8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported):
September 12, 2008

EPICEPT CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

000-51290	52-1841431
(Commission File Number)	(IRS Employer Identification No.)

777 Old Saw Mill River Road
Tarrytown, NY	10591
(Address of Principal Executive Offices)	(Zip Code)

(914) 606-3500

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On September 12, 2008, the registrant, EpiCept Corporation (the “Company”), entered into Amendment No. 1 to a license agreement with DURECT Corporation (“Durect”), dated as of December 20, 2006.

As previously disclosed on the Company’s Current Report on Form 8-K filed on December 26, 2006, the Company entered into a license agreement with Durect pursuant to which the Company granted Durect the exclusive worldwide rights to certain of Company’s intellectual property for a transdermal patch containing bupivacaine for the treatment of back pain.

Pursuant to the Amendment, in consideration for the receipt of $2.25 million from Durect, EpiCept granted Durect an exclusive royalty-free, fully paid up license for such intellectual property.

A copy of the Amendment is attached hereto and incorporated herein by reference as Exhibit 10.1.

Item 9.01 Financial Statement and Exhibits.

(d) Exhibits.

10.1	Amendment No. 1 to License Agreement between EpiCept Corporation and DURECT Corporation, dated as of September 12, 2008.
99.1	Press Release of EpiCept Corporation, dated September 15, 2008.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EPICEPT CORPORATION
By:	/s/ Robert W. Cook
	Name:	Robert W. Cook
	Title:	Chief Financial Officer

Date: September 16, 2008

EXHIBIT INDEX

No.		Description
	10.1	Amendment No. 1 to License Agreement between EpiCept Corporation and DURECT Corporation, dated as of September 12, 2008.
	99.1	Press Release of EpiCept Corporation, dated September 15, 2008.

EX-10.1

Exhibit 10.1

AMENDMENT NO. 1 TO LICENSE AGREEMENT

This Amendment No. 1 to License Agreement (“Amendment No. 1”) is entered into as of September 12, 2008 and effective on the Amendment Date (defined below) by and between DURECT Corporation (“Durect”) and EpiCept Corporation (“EpiCept”).

PRELIMINARY STATEMENTS

     A. EpiCept and Durect have previously entered into that certain License Agreement effective December 20, 2006 (the “Agreement”).

     B. In consideration for a one-time cash payment by Durect in the amount specified below, EpiCept and Durect now desire to amend the license granted by EpiCept to Durect pursuant to the Agreement so that it is royalty-free, fully paid up, perpetual and irrevocable, in addition to other amendments to the Agreement as specified below.

     THEREFORE, in consideration of the premises and mutual promises and covenants herein contained and for good and valuable consideration, the sufficiency of which is hereby acknowledged, Durect and EpiCept hereby agree to amend the Agreement as follows:

AMENDMENT TO AGREEMENT

     1. Unless otherwise defined herein, all capitalized terms used herein shall have the same meaning ascribed to such terms in the Agreement.

     2. On or before three (3) business days after the Amendment Date, Durect shall pay to EpiCept the sum of two million two hundred fifty thousand U.S. Dollars ($2,250,000) by wire transfer to an account designated in writing by EpiCept in exchange for and in consideration of the changes and modifications made to the Agreement, as set forth in this Amendment No. 1, including, without limitation, the modifications that have the effect of expanding the license as set forth below and making the license and other rights granted by EpiCept to Durect in the Agreement exclusive, royalty-free, fully paid up, perpetual and irrevocable, as set forth below. For the avoidance of doubt, after the Amendment Date and EpiCept’s receipt of the payment described above, Durect will not owe any further royalty, milestone or other payments to EpiCept for any intellectual property governed by the Agreement, as amended by this Amendment No. 1. As used herein, “Amendment Date” means the date upon which this Agreement is fully executed by the Parties and the consent to the Amendment in the form attached hereto as Exhibit A has been fully executed by Durect and Hercules Technology Growth Capital, Inc.

     3. Section 1.27 shall be replaced in its entirety to read as follows:

“Field” shall mean all uses which are covered by the Epicept Licensed Patents and Patents within the EpiCept Improvements.

4. Section 2.1 of the Agreement shall be replaced in its entirety to read as follows:

License Grant: Subject to the terms and conditions hereof, EpiCept hereby grants to Durect, and Durect hereby accepts, an exclusive (even as to EpiCept and its Affiliates), royalty-free, fully paid up, perpetual, irrevocable right and license, with the right to grant sublicenses, under the EpiCept Licensed Patents and Patents within the EpiCept Improvements to make, have made, develop, use, sell, offer for sale, have sold, and import Licensed Products in and for the Field throughout the Territory.

     5. Section 6.1 of the Agreement is hereby amended to delete all references to a “Non-Back Pain Product.”

     6. The following sections of the Agreement are hereby deleted in their entirety: Sections 2.3, 3 (except for 3.2), 4, 5, 10 (except for 10.2, 10.5, 10.6 and 10.7) and 11.9.

     7. EpiCept represents and warrants that it has carefully reviewed the terms of the transaction described in the Agreement as amended by this Amendment No. 1 and determined that the consideration paid by Durect hereby is reasonable and fair consideration for the rights and benefits obtained by Durect pursuant to the Agreement as amended by this Amendment No. 1. EpiCept further represents and warrants that it is not now insolvent and will not be rendered insolvent by consummating the transaction described herein. EpiCept further represents and warrants that it is not entering into this Amendment No. 1 with the intent to defraud, delay or hinder its respective creditors and the consummation of the transaction described herein will not have any such effect.

     7. Each Party hereby represents and warrants to the other Party that such Party’s representations and warranties set forth in Section 7 of the Agreement are true and correct as of the Amendment Date, where each reference to the Agreement shall mean the Agreement as amended pursuant to this Amendment No. 1.

     8. Except as specifically provided in this Amendment No. 1, all other terms and conditions of the Agreement shall remain the same.

     9. This Amendment No. 1 shall be governed and interpreted in accordance with the law of the State of Delaware without regard to conflicts of law principles

     10. This Amendment No. 1 may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of which, taken together, shall constitute one and the same instrument. This Amendment No. 1 may be executed by any party hereto by means of a facsimile transmission or by email with pdf attachment of an originally executed counterpart, the delivery of which facsimile transmission or email shall have the same force and effect as the delivery of the originally executed counterpart.

[Signature Page Follows]

CONFIDENTIAL

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     IN WITNESS WHEREOF, each party has caused this Amendment No. 1 to be executed by its duly authorized representative as of the date noted above in the preamble.

DURECT CORPORATION		EPICEPT CORPORATION
By:	/s/ James E. Brown	By:	/s/ Jack V. Talley
Name:	James E. Brown	Name:	Jack V. Talley
Title:	President & CEO	Title:	President & CEO
Date:		Date:

CONFIDENTIAL

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EXHIBIT A

SECOND CONSENT TO LICENSE
AGREEMENT AND USE OF COLLATERAL

     This Second Consent to License Agreement and Use of Collateral (“Second Consent”) is made as of September     , 2008, by and between Hercules Technology Growth Capital, Inc. (“Hercules”) and Durect Corporation (“Durect).

RECITALS

     A. Hercules is the lender to EpiCept Corporation (“EpiCept”) and Maxim Pharmaceuticals Inc. (together with EpiCept, the “Borrowers”) pursuant to the Loan and Security Agreement, dated as of August 30, 2006, as amended from time to time (the “Loan Agreement”).

     B. Pursuant to the Loan Agreement, the Borrowers granted to Hercules a security interest in and to certain “Collateral,” as that term is defined in the Loan Agreement. The Collateral includes all of the Borrowers’ personal property, including intellectual property.

     C. On December 20, 2006, EpiCept and Durect entered into that certain License Agreement (the “License Agreement”), whereby EpiCept granted to Durect a license in and to certain of EpiCept’s intellectual property (the “Subject IP”).

     D. As a condition to its willingness to enter into the License Agreement, Durect required Hercules to provide assurances that, among other things, Durect’s rights under the License Agreement would be preserved notwithstanding an event of default by the Borrowers under the Loan Agreement, or in the event of a disposition of the Collateral or other enforcement of Hercules’ rights as a secured party upon the Borrowers’ default.

     E. Hercules provided Durect with such assurances by executing and delivering that certain Consent to License Agreement and Use of Collateral, dated as of November 17, 2006 (the “First Consent”).

     F. Durect and EpiCept have determined to amend the License Agreement, pursuant to that certain Amendment No. 1 to License Agreement between EpiCept and Durect, dated as of an even date herewith and attached hereto as Exhibit A (the “License Amendment”), and Durect again requires assurances from Hercules similar to those obtained pursuant to the First Consent, as provided herein.

     G. Hercules is willing to provide Durect such assurances by executing and delivering this Second Consent, in view of the potential benefits to Hercules (including the enhancement of the value of the Collateral) as a result of EpiCept and Durect entering into the License Amendment.

CONFIDENTIAL

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AGREEMENT

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree and covenant as follows:

     1. Hercules has reviewed the License Amendment and hereby consents to EpiCept entering into the License Amendment. Hercules acknowledges that the License Amendment modifies the terms of the License Agreement causing, among other things, the license granted by EpiCept to Durect to be exclusive, royalty-free, fully paid up, perpetual and irrevocable upon the occurrence of the Amendment Date (as defined in the License Amendment). Hercules agrees that the License Agreement, as amended by the License Amendment is a “Permitted Transfer” as that term is defined in the Loan Agreement.

     2. All of the rights granted to Durect under the License Agreement, as amended by the License Amendment with respect to the Subject IP are hereby recognized by Hercules, and such rights shall not be cancelled, terminated, diminished, or otherwise interfered with by Hercules so long as Durect is not in breach of any of the terms contained in the License Agreement, as amended by the License Amendment, and, including on account of (a) a default by either of the Borrowers, or the occurrence of any other “Event of Default,” under and as defined by the Loan Agreement, or (b) any disposition of, or other enforcement of the security interest in, the Collateral on account of a default under the Loan Agreement. Any such disposition of, or other enforcement of the security interest in, the Collateral shall expressly be subject to the rights of Durect under the License Agreement, as amended by the License Amendment, including but not limited to the right to enforce any exclusivity provision under the License Agreement, as amended by the License Amendment.

     3. Following a disposition of, or other enforcement of the security interest in, the Collateral on account of a default by any of the Borrowers, Durect will, if so requested in writing by the party that acquires any portion of the Collateral that includes the Subject IP, and upon the demonstration to the reasonable satisfaction of Durect of the acquiring party’s rights and of the termination of any rights of the Borrowers in the Collateral, enter into a new license (the “New License”) for the Subject IP with the acquiring party on the same terms as the License Agreement, as amended by the License Amendment (including the terms of this Second Consent), including, without limitation, the terms that make the license exclusive, royalty-free, fully paid up, perpetual and irrevocable.

     4. This Second Consent contains the complete agreement between the parties hereto and may not be modified orally or in any other manner other than by an agreement in writing signed by the parties hereto or their respective successors in interest.

CONFIDENTIAL

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     5. This Second Consent shall be governed in all respects by the laws of the State of California, irrespective of its choice of law rules.

     6. This Second Consent may be executed in identical counterparts, each of which shall constitute an original and all of which shall constitute one and the same agreement.

     7. This Second Consent shall inure to the benefit of and be binding upon the parties hereto, their respective heirs, successors and assigns, it being expressly understood that all references herein to Hercules shall be deemed to include not only Hercules, but also its legal representatives, successors and assigns, and all parties subsequently acquiring title in and to the Collateral from or through Hercules.

     IN WITNESS WHEREOF, the parties hereto have executed this Second Consent by their proper officers or representatives to be effect as of the day and year first written above.

HERCULES TECHNOLOGY	DURECT CORPORATION
GROWTH CAPITAL, INC.
By:	By:
Name:	Name:
Title:	Title:

CONFIDENTIAL

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EX-99.1

Exhibit 99.1

Contacts

EpiCept Corporation:
777 Old Saw Mill River Road
Tarrytown, NY 10591
Robert W. Cook
(914) 606-3500
rcook@epicept.com

Media:
Feinstein Kean Healthcare
Greg Kelley
(617) 577-8110
gregory.kelley@fkhealth.com Investors:
Lippert/Heilshorn & Associates
Kim Sutton Golodetz
(212) 838-3777
kgolodetz@lhai.com

or

Bruce Voss
(310) 691-7100
bvoss@lhai.com

EpiCept Amends DURECT Bupivacaine patch Licensing Agreement
Receives $2.25 million cash Payment

TARRYTOWN, N.Y. (September 15, 2008) — EpiCept Corporation (Nasdaq and OMX Nordic Exchange: EPCT) today announced that it has amended its December 20, 2006 licensing agreement with DURECT Corporation granting DURECT exclusive, worldwide rights to certain EpiCept intellectual property for a transdermal patch containing bupivacaine for the treatment of back pain.

Under the terms of the amended agreement, EpiCept has granted DURECT royalty-free, fully paid up, perpetual and irrevocable rights to the intellectual property licensed as part of the original agreement in exchange for a cash payment of $2.25 million from DURECT.

EpiCept intends to use the proceeds of this non-dilutive cash payment as working capital and for general corporate purposes as the Company prepares for the launch of Ceplene^® (histamine dihydrochloride) following receipt of final marketing authorization in Europe, which EpiCept anticipates receiving within the next several weeks.

About EpiCept Corporation
EpiCept is focused on unmet needs in the treatment of cancer and pain. The Company’s broad portfolio of pharmaceutical product candidates includes Ceplene^®, a cytokine immunomodulator that recently received a positive opinion from the CHMP in Europe for the remission maintenance of AML patients, and several pain therapies in clinical development. In addition, EpiCept’s ASAP technology, a proprietary live-cell high-throughput caspase-3 screening technology, can efficiently identify new cancer drug candidates and molecular targets that selectively induce apoptosis in cancer cells. Two oncology drug candidates currently in clinical development that were discovered using this technology have also been shown to act as vascular disruption agents in a variety of solid tumors.

September 15, 2008
Page 2

Forward-Looking Statements
This news release and any oral statements made with respect to the information contained in this news release, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements which express plans, anticipation, intent, contingency, goals, targets, future development and are otherwise not statements of historical fact. These statements are based on EpiCept’s current expectations and are subject to risks and uncertainties that could cause actual results or developments to be materially different from historical results or from any future results expressed or implied by such forward-looking statements. Factors that may cause actual results or developments to differ materially include: the risks associated with the adequacy of our existing cash resources, our need to raise additional financing to continue to meet our capital needs and our ability to continue as a going concern, the risks associated with our ability to continue to meet our obligations under our existing debt agreements or that we may default on our loans or that our lenders may declare the Company in default or that our secured lender would seek to sell our assets, the risk that the Company’s securities may be delisted by The Nasdaq Capital Market or the OMX Nordic Exchange, the risk that we do not receive final regulatory marketing approval by the European Commission for Ceplene^®, the risk that Ceplene^®, if approved, will not be launched in the first quarter of 2009 or achieve significant commercial success, the risk that we are unable to find a suitable marketing partner for Ceplene^® on attractive terms, a timely basis or at all, the risk that Myriad’s development of Azixa™ will not be successful, the risk that Azixa™ will not receive regulatory approval or achieve significant commercial success, the risk that we will not receive any significant payments under our agreement with Myriad, the risk that the development of our other apoptosis product candidates will not be successful, the risk that our ASAP technology will not yield any successful product candidates, the risk that clinical trials for NP-1 or EPC2407 will not be successful, the risk that NP-1 or EPC2407 will not receive regulatory approval or achieve significant commercial success, the risk that our other product candidates that appeared promising in early research and clinical trials do not demonstrate safety and/or efficacy in larger-scale or later stage clinical trials, the risk that we will not obtain approval to market any of our product candidates, the risks associated with dependence upon key personnel, the risks associated with reliance on collaborative partners and others for further clinical trials, development, manufacturing and commercialization of our product candidates; the cost, delays and uncertainties associated with our scientific research, product development, clinical trials and regulatory approval process; our history of operating losses since our inception; the highly competitive nature of our business; risks associated with litigation; risks associated with prior material weaknesses in our internal controls; and risks associated with our ability to protect our intellectual property. These factors and other material risks are more fully discussed in EpiCept’s periodic reports, including its reports on Forms 8-K, 10-Q and 10-K and other filings with the U.S. Securities and Exchange Commission. You are urged to carefully review and consider the disclosures found in EpiCept’s filings, which are available at www.sec.gov or at www.epicept.com. You are cautioned not to place undue reliance on any forward-looking statements, any of which could turn out to be wrong due to inaccurate assumptions, unknown risks or uncertainties or other risk factors.

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EPCT-GEN

*Azixa is a registered trademark of Myriad Genetics, Inc.