Subsequent events	12 Months Ended
Dec. 31, 2019
Subsequent events
Subsequent events	Note 19. Subsequent Event In January 2020, we entered into a Collaboration and License Agreement with MorphoSys AG and MorphoSys US Inc., a wholly-owned subsidiary of MorphoSys AG (together with MorphoSys AG, “MorphoSys”), covering the worldwide development and commercialization of MOR208 (tafasitamab), an investigational Fc engineered monoclonal antibody directed against the target molecule CD19 that is currently in clinical development by MorphoSys. MorphoSys has exclusive worldwide development and commercialization rights to tafasitamab under a June 2010 collaboration and license agreement with Xencor, Inc. In December 2019, MorphoSys submitted a Biologics License Application to the FDA for tafasitamab for the treatment of relapsed or refractory diffuse large B cell lymphoma. Under the terms of the agreement, we will receive exclusive commercialization rights outside of the United States, and MorphoSys and we will have co-commercialization rights in the United States, with respect to tafasitamab. MorphoSys will be responsible for leading the commercialization strategy and booking all revenue from sales of tafasitamab in the United States, and we and MorphoSys will both be responsible for commercialization efforts in the United States and will share equally the profits and losses from the co-commercialization efforts. We will lead the commercialization strategy outside of the United States, and will be responsible for commercialization efforts and book all revenue from sales of tafasitamab outside of the United States, subject to our royalty payment obligations set forth below. We and MorphoSys have agreed to co-develop tafasitamab and to share development costs associated with global and U.S.-specific clinical trials, with Incyte responsible for 55% of such costs and MorphoSys responsible for 45% of such costs. Each company will be responsible for funding any independent development activities, and we will be responsible for funding development activities specific to our territory. All development costs related to the collaboration will be subject to a joint development plan. We have agreed to pay MorphoSys an upfront non-refundable payment of $750.0 million. MorphoSys will be eligible to receive up to $740.0 million in future contingent development and regulatory milestones and up to $315.0 million in commercialization milestones as well as tiered royalties ranging from the mid-teens to mid-twenties of net sales outside of the United States. MorphoSys’ right to receive royalties in any particular country will expire upon the last to occur of (a) the expiration of patent rights in that particular country, (b) a specified period of time after the first post-marketing authorization sale of a licensed product comprising tafasitamab in that country, and (c) the expiration of any regulatory exclusivity for that licensed product in that country. The effectiveness of the agreement is conditioned on the early termination or expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 as well as clearance by the German and Austrian antitrust authorities; however, certain confidentiality and antitrust filing provisions became effective upon execution of the agreement. In addition, under the collaboration agreement and pursuant to a related purchase agreement, we have agreed to purchase American Depositary Shares (“ADSs”), each representing 0.25 of an ordinary share of MorphoSys AG, for an aggregate purchase price of $150 million (such ADSs to be purchased, the “New ADSs”). Under the purchase agreement, we have agreed, subject to limited exceptions, not to sell or otherwise transfer any of the New ADSs for an 18-month period. Closing of the purchase of the New ADSs is subject to customary conditions, as well as the effectiveness of the collaboration agreement described above.

Subsequent events

12 Months Ended

Dec. 31, 2019

Note 19. Subsequent Event

In January 2020, we entered into a Collaboration and License Agreement with MorphoSys AG and MorphoSys US Inc., a wholly-owned subsidiary of MorphoSys AG (together with MorphoSys AG, “MorphoSys”), covering the worldwide development and commercialization of MOR208 (tafasitamab), an investigational Fc engineered monoclonal antibody directed against the target molecule CD19 that is currently in clinical development by MorphoSys. MorphoSys has exclusive worldwide development and commercialization rights to tafasitamab under a June 2010 collaboration and license agreement with Xencor, Inc. In December 2019, MorphoSys submitted a Biologics License Application to the FDA for tafasitamab for the treatment of relapsed or refractory diffuse large B cell lymphoma.

Under the terms of the agreement, we will receive exclusive commercialization rights outside of the United States, and MorphoSys and we will have co-commercialization rights in the United States, with respect to tafasitamab. MorphoSys will be responsible for leading the commercialization strategy and booking all revenue from sales of tafasitamab in the United States, and we and MorphoSys will both be responsible for commercialization efforts in the United States and will share equally the profits and losses from the co-commercialization efforts. We will lead the commercialization strategy outside of the United States, and will be responsible for commercialization efforts and book all revenue from sales of tafasitamab outside of the United States, subject to our royalty payment obligations set forth below. We and MorphoSys have agreed to co-develop tafasitamab and to share development costs associated with global and U.S.-specific clinical trials, with Incyte responsible for 55% of such costs and MorphoSys responsible for 45% of such costs. Each company will be responsible for funding any independent development activities, and we will be responsible for funding development activities specific to our territory. All development costs related to the collaboration will be subject to a joint development plan.

We have agreed to pay MorphoSys an upfront non-refundable payment of $750.0 million. MorphoSys will be eligible to receive up to $740.0 million in future contingent development and regulatory milestones and up to $315.0 million in commercialization milestones as well as tiered royalties ranging from the mid-teens to mid-twenties of net sales outside of the United States. MorphoSys’ right to receive royalties in any particular country will expire upon the last to occur of (a) the expiration of patent rights in that particular country, (b) a specified period of time after the first post-marketing authorization sale of a licensed product comprising tafasitamab in that country, and (c) the expiration of any regulatory exclusivity for that licensed product in that country.

The effectiveness of the agreement is conditioned on the early termination or expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 as well as clearance by the German and Austrian antitrust authorities; however, certain confidentiality and antitrust filing provisions became effective upon execution of the agreement.

In addition, under the collaboration agreement and pursuant to a related purchase agreement, we have agreed to purchase American Depositary Shares (“ADSs”), each representing 0.25 of an ordinary share of MorphoSys AG, for an aggregate purchase price of $150 million (such ADSs to be purchased, the “New ADSs”). Under the purchase agreement, we have agreed, subject to limited exceptions, not to sell or otherwise transfer any of the New ADSs for an 18-month period. Closing of the purchase of the New ADSs is subject to customary conditions, as well as the effectiveness of the collaboration agreement described above.