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Subsequent Events | 6 Months Ended
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Jun. 30, 2014
Subsequent Events | 14. Subsequent Events Facility Agreement On July 18, 2014, following receipt of approval of AFFREZZA® from the FDA on June 27, 2014 and the satisfaction of certain other conditions, Deerfield purchased the Tranche 4 notes, which constituted the fourth and final tranche of 2019 notes, in the aggregate principal amount of $40.0 million in accordance with the terms of the Facility Agreement. On August 11, 2014 the Company entered into a second amendment to the Facility Agreement to provide for the Sanofi Loan Facility. Supply Agreement with Amphastar On July 31, 2014, the Company entered into a Supply Agreement with Amphastar France Pharmaceuticals S.A.S., a French corporation (“Amphastar”), pursuant to which Amphastar will manufacture for and supply to the Company certain quantities of recombinant human insulin (“Insulin”) for use in AFREZZA. Under the terms of the Supply Agreement, Amphastar will be responsible for manufacturing the Insulin in accordance with the Company’s specifications and agreed-upon quality standards. The Company has agreed to purchase annual minimum quantities of Insulin under the Supply Agreement of an aggregate of approximately €120.1 million in calendar years 2015 through 2019. The Company may request to purchase additional quantities of Insulin over such annual minimum quantities. Unless earlier terminated, the term of the Supply Agreement expires on December 31, 2019 and can be renewed for additional, successive two year terms upon 12 months written notice, given prior to the end of the initial term or any additional two year term. The Company and Amphastar each have normal and customary termination rights, including termination for material breach that is not cured within a specific time frame or in the event of liquidation, bankruptcy or insolvency of the other party. In addition, The Company may terminate the Supply Agreement upon two years’ prior written notice to Amphastar without cause or upon 30 days prior written notice to Amphastar if a controlling regulatory authority withdraws approval for AFREZZA, provided, however, in the event of a termination pursuant to either of the latter two scenarios, the provisions of the Supply Agreement require the Company to pay the full amount of all unpaid purchase commitments due over the initial term within 60 calendar days of the effective date of such termination. License and Collaboration Agreement with SANOFI-AVENTIS Deutschland GmbH On August 11, 2014, the Company entered into the Sanofi License Agreement pursuant to which it will receive $150.0 million upfront fee and may earn potential payments of up to an aggregate of $775.0 million upon the achievement of certain development, manufacturing, regulatory and sales milestones. Worldwide profits and losses will be shared 65% by Sanofi and 35% by the Company. Pursuant to a separate supply agreement, the Company will manufacture AFREZZA at its manufacturing facility in Danbury, Connecticut to supply Sanofi’s demand for the product. In addition, the Company received a commitment letter from an affiliate of Sanofi to provide the Company with a secured loan facility of up to $175.0 million to fund the Company’s share of net losses under the Sanofi License Agreement. The commitment letter provides that our obligations under the Sanofi Loan Facility would be secured by a first priority mortgage on our facility in Valencia, California, a first priority security interest in certain insulin inventory located at our facility in Danbury, Connecticut and any contractual rights and obligations pursuant to which we purchase or have purchased such insulin, and a second priority security interest in our assets that secure our obligations under the Facility Agreement. The commitment is subject to customary conditions, including the effectiveness of the Sanofi License Agreement, the finalization of loan documentation and the entry into satisfactory intercreditor agreement with Deerfield. The effectiveness of the Sanofi License Agreement and the Supply Agreement is contingent upon satisfaction of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the entry into the definitive loan documents relating to the Sanofi Loan Facility (unless we terminate the commitment letter for the Sanofi Loan Facility).

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References No definition available. + Details
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