of a multiple product offering with any other products or services that: (i) are not a normal and customary discount that Takeda would provide on other products in its portfolio; or (ii) are unreasonably disproportionate to discounts Takeda has provided on other products in its portfolio.  In addition, Takeda will not, nor, to the extent permitted under Applicable Law, shall it allow its Affiliates or sublicencees to, take into consideration any royalty payments it is obligated to pay Amylin when determining the amount of any discounts to be provided on Products.

9.PAYMENT; RECORDS; AUDITS

9.1Payment; Reports.  Royalties shall be calculated and reported for each calendar quarter.  All payments due to Amylin under this Agreement shall be paid within [***]  after the end of each calendar quarter, unless otherwise specifically provided herein.  Each payment shall be accompanied by a report of Net Sales of Products by Takeda and its Affiliates and sublicensees in sufficient detail to permit confirmation of the accuracy of the payment made, including, on a country-by-country basis, the number of Products sold, the gross sales and Net Sales of such Products, the royalties payable, the method used to calculate the royalties, and the exchange rates used.

9.2Manner and Place of Payment; Exchange Rate.  All payments hereunder shall be payable in U.S. dollars.  All payments owed under this Agreement shall be made by wire transfer in immediately available funds to a bank and account designated in writing by the Party receiving the payment, unless otherwise specified in writing by such Party.  If any currency conversion shall be required in connection with calculating any payments hereunder, such

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conversion shall be made by using the exchange rates used by the paying Party in calculating its own revenues for financial reporting purposes, unless otherwise agreed in writing by the Parties.

9.3Income Tax Withholding.

9.3.1Cooperation and Coordination.  The Parties acknowledge and agree that it is their mutual objective and intent that taxes payable with respect to their collaborative efforts under this Agreement are paid or omitted, as appropriate, at the most favorable rate(s) proposed by the Party that would be subject to payment of such taxes, and that they shall use their reasonable efforts to cooperate and coordinate with each other in completing and filing documents required under the provisions of any Applicable Laws in connection with the making of any required tax payment or withholding payment, in connection with a claim of exemption from, or entitlement to, a reduced rate of withholding or in connection with any claim to a refund of or credit for any such payment.

9.3.2Payment of Tax.  All payments made by Takeda to Amylin pursuant to this Agreement shall be made without reduction for any taxes, charges or remittance fees, provided that Amylin shall be responsible for any income taxes payable by Amylin on payments made to it under this Agreement.  If Applicable Laws require that taxes be deducted and withheld from a payment due from Takeda to Amylin under this Agreement, Takeda shall (a) deduct those taxes from the payment; (b) pay the taxes to the proper taxing authority; and (c) send evidence of the obligation together with proof of payment to Amylin promptly following that payment.  Amylin shall provide Takeda with documentation necessary for Takeda to file an application with the applicable tax authorities to avoid or reduce withholding or other applicable taxes under any applicable tax treaty.

9.4Audits.  During the Term and for a period of [***] thereafter, Takeda shall keep (and shall cause its Affiliates and sublicensees to keep) complete and accurate records pertaining to the sale or other disposition of Products and calculations of Net Sales and payments required under this Agreement in sufficient detail to permit Amylin to confirm the accuracy of all payments due to it hereunder.  Amylin shall have the right to cause an independent, certified public accountant reasonably acceptable to Takeda to audit such records to confirm Net Sales, royalty, milestone and other payments for a period covering not more than the preceding [***]; provided that any such accountant shall have previously entered into a confidentiality agreement in terms reasonably satisfactory to Takeda limiting its disclosure of such information to authorized representatives of the Parties or as required under Applicable Laws. Any such inspection shall be for the sole purpose of verifying the calculation of payments on Net Sales of the Products by Takeda, its Affiliates or sublicensees and milestone and other payments to Amylin under this Agreement, and to determine the reasonableness of any discounts applied to Products.  The accountant shall disclose to Amylin the findings of the audit and the specific details concerning any discrepancies.  No other information shall be provided to Amylin.  Such audit rights may be exercised during normal business hours upon reasonable prior written notice to Takeda; provided that such audit right may be exercised no more than once in any [***] period and no more than once with regard to any given [***].  Prompt adjustments shall be made by the Parties to reflect the results of such audit.  Amylin shall bear the full cost of such audit unless such audit discloses an underpayment by Takeda of more than [***] percent ([***] %) of the amount of royalties or other payments due under this Agreement, in which case,

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Takeda shall bear the full cost of such audit and shall promptly remit to Amylin the amount of any underpayment.

9.5Late Payments.  In the event that any payment due under this Agreement is not made when due, the payment shall accrue interest from the date due until such payment is made in full at an interest rate equal to the [***]; provided, however, that in no event shall such rate exceed the maximum interest rate permitted under Applicable Laws.  The payment of such interest shall not limit a Party from exercising any other rights it may have as a consequence of the lateness of any payment.

10.CONFIDENTIALITY AND PUBLICATION

10.1Confidential Information.  Except to the extent expressly authorized by this Agreement or otherwise agreed in writing by the Parties, the Parties agree that, during the Term and for [***] ([***]) years thereafter, the receiving Party shall keep confidential and shall not publish or otherwise disclose and shall not use for any purpose other than as expressly provided for in this Agreement any Information furnished to it by the other Party or any of its Affiliates pursuant to this Agreement or owned by such other Party or any of its Affiliates as provided herein (collectively, “Confidential Information”).  For clarification, Amylin Technology is Confidential Information of Amylin, Takeda Technology is Confidential Information of Takeda and Joint Inventions and Joint Patents shall be deemed Confidential Information of both Parties.  Each Party may use such Confidential Information only as permitted by this Agreement.  Each Party will use at least the same standard of care as it uses to protect proprietary or confidential information of its own (but no less than reasonable care) to ensure that its employees, agents, consultants and other representatives do not disclose or make any unauthorized use of the Confidential Information.  Each Party will promptly notify the other upon discovery of any unauthorized use or disclosure of the Confidential Information.

10.2Treatment of Manufacturing Information.  In addition to the other provisions herein, Takeda recognizes that maintaining the confidentiality and trade secret nature of the Manufacturing Information requires a higher level of vigilance than other Confidential Information, and agrees to: (i) maintain in confidence Manufacturing Information with the same degree of care that Takeda uses to protect its own like information (but no less than reasonable care); (ii) strictly limit access to and use of Manufacturing Information to employees, representatives, consultants and contractors of Takeda and its Affiliates with a need to know such information; and (iii) use Manufacturing Information only for producing Products in the Field.  Takeda shall ensure that any Person having access to the Manufacturing Information will be made aware of its highly confidential nature and will agree to be bound by confidentiality terms no less stringent than those in this Agreement.  The obligations under this Section 10.2 shall survive and continue in effect for a period of [***] following any expiration or termination of this Agreement, except any obligations under this Section 10.2 that relate to Manufacturing Information received by Amylin or Takeda under the [***] shall survive and continue in effect for a period of [***] after expiration or termination of this Agreement.   Each of Amylin and Takeda acknowledge and agree that Sections 10.3 and 10.4 shall apply to each Party’s Manufacturing Information, and that: (a) Confidential Information disclosed to any contract manufacturer used by either Party pursuant to this

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Agreement; and (b) any Confidential Information of the other Party received from such contract manufacturer, shall not cause such Confidential Information to fall within any exceptions to the definition of Confidential Information set forth in Section 10.3 or otherwise cease to be Confidential Information of the applicable Party for any reason.

10.3Exceptions.  Confidential Information shall not include any information which the receiving Party can prove by written evidence: (i) is now, or hereafter becomes, through no act or failure to act on the part of the receiving Party, or any of its Affiliates, generally known or available; (ii) is known by the receiving Party or any of its Affiliates at the time of receiving such information, as evidenced by records of the receiving Party or any of its Affiliates; (ii) is hereafter furnished to the receiving Party or any of its Affiliates by a Third Party, as a matter of right and without restriction on disclosure; (iv) is independently discovered or developed by or on behalf of the receiving Party or any of its Affiliates without the use of Confidential Information belonging to the disclosing Party; or (v) is the subject of a written permission to disclose provided by the disclosing Party.

10.4Authorized Disclosure.  Each Party may disclose Confidential Information belonging to the other Party as expressly permitted by this Agreement or if and to the extent such disclosure is reasonably necessary in the following instances:

10.4.1filing or prosecuting Patents as permitted by this Agreement with the written permission of such other Party;

10.4.2regulatory filings for Products such Party has a license or right to develop hereunder;

10.4.3prosecuting or defending litigation as permitted by this Agreement;

10.4.4complying with applicable court orders or governmental regulations;

10.4.5disclosure to Affiliates, licensees, sublicensees or potential sublicensees, employees, consultants, subcontractors or potential subcontractors or agents of the receiving Party who have a need to know such information in order for the receiving Party to exercise its rights or fulfill its obligations under this Agreement; provided, however, in each case, any such Affiliate, licensee, sublicensee or potential sublicensee, employee, consultant, subcontractor or potential subcontractor or agent agrees to be bound by terms of confidentiality and non-use no less restrictive than those set forth in this Article 10;

10.4.6disclosure by Amylin to the other Parties to the In-License Agreements (and any licensor of intellectual property rights thereunder) in order for Amylin to exercise its rights or fulfill its obligations under the In-License Agreements, provided, in each case, that any such other Parties (and their licensors) are bound by terms of confidentiality and non-use comparable in scope to those set forth in this Article 10; and

10.4.7disclosure to Third Parties in connection with due diligence or similar investigations by such Third Parties, and disclosure to potential Third Party investors in confidential financing documents, provided, in each case, that any such Third Party agrees to be

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bound by similar terms of confidentiality and non-use comparable in scope to those set forth in this Article 10.

Notwithstanding the foregoing, in the event a Party is required to make a disclosure of the other Party’s Confidential Information pursuant to Sections 10.4.3 and 10.4.4, it will, except where impracticable, give reasonable advance notice to the other Party of such disclosure and use efforts to secure confidential treatment of such information at least as diligent as such Party would use to protect its own confidential information, but in no event less than reasonable efforts.  In any event, the Parties agree to take all reasonable action to avoid disclosure of Confidential Information hereunder.

10.5Publication.  Each Party to this Agreement recognizes that the publication of papers regarding results of and other information regarding the activities under this Agreement, including oral presentations and abstracts, may be beneficial to both Parties provided such publications are subject to reasonable controls to protect Confidential Information.  Accordingly, the ODC shall develop procedures for review and approval of publications with respect to data generated from the Development of Products in the Field and/or including Confidential Information, and neither Party shall permit any publication in violation of such procedures.

10.6Publicity.  Amylin and/or Takeda may, by mutual written agreement, issue a press release announcing the execution of this Agreement, which shall be substantially in a form approved by the Parties prior to execution of this Agreement.  Except with respect to such initial release or as otherwise required by Applicable Laws (including disclosure requirements of the U.S. Securities and Exchange Commission, the NASDAQ stock exchange or any other stock exchange on which securities issued by a Party are traded), neither Party shall issue an additional press release or public announcement relating to this Agreement without the prior written approval of the other Party, which shall not be unreasonably withheld or delayed.  In the event that a Party wishes to refer to the other Party or the transactions under this Agreement in promotional or other communications with prospective customers and investors, such Party shall first provide the other Party with advance notice of such proposed disclosure and the form, substance and intended use of such proposed disclosure and obtain the prior written approval of the other Party to the form, substance and intended use of such proposed disclosure.  For purposes of clarification, after a Party has obtained the other Party’s written approval of the form, substance and intended use of a particular reference, no further approval of the other Party will be required for inclusion of the same reference in future communications that are intended for the same use.  The Parties will consult with each other on the provisions of this Agreement to be redacted in any filings made by the Parties with the Securities and Exchange Commission or as otherwise required by Applicable Laws.

10.7Equitable Relief.  Given the nature of the Confidential Information and the competitive damage that would result to a Party upon unauthorized disclosure, use or transfer of its Confidential Information to any Third Party, the Parties agree that monetary damages would not be a sufficient remedy for any breach of this Article 10.  In addition to all other remedies, a Party shall be entitled to specific performance and injunctive and other equitable relief as a remedy for any breach or threatened breach of this Article 10.

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11.REPRESENTATIONS, WARRANTIES AND COVENANTS; DISCLAIMER

11.1Mutual Representations and Warranties.  Each Party represents and warrants to the other as of the Effective Date that:

11.1.1It is duly organized and validly existing under the laws of its jurisdiction of incorporation or formation;

11.1.2It has full corporate or other power and is duly authorized to execute and deliver this Agreement and to perform its obligations hereunder, and the person(s) executing this Agreement on its behalf has been duly authorized to do so by all requisite corporate or partnership action;

11.1.3This Agreement is legally binding upon it and enforceable in accordance with its terms;

11.1.4Neither this Agreement nor such Party’s performance of its obligations hereunder conflicts with any material agreement, instrument or understanding, oral or written, to which it is a Party or by which it may be bound, or violates any material law or regulation of any court, governmental body or administrative or other agency having jurisdiction over it;

11.1.5All of such Party’s employees or contractors acting on its behalf pursuant to this Agreement are obligated under a binding written agreement to assign to such Party or its designee all Inventions; and

11.1.6Neither Party nor their respective Affiliates have been debarred by the FDA under the Generic Drug Enforcement Act of 1992 (or by any analogous agency or under any analogous law or regulation), and neither Party, or to its Knowledge, any of its current officers or directors, have ever been convicted of a felony under the laws of the United States for conduct relating to the development or approval of a drug product or relating to the marketing or sale of a drug product; provided, further, to each Party’s Knowledge, no individual, company, partnership or other legal entity debarred by FDA or any other governmental authority will participate in the Development or Commercialization activities under this Agreement.

11.2Amylin Representations and Warranties.  Amylin represents and warrants to Takeda as of the Effective Date that:

11.2.1There are no pending legal actions, nor has Amylin received any written notice regarding any pending legal actions, with respect to the Amylin Technology;

11.2.2Amylin has not received written notice of any pending or threatened claims or litigation seeking to invalidate any Amylin Patents or claiming that the practice of the Amylin Technology infringes the intellectual property rights of any Third Party;

11.2.3Except as set forth in the Psylin Agreement, the Shionogi Agreement, or the In-License Agreements, Amylin has not assigned, transferred, conveyed or otherwise encumbered its right, title and interest in the Amylin Patents or Amylin Know-How in the Territory;

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11.2.4Amylin has the full right, power, and authority to grant the license rights granted under Article 7 hereof;

11.2.5Amylin has provided to Takeda true and complete copies of the In-License Agreements, the Psylin Agreement and the Shionogi Agreement, and the In-License Agreements are in full force and effect and represent: (i) all Patent in-license agreements between Amylin and Third Parties relating to the Amylin Licensed Compounds in existence as of the Effective Date; and (ii) all the rights and obligations of Amylin contained in or in any way relating to the In-License Agreements;

11.2.6Amylin has maintained, and has not breached in any material respect, any currently existing agreements with Third Parties relating to any Amylin Licensed Compounds or Products, including the In-License Agreements and any currently existing agreements relating to the manufacture of any Amylin Licensed Compounds to which Amylin is a Party;

11.2.7(i) Amylin is the sole and exclusive owner (or, unless otherwise set forth in an In-License Agreement, Amylin is the exclusive licensee, with right to sublicense) of the Amylin Technology all of which are free and clear of any liens, charges and encumbrances (other than any terms of any In-License Agreement), and to Amylin’s Knowledge, no other Person or governmental entity or subdivision thereof has any claim of ownership whatsoever with respect to Amylin Technology (other than Third Parties who have ownership rights to the Amylin Technology licensed to Amylin under the In-License Agreements);

(ii) as the licensee or sublicensee of certain Amylin Technology under the In-License Agreements, Amylin has the right, with respect to such licenses or sublicenses, to enter into the covenants and agreements provided in this Agreement to enable Takeda to exercise the rights granted under Article 7 in accordance with the terms and conditions of this Agreement;

11.2.8To Amylin’s Knowledge, it has made available to Takeda the Amylin Patents and all written information in Amylin’s possession or Control, which is reasonably necessary to Develop or Commercialize the Amylin Licensed Compounds or Products in the Field in the Territory as contemplated by this Agreement.

11.2.9Amylin has not withheld any information in Amylin’s possession or Control, which failure to disclose to Takeda would have a material adverse effect on Takeda’s ability to Develop, Commercialize, or manufacture the Amylin Licensed Compounds or Products in the Field in the Territory as contemplated by this Agreement;

11.2.10Amylin has specifically provided Takeda with the opportunity to review the following:

(a)all non-clinical safety data regarding the Amylin Licensed Compounds that is in Amylin’s possession or Control;

(b)any and all human subject safety data (Life-threatening adverse drug experience, Serious adverse drug experience, Unexpected adverse drug experience, Adverse Event, Serious Adverse Event, Adverse Drug Reaction, Serious Adverse Drug Reaction,

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Unexpected Adverse Drug Reaction, as defined in 21 CFR 312 and/or ICH Guidance (ICH-E6)) that is in Amylin’s possession or Control regarding the Amylin Licensed Compounds set forth in Section 1.8(iii) and (iv);

(c)with respect to the Amylin Licensed Compound set forth in Section 1.8(i), any and all human subject safety data (Life-threatening adverse drug experience, Serious adverse drug experience, Unexpected adverse drug experience, Adverse Event, Serious Adverse Event, Adverse Drug Reaction, Serious Adverse Drug Reaction, Unexpected Adverse Drug Reaction, as defined in 21 CFR 312 and/or ICH Guidance (ICH-E6)) that is in Amylin’s possession or Control and: (i) was submitted to the FDA in connection with the regulatory approval, and maintenance of the regulatory approval, of Symlin (pramlintide acetate) injection (including periodic safety update reports); or (ii) derived from clinical trials studying pramlintide in obese human subjects; and

(d)with respect to the Amylin Licensed Compound set forth in Section 1.8(ii), any and all human subject safety data (Life-threatening adverse drug experience, Serious adverse drug experience, Unexpected adverse drug experience, Adverse Event, Serious Adverse Event, Adverse Drug Reaction, Serious Adverse Drug Reaction, Unexpected Adverse Drug Reaction, as defined in 21 CFR 312 and/or ICH Guidance (ICH-E6)) that is in Amylin’s possession or Control and: (i) was derived pursuant to clinical trials conducted by Amgen or Amylin in obese and/or diabetic human subjects; and (ii) was provided to the FDA pursuant to an IND;

11.2.11Neither Amylin nor its Affiliates are aware of any safety, efficacy, or regulatory issues, other than the information that has previously been made available to Takeda in writing (including through electronic access), that would preclude Takeda or Amylin from researching, Developing, manufacturing, marketing, using, selling, offering for sale, importing, exporting or otherwise Commercializing the Amylin Licensed Compounds or Products in the Field in the Territory in compliance with Applicable Laws;

11.2.12Amylin, its contractors and its consultants have conducted all research and development, including non-clinical studies and Clinical Trials of Amylin Licensed Compounds and/or Products and all manufacturing of Amylin Licensed Compounds and/or Products in accordance with: (i) all material provisions of Applicable Laws; (ii) the known or published standards of the FDA or other applicable regulatory agencies in the Territory; (iii) the prevailing scientific standards applicable to the conduct of such studies and activities in Territory; and (iv) applicable Regulatory Materials, except in each of subsections (i), (ii), (iii) and (iv) where the failure to do so would not have a material adverse effect on the Development, manufacturing and/or Commercialization of the Amylin Licensed Compounds or Products in the Field in the Territory as contemplated by this Agreement;

11.2.13Amylin has conducted audits and/or assessments of its contract manufacturer organizations and contract research organizations , which organizations are or have been involved in activities with respect to Amylin Licensed Compounds or Products in accordance with the prevailing pharmaceutical industry standards, and, to Amylin’s Knowledge there are no circumstances that would have a material adverse effect on the Development, manufacturing and/or Commercialization of the Amylin Licensed Compounds or Products in the Field in the Territory as contemplated by this Agreement;

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11.2.14Neither Amylin nor any officer, employee or agent of Amylin has knowingly made an untrue statement of a material fact to any Regulatory Authority in the Territory with respect to the Amylin Licensed Compounds and/or Products or knowingly failed to disclose a material fact required to be disclosed to any Regulatory Authority in the Territory with respect to the Amylin Licensed Compounds and/or Products; and

11.2.15None of the United States Government, any agency of the United States Government, any foreign government, or any agency of a foreign government has provided funding or support for any work performed in the conception or reduction to practice of any Amylin Licensed Compound listed in Sections 1.8(i), (iii) and (iv), or since February 7, 2006 with respect to the Amylin Licensed Compound listed in Section 1.8(ii).  Other than possible funding provided to Rockefeller by the United States government or an agency of the United States government, to Amylin’s Knowledge, there has been no funding or support provided by any other agency of the United States Government, any foreign government, or any agency of a foreign government for any work performed in the conception or reduction to practice of any Amylin Licensed Compound listed in Section 1.8(ii).

11.3Amylin Covenants.  Amylin covenants that throughout the Term of the Agreement:

11.3.1Amylin shall maintain in good standing in all material respects the In-License Agreements, and it shall use Commercially Reasonable Efforts to maintain in good standing in all material respects its other agreements with Third Parties referenced in Section 11.2.6 that are necessary for either Party to exercise its rights or perform its obligations under this Agreement (provided that Amylin shall have no responsibility with respect to any action or omission by Takeda or its Affiliates or sublicensees that may cause any In-License Agreement or other agreement referenced in Section 11.2.6 not to be maintained in good standing in any material respect);

11.3.2Except as provided in Section 11.3.3, Amylin shall not amend any term or condition of any In-License Agreement without the prior written consent of Takeda, such consent not to be unreasonably withheld, delayed or conditioned;

11.3.3Amylin shall not amend any term or condition of the Psylin Agreement or the Pacira Agreement in any manner that would adversely affect the rights granted to Takeda under this Agreement without the prior written consent of Takeda, such consent not to be unreasonably withheld or delayed; provided, further, in the event that an analog of an Amylin Licensed Compound or an Analog of an Amylin Licensed Compound is added as an Amylin Licensed Compound pursuant to Section 3.3 or has become part of the Development Plan pursuant to Section 3.5.2, and to the extent that such Amylin Licensed Compound has not previously been [***], Amylin agrees to promptly designate such analog of an Amylin Licensed Compound or Analog of an Amylin Licensed Compound as [***]; and

11.3.4Amylin shall assist Takeda in obtaining waiver letters from the National Institute of Health, and any other Person, as necessary to manufacture Licensed Compounds or Products outside the United States.

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11.3.5As will be provided in the pharmacovigilence agreement to be entered into between the Parties pursuant to Section 4.4, upon Takeda’s request, Amylin shall provide Takeda with access to any human subject safety data (Life-threatening adverse drug experience, Serious adverse drug experience, Unexpected adverse drug experience, Adverse Event, Serious Adverse Event, Adverse Drug Reaction, Serious Adverse Drug Reaction, Unexpected Adverse Drug Reaction, as defined in 21 CFR 312 and/or ICH Guidance (ICH-E6)) that is in Amylin’s possession or Control as of the Effective Date, or that comes into Amylin’s possession or Control during the Term of the Agreement, regarding the Amylin Licensed Compounds set forth in Section 1.8(i), (ii), (iii) and (iv).

11.3.6Upon Takeda’s request, Amylin shall make available to Takeda Amylin Patents and any written information in Amylin’s possession or Control, which is reasonably necessary to Develop or Commercialize the Amylin Licensed Compounds or Products in the Field in the Territory as contemplated by this Agreement.

11.4Mutual Covenants.  Each Party covenants that throughout the Term of the Agreement:

11.4.1Each Party shall, at all times, comply in all material respects with all Applicable Laws including, but not limited to, the United States Foreign Corrupt Practices Act;

11.4.2If during the Term, a Party: (i) becomes debarred or disqualified; or (ii) receives notice of an action or threat of an action with respect to debarment or disqualification, such Party shall immediately notify the other Party thereof in writing; and

11.4.3All of such Party’s employees or contractors acting on its behalf pursuant to this Agreement will be obligated under a binding written agreement to assign to such Party or its designee all Inventions.

11.5        Takeda Acknowledgment. TAKEDA HEREBY ACKNOWLEDGES THAT IT HAS EXPERIENCE IN THE OPERATION OF PHARMACEUTICAL DEVELOPMENT, MANUFACTURING, DISTRIBUTION AND SALES, HAS INDEPENDENTLY EVALUATED AND CONDUCTED DUE DILIGENCE WITH RESPECT TO THE AMYLIN LICENSED COMPOUNDS, INTELLECTUAL PROPERTY RIGHTS AND THE INFORMATION PROVIDED OR MADE AVAILABLE BY AMYLIN AS DESCRIBED IN SECTIONS 11.2.8 AND 11.2.10, AND HAS BEEN REPRESENTED BY, AND HAD THE ASSISTANCE OF, COUNSEL, INCLUDING INTELLECTUAL PROPERTY COUNSEL, IN THE CONDUCT OF SUCH DUE DILIGENCE, THE PREPARATION AND NEGOTIATION OF THIS AGREEMENT AND THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED HEREBY.  THE FOREGOING ACKNOWLEDGEMENTS SHALL NOT AFFECT OR DIMINISH IN ANY WAY ANY OF THE REPRESENTATIONS, WARRANTIES, COVENANTS, INDEMNIFICATIONS OR AGREEMENTS OF AMYLIN CONTAINED IN THIS AGREEMENT.

11.6Disclaimer.  Except as expressly set forth in this Agreement, THE TECHNOLOGY AND INTELLECTUAL PROPERTY RIGHTS PROVIDED BY EACH PARTY HEREUNDER ARE PROVIDED “AS IS” AND EACH PARTY EXPRESSLY

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DISCLAIMS ANY AND ALL WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING THE WARRANTIES OF DESIGN, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES, OR ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICE, IN ALL CASES WITH RESPECT THERETO.  Without limiting the generality of the foregoing, each Party expressly does not warrant: (i) the success of any study, test or Clinical Trial conducted hereunder; or (ii) the safety or usefulness for any purpose of the technology it provides hereunder.

12.INTELLECTUAL PROPERTY

12.1Ownership of Inventions. Inventorship of all Inventions shall be determined in accordance with the rules of inventorship under United States patent laws.  As between the Parties, ownership of Inventions shall be as set forth in this Section 12.1.

12.1.1Compound Related Inventions.  To the extent an Invention may be practiced on: (i) Amylin Licensed Compounds and/or Option Compounds and/or any analogs or derivatives thereof; or (ii) Excluded Products, Amylin shall own such Invention (the “Amylin Compound Related Inventions”), and all Patents to the extent such Patents claim such Amylin Compound Related Inventions.  To the extent an Invention may be practiced on Takeda Y-family Agonists or other Takeda Nominated Compounds, Takeda shall own such Invention (the “Takeda Compound Related Inventions”) and all Patents to the extents such Patents claim such Takeda Compound Related Inventions.  As an example, if Takeda invents a new pharmaceutical formulation which may contain as a clinically active ingredient Pramlintide, Compound X, Compound Y or Compound Z (and Compounds X, Y and Z are not Amylin Licensed Compounds, Option Compounds or Excluded Products) Amylin shall own the Invention of the formulation containing Pramlintide as well as any corresponding patent rights, and Takeda shall own the Invention of the formulation containing Compound X, Y or Z, as well as any corresponding patent rights.

12.1.2Takeda Inventions.  Takeda shall solely own all Inventions other than Amylin Compound Related Inventions that are made, conceived or reduced to practice solely by one or more employees or contractors of Takeda or its Affiliate and all Patents that claim such Inventions.

12.1.3Amylin Inventions.  Amylin shall solely own all Inventions other than Takeda Compound Related Inventions that are made, conceived or reduced to practice solely by one or more employees or contractors of Amylin or its Affiliate and all Patents that claim such Inventions.

12.1.4Joint Inventions.  Amylin and Takeda shall jointly own all Inventions other than Amylin Compound Related Inventions and Takeda Compound Related Inventions made, conceived or reduced to practice jointly by one or more employees or contractors of Amylin or its Affiliate and one or more employees or contractors of Takeda or its Affiliate (the “Joint Inventions”) and all Patents that claim Joint Inventions (the “Joint Patents”), and each Party shall have an undivided ownership interest in such Joint Inventions and Joint Patents.

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12.2Joint Obesity Patent Committee.  Amylin and Takeda will establish a committee (the “JOPC”) to resolve any issues regarding Inventorship or ownership of Inventions pursuant to the provisions of Section 12.1.  The JOPC shall be composed of one patent counsel appointed by Amylin and one patent counsel appointed by Takeda.  Amylin and Takeda may each replace its JOPC representative at any time, upon written notice to the other Party.  Each member of the JOPC shall have one vote in connection with any matter to be determined by the JOPC.  All decisions of the JOPC shall be unanimous and shall be made in accordance with the provisions of this Section 12.1.  In the event that the members of the JOPC cannot reach a unanimous decision the dispute shall be resolved in accordance with Article 15.

12.3Patent Prosecution and Maintenance. Takeda Patents.  Takeda shall have the sole right to control and manage the preparation, filing, prosecution and maintenance of all Takeda Patents (including the right to conduct any interferences, oppositions, or reexaminations thereon and to request any reissues or patent term extensions thereof), at Takeda’s sole expense.  Takeda shall keep Amylin informed of progress with regard to the preparation, filing, prosecution and maintenance of Takeda Patents in the Territory in a timely manner through the JOPC. In the event that Takeda desires to abandon or cease prosecution or maintenance of any Takeda Patent, Takeda shall provide reasonable prior written notice to Amylin of such intention not to file or to abandon or decline responsibility (which notice shall, in any event, be given no later than [***] prior to the next deadline for any action that may be taken with respect to such Takeda Patent with the applicable patent office), and Takeda shall permit Amylin, at Amylin’s sole discretion, to continue prosecution and/or maintenance of such Takeda Patent on Takeda’s behalf and at Amylin’s own expense.

12.3.1Amylin Patents.  Amylin (or its licensor with respect to Amylin Patents licensed under the In-License Agreements) shall have the sole right to control and manage the preparation, filing, prosecution and maintenance of all Amylin Patents (including the right to conduct any interferences, oppositions, or reexaminations thereon and to request any reissues or patent term extensions thereof), at Amylin’s sole expense, except as expressly provided in this Section 12.3.1 and subject to its right to do so with respect to Amylin Patents licensed under the In-License Agreements.  Amylin shall keep Takeda informed of progress with regard to the preparation, filing, prosecution and maintenance of Amylin Patents in the Territory in a timely manner through the JOPC.  Amylin will consider in good faith the requests and suggestions of Takeda with respect to strategies for filing, prosecuting and maintaining Amylin Patents in the Territory subject to its right to do so with respect to Amylin Patents licensed under the In-License Agreements.  In the event that Amylin desires to abandon or cease prosecution or maintenance of any Amylin Patent, Amylin shall provide reasonable prior written notice to Takeda of such intention not to file or to abandon or decline responsibility (which notice shall, in any event, be given no later than [***] prior to the next deadline for any action that may be taken with respect to such Amylin Patent with the applicable patent office), and Amylin shall permit Takeda, at Takeda’s sole discretion, to continue prosecution and/or maintenance of such Amylin Patent on Amylin’s behalf and at Takeda’s own expense, subject to Amylin’s right to do so with respect to Amylin Patents licensed under the In-License Agreements.

12.3.2Joint Patents.  Takeda and Amylin shall discuss and evaluate Joint Inventions and confer with each other regarding the advisability of filing patent applications covering Joint Inventions and, if either Party requests that a patent application be filed covering a

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Joint Invention, the other Party shall not unreasonably withhold its consent to such filing.  The JOPC shall determine whether Amylin or Takeda shall have the first right to control and manage (the “Filing Party”) the preparation, filing, prosecution and maintenance of all Joint Patents (including the right to conduct any interferences, oppositions, or reexaminations thereon and to request any reissues or patent term extensions thereof), and an appropriate allocation of expenses related thereto, using a mutually acceptable and independent patent counsel.  The Filing Party shall keep the other Party informed of progress with regard to the preparation, filing, prosecution and maintenance of Joint Patents in the Territory in a timely manner through the JOPC, shall give the other Party an opportunity to review the text of any patent application within the Joint Patents before filing, and shall consider in good faith the requests and suggestions of the other Party with respect to strategies for filing, prosecuting and maintaining Joint Patents in the Territory.  In the event that the Filing Party desires not to file or to abandon or cease prosecution or maintenance of any Joint Patent, the Filing Party shall provide reasonable prior written notice to the other Party of such intention not to file or to abandon or decline responsibility (which notice shall, in any event, be given no later than [***] prior to the next deadline for any action that may be taken with respect to such Joint Patent with the applicable patent office), and the Filing Party shall permit the other Party, at the other Party’s sole discretion, to file for or continue prosecution and/or maintenance of such Joint Patent at the other Party’s own expense, in which event the Filing Party shall assign all of its right, title and interest in such Joint Patent to the other Party and such Joint Patent shall thereafter be considered a Takeda Patent, or Amylin Patent, as the case may be.

12.3.3Cooperation of the Parties.  Each Party agrees to cooperate fully in the preparation, filing, prosecution and maintenance of Takeda Patents, Amylin Patents and Joint Patents under this Agreement.  Such cooperation includes, but is not limited to:  (i) executing all papers and instruments, or requiring its employees or contractors, to execute such papers and instruments, so as to effectuate the ownership of Inventions set forth in Section 12.1, and Patents claiming or disclosing such Inventions, and to enable the other Party to apply for and to prosecute patent applications in any country as permitted by this Agreement; and (ii) promptly informing the other Party of any matters coming to such Party’s attention that may affect the preparation, filing, prosecution or maintenance of any such patent applications.

12.3.4Patent Term Extensions.  The JOPC will discuss and recommend for which, if any, of the Amylin Patents, Joint Patents and Takeda Patents the Parties should seek Patent term extensions in the Territory.  Amylin, in the case of the Amylin Patents and Joint Patents, and Takeda in the case of the Takeda Patents, shall have the final decision-making authority with respect to applying for any such Patent term extensions, and will act with reasonable promptness in light of the Development stage of Products to apply for any such Patent term extensions, where it so elects; provided, however, if in a particular country or jurisdiction in the Territory, only one such Patent can obtain a patent term extension, then the Parties will consult in good faith to determine which such Patent should be the subject of efforts to obtain a Patent term extension, and in any event, Amylin’s decision, in the case of the Amylin Patents, and Takeda’s decision, in the case of the Takeda Patents and the Joint Patents, will control in the case of any disagreement.  The Party that does not apply for an extension hereunder will cooperate fully with the other Party in making such filings or taking such actions, including, but not limited to, making available all required regulatory data and information and executing any required authorizations to apply for such Patent term extension.  The Party seeking

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a Patent term extension shall be obligated to pay the costs and expenses incurred by each Party in connection with such activity.

12.3.5Orange Book Listing; Compendial Listing.   Upon request of Takeda, Amylin shall cooperate with Takeda to: (i) file appropriate information with the FDA in the United States listing any Amylin Patents in the Orange Book; and (ii) with respect to other countries in the Territory, file appropriate information with the applicable Regulatory Authority listing any Amylin Patents in the Patent listing source in such country in the Territory that is equivalent to the Orange Book, if any.

12.4Infringement by Third Parties.  Amylin and Takeda shall promptly notify the other in writing of any alleged or threatened infringement of any Takeda Patent, Amylin Patent or Joint Patent of which they become aware.

12.4.1Takeda Patents.  Takeda shall have the sole right to bring and control any action or proceeding with respect to alleged or threatened infringement of any Takeda Patent, at its own expense and by counsel of its own choice.

12.4.2Amylin Patents.  Except to the extent that an alleged or threatened infringement of an Amylin Patent relates to an Excluded Product, Takeda shall have the first right to bring and control any action or proceeding with respect to alleged or threatened infringement of any Amylin Patent (to the extent Amylin may grant to Takeda such rights with respect to Amylin Patents licensed under the In-License Agreements), at its own expense, to the extent that any such infringement could reasonably be expected to have a material adverse effect on any Product being developed or commercialized for use in the Field in the Territory (a “Material Activity”), and Amylin shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.  Takeda and its counsel will reasonably cooperate with Amylin and its counsel in strategizing with respect to, and preparing and presenting, any such action.  If Takeda fails to bring any such action within: (i) [***] following the notice of alleged infringement; or (ii) [***] before the time limit, if any, set forth in the appropriate laws and regulations for the filing of such action, whichever comes first, then Amylin shall have the right to bring and control any such action, at its own expense and by counsel of its own choice, and Takeda shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.  Amylin (or its licensor with respect to Amylin Patents licensed under the In-License Agreements) shall have the sole right to bring and control any action or proceeding with respect to alleged or threatened infringement of any Amylin Patent that is not a Material Activity.

12.4.3Joint Patents.  Takeda shall have the first right to bring and control any action or proceeding with respect to alleged or threatened infringement of any Joint Patent, at its own expense and by counsel of its own choice, and Amylin shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.  If Takeda fails to bring any such action or proceeding within (a) [***] following the notice of alleged infringement, or (b) [***] before the time limit, if any, set forth in the appropriate laws and regulations for the filing of such actions, whichever comes first, then Amylin shall have the right to bring and control any such action, at its own expense and by counsel of its own choice,

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and Takeda shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.

12.4.4Cooperation; Award.  In the event a Party brings an infringement action in accordance with this Section 12.4, the other Party shall cooperate fully, including, if required to bring such action, the furnishing of a power of attorney or being named as a Party.  Neither Party shall enter into any settlement or compromise of any action under this Section 12.4 which would in any manner alter, diminish, or be in derogation of the other Party’s rights under this Agreement without the prior written consent of such other Party, which shall not be unreasonably withheld.  Except as otherwise agreed to in writing by the Parties, any recovery realized as a result of such action shall be used first to reimburse the documented out-of-pocket legal expenses of the Parties relating to such action, and any remainder shall be retained by the Party that brought and controlled such action for purposes of this Agreement, except that any such remainder retained by Takeda shall be treated as Net Sales for purposes of this Agreement.

12.5Infringement of Third Party Rights.  Each Party shall promptly notify the other Party in writing of any allegation by a Third Party that the activity of either Party pursuant to this Agreement infringes or may infringe the intellectual property rights of such Third Party.  Amylin shall have the sole right to control any defense of any such claim involving alleged infringement of Third Party rights by Amylin’s activities, at its own expense and by counsel of its own choice, and Takeda shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.  Takeda shall have the sole right to control any defense of any such claim involving alleged infringement of Third Party rights by Takeda’s activities, at its own expense and by counsel of its own choice, and Amylin shall have the right, at its own expense, to be represented in any such action by counsel of its own choice.  Neither Party shall enter into any settlement or compromise of any action under this Section 12.5 which would in any manner alter, diminish, or be in derogation of the other Party’s rights under this Agreement without the prior written consent of such other Party, which shall not be unreasonably withheld. In the event that it is determined by any court of competent jurisdiction that the research, Development, manufacture, distribution, use, sale, import, export or other Commercialization of a Licensed Compound or Product, conducted in accordance with the terms and conditions of this Agreement, infringes, or the OSC determines that such activities are likely to infringe, any patent, copyright, trademark, data exclusivity right or trade secret right arising under Applicable Laws of any Third Party, the Parties shall use Commercially Reasonable Efforts to: (i) procure a license from such Third Party authorizing Amylin and Takeda to continue to conduct such activities; or (ii) modify such activities with Takeda’s prior written consent, so as to render it non-infringing. If a license is obtained from such Third Party the cost of such license shall be allocated between the Parties in accordance with Section 8.5, provided the Parties have agreed to undertake such a cost. In the event that the OSC decides that neither of the foregoing alternatives is reasonably available or commercially feasible, the Parties may mutually agree to terminate this Agreement for the Licensed Compound or Product affected in accordance with Section 13.2.5.

12.6Patent Term Restoration.  At the request of the Party owning any Patents subject to this Agreement, the Parties hereto will cooperate with each other in obtaining patent term restoration, extensions and/or any other extensions of such Patents as available under Applicable Laws.

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12.7Patent Marking.  Takeda shall mark all Products made, used or sold under the terms of this Agreement, or their containers, in accordance with all Applicable Laws relating to patent marking.

12.8Certification.  Takeda and Amylin each will immediately give notice to the other of any certification of which they become aware filed under the U.S. Drug Price Competition and Patent Term Restoration Act of 1984, as amended, arising from the filing of an application for the regulatory approval of a Generic Product claiming that Patents covering any Product are invalid or that infringement will not arise from the manufacture, use or sale of any Product in the Field in the Territory by a Third Party.  Any action based on such a certification shall be brought and controlled as provided in Section 12.4.

12.9Product Trademarks.  Takeda shall have sole control over all matters relating to the use of, and shall own, all trademarks used in the sale of Products in the Field in the Territory, including the selection, filing and enforcement thereof, but excluding Symlin® and other trademarks which are proprietary to Amylin.

13.TERM; TERMINATION

13.1Term.  The term of this Agreement (the “Term”) shall commence on the Effective Date and continue in effect until the expiration of all payment obligations under Article 8, unless earlier terminated as provided in Section 13.2.

13.2Termination.  Each Party may terminate this Agreement: (i) in its entirety; or (ii) on a Licensed Compound-by-Licensed Compound, Product-by-Product and country-by-country basis (a “Partial Termination”), in accordance with the terms and conditions set forth in this Section 13.2.

13.2.1Termination for Cause.

(a)Bankruptcy.  A Party may terminate this Agreement in its entirety upon written notice to the other Party upon or after the time that such other Party makes a general assignment for the benefit of creditors, files an insolvency petition in bankruptcy, petitions for or acquiesces in the appointment of any receiver, trustee or similar officer to liquidate or conserve its business or any substantial part of its assets, commences under the laws of any jurisdiction any proceeding involving its insolvency, bankruptcy, reorganization, adjustment of debt, dissolution, liquidation or any other similar proceeding for the release of financially distressed debtors or becomes a party to any proceeding or action of the type described above and such proceeding or action remains un-dismissed or un-stayed for a period of more than [***].

(b)Payment Default.  A Party may terminate this Agreement in its entirety upon written notice to the other Party upon or after the breach of any payment obligation under this Agreement if the breaching Party has not cured such breach within the [***] period following receipt of written notice of termination by the non-breaching Party.

(c)Material Breach.  A Party may terminate this Agreement with respect to the affected Licensed Compound and/or Product, and the affected country, upon

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written notice to the other Party upon or after the breach of any material provision of this Agreement by such other Party (except for any payment breach or any breach of Commercially Reasonable Efforts, for which the right to terminate shall be exclusively governed by Section 13.2.1(b) and 13.2.1(d), respectively) if the breaching Party has not cured such breach within the [***] period following receipt by the breaching Party of written notice of termination from the notifying Party.  Notwithstanding the foregoing, in the event such breach is not reasonably capable of being cured within the [***] cure period by the breaching Party and such breaching Party is making a good faith effort to cure such breach, the notifying Party may not terminate this Agreement with respect to the affected Licensed Compound and/or Product, and the affected country; provided, however, that the notifying Party may terminate this Agreement with respect to the affected Licensed Compound and/or Product, and the affected country, if such breach is not cured within [***] of receipt by the breaching Party of such original notice of termination. For the avoidance of doubt, the Parties recognize that certain material breaches, other than a breach of Commercially Reasonable Efforts for which the right to terminate shall be exclusively governed by Section 13.2.1(d), may be of such a significant nature as to warrant termination of this Agreement in its entirety including, by way of example, certain material breaches relating to: (i) the use of Confidential Information; (ii) intellectual property rights; (iii) violations of Applicable Laws; or (iv) fraudulent activities related to the exercise of rights or performance of obligations under the Agreement.

(d)Breach of Commercially Reasonable Efforts. In the event that a Party provides written notice of termination for the breach by the other Party of any obligation to use Commercially Reasonable Efforts with regard to Development, manufacturing or Commercialization of Products in the Field in the Territory, such matter shall be submitted to the OSC for resolution pursuant to Section 2.1.4.  If the OSC is not able to resolve such matter by unanimous vote, the dispute shall be resolved in accordance with Article 15; provided, however, if it is determined that a Party is in breach of Commercially Reasonable Efforts pursuant to Section 15.2 or 15.3, the notifying Party may terminate this Agreement with respect to the affected Licensed Compound and/or Product, and the affected country, upon providing written notice to the other Party if the breaching Party has not cured such breach within [***] following resolution of the dispute pursuant to Article 15.  Notwithstanding the foregoing, in the event such a breach is not reasonably capable of being cured within the [***] cure period by the breaching Party, and such breaching Party is making a good faith effort to cure such breach, the notifying Party may not terminate this Agreement; provided, however, that the notifying Party may terminate this Agreement with respect to the affected Licensed Compound and/or Product, and the affected country, pursuant to this Section 13.2.1(d), if such breach is not cured within [***] following resolution of the dispute pursuant to Article 15.  For the avoidance of doubt, nothing contained in this Section 13.2.1(d) shall permit at any time a non-breaching Party to terminate this Agreement in its entirety, or to terminate this Agreement with respect to a non-affected Licensed Compound and/or Product, or a non-affected country.

The right of either Party to terminate this Agreement as provided in this Section 13.2.1 shall not be affected in any way by its waiver of, or failure to take action with respect to, any previous breach.

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13.2.2     Termination for Patent Challenge.  Either Party may terminate this Agreement by written notice effective upon receipt if the other Party, or any of the other Party’s Affiliates or sublicensees, directly or indirectly through assistance granted to a Third Party, commences any interference or opposition proceeding, challenges the validity or enforceability of, or opposes any extension of or the grant of a supplementary protection certificate with respect to, in the case of Takeda or any of its Affiliates or sublicensees, any Amylin Patent, and in the case of Amylin or any of its Affiliates or sublicensees, any Takeda Patent (each such action, a “Patent Challenge”).  Takeda will include provisions in all agreements granting sublicenses of Amylin Patents providing that, if the sublicensee undertakes a Patent Challenge with respect to any Amylin Patent under which the sublicensee is sublicensed, Takeda will terminate such sublicense agreement.

13.2.3     Termination for Safety Reasons.

(a)           Either Party shall have the right to terminate this Agreement with respect to any Licensed Compound or Product in the Territory, without liability for any compensation or other payment obligation to the other Party due to such termination except as expressly specified in this Agreement, by providing the other Party with at least [***] prior written notice of termination, if, at any time, the OSC determines that such Licensed Compound or Product, caused or is likely to cause a fatal, life-threatening or other serious adverse safety event that is reasonably expected, based upon then available data, to preclude obtaining Regulatory Approval for such Licensed Compound or Product, or, if Regulatory Approval of such Product has already been obtained, to preclude continued marketing of such Product; provided, further, if the OSC does not agree on the issue, either Party may terminate this Agreement with respect to such Licensed Compound or Product if: (i) each Party’s Chief Executive Officer (or such delegate of either Chief Executive Officer who shall have appropriate decision making authority regarding such dispute) meets in person or by telephone, within [***]  after receiving written notice of the other Party’s intent to terminate hereunder, to resolve the dispute in good faith; and (ii) they are unable to resolve the dispute.  For the avoidance of doubt, in the event of a termination for safety reasons hereunder, the terminating Party may immediately suspend Development and/or Commercialization activities relating to the terminated Licensed Compound or Product.

(b)           Notwithstanding anything to the contrary in this Agreement, with respect to termination pursuant to Section 13.2.3(a) above, Takeda shall: (i) be relieved from making any development milestone payments to Amylin under Section 8.2.1 regarding such Licensed Compound or Product to the extent a development milestone trigger event occurs after either Party sends the other Party a notice of termination hereunder; and (ii) pay only those commercial and sales-based milestone payments to Amylin under Section 8.2.1 regarding such Licensed Compound or Product to the extent a commercial or sales-based milestone trigger event occurs within [***] after notice of termination.

13.2.4     Commercial Viability.

(a)           At any time, Takeda may terminate this Agreement with respect to any Licensed Compound or Product and any country in the Territory, if it determines that it cannot continue the Agreement on a profitable and commercially viable basis, and upon: (i)

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[***] consultation with the other Party and after providing [***] prior written notice at any time prior to launch of the Product, or (ii) [***] consultation with the other Party and after providing [***]  prior written notice at any time after launch of the Product. For the avoidance of doubt, such [***] consultation periods are intended to fall within such [***] and [***] notice periods.

(b)           For the avoidance of doubt, the determination of profitability and commercial viability under this Section 13.2.4 shall be made on the basis of Commercially Reasonable Efforts and taking into account financial projections suitable to support Commercialization of the Licensed Compound or Product.

(c)           Notwithstanding anything to the contrary in this Agreement, with respect to termination pursuant to (a) and (b) above, Takeda shall be relieved from making any development milestone payments to Amylin as to such Licensed Compound or Product under Section 8.2.1 to the extent a development milestone trigger event occurs after either Party sends such notice of termination hereunder.

13.2.5     No Third Party License.  The Parties may terminate this Agreement with respect to any Licensed Compound or Product and any country in the Territory immediately upon mutual written agreement if a necessary Third Party license is not obtained, all in accordance with Section 12.5.

13.3        Consequences of Termination

13.3.1     Termination of Rights and Obligations.  Upon expiration of this Agreement or early termination of this Agreement under Section 13.2, all rights and obligations of the Parties under this Agreement shall terminate, except as provided in this Section 13.3. In case of Partial Termination of this Agreement where termination is only with respect to one or more of the Licensed Compounds or Products (the “Terminated Product”) in a particular country (the “Terminated Country”), then, notwithstanding anything to the contrary contained in Section 13.3, the consequences of termination described under this Section 13.3 shall only apply to the Terminated Product in the Terminated Country, and this Agreement shall remain in full force and effect in accordance with its terms with respect to all Licensed Compounds or Products other than the Terminated Products, in all countries of the Territory other than the Terminated Countries.

13.3.2     Winding Down of Activities.  In the event there are any on-going research, Development or Commercialization activities, the Parties shall negotiate in good faith and adopt a plan to wind-down such activities in an orderly fashion or, at the continuing Party’s election, promptly transition such activities from the terminating Party to the continuing Party or its designee, with due regard for patient safety and the rights of any subjects that are participants in any Clinical Trials of Licensed Compounds or Products, and take any actions it deems reasonably necessary or appropriate to avoid any human health or safety problems and in compliance with all Applicable Laws.

13.3.3     Reversion of Rights to Amylin.  Except as otherwise set forth in Section 13.3.3(e), upon termination of this Agreement by: (i) mutual agreement of the Parties, including

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under Section 13.2.3(a) or 13.2.5; (ii) Takeda under Section 13.2.3(a) or 13.2.4; or (iii) Amylin under Section 13.2.1 or 13.2.2:

(a)           Takeda shall, and it hereby does, grant to Amylin an exclusive (even as to Takeda) license, with the right to sublicense through multiple tiers of sublicense, under the Takeda Technology and Takeda’s interest in the Joint Inventions and Joint Patents (to the extent used at the time of termination), to research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import and export Licensed Compounds and Products in the Territory, subject in each case to compliance by Amylin with the surviving provisions of this Agreement;

(b)           Takeda shall: (i) transfer to Amylin as soon as reasonably practicable all Takeda Know-How as may be necessary to enable Amylin to practice the license granted under Section 13.3.3(a); (ii) transfer and assign to Amylin all of its right, title and interest in and to all INDs, Regulatory Approvals and other Regulatory Materials with respect to such Licensed Compounds and Products; (iii) if Takeda is responsible for manufacturing the Licensed Compounds and Products pursuant to Article 6, Takeda shall transition to Amylin upon Amylin’s request any arrangement with any contractor from which Takeda had arranged to obtain supplies of Licensed Compounds or Products, to the extent permitted under Takeda’s agreement with such contractor, or in the event that such materials are manufactured by Takeda or its Affiliates then, upon request by Amylin, Takeda shall continue to supply Amylin with such materials at a commercially reasonable price and for a time period to be agreed by the Parties, and, if requested, provide technical assistance (at Takeda’s reasonable cost) reasonably necessary to assist Amylin in the start up of manufacturing of the Licensed Compound and Product and obtaining Regulatory Approval thereof; and (iv) take such other actions and execute such other instruments, assignments and documents as may be necessary to effect the transfer of rights to such Licensed Compounds or Products hereunder to Amylin;

(c)           Takeda shall, and hereby does, grant to Amylin a license, with the right to further sublicense, to use the trademark registered by Takeda pursuant to Section 12.9 with respect to any Licensed Compound or Product in the Territory in exchange for paying to Takeda a royalty of [***] percent ([***] %) of Net Sales of such Licensed Compound or Product in the Territory by Amylin and its Affiliates and sublicensees (with the definition Net Sales and the provisions of Article 9 applying to Amylin as if relevant references to Takeda were instead references to Amylin in the case that Amylin owes such royalty to Takeda), from the effective date of such termination until the expiration of the last-to-expire of the Takeda Patents and Joint Patents claiming such Licensed Compound or Product in the Territory, at which time such license shall become fully paid, royalty-free, perpetual and irrevocable;

(d)           If, after termination of the Agreement pursuant to 13.2.5, Amylin is able to obtain the necessary Third Party license to intellectual property rights and thereafter commercializes the Licensed Compound or Product in the Territory, Amylin shall pay Takeda a royalty of [***] percent ([***] %) on Net Sales of such Product sold by Amylin, its Affiliate or a licensee;

(e)           If the Parties mutually agree to terminate the Agreement pursuant to Section 13.2.3(a) or 13.2.5, then: (i) any and all rights in Amylin Technology Controlled by

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Takeda shall be transferred, licensed to, or assigned, as applicable, from Takeda to Amylin; and (ii) any and all rights in Takeda Technology Controlled by Amylin shall be transferred, licensed to, or assigned, as applicable, from Amylin to Takeda; and

(f)            In consideration for the license granted by Takeda to Amylin under this Section 13.3.3, Amylin shall pay to Takeda royalties on Net Sales derived from the sale of the following Products and equal to: (i) in the case of termination by Takeda under Section 13.2.3(a) of a Product that contains only a Takeda Y-family Agonist, [***] percent ([***] %) during the Initial Royalty Term, [***] percent ([***] %) during the Secondary Royalty Term, and, thereafter, such license shall be fully-paid, royalty-free, perpetual and irrevocable; and (ii) in the case of termination by Takeda under Section 13.2.3(a) of a Product that contains a Takeda Y-family Agonist and an Amylin Licensed Compound, [***] percent ([***] %) during the Initial Royalty Term, [***] percent ([***] %) during the Secondary Royalty Term, and, thereafter, such license shall be fully-paid, royalty-free, perpetual and irrevocable.  All royalties payable by Amylin to Takeda under this Section 13.3.3(f) shall be paid on a [***] basis in accordance with the provisions of Article 9 hereof.  Amylin shall be entitled to take a credit against such royalties in an amount not to exceed any amounts payable under this Agreement by Takeda to Amylin, which have accrued but remain outstanding as of the date of termination, minus any amounts payable hereunder by Amylin to Takeda, which have accrued but remain outstanding as of the date of termination.

13.3.4     Product Rights to Takeda.  Upon termination of this Agreement by: (i) Amylin under Section 13.2.3(a); or (ii) Takeda under Section 13.2.1 or 13.2.2:

(a)           Amylin shall, and it hereby does, grant to Takeda an exclusive (even as to Amylin) license, with the right to sublicense through multiple tiers of sublicense, under the Amylin Technology and Amylin’s interest in the Joint Inventions and Joint Patents, to research, develop, make, have made, distribute, use, sell, have sold, offer for sale, import and export the Licensed Compounds or Products in the Field in the Territory.

(b)           In consideration for the license granted by Amylin to Takeda under this Section 13.3.4, Takeda shall pay to Amylin royalties on Net Sales derived from the sale of the Products, equal to: (i) in the case of termination by Amylin under Section 13.2.3(a), [***] percent ([***] %) during the Initial Royalty Term, [***] percent ([***] %) during the Secondary Royalty Term, and, thereafter, such license shall be fully-paid, royalty-free, perpetual and irrevocable; and (ii) in the case of termination by Takeda under Section 13.2.1 or 13.2.2, [***] percent ([***] %) during the Initial Royalty Term, [***] percent ([***] %) during the Secondary Royalty Term, and, thereafter, such license shall be fully-paid, royalty-free, perpetual and irrevocable.  All royalties payable by Takeda to Amylin under this Section 13.3.4(b) shall be paid on a [***] basis in accordance with the provisions of Article 9 hereof.  Takeda shall be entitled to take a credit against such royalties in an amount not to exceed any amounts payable hereunder by Amylin to Takeda, which have accrued but remain outstanding as of the date of termination, minus any amounts payable hereunder by Takeda to Amylin, which have accrued but remain outstanding as of the date of termination.

(c)           Amylin shall: (i) transfer to Takeda as soon as reasonably practicable all Amylin Know How as may be necessary to enable Takeda to practice the license

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granted under Section 13.3.4(a); (ii) transfer and assign to Amylin all of its right, title and interest in and to the all INDs, Regulatory Approvals and other Regulatory Materials with respect to such Licensed Compounds or Products; (iii) if Amylin is responsible for manufacturing the Licensed Compounds or Products pursuant to Article 6, Amylin shall transition to Takeda upon Takeda’s request any arrangement with any contractor from which Amylin had arranged to obtain supplies of Products, to the extent permitted under Amylin’s agreement with such contractor, or in the event that such materials are manufactured by Amylin or its Affiliate, then, upon request by Takeda, Amylin shall continue to supply Takeda with such materials at a commercially reasonable price and for a time period to be mutually agreed upon by the Parties, and, if necessary, provide technical assistance (at Amylin’s reasonable cost) reasonably necessary to assist Takeda in the start-up of manufacturing of the Licensed Compound or Product and obtaining Regulatory Approval thereof, and (iv) take such other actions and execute such other instruments, assignments and documents as may be necessary to effect the transfer of rights to such Licensed Compounds or  Products hereunder to Takeda.

13.3.5     Return of Confidential Information.  Upon expiration or termination of this Agreement, except to the extent that the continuing Party retains a license from the terminating Party under Sections 13.3.3 or 13.3.4, each Party will promptly return all records and materials in its possession or control containing or comprising the other Party’s Confidential Information.  Each Party shall have the right to maintain one copy of such records in its legal department files for archive purposes, provided that such copy is maintained in accordance with the surviving confidentiality obligations of this Agreement.

13.3.6     Surviving Terms.  Expiration or termination of this Agreement for any reason shall not relieve the Parties of any liability or obligation accruing prior to such expiration or termination nor affect the survival of any provision hereto to the extent it is expressly stated to survive such termination. In addition, the rights and obligations of the Parties under the following provisions of this Agreement shall survive expiration or termination of this Agreement:  Sections 3.5.2(d) (last sentence), 3.7, 3.8, 7.5, 7.1.3, 9.4, 11.5, 11.6, 12.1, 13.3, 13.4, 13.5, and Articles 1, 10, 14, 15 and 16.

13.4        Damages; Relief.  Termination of this Agreement shall not preclude either Party from claiming any other damages, compensation or relief that it may be entitled to under this Agreement.

13.5        Exercise of Right to Terminate.  The use by either Party of a termination right provided for under this Agreement shall not give rise to the payment of damages or any other form of compensation or relief to the other Party with respect thereto.

13.6        Bankruptcy Laws.  All rights and licenses granted under or pursuant to this Agreement are, and shall otherwise be deemed to be, for purposes of Section 365(n) of Title 11 of the United States Code and other similar laws in any jurisdiction outside the United States (collectively, the “Bankruptcy Laws”), licenses of rights to be “intellectual property” as defined under the Bankruptcy Laws.  If a case is commenced during the Term by or against a Party under Bankruptcy Laws then, unless and until this Agreement is rejected as provided in such Bankruptcy Laws, such Party (in any capacity, including debtor-in-possession) and its successors and assigns (including a Title 11 trustee) shall perform all of the obligations provided in this

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Agreement to be performed by such Party.  If a case is commenced during the Term by or against a Party under the Bankruptcy Laws, this Agreement is rejected as provided in the Bankruptcy Laws, and the other Party elects to retain its rights hereunder as provided in the Bankruptcy Laws, then the Party subject to such case under the Bankruptcy Laws (in any capacity, including debtor-in-possession) and its successors and assigns (including a Title 11 trustee), shall provide to the other Party copies of all Information necessary for such other Party to prosecute, maintain and enjoy its rights under the terms of this Agreement promptly upon such other Party’s written request therefor.  All rights, powers and remedies of the non-bankrupt Party as provided herein are in addition to and not in substitution for any and all other rights, powers and remedies now or hereafter existing at law or in equity (including the Bankruptcy Laws) in the event of the commencement of a case by or against a Party under the Bankruptcy Laws.  Additionally, in the event of any insolvency of Takeda or the entry by it into any formal insolvency administration under Japanese law, it is the intention of the Parties that this Agreement shall not terminate and shall continue pursuant to the principles governing insolvency proceedings under Japanese law.  In particular, it is the intention and understanding of the Parties to this Agreement that the rights granted to the Parties under this Section 13.6 are essential to the Parties’ respective businesses and the Parties acknowledge that damages are not an adequate remedy.

14.          INDEMNIFICATION

14.1        Indemnification by Takeda.  Takeda hereby agrees to save, defend and hold Amylin and its Affiliates, and each of their respective directors, officers, employees, agents and representatives (each, an “Amylin Indemnitee”) harmless from and against any and all claims, suits, actions, demands, liabilities, expenses and/or loss, including reasonable legal expense and attorneys’ fees (collectively, the “Losses”), to which any Amylin Indemnitee may become subject as a result of any claim, demand, action or other proceeding by any Third Party (each, a “Claim”) to the extent such Losses arise directly or indirectly out of: (i) the practice by Takeda or its Affiliate or sublicensee of any license granted to it under Article 7; (ii) the manufacture, use, handling, storage, sale or other disposition of any Licensed Compound or Product by Takeda or its Affiliate or sublicensee; (iii) failure by Takeda to obtain or maintain rights under the Takeda Technology sufficient to grant Amylin the licenses set forth in Article 7; (iv) the breach by Takeda of any warranty, representation, covenant or agreement made by Takeda in this Agreement, or, if Amylin exercises the Co-Commercialization Option, the Co-Commercialization Agreement; (v) the negligence, gross negligence or willful misconduct (including to the extent such negligence, gross negligence or willful misconduct gives rise to product liability Claims under any legal theory) of Takeda or its Affiliate or sublicensee, or any officer, director, employee, agent or representative thereof; or (vi) any development or commercialization by Takeda or its Affiliate or sublicensee of any Licensed Compound or Product following the termination of this Agreement by Amylin pursuant to Section 13.2.3(a) with respect to such Licensed Compound or Product; except, with respect to each of subsections (i) through (vi) above, to the extent such Losses arise directly or indirectly from the negligence, gross negligence or willful misconduct of any Amylin Indemnitee or the breach by Amylin of any warranty, representation, covenant or agreement made by Amylin in this Agreement.

14.2        Indemnification by Amylin.  Amylin hereby agrees to save, defend and hold Takeda and its Affiliates and each of their respective directors, officers, employees, agents and

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representatives (each, a “Takeda Indemnitee”) harmless from and against any and all Losses to which any Takeda Indemnitee may become subject as a result of any Claim to the extent such Losses arise directly or indirectly out of: (i) the manufacture, use, handling, storage, sale or other disposition of any Licensed Compound, Product or Excluded Product by Amylin or its Affiliate or licensee (other than Takeda or its Affiliate or sublicensee); (ii) the practice by Amylin or its Affiliate or licensee of any retained license right under Article 7 to Develop or Commercialize any Licensed Compound or Product pursuant to the terms of this Agreement, or, if Amylin exercises its Co-Commercialization Option, any Co-Commercialization Agreement; (iii) failure by Amylin to obtain or maintain rights under the Amylin Technology sufficient to grant Takeda the licenses set forth in Article 7, including any breach or material amendment of an In-License Agreement by Amylin or the other party to such agreement; (iv) the breach by Amylin of any warranty, representation, covenant or agreement made by Amylin in this Agreement, or, if Amylin exercises the Co-Commercialization Option, the Co-Commercialization Agreement; (v) the negligence, gross negligence or willful misconduct (including to the extent such negligence, gross negligence or willful misconduct gives rise to product liability Claims under any legal theory) of Amylin or its Affiliate or licensee (other than Takeda or its Affiliate or sublicensee), or any officer, director, employee, agent or representative thereof; or (vi) any development or commercialization by Amylin or its Affiliate or licensee of any Licensed Compound or Product following the termination of this Agreement by Takeda pursuant to Section 13.2.3(a) with respect to such Licensed Compound or Product; except, with respect to each of subsections (i) through (vi) above, to the extent such Losses arise directly or indirectly from the negligence, gross negligence or willful misconduct of any Takeda Indemnitee or the breach by Takeda of any warranty, representation, covenant or agreement made by Takeda in this Agreement.

14.3        Indemnification Procedures.

14.3.1     Notice.  Promptly after an Amylin Indemnitee or a Takeda Indemnitee (each, an “Indemnitee”) receives notice of a pending or threatened Claim, such Indemnitee shall give written notice of the Claim to the Party from whom the Indemnitee is entitled to receive indemnification pursuant to Sections 14.1 or 14.2, as applicable (the “Indemnifying Party”).  However, an Indemnitee’s delay in providing or failure to provide such notice will not relieve the Indemnifying Party of its indemnification obligations, except to the extent it can demonstrate prejudice due to the delay or lack of notice.

14.3.2     Defense.  Upon receipt of notice under Section 14.3.1 from the Indemnitee, the Indemnifying Party will have the duty to either compromise or defend, at its own expense and by counsel (reasonably satisfactory to Indemnitee), such Claim.  The Indemnifying Party will promptly (and in any event not more than twenty (20) days after receipt of the Indemnitee’s original notice) notify the Indemnitee in writing that it acknowledges its obligation to indemnify the Indemnitee with respect to the Claim pursuant to this Article 14 and of its intention either to compromise or defend such Claim.  Once the Indemnifying Party gives such notice to the Indemnitee, the Indemnifying Party is not liable to the Indemnitee for the fees of other counsel or any other expenses subsequently incurred by the Indemnitee in connection with such defense, other than the Indemnitee’s reasonable costs of investigation and cooperation.  However, the Indemnitee will have the right to employ separate counsel and to control the defense of a Claim at its own expense.

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14.3.3     Cooperation.  The Indemnitee will cooperate fully with the Indemnifying Party and its legal representatives in the investigation and defense of any Claim.  The Indemnifying Party will keep the Indemnitee informed on a reasonable and timely basis as to the status of such Claim (to the extent the Indemnitee is not participating in the defense of such Claim) and conduct the defense of such Claim in a prudent manner.

14.3.4     Settlement.  If an Indemnifying Party assumes the defense of a Claim, no compromise or settlement of such Claim may be effected by the Indemnifying Party without the Indemnitee’s written consent (which consent will not be unreasonably withheld or delayed), unless: (i) there is no finding or admission of any violation of law or any violation of the rights of any person and no effect on any other claims that may be made against the Indemnitee; (ii) the sole relief provided is monetary damages that are paid in full by the Indemnifying Party; and (iii) the Indemnitee’s rights under this Agreement are not adversely affected.  If the Indemnifying Party fails to assume defense of a Claim within a reasonable time, the Indemnitee may settle such Claim on such terms as it deems appropriate with the consent of the Indemnifying Party (which consent shall not be unreasonably withheld), and the Indemnifying Party will be obligated to indemnify the Indemnitee for such settlement as provided in this Article 14.

14.4        Insurance.  Each Party shall, at its own expense, procure and maintain during the Term and for a period of five (5) years thereafter, insurance policy/policies, including product liability insurance, adequate to cover its obligations hereunder and which are consistent with normal business practices of prudent companies similarly situated.  Such insurance shall not be construed to create a limit of a Party’s liability with respect to its indemnification obligations under this Article 14.  Each Party shall provide the other Party with written evidence of such insurance or self-insurance upon request.  Each Party shall provide the other Party with prompt written notice of cancellation, non-renewal or material change in such insurance self-insurance, which could materially adversely affect the rights of such other Party hereunder, and shall provide such notice within thirty (30) days after any such cancellation, non-renewal or material change.

15.          DISPUTE RESOLUTION

15.1        Objective.  The Parties recognize that disputes as to matters arising under or relating to this Agreement or either Party’s rights and/or obligations hereunder may arise from time to time.  It is the objective of the Parties to establish procedures to facilitate the resolution of such disputes in an expedient manner by mutual cooperation and without resort to litigation.  To accomplish this objective, the Parties agree to follow the procedures set forth in this Article 15 to resolve any such dispute if and when it arises.  For the avoidance of doubt, both Parties acknowledge and agree that notwithstanding anything to the contrary contained in this Agreement, the following shall not be subject to the dispute resolution provisions contained in Sections 15.2 and 15.3: (i) final decisions made by [***] pursuant to its rights under [***]; (ii) failure of the OSC to unanimously decide (a) [***], or (b) whether to [***]; and (iii) termination by either Party for safety reasons under Section 13.2.3(a).  For clarification, the determination by either Party that a safety issue exists that would permit termination of this

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Agreement under Section 13.2.3(a) shall not be subject to the dispute resolution provisions contained in Sections 15.2 and 15.3; provided, however, that, if a Party believes in good faith that the election by the other Party to terminate this Agreement under Section 13.2.3(a) was a breach of this Agreement because the electing Party had not in fact determined that a safety issue permitting such termination existed, then such dispute shall be subject to the dispute resolution provisions contained in Sections 15.2 and 15.3.

15.2        Resolution by Senior Executives.  Except as otherwise provided in this Agreement including Section 15.1, if an unresolved dispute as to matters arising under or relating to this Agreement or either Party’s rights and/or obligations hereunder arises, either Party may refer such dispute to the Chief Executive Officers of each of Takeda and Amylin (or such delegate of either Chief Executive Officer who shall have appropriate decision making authority regarding such dispute), who shall meet in person or by telephone within [***] after such referral to attempt in good faith to resolve such dispute.  If such matter cannot be resolved by discussion of Chief Executive Officers, or their respective delegates, within such [***] period (as may be extended by mutual written agreement), such dispute shall be resolved in accordance with Section 15.3.

15.3        Arbitration.  Any dispute that is not resolved as provided in Section 15.2 may be referred to arbitration by either Party.  Such arbitration shall be conducted in accordance with the Rules of Arbitration of the International Chamber of Commerce (the “ICC Rules”) as then in effect.  The arbitration shall be held solely in New York, New York, U.S.A, and shall be conducted in English before an arbitration panel comprised of three (3) arbitrators, who shall be selected as follows: (i) each Party shall select one (1) arbitrator within twenty (20) days after the date on which one of the Parties makes a written demand for arbitration in accordance with the ICC Rules; and (ii) the third arbitrator, who shall act as chairman of the arbitration panel, shall be selected by the other two (2) arbitrators within twenty (20) days after the selection of the other two (2) arbitrators; provided, however, in the event that a Party fails to select an arbitrator, or the two (2) arbitrators selected by the Parties fail to select the third arbitrator in accordance with this Section 15.3, such arbitrator(s) shall be selected by the Chairman of the International Chamber of Commerce upon the written request of either Party. The decision and award of the arbitrators in any arbitration proceeding between the Parties under this Section 15.3 shall be: (a) in writing, stating the reasons for such decision; (b) based solely on the terms and conditions of this Agreement, as interpreted in accordance with the laws of the State of New York, U.S.A.; (c) final and binding upon the Parties hereto; and (d) enforceable in any court of competent jurisdiction.  The fees and expenses of the arbitration shall be shared equally by the Parties.

15.4        Court Actions. The dispute resolution process described in Section 15.3 shall be employed in lieu of litigation in a court of law, except in the following circumstances:  (i) either Party shall be permitted to seek a preliminary injunction or other equitable remedy in the courts to preserve rights, which may otherwise be lost or encumbered in the absence of injunctive relief, or to preserve the status quo including, but not limited to, preserving the confidentiality of Confidential Information; and (ii) any dispute, controversy or claim relating to the scope, validity, enforceability or infringement of any Patents or any trademark relating to any Licensed Compound or Product that is the subject of this Agreement shall be submitted to a court of competent jurisdiction in which such Patent or trademark rights were granted or arose.

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16.          MISCELLANEOUS

16.1        Standstill Agreement.  Until the date that is three (3) years after the Effective Date (the “Standstill Period”), none of Takeda, Takeda’s Affiliates, nor any of their respective directors, officers, employees, agents or representatives (provided such person is acting on behalf of Takeda) will, in any manner, directly or indirectly, without the prior express written consent of Amylin (provided that the foregoing shall not limit Takeda’s obligations under this Section 16.1):

(a)           acquire, offer to acquire or agree to acquire, alone or in concert with any other Person, by purchase, tender offer, exchange offer, agreement or business combination or any other manner: (i) beneficial ownership of any securities of Amylin or any securities of any Affiliate of Amylin, if, after completion of such acquisition or proposed acquisition, Takeda would beneficially own more than nine and 99/100 percent (9.99%) of the outstanding shares of common stock of Amylin (the “Common Stock”); (ii) any assets of Amylin or any assets of any Affiliate of Amylin, other than non-material acquisitions in the ordinary course of business;

(b)           initiate, participate in or enter into any merger, business combination, recapitalization, restructuring, liquidation, dissolution or similar extraordinary transaction involving Amylin or any Affiliate of Amylin, or involving any securities or assets of Amylin or any securities or assets of any Affiliate of Amylin;

(c)           “solicit” “proxies” (as those terms are used in the proxy rules of the Securities and Exchange Commission) or consents with respect to any securities of Amylin;

(d)           form, join or participate in a Group with respect to the beneficial ownership of any securities of Amylin;

(e)           act, alone or in concert with others, to seek to control the management, board of directors or policies of Amylin;

(f)            take any action that would reasonably be expected to require Amylin to make a public announcement regarding any of the types of matters set forth in clause “(a)”, “(b)”, “(c)” or “(d)” of this sentence;

(g)           agree, offer to take, propose, assist, induce or encourage any other Person to take, publicly or otherwise, any action of the type referred to in clause “(a)”, “(b)”, “(c)”, “(d)”, “(e)” or “(f)” of this sentence;

(h)           enter into any discussions, negotiations, arrangements or agreements with any other Person relating to any of the foregoing; or

(i)            request or propose that Amylin or any of Amylin’s representatives amend, waive or consider the amendment or waiver of any of the provisions set forth in this Section 16.1.

Notwithstanding the restrictions contained in the foregoing clauses “(a)” through “(i)”: (1) Takeda shall not be prohibited from entering into an agreement and having discussions

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with legal, accounting, or financial advisors for the limited purposes of evaluating any of the transactions contemplated in clause “(a)”, “(b)”, “(c)”, “(d)”, “(e)” or “(f)” of this sentence; and (2) so long as Takeda has not violated the provisions of clauses “(a)” through “(i)” inclusive, Takeda may inform Amylin or Amylin’s Representatives privately that Takeda alone, and not in concert with others, would be interested in engaging in discussions with Amylin that could result in a negotiated transaction described in clause “(a)” or “(b)” so long as, (x) Takeda does not propose any such transaction unless Amylin requests Takeda to make such a proposal, (y) Takeda does not seek any amendment or waiver of any provision of this Section 16.1, and (z) Takeda does not take any action that would reasonably be expected to require Amylin to make any public announcement.

Notwithstanding the restrictions contained in the foregoing “(a)” through “(i)”, the provisions of this Section 16.1 shall not apply to:

(i)            the exercise by Takeda of any of its rights under this Agreement;

(ii)           the exercise by Takeda as an Amylin stockholder, if applicable, of any voting rights available to Amylin stockholders generally pursuant to any transaction described in subparagraph “(a)(ii)” or “(b)” above, provided that Takeda has not then either directly, indirectly, or as a member of a Group made, effected, initiated or caused such transaction to occur;

(iii)          any activity by Takeda after Amylin, or any Third Party unrelated to Takeda, has made any public announcement of its intent to solicit or engage in any transaction which would result in a Change in Control of Amylin, or after any such Change in Control of Amylin shall have occurred; or

(iv)          any investment by Takeda or an Affiliate of Takeda in third-party mutual funds or other similar passive investment vehicles that hold interests in securities of Amylin or any of its Affiliates (and any such interests in securities shall not be taken into account for the purpose of subparagraph (a) including the nine and 99/100 percent (9.99%) exception contained therein), provided that the provisions of this clause (iv) shall apply with respect to any such fund or vehicle only for so long as such fund or vehicle satisfies the requirements of paragraphs (i) and (ii) of Rule 13d-1(b)(1) promulgated under the Securities Exchange Act of 1934, as amended, with respect to any Amylin securities held by such fund or vehicle.

Except as provided for below, the restrictions of this Section 16.1 shall no longer be applicable in the event of any of the following:

(A)          the acquisition by any Third Party of beneficial ownership of more than fifteen percent (15%) of the outstanding Common Stock;

(B)           the announcement or commencement by any Person or Group of a tender offer or exchange offer to acquire securities of Amylin which, if successful, would result in such Person or Group owning, when combined with any other securities owned by such Person or Group, fifty percent (50%) or more of the then outstanding Common Stock;

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(C)           Amylin enters into a definitive written merger, sale or other business combination agreement pursuant to which fifty percent (50%) or more of the outstanding Common Stock of Amylin would be converted into cash or securities of another Person or Group or, immediately after the consummation of such transaction, fifty percent (50%) or more of the then outstanding Common Stock would be owned by Persons other than the holders of Common Stock immediately prior to the consummation of such transaction, or which would result in all or substantially all of Amylin’s assets being sold to any Person or Group;

(D)          Amylin or any of its Affiliates becomes the subject of any bankruptcy, insolvency or similar proceeding (except for any involuntary proceeding that is dismissed within 60 days); or

(E)           Amylin engages in the solicitation of one (1) or more Third Party bids for any transaction which would result in a Change of Control of Amylin.

The provisions of this Section 16.1 shall again be applicable if: (1) Amylin or such Third Party, Person or Group, as applicable, terminates or announces its intent not to proceed with any transaction referred to in clauses (iii), (B), (C) or (E) above, as applicable, or, in the case of clause (D) above, Amylin and its Affiliates shall cease to be the subject of any such bankruptcy, insolvency or similar proceeding, as applicable; and (2) either (x) Takeda has not previously made any public announcement of its intent to solicit or engage in any transaction of the type referred to in clauses (iii), (B), (C) or (E) above, or (y) in the event such a public announcement has been made by Takeda, Takeda has terminated or announced its intent to terminate such transaction.

If, during the Standstill Period, Amylin enters into any development and commercialization agreement with a Third Party that is similar in size and scope to this Agreement (the “Third Party Agreement”), which does not contain provisions restricting the activities of such Third Party that, taken as a whole (the “Third Party Standstill Provisions”), are at least as onerous to the Third Party as the provisions of this Section 16.1, then, upon the effective date of the Third Party Agreement, the provisions of this Section 16.1 shall automatically be deemed modified without further action so as to conform to the Third Party Standstill Provisions.  For the avoidance of doubt, the Parties agree that if the Third Party Agreement contains no standstill provision, this Section 16.1 shall terminate in its entirety upon the effective date of the Third Party Agreement.

The expiration of the Standstill Period will not terminate or otherwise affect any of the provisions of this Agreement other than this Section 16.1.

16.2        Force Majeure.  Neither Party shall be held liable to the other Party nor be deemed to have defaulted under or breached this Agreement for failure or delay in performing any obligation under this Agreement when such failure or delay is caused by or results from an event of force majeure; provided, however, with respect to a failure to make payment due to an event of force majeure, the non-performing Party shall be required to make such payment as quickly as possible, but in any event, even if the force majeure continues, within two (2) months from the date that the force majeure began; provided, further, that in the event that an event of force majeure prevents either Party from making any payment to the other Party in a timely

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manner, as provided in Article 9 hereof, interest on such unpaid amount shall nonetheless accrue in accordance with the provisions of Section 9.5.  For purposes of this Section 16.2, an event of force majeure shall mean and include any causes beyond the reasonable control of the affected Party including, but not limited to, embargoes, war, acts of war (whether war be declared or not), insurrections, riots, civil commotions, strikes, lockouts or other labor disturbances, fire, floods, or other acts of God, or acts, omissions or delays in acting by any governmental authority (including, but not limited to, the refusal of the competent government agencies to issue required Regulatory Approvals due to reasons other than the affected Party’s negligence or willful misconduct or any other cause within the reasonable control of the affected Party).  The affected Party shall notify the other Party of such force majeure event as soon as reasonably practical, and shall promptly undertake all Commercially Reasonable Efforts necessary to cure such force majeure event.  Such excuse from liability shall be effective only to the extent and duration of the force majeure event(s) causing the failure or delay in performance and provided that the Party has not caused such event(s) to occur.

16.3        Assignment.  Except as expressly provided hereunder, neither this Agreement nor any rights or obligations hereunder may be assigned or otherwise transferred by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld;provided, however, that it shall not be unreasonable for a Party to refuse to authorize any assignment (other than to an Affiliate, as provided in Section 16.3(b) below) proposed by the other Party in the event that: (i) such Party reasonably determines that the proposed assignee does not have the financial, technical and/or marketing resources to perform the other Party’s obligations hereunder; (ii) the proposed assignee is engaged in any litigation, arbitration or an other legal proceeding of a material nature as an adverse party to such Party; or (iii) the proposed assignee has infringed any of the intellectual property rights hereunder, misappropriated or misused any of Confidential Information, or engaged in any other unfair or unethical business practices. Notwithstanding the foregoing, Amylin may assign its right to receive payments under this Agreement without Takeda’s prior written consent and either Party may assign this Agreement and its rights and obligations hereunder without the other Party’s consent:

(a)           in connection with the transfer or sale of all or substantially all of the business of such Party to a Third Party, whether by merger, sale of stock, sale of assets or otherwise, provided that in the event of a transaction (whether this Agreement is actually assigned or is assumed by the acquiring Third Party by operation of law (e.g., in the context of a reverse triangular merger)), intellectual property rights of the acquiring Third Party in such transaction (if other than one of the Parties to this Agreement) shall not be included in the intellectual property rights licensed under this Agreement; or

(b)           to an Affiliate, provided that the assigning Party shall remain liable and responsible to the non-assigning Party hereto for the performance and observance of all such duties and obligations by such Affiliate.

Notwithstanding anything to the contrary contained in this Agreement, upon a Change of Control of either Party, the other Party will have final decision making authority for all decisions made by the OSC and ODC with respect to Development and Commercialization matters.  A “Change of Control” of a Party shall occur if: (i) any Third Party acquires directly or indirectly the beneficial ownership of any voting security of such Party, or if the percentage ownership of

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such person or entity in the voting securities of such Party is increased through stock redemption, cancellation or other recapitalization, and immediately after such acquisition or increase such Third Party is, directly or indirectly, the beneficial owner of voting securities representing more than fifty percent (50%) of the total voting power of all of the then-outstanding voting securities of such Party; (ii) the consummation of a merger, consolidation, recapitalization, or reorganization of such Party, other than any such transaction, which would result in stockholders or equity holders of such Party, or an Affiliate of such Party, immediately prior to such transaction owning at least fifty percent (50%) of the outstanding securities of the surviving entity (or its parent entity) immediately following such transaction; or (iii) the stockholders or equity holders of such Party approve a plan of complete liquidation of such Party, or an agreement for the sale or disposition by such Party of all or a substantial portion of such Party’s assets, other than pursuant to the transaction as described above or to an Affiliate.

This Agreement shall be binding upon successors and permitted assigns of the Parties.  Any assignment not in accordance with this Section 16.3 will be null and void.

16.4        Limitation of Liability.  EXCEPT FOR EACH PARTY’S OBLIGATIONS WITH RESPECT TO THE INTELLECTUAL PROPERTY RIGHTS AS PROVIDED IN ARTICLE 12, AND EACH PARTY’S OBLIGATIONS WITH RESPECT TO THE OTHER PARTY’S CONFIDENTIAL INFORMATION AS PROVIDED IN ARTICLE 10, NEITHER PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ANY SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES IN CONNECTION WITH THIS AGREEMENT OR ANY LICENSE GRANTED HEREUNDER INCLUDING, BUT NOT LIMITED TO, LOST PROFITS, LOST SALES OR LOSS OF GOODWILL, EVEN IF THAT PARTY HAS BEEN PLACED ON NOTICE OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED, HOWEVER, THAT THIS SECTION 16.4 SHALL NOT BE CONSTRUED TO LIMIT EITHER PARTY’S INDEMNIFICATION OBLIGATIONS UNDER ARTICLE 14, AND IN NO EVENT SHALL PAYMENTS DUE AND OWING UNDER ARTICLE 8 BE CONSIDERED SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL, OR PUNITIVE DAMAGES.

16.5        Severability.  If any one or more of the provisions contained in this Agreement is held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, unless the absence of the invalidated provision(s) adversely affects the substantive rights of the Parties.  The Parties shall in such an instance negotiate in good faith and use Commercially Reasonable Efforts to replace the invalid, illegal or unenforceable provision(s) with valid, legal and enforceable provision(s) which, insofar as practical, implement the purposes of this Agreement.

16.6        Notices.  All notices which are required or permitted hereunder shall be in writing and sufficient if delivered personally, sent by facsimile (and promptly confirmed by personal delivery, registered or certified mail or overnight courier), sent by nationally-recognized overnight courier or sent by registered or certified mail, postage prepaid, return receipt requested, addressed as follows:

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If to Amylin, addressed to:

Amylin Pharmaceuticals, Inc.

9360 Towne Centre Drive

San Diego, CA 92121, U.S.A.

Attention: Chief Executive Officer

Fax: (858) 552-2212

With a required copy to:

Amylin Pharmaceuticals, Inc.

9360 Towne Centre Drive

San Diego, CA 92121, U.S.A.

Attention: General Counsel

Fax: (858) 552-1936

If to Takeda, addressed to:

Takeda Pharmaceutical Company Limited

1-1, Doshomachi 4-chome, Chuo-ku

Osaka 540-8645, Japan

Attention: General Counsel, Legal Department

Fax: +81 6 6204-2880

With a required copy to:

Takeda Pharmaceuticals North America, Inc.

One Takeda Parkway

Deerfield, Illinois 60015

Attention: General Counsel, Legal Department

Fax: (224) 554-7831

or to such other address as the Party to whom notice is to be given may have furnished to the other Party in writing in accordance herewith.  Any such notice shall be deemed to have been given: (i) when delivered if personally delivered or sent by facsimile on a business day; (ii) on the business day after dispatch if sent by nationally recognized overnight courier; and/or (iii) on the third (3rd) business day following the date of mailing if sent by mail.

16.7        Applicable Law.  Except as otherwise provided for in this Agreement, including in Section 15.4, this Agreement and all questions regarding its existence, validity, interpretation, breach or performance, shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, United States, without reference to its conflicts of law principles with the exception of Sections 5-1401 and 5-1402 of New York General Obligations Law; provided, however, that: (i) the validity or enforcement of all Amylin Technology or Takeda Technology hereunder shall be determined under the laws of that jurisdiction in which the Amylin Technology or Takeda Technology is registered or for which an application for registration has been filed; and (ii) the use in the Territory of the Product trademarks and other unregistered Amylin Technology or Takeda Technology shall be governed by Applicable Law.

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The United Nations Conventions on Contracts for the International Sale of Goods shall not be applicable to this Agreement.

16.8        Entire Agreement; Amendments.  This Agreement, together with the Exhibit hereto, contains the entire understanding of the Parties with respect to the subject matter hereof and supersedes and cancels all previous express or implied agreements and understandings, negotiations, writings and commitments, either oral or written, in respect to the subject matter hereof.  In the event of any conflict between the terms of this Agreement and any provisions contained in the Exhibits to this Agreement, the terms of this Agreement shall prevail.  This Agreement may be amended, or any term hereof modified, only by a written instrument duly executed by authorized representatives of both Parties hereto.

16.9        Headings.  The captions to the several Articles and Sections hereof are not a part of this Agreement, but are merely for convenience to assist in locating and reading the several Articles and Sections hereof.

16.10      Independent Contractors.  It is expressly agreed that Amylin and Takeda shall be independent contractors and that the relationship between the two Parties shall not constitute a partnership, joint venture or agency.  Neither Amylin nor Takeda shall make, nor have the authority to make, any statements, representations or commitments of any kind, or to take any action, which shall be binding on the other Party, without the prior written consent of the other Party.

16.11      Waiver.The failure by either Party hereto to assert any of its rights hereunder, including, but not limited to, the right to terminate this Agreement due to a breach or default by the other Party hereto, shall not be deemed to constitute a waiver by that Party of its right thereafter to enforce each and every provision of this Agreement in accordance with its terms.  No waiver by either Party of any provision of this Agreement shall be effective unless made in writing and signed by the Party granting such waiver.

16.12      Cumulative Remedies.  No remedy referred to in this Agreement is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to in this Agreement or otherwise available under law.

16.13      Waiver of Rule of Construction.  Each Party has had the opportunity to consult with counsel in connection with the review, drafting and negotiation of this Agreement.  Accordingly, the rule of construction that any ambiguity in this Agreement shall be construed against the drafting Party shall not apply.

16.14      Interpretation.  All references in this Agreement to an Article, Section or Exhibit shall refer to an Article, Section or Exhibit in or to this Agreement, unless otherwise stated.  Any reference to any federal, national, state, local, or foreign statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise.  The word “including” and similar words means including without limitation.  The words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Article or Section or other subdivision.  All references to days,

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months, quarters or years are references to calendar days, calendar months, calendar quarters, or calendar years, unless stated otherwise.  References to the singular include the plural.

16.15      No Third Party Beneficiaries.  This Agreement is neither expressly nor impliedly made for the benefit of any party other than Amylin and Takeda.

16.16      English Language.  This Agreement is in the English language, and the English language shall control their interpretation.  In addition, all notices required or permitted to be given under this Agreement, and all written, electronic, oral or other communications between the Parties regarding this Agreement, shall be in the English language.

16.17      Counterparts.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

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IN WITNESS WHEREOF, the Parties hereto have duly executed this LICENSE, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT as of the Effective Date.

TAKEDA PHARMACEUTICAL COMPANY LIMITED		AMYLIN PHARMACEUTICALS, INC.
By:	/s/ Yasuchika Hasegawa	By:	/s/ Daniel M. Bradbury
Name: Yasuchika Hasegawa		Name: Daniel M. Bradbury
Title: President & CEO		Title: President & CEO

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Exhibit A

Amylin Patents as of the Effective Date

[***]

*** Confidential Treatment Requested

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Exhibit B

Development Plan Through [***]

The following timelines represent the most current version of the clinical development portion of the overall Development Plan.  Within [***] after the Effective Date, the Parties shall update and amend, and confirm through the ODC and OSC, the Development Plan to include a comprehensive Development Budget and CMC, toxicology and additional or revised clinical or non-clinical activities, all in accordance with Section 3.1 of the Agreement.

Name: [***]

Indication: Obesity

[***]

*** Confidential Treatment Requested

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Name: [***]

Indication: Obesity

[***]

Name: [***]

Indication: Obesity

[***]

*** Confidential Treatment Requested

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Name: [***]

Indication: Obesity

[***]

*** Confidential Treatment Requested

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Commission.  Confidential Treatment Requested Under

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Exhibit C

Analogs of MetreLeptin

1.             [***]

2              [***]

*** Confidential Treatment Requested

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Exhibit D

Co-Commercialization Agreement Terms

The Co-Commercialization Agreement shall include the following terms and conditions, unless otherwise mutually agreed by the Parties, in addition to such terms and conditions as are customarily contained in similar agreements in the pharmaceutical industry and such other terms and conditions as the Parties may agree upon:

1.             Commercialization right.  Amylin shall be entitled to participate in the Commercialization of the Products as follows:  (i) through membership in the OCC; (ii) performing a portion of the Detailing efforts for Products, subject to the limits described in Section 5.3 of the Agreement; and (iii) conducting such other activities necessary to support its PDE obligations. The Co-Commercialization Agreement shall be structured to reflect the following:

·The number of PDEs to be performed annually by Amylin for Products will be mutually agreed by the Parties; provided that Amylin shall perform not more than [***] percent ([***] %) of the aggregate number of PDEs specified in the Commercialization Plan for each Product;

·The allocation of Details to be performed by Amylin will be determined by Takeda, with input from Amylin, taking into consideration prescribing levels, geographic territory, centers of excellence, target groups, Detail position and other relevant considerations as Takeda may determine.

·Amylin will maintain [***] percent ([***] %) adherence to its PDE requirement under the call plan for the Takeda Detail allocation.

·Amylin shall implement and maintain an appropriate incentive plan for the sale of the Product for its sales force that provides an incentive on an interval to be specified in the Co-Commercialization Agreement, and shall be weighted at a level commensurate with the Product Detail position for the Product as compared with the total number of products handled by such Medical Sales Representative, but not less than [***] percent ([***] %).

·Amylin will provide PDEs in accordance with the applicable Commercialization Plan.

2.             Co-Commercialization expenses.  Except as otherwise specifically provided in this Exhibit D, Amylin will be responsible for all costs and expenses of its Commercialization activities under the Co-Commercialization Agreement, including, without limitation, costs and expenses of its Medical Sales Representatives.

3.             PDE Reimbursement.  Following the end of each calendar quarter, Takeda will pay Amylin an amount equal to [***] percent ([***] %) of Takeda’s then-current fully burdened internal PDE costs for each PDE performed by Amylin during such calendar quarter.

*** Confidential Treatment Requested

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4.             Detail and Sample Reporting.

·Amylin will maintain complete and accurate records of each PDE performed by its Medical Sales Representatives using a call document which records the name and address of each target prescriber, the date and position of the PDE, the number of samples delivered and any other information reasonably requested by Takeda.

·Amylin will provide Takeda with a monthly written report of the number of total PDEs delivered, and any other information reasonably requested by Takeda, in a form agreed upon by the Parties.  The monthly report shall be provided to Takeda no later than the 10th calendar day of the following month, or within such timeframe as is consistent with Amylin’s then-current systems and processes for creating such written reports.

·Takeda shall determine sampling procedures to be followed by Amylin, if applicable, with input with Amylin.

·Takeda shall have the right to perform audits of Amylin’s files, records, databases, etc. to confirm the accuracy of any PDE or sample reports provided under the Co-Commercialization Agreement.

5.             Performance Standards.

·Amylin will use Commercially Reasonable Efforts to Commercialize the Products and will perform its Commercialization obligations in accordance with the Agreement, the Co-Commercialization Agreement and the applicable Commercialization Plan.

·Amylin shall comply with all laws, rules and regulations applicable to the marketing, sale and promotion of pharmaceutical products, including, without limitation, the statutes, regulations and written directives of the FDA, including the FD&C Act, the Prescription Drug Marketing Act, the Federal Health Care Programs Anti-Kickback Law, 42 U.S.C. 1320a-7b(b), the statutes, regulations and written directives of Medicare, Medicaid and all other health care programs, as defined in 42 U.S.C. §1320a-7b(f) the Health Insurance Portability and Accountability Act of 1996, the Pharmaceutical Research and Manufacturers of America Code on Interactions with Healthcare Professionals, and the American Medical Association Guidelines on Gifts to Physicians from Industry, each as may be amended from time to time.  Consistent with the “Compliance Program Guidance for Pharmaceutical Manufacturers,” published by the Office of Inspector General, U.S. Department of Health and Human Services (the “OIG Guidance”), Amylin agrees to maintain a compliance program with respect to its promotional and sales activities relating to the Products containing all of the elements described in such guidance document.  Upon Takeda’s request, Amylin will provide Takeda with copies of its policies for such compliance programs.

6.             Promotional Materials and Samples.  Takeda will provide to Amylin reasonable quantities of promotional materials and samples and/or sample vouchers for Products to support Amylin’ Co-Commercialization activities.

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·Takeda will provide such materials to Amylin at Takeda’s sole expense;

·Amylin shall not, and shall ensure that its Medical Sales Representatives do not, make any changes to the promotional materials.

7.             Training and Related Amylin Sales Force Issues.  Takeda shall provide initial training to Amylin’ sales managers and trainers (i.e., “train-the-trainer”) at Takeda’s expense. Thereafter, Amylin will be responsible for conducting training for its own sales forces.  Takeda will be responsible for designing training materials, approving participation and representation at meetings, and will ship training materials to Amylin as reasonably required for Amylin’ ongoing training needs at Takeda’s expense.

·At the request of a Party, such Party’s trainers may participate in the other Party’s training programs specific to Products.

·Amylin shall be responsible, at Takeda’s expense, for the training of its sales force specifically related to the launch of a Product.

·Amylin shall be responsible, at its expense, for establishing ongoing training (other than the training provided by Takeda), supervising and maintaining its Medical Sales Representatives.

·Amylin will be permitted to participate in any speaker meetings, advisory board meetings and/or promotional events (including, but not limited to, displays and exhibit booths) related to the Product in a manner consistent with the participation of Takeda’s personnel and polices.

8.             Term and Termination.

·The term of the Co-Commercialization Agreement shall commence on the effective date of the Co-Commercialization Agreement and shall continue in effect for a period of [***]; provided that the term may be extended for an additional [***]: (i) by mutual agreement of the Parties; or (ii) at Amylin’s sole option, if, during discussions by the Parties relating to such extension, Takeda expresses its intention to use a contract sales organization during the period of the [***] extension.  Amylin must exercise its option to extend not later than [***] prior to the expiration of the first [***] term.

·The Co-Commercialization Agreement shall contain reasonable and appropriate termination rights, including without limitation, Takeda’s right to terminate in the event of: (i) a Change of Control of Amylin (as defined in the Agreement); and (ii) Amylin’s failure to meet its PDE obligation after a reasonable opportunity to cure, which shall not exceed a period of [***].

9.             Medical Inquires.  Takeda will establish procedures for handling any medical inquires from health care professionals or others and any requests for medical information about the Product.

*** Confidential Treatment Requested

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10.          Adverse Events.  The Parties will establish a process for communicating and reporting any adverse events and complaints relating to the Products in accordance with the pharmacovigilance agreement described in Section 4.4 of the Agreement.

11.          Non-Solicitation.  During the term of the Co-Commercialization Agreement and for twelve (12) months thereafter, neither Party will recruit or solicit, directly or through a Third Party, for employment or otherwise, any Medical Sales Representative and associated field support of the other Party without the written consent of the other Party.

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Exhibit E

Takeda Y-family Agonists

1.[***]

*** Confidential Treatment Requested

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Commission.  Confidential Treatment Requested Under

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Exhibit F

In-License Agreements

License Agreement between Amgen Inc. and Amylin, dated February 7, 2006, as amended.

License Agreement between Curis Inc. and Amylin, dated December 4, 2002, as amended.

Development and License Agreement between Pacira Pharmaceuticals, Inc. and Amylin, dated as of March 31, 2008, as amended.

Confidential Agreement and Release of All Claims among the University of Minnesota and Per Westermark and Amylin, dated October 21, 1998, as amended.

F-1

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Commission.  Confidential Treatment Requested Under

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Exhibit G

[***]

*** Confidential Treatment Requested

G-1

EX-10.53

EXHIBIT 10.53

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Commission.  Confidential Treatment Requested Under

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[AMYLIN LETTERHEAD]

October 30, 2009

Takeda Pharmaceutical Company Limited

1-1, Doshomachi 4-chome, Chuo-ku

Osaka 540-8645, Japan

Attention: Mr. Yasuchika Hasegawa, President & CEO

Re:License, Development and Commercialization Agreement dated as of October 30, 2009 (the “Agreement”) by and between Takeda Pharmaceutical Company Limited (“Takeda”) and Amylin Pharmaceuticals, Inc. (“Amylin”)

Ladies and Gentlemen:

This letter (the “Letter”) will confirm the understanding of Takeda and Amylin regarding certain matters relating to the Agreement.  Capitalized terms used but not otherwise defined in this Letter shall have the meanings provided in the Agreement.  Takeda and Amylin, intending to be legally bound, hereby agree as follows:

1.             The Product which is a [***] is intended by the Parties to be a [***] under the [***], including, without limitation, for purposes of [***].

2.             Amylin shall take all reasonable steps necessary to maintain at all times during the term of the Agreement the [***], including the [***] to Takeda, that are [***] to [***] the [***], and Amylin shall be responsible for making any and all [***] necessary to [***]; provided, however, except with respect to [***]  to use “[***]”([***]) with respect to “[***]”([***]), Amylin shall have no obligations to Takeda pursuant to this Letter to the extent any [***] causes [***].

3.             (A) Amylin agrees that the provisions of Paragraph 3(B) shall be applicable, if: (a)(i) [***] with respect to the [***] prior to [***] by Takeda under the Agreement; or (ii) there is a Partial Termination of the Agreement with respect to the [***] of the [***]  by Takeda under the Agreement; (b) [***] that the [***] is not a “[***]” under the [***], and therefore the exception under [***]  “[***]” does not apply to the [***]; and (c) [***] from Amylin to

*** Confidential Treatment Requested

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Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

[***] the [***] pursuant to [***] and the [***] is [***] or its affiliates or sublicensees.

(B)  If the conditions set forth in Paragraph 3(A) are met, then, with respect to only the [***] or its Affiliates or sublicensees (the “[***]”): (i) the [***] will be considered a [***] with respect to the [***]; (ii) the [***] for the [***]  will be deemed to have [***]; (iii) the [***]  on the [***] will be payable pursuant to [***] of the Agreement during the [***]  for the [***]; and (iv) upon [***]  of the [***], Takeda will no longer be obligated to make [***] on the [***]  to Amylin.

4.In the event that Amylin obtains [***] that clarify, in Takeda’s reasonable judgment, that Amylin has secured [***] (including by clarifying that the [***] is a “[***]”[***]), including the [***] to Takeda, that are necessary or useful to [***] the [***] at all times during the term of the Agreement, then Amylin shall provide written notice and a copy of such [***] (the “Clarification”) to Takeda, and Takeda shall terminate this Letter by providing written notice to Amylin within thirty (30) days of receipt of the Clarification, after which this Letter shall be of no further force and effect.  In the event that Takeda does not object to the Clarification by written notice to Amylin within thirty (30) days of receipt of the Clarification, the Clarification shall be deemed reasonable and this Letter shall be of no further force and effect.

5.The provisions of this Letter shall supersede any conflicting terms contained in the last sentence of [***] of the Agreement.

6.The Parties hereby agree that this Letter shall be subject to the terms and conditions of the Agreement, and all references to “Agreement” and words such as “herein”, “hereof” and “hereunder” in the Agreement shall include the terms and conditions set forth in this Letter.

7.This Letter may be executed in two counterparts (including, without limitation, by facsimile signature), each of which shall be deemed an original, but both of which together shall constitute one and the same instrument.

*** Confidential Treatment Requested

***Text Omitted and Filed Separately with the Securities and Exchange

Commission.  Confidential Treatment Requested Under

17 C.F.R. Sections 200.80(b)(4) and 240.24b-2

If the foregoing is acceptable, please countersign this Letter and return it to the undersigned.

Sincerely,
AMYLIN PHARMACEUTICALS, INC.
By:	/s/ Daniel M. Bradbury
Name:	Daniel M. Bradbury
Title:	President & CEO

Agreed to and accepted as of the Effective Date:

TAKEDA PHARMACEUTICAL COMPANY LIMITED

By:	/s/ Yasuchika Hasegawa
Name:	Yasuchika Hasegawa
Title:	President & CEO

EX-10.54

Exhibit 10.54

THIRD AMENDMENT

THIS THIRD AMENDMENT, dated as of December 18, 2009 (this “Amendment”), among AMYLIN PHARMACEUTICALS, INC., a Delaware corporation (the “Company”), each of the Company’s subsidiaries listed on the signature pages hereto (collectively, together with the Company, the “Borrowers” and each a “Borrower”), the Lenders (as defined below) party hereto, and BANK OF AMERICA, N.A., as Administrative Agent, Collateral Agent and L/C Issuer (in such capacity, the “Administrative Agent”) for the Lenders.

W I T N E S S E T H:

WHEREAS, the Borrowers are a party to a Credit Agreement, dated as of December 21, 2007, among the Borrowers, the lenders from time to time party thereto (the “Lenders”), the Administrative Agent, and the other agents, lead arranger and book manager party thereto (as amended, restated, supplemented or otherwise modified to but excluding the date hereof, the “Existing Credit Agreement”). Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the Existing Credit Agreement;

WHEREAS, pursuant to (i) Section 7.02(o) of the Existing Credit Agreement, the Company is permitted to incur Indebtedness under a Permitted Ohio Sale/Leaseback, and (ii) Section 7.05(g) of the Existing Credit Agreement, the Company is permitted to Dispose of the Ohio Sale/Leaseback Property in connection with a Permitted Ohio Sale/Leaseback;

WHEREAS, the definition of “Ohio Sale/Leaseback Property” in Section 1.01 of the Existing Credit Agreement refers to electrical equipment, a housing structure and related tangible property located at 8874 Tradeport Drive (the “Original Address”), but the equipment, structure and property subject to the Permitted Ohio Sale/Leaseback are located at 8814 Tradeport Drive, Building 1, and 8848 Tradeport Drive, Building 2(1) (collectively, the “Corrected Address”);

WHEREAS, the Company has requested that the Required Lenders amend the definition of “Ohio Sale/Leaseback Property” as set forth herein to correct the property description from the Original Address to the Corrected Address;

WHEREAS, the undersigned Required Lenders have agreed to amend the Existing Credit Agreement upon the terms and conditions set forth herein;

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

SECTION 1.01.                   Amendment to Section 1.01 of the Existing Credit Agreement.  Effective immediately upon the Third Amendment Effective Date, the definition of “Ohio Sale/Leaseback Property” set forth in Section 1.01 of the Existing Credit Agreement is hereby deleted in its entirety and replaced by following:

“Ohio Sale/Leaseback Property” means electrical equipment and all accompanying accessories, appurtenances, fences and attachments required for the equipment, a housing structure and related tangible property located at 8814 Tradeport Drive, Building 1, and 8848 Tradeport Drive, Building 2.

SECTION 1.02.                   Representations and Warranties.  Each Borrower hereby represents and warrants to the Administrative Agent and the Lenders, as follows:

(a)           The representations and warranties of such Borrower contained in Article V of the Existing Credit Agreement, as modified hereby (the “Credit Agreement”), or any other Loan Document (except for any Secured Hedge Agreements or Secured Cash Management Agreements) or which are contained in any document furnished at any time under or in connection therewith are true and correct in all material respects on and as of the Third Amendment Effective Date with the same effect as if made on and as of such date, except to the extent such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and except that the representations and warranties contained in Sections 5.05(a) and (b) of the Existing Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to Sections 6.01(a) and (b) thereof, respectively.

(b)           Each Loan Party is in compliance in all material respects with all the terms and conditions of the Credit Agreement and the other Loan Documents on its part to be observed or performed and no Default or Event of Default has occurred or is continuing under the Credit Agreement.

(c)           The execution, delivery and performance by such Borrower of this Amendment have been duly authorized by such Borrower.

(d)           Each of this Amendment and the Credit Agreement constitutes the legal, valid and binding obligation of such Borrower, enforceable against such Borrower in accordance with its terms subject to bankruptcy, insolvency, reorganization, moratorium, or similar laws of general applicability relating to or affecting creditors’ rights.

(e)           The execution, delivery, performance and compliance with the terms and provisions by such Borrower of this Amendment and the consummation of the transactions contemplated herein, do not and will not: (i) contravene the terms of any of such Borrower’s Organization Documents; (ii) conflict with or result in any breach or contravention of, or (except for the Liens created under the Loan Documents) the creation of any Lien under, (A) any material Contractual Obligation to which such Borrower is a party affecting such Borrower or the properties of such Borrower or its Subsidiaries or (B) any material order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Borrower or its property is subject or (C) violate any Law in any material respect.

SECTION 1.03.                   Effectiveness.  This Amendment shall become effective only upon Administrative Agent’s receipt of duly executed counterparts of this Amendment which, when taken together, bear the authorized signatures of the Borrower, the Administrative Agent and the

2

Required Lenders (the first date such condition has been satisfied being herein called the “Third Amendment Effective Date”).

SECTION 1.04.                   APPLICABLE LAW.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

SECTION 1.05.                   Fees, Costs and Expenses.  The Borrowers promptly shall pay all costs and expenses of the Administrative Agent in connection with the preparation, execution and delivery of this Amendment and the other instruments and documents to be delivered hereunder (including, without limitation, the reasonable fees and expenses of counsel for the Administrative Agent) in accordance with and to the extent required by the terms of Section 10.04(a) of the Credit Agreement.

SECTION 1.06.                   Loan Document; Counterparts.  This Amendment is, and from and after the Third Amendment Effective Date shall be deemed to be, a “Loan Document” under the Credit Agreement. This Amendment may be executed in any number of counterparts, each of which shall constitute an original but all of which when taken together shall constitute but one agreement. Delivery by facsimile or PDF by any of the parties hereto of an executed counterpart of this Amendment shall be as effective as an original executed counterpart hereof and shall be deemed a representation that an original executed counterpart hereof will be delivered, but the failure to deliver a manually executed counterpart shall not affect the validity, enforceability or binding effect of this Amendment.

SECTION 1.07.                   Existing Credit Agreement.  Except as expressly set forth herein, the amendment provided herein shall not, by implication or otherwise, limit, constitute a waiver of, or otherwise affect the rights and remedies of the Administrative Agent or any other Secured Party under the Existing Credit Agreement or any other Loan Document, nor shall it alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Existing Credit Agreement or any other Loan Document.  The amendment provided herein shall apply and be effective only with respect to the provisions of the Existing Credit Agreement specifically referred to by such amendment.  Except to the extent a provision in the Existing Credit Agreement is expressly amended herein, the Existing Credit Agreement and the other Loan Documents shall continue in full force and effect in accordance with the provisions thereof and each of the undersigned Loan Parties hereby ratifies and confirms in all respects its obligations under and the continued full force and effect of the Amended Credit Agreement and the other Loan Documents.

[Signature pages follow]

3

IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to be duly executed by their duly authorized officers, all as of the date first above written.

AMYLIN PHARMACEUTICALS, INC., as a Borrower
By:	/s/ Mark G. Foletta
Name:	Mark G. Foletta
Title:	Senior Vice President, Finance and CFO
AMYLIN OHIO LLC, as a Borrower
	By:	Amylin Pharmaceuticals, Inc.,
		its Sole Manager
By:	/s/ Mark G. Foletta
Name:	Mark G. Foletta
Title:	Senior Vice President, Finance and CFO
AMYLIN INVESTMENTS LLC, as a Borrower
	By:	Amylin Pharmaceuticals, Inc.,
		its Sole Manager
By:	/s/ Mark G. Foletta
Name:	Mark G. Foletta
Title:	Senior Vice President, Finance and CFO

Third Amendment

Signature Page

BANK OF AMERICA, N.A., as
Administrative Agent
By:	/s/ Brenda H. Little
Name:	Brenda H. Little
Title:	Vice President

Third Amendment

Signature Page

BANK OF AMERICA, N.A., as a Revolving Credit Lender, L/C Issuer and Hedge Bank under the Permitted F/X Facility
By:	/s/ Christopher D. Pannacciulli
Name:	Christopher D. Pannacciulli
Title:	Senior Vice President

Third Amendment

Signature Page

BANC OF AMERICA LEASING & CAPITAL, LLC, as a Term Lender
By:	/s/ Lori J. Noberini
Name:	Lori J. Noberini
Title:	Vice President

Third Amendment

Signature Page

SILICON VALLEY BANK, as a Term Lender
By:	/s/ Sarah Larson
Name:	Sarah Larson
Title:	Relationship Manager

Third Amendment

Signature Page

COMERICA BANK, as a Term Lender
By:	/s/ Greg Park
Name:	Greg Park
Title:	Vice President

Third Amendment

Signature Page

BMO CAPITAL MARKETS FINANCING, INC., as a Term Lender
By:	/s/ Scott W. Morris
Name:	Scott W. Morris
Title:	Vice President

Third Amendment

Signature Page

FIRST BANK, as a Term Lender
By:	/s/ Gilmore Hector
Name:	Gilmore Hector
Title:	Vice President

Third Amendment

Signature Page

UNION BANK OF CALIFORNIA, N.A., as a Term Lender
By:	/s/ Paul Moyer
Name:	Paul Moyer
Title:	Vice President

Third Amendment

Signature Page

AIB DEBT MANAGEMENT, LIMITED, as a Term Lender
By:	/s/ Brent Phillips
Name:	Brent Phillips
Title:	Vice President, Investment Advisor to AIB Debt
Management Limited
By:	/s/ Martin Chin
Name:	Martin Chin
Title:	Senior Vice President, Investment Advisor to AIB
Debt Management Limited

Third Amendment

Signature Page

EX-18

Exhibit 18

January 21, 2010

Board of Directors and Management

Amylin Pharmaceuticals

Dear Members of the Board of Directors and Management:

Note 1 of the Notes to the Consolidated Financial Statements of Amylin Pharmaceuticals, Inc. included in its Form 10-K for the three years ended December 31, 2009 describes a change in the classification of reimbursements of research and development expenses under collaborative arrangements from revenue under collaborative arrangements to research and development expense.

There are no authoritative criteria for determining a ‘preferable’ method for presenting reimbursements of research and development expenses under collaborative arrangements, based on the particular circumstances, however, we conclude that such change in the method of accounting is to an acceptable alternative method which, based on your business judgment to make this change and for the stated reasons, is preferable in your circumstances.

Very truly yours,

/s/ Ernst & Young LLP

EX-21.1

Exhibit 21.1

Subsidiaries of Amylin Pharmaceuticals, Inc.

All of the following subsidiaries are 100% owned by Amylin Pharmaceuticals, Inc.

Name	State or Country of Incorporation or Organization
Amylin Investments LLC	Delaware
Amylin Ohio LLC	Delaware

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statements on Form S-8 (No.’s 33-45092, 33-47604, 33-85512, 333-2894, 333-2896, 333-51577, 333-82965, 333-39124, 333-61660, 333-108050, 333-115187, 333-121496, 333-126513, 333-134528, 333-145202, 333-151503 and 333-160120) and Form S-3 (No.’s 33-83602, 333-2898, 333-14143, 333-15295, 333-58831, 333-59639, 333-87033, 333-33340, 333-61144, 333-75066, 333-101278, 333-108008, 333-111086, 333-115509, 333-127949, 333-127950, 333-132730, 333-136860, and 333-145200), of our reports dated February 26, 2010, with respect to the consolidated financial statements and schedule of Amylin Pharmaceuticals, Inc., and the effectiveness of internal control over financial reporting of Amylin Pharmaceuticals, Inc. included in this Annual Report (Form 10-K) for the year ended December 31, 2009.

	/s/ Ernst & Young LLP
San Diego, California
February 26, 2010

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Mark G. Foletta, certify that:

1.I have reviewed this annual report on Form 10-K of Amylin Pharmaceuticals, Inc.;

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; and

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; and

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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

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.

Date: February 26, 2010
	By:	/S/ MARK G. FOLETTA
		Senior Vice President, Finance and
		Chief Financial Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Daniel M. Bradbury, certify that:

1.I have reviewed this annual report on Form 10-K of Amylin Pharmaceuticals, Inc.;

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; and

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; and

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 (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

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 those performing similar 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.

Date: February 26, 2010
	By:	/S/ DANIEL M. BRADBURY
		President and Chief Executive Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. § 1350, as adopted), Daniel M. Bradbury, the President and Chief Executive Officer of Amylin Pharmaceuticals, Inc. (the “Company”), and Mark G. Foletta, the Senior Vice President, Finance and Chief Financial Officer of the Company, each hereby certifies that, to the best of his knowledge:

1.The Company’s Annual Report on Form 10-K for the period ended December 31, 2009, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934, as amended; and

2.The information contained in the Periodic Report fairly presents, in all material respects, the financial condition of the Company at the end of the period covered by the Periodic Report and results of operations of the Company for the period covered by the Periodic Report.

Dated:  February 26, 2010

/S/ DANIEL M. BRADBURY	/S/ MARK G. FOLETTA
Daniel M. Bradbury	Mark G. Foletta
President and Chief Executive Officer	Senior Vice President, Finance and Chief Financial Officer