Item 1.01. Entry Into a Material Definitive Agreement.

On September 12, 2012, DARA BioSciences, Inc. (the "Company") entered into a distribution and license agreement (the "License Agreement") with Helsinn Healthcare SA ("Helsinn"). Under the License Agreement, Helsinn granted the Company an exclusive license to distribute, promote, market and sell GelclairŽ for treatment of certain approved indications in the United States and the right to subcontract certain of those licensed rights to subcontractors. GelclairŽ is an FDA-cleared product indicated for the treatment of oral mucositis. Under the License Agreement, the Company is obligated to launch GelclairŽ in the United States within six months of September 12, 2012 and is obligated to meet minimum sales thresholds during the License Agreement's ten-year term. The License Agreement also provides that the Company will receive exclusive rights to distribute, promote, market and sell GelclairŽ for an additional indication if Helsinn is able to obtain regulatory approval for such indication, and Helsinn shall use its commercially reasonable efforts to obtain such regulatory approval according to certain timelines.

Under the License Agreement, the Company is required to make certain up-front, milestone, sales performance and royalty payments to Helsinn. The License Agreement requires the Company to pay Helsinn specified royalties based on sales of GelclairŽ in the United States by the Company or its subcontractors.

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