Annexe 1

Bayer Pharma AG of Müllerstr. 178, 13353 Berlin, Germany, formerly known as Bayer Schering Pharma AG (“Bayer”);

Bayer Australia Limited of PO Box 903, 875 Pacific Highway, Pymble NSW 2073, Australia (“Bayer Australia”);

Regeneron Pharmaceuticals Inc of 777 Old Saw Mill River Road, Tarrytown NY 10591, USA (“Regeneron”);

Regeneron UK Ltd of 40 Bank Street, Canary Wharf, E14 5DS London, UK (“Regeneron UK”); and

Genentech Inc of 1 DNA Way, South San Francisco, CA 94080-4990, USA (“Genentech”)

Genentech is the proprietor of the following patents and patent applications relating to the use of VEGF antagonists for the treatment of certain non-neoplastic diseases and disorders, including age-related macular degeneration: EP 1 238 986 (which expired on October 27, 2012) (the “986 Patent”), EP 1 802 334 and EP 2 089 059, together with those other members of the same patent families in the Territory defined below as the Dosing Regime Patents and the Dosing Regime Patent Applications;

Bayer and Regeneron have developed the product Eylea (aflibercept), as defined below, for the treatment of eye diseases and eye disorders in a human including, but not limited to, the prevention or treatment of age-related macular degeneration.

Bayer, Bayer Australia, Regeneron and Regeneron UK (the “Claimants”) and Genentech (together the “Parties” or each individually a “Party”) are engaged in litigation concerning several of the aforementioned patents and Eylea in Australia, Germany, Italy and the United Kingdom. Such proceedings are defined below.

In consideration of the mutual agreements set out below the Parties have agreed to settle the Proceedings (as defined below) upon the terms set out in this agreement (the “Agreement”).

Definitions:

Genentech represents and warrants that it is the owner of the Subject Patents and the Dosing Regime Patent Applications.

Each Party represents and warrants that it has the full right, power and authority to execute, deliver and perform this Agreement.

The Parties hereby agree that:

The European Proceedings shall be formally withdrawn or discontinued by the Parties serving on the other Parties and/or filing at the appropriate court within seven (7) days of the Effective Date duly signed originals of the documents attached hereto as Annexes 1 and 2;

Bayer and Regeneron agree and covenant that they will withdraw their applications for permission to appeal to the UK Supreme Court and will not otherwise pursue an appeal to the UK Supreme Court in respect of the court orders dated February 21, 2013 in appeals 2012/0931 and 2012/0933;

The Australian Patent Office Opposition Proceedings shall, with effect from the Effective Date, be withdrawn by the Parties or their appropriate Affiliate(s) filing at the Australian Patent Office within seven (7) days of the Effective Date duly signed notices of withdrawal in the form of the documents attached hereto as Annexes 3 and 4;

The Australian Proceedings shall, with effect from the Effective Date, be discontinued by the Parties or their appropriate Affiliate(s) filing at the appropriate court within seven (7) days of the Effective Date duly signed originals of the document attached hereto as Annexe 5 and, in the case of Regeneron, filing and serving prior thereto a Notice of Appearance in the Australian Proceedings; and

Bayer and Genentech shall discontinue the English Dosing Regime Proceedings by filing at the High Court within seven (7) days of the Effective Date the document attached hereto as Annexe 6.

The Parties shall take all steps necessary to promptly withdraw or discontinue the Proceedings pursuant to this clause 4 (including any other proceedings in relation to the Subject Patents initiated before the Effective Date) and shall cooperate with each other to take all steps necessary to obtain court orders as required to achieve the same.

The Parties further agree that they shall bear their own legal costs and court fees in respect of the Proceedings, notwithstanding the English Orders or any other court orders or statutory or procedural provisions to the contrary, and each Party further agrees that it shall not seek from any other Party or its Affiliates, successors, licensees or assignees any repayment or reimbursement of any costs or interest thereon, including without limitation any costs or interest paid pursuant to the English Orders, or any court fees paid or payable in respect of the Proceedings.

Genentech hereby agrees and covenants that it will not initiate any lawsuit or other legal proceeding (and to procure that its Affiliates, successors, licensees and assignees shall not initiate any lawsuit or other legal proceeding) at any time from the Effective Date against any of the Claimants, their Affiliates, successors, licensees, assignees, manufacturers, distributors or customers for infringement of any of the Subject Patents based on its or their dealings in Eylea, including inter alia the making, keeping, supplying, marketing, using, selling, importing, or exporting of Eylea or authorising, aiding, abetting, counselling, procuring, inducing or otherwise participating with any Person in a common design to do any of those things. Genentech agrees and covenants that it will assign the Subject Patents and Dosing Regime Patent Applications only to a Person which has accepted to be bound by the obligations of this Agreement.

The provisions set out in clauses 4 to 6 above shall be in full and final settlement of the Proceedings and, with effect from the Effective Date, the Parties, and Affiliates, successors, licensees, assignees, manufacturers, distributors, and customers are mutually released and discharged from any and all liabilities (existing or future, contingent or actual) in relation to the Subject Patents or Dosing Regime Patent Applications arising out of, in connection with, or related to, any dealings of Regeneron or its Affiliates and/or Bayer or its Affiliates in Eylea, in the Territory, save for each Party’s obligations and liabilities arising under this Agreement and any liabilities, costs, expenses or loss arising in

It is expressly agreed and acknowledged by the Parties that the execution and performance of this Agreement is not, and is not to be construed as, an admission by any Party as to the patentability, validity, invalidity, infringement or non-infringement of any of the Subject Patents, nor of any counterpart thereof anywhere in the world.

For the avoidance of doubt, nothing in this Agreement shall affect Regeneron’s and Bayer's prior obligations to comply with the injunctions in paragraph 1 of the English Orders dated April 4, 2012 which were in force until expiry of the 986 Patent. Further, nothing in this Agreement shall affect Genentech’s right to enforce, against any one or more of the Claimants, their Affiliates, successors, licensees, manufacturers, suppliers, distributors or customers, (i) any patents, other than the Subject Patents, anywhere in the world or (ii) any of the Subject Patents based on the making, keeping, supplying, marketing, using, selling, importing, or exporting of any product other than Eylea.

The Parties agree that the fact of and contents of this Agreement, any discussions, correspondence or negotiations leading to this Agreement or concerning the performance of this Agreement, and any documents that have passed between the Parties that relate to the Proceedings and to which the public does not by law have a right of inspection shall be kept confidential to the Parties and their Affiliates and successors and (to the extent required for the purposes of clause 6 of this Agreement) their applicable licensees and/or assignees. In the event that a Party is required by law or legal process to disclose the existence or any term of any document or other information that is subject to this clause 10 or the fact of or contents of this Agreement, it will provide the other Parties with prompt notice of such legal requirement or the receipt of such legal process in order to enable any of the other Parties to seek an appropriate protective order.

The Parties hereby agree and covenant that the fact of or contents of this Agreement or of any other document or information that is subject to clause 10 above shall not be used by any Party for any reason in any other legal proceeding anywhere in the world, including, but not limited to, the litigations in the United States of America captioned Genentech, Inc. v Regeneron Pharmaceuticals, Inc., Sanofi-Aventis U.S. LLC, and Sanofi-Aventis U.S. Inc., and Regeneron Pharmaceuticals Inc. v Genentech, Inc., Civil Action Nos. 11-CV-09463 and 11-CV-01156 (SDNY), except if necessary (and then only to the limited extent necessary) for the sole and exclusive purpose of enforcing this Agreement.

Furthermore, if a Party is required by law to make an announcement concerning this Agreement then:

It shall send written notice to the other Parties of the full text of the proposed announcement as soon as possible prior to the announcement so that the other Parties will have an opportunity to comment upon the announcement; and

Any such announcement shall be factual and as brief as possible.

The Parties shall use commercially reasonable endeavours to ensure that, to the extent permitted by relevant authorities, this Agreement shall not form part of any public record.

This Agreement shall come into effect on the Effective Date and, subject to earlier termination pursuant to clauses 15 or 16 below, this Agreement shall continue in force until the latest of the dates of expiry of the Dosing Regime Patent Rights, provided that, if this Agreement has not been earlier terminated pursuant to clauses 15 or 16 below, the Parties’ respective covenants, undertakings, and releases/discharge set forth in clauses 6 – 7 and clauses 10-13 above shall survive such expiry of such patents.

The Claimants shall be entitled to terminate this Agreement by written notice thereof to Genentech if at any time from the Effective Date Genentech or any of its Affiliates, successors, licensees or assignees fails to comply with clause 6 above by initiating a lawsuit or other legal proceeding against one or more of the Claimants, their Affiliates, successors, licensees, manufacturers, suppliers, distributors or customers for infringement of the Subject Patents based on its or their dealings in Eylea, including inter alia the making, using, keeping, supplying, marketing, selling, importing, or exporting of Eylea or authorising, aiding, abetting, counselling, procuring, inducing or otherwise participating with any Person in a common design to do any of those things. Provided, however, that after the receipt of such written notice Genentech, its Affiliates, successors, licensees and assignees shall have ten (10) days to cure such failure to comply by withdrawing or discontinuing, or taking all necessary actions to have the tribunal dismiss, such lawsuit or other legal proceeding, and if such cure is timely made the written notice shall be deemed withdrawn and Claimants shall not be entitled to terminate this Agreement.

Genentech shall be entitled to terminate this Agreement by written notice thereof to Claimants if at any time from the Effective Date any of the Claimants, their Affiliates or, as to Claimants’ rights in Eylea, successors, licensees (to the extent the parties have the contractual right to control them) or assignees: (i) initiates a lawsuit, opposition or other official proceeding seeking the revocation of any of the Subject Patents, or (ii) initiates a lawsuit, opposition or other official proceeding disputing or challenging the patentability, validity, or enforceability of any of the Subject Patents, or (iii) authorises, aids, abets, counsels, procures, induces or otherwise participates with any Person in a common design to do any of (i) or (ii). Provided, however, that after the receipt of such written notice the Claimants, their Affiliates, successors, licensees and assignees shall have ten (10) days to cure such failure to comply by withdrawing or discontinuing, or taking all necessary actions to have the tribunal dismiss, such lawsuit or other legal proceeding, or ending all such assistance to the third party, as the case may be, and if such cure is timely made the written notice shall be deemed withdrawn and Genentech shall not be entitled to terminate this Agreement.

Following any termination of this Agreement pursuant to and in accordance with clauses 15 or 16 above, the rights and the obligations of the Parties under this Agreement shall terminate (save for clauses 6-7 and 10-13, which shall survive termination).

Any dispute, controversy, or claim arising out of or in connection with or relating to this Agreement or the breach or alleged breach thereof (including any dispute regarding arbitrability), but not including any dispute, controversy, or claim concerning the patentability, validity, enforceability, or infringement of any patent, shall be finally and exclusively decided by binding arbitration under the then-current Commercial Arbitration Rules of the American Arbitration Association (“AAA”). If the arbitration is demanded by Genentech, the arbitration shall be held in New York, New York. If the arbitration is demanded by one or more of the Claimants, the arbitration shall be held in San Francisco, California. The Parties shall choose, by mutual agreement, one (1) neutral arbitrator within thirty (30) days of receipt of the notice of the intent to arbitrate. If no arbitrator is appointed within that time or any extension

Any notice (which term shall in this clause include any other communication) required or permitted to be given under this Agreement or in connection with the matters contemplated by it shall be in writing and addressed as follows:

This Agreement shall constitute the entire agreement between the Parties in relation to the subject matter hereof and all other terms are expressly excluded.

Nothing in this Agreement is intended or shall be deemed to amend, alter, modify, or have any effect whatsoever on any of the terms and conditions of any other written agreement between the Parties entered into on or prior to the Effective Date that pertains to subject matter different from the subject matter of this Agreement. Nothing in this Agreement shall be used to construe or interpret any other written agreement between the Parties. By way of example only, and without limitation, nothing in this Agreement is intended or shall be deemed to amend, alter, modify, or have any effect on (i) that certain Confidentiality Agreement that was entered into by and between Genentech and Regeneron with respect to the settlement discussions that preceded this Agreement, (ii) that certain Non-Exclusive License and Partial Settlement Agreement by and between Genentech and Regeneron, having an effective date of December 31, 2011, and (iii) that certain agreement by and between Bayer, Regeneron, Regeneron UK and Genentech, dated October 19, 2011.

Genentech shall be solely responsible, at its sole discretion and expense, for the prosecution, defense, and maintenance of the Subject Patents and the Dosing Regime Patent Applications (including whether to undertake such activities), and for enforcing the same against actual or suspected third party infringers (including whether to undertake such activities).

If any term or provision of this Agreement shall be held to be illegal or unenforceable, in whole or in part, under any enactment or rule of law or otherwise, such term or provision or part shall to that extent be deemed not to form part of this Agreement but the enforceability of the remainder of this Agreement shall not be affected.

No Party shall assign any of its rights or obligations hereunder except: (i) as incident to the merger, consolidation, reorganization or acquisition of stock or assets affecting substantially all of the assets or voting control of the assigning Party; (ii) to any Person to which it transfers all or substantially all of its assets related to the Subject Patents or Eylea, as the case may be; or (iii) with the prior written consent of the other Parties (which consent shall not be unreasonably withheld). This Agreement shall be binding upon the successors and permitted assigns of the Parties, and the name of a Party appearing herein shall be deemed to include the names of such Party’s successor’s and permitted assigns to the extent necessary to carry out the intent of this Agreement. Any assignment not in accordance with this clause shall be void.

This Agreement shall not be altered, modified or otherwise amended in any respect except in writing duly signed by all Parties.

This Agreement shall be governed by English law. Subject to clause 18 above, the Parties submit to the exclusive jurisdiction of the Courts of England and Wales and the enforcement or interpretation of this Agreement shall be carried out solely by this jurisdiction. A Person who is not a Party to this Agreement shall not have any rights under

This Agreement may be executed in two or more counterparts, each of which should be deemed an original, but all of which together shall constitute one and the same instrument.