Common use of New Product Development Clause in Contracts

New Product Development. (a) From time to time during the Blood Screening Term, the Supervisory Board may discuss the selection and establishment of development programs for one or more new Products, including without limitation the development of modifications to the then-existing Products (which modifications shall in and of themselves be considered Products). The rights granted by each party to the other with respect to any of the Products during the Blood Screening Term shall extend to and include any and all modifications to such Product as are developed during the Blood Screening Term to improve the sample processing, amplification, detection, analysis, or reliability of such Product which utilize the same base technologies and which do not change the fundamental character of such Product, to the extent that Gen-Probe is not prohibited as of the Effective Date from granting such rights. From time to time during the Blood Screening Term, the Supervisory Board shall consider potential modifications to the Products. (b) If both parties wish to develop a Product, the Supervisory Board shall discuss in good faith and propose a mutually acceptable written Development Program and a budget for such development (both of which shall be updated at least annually) for such Product which shall set forth (i) the specifications for such Product, and (ii) the parties’ respective obligations to develop such Product and to conduct such clinical trials and apply for such regulatory approvals as necessary or appropriate to make and sell the Products in the Territory for use in the Blood Screening Field. If a Blood Screening Assay or Blood Screening Instrument is selected for development by both parties in accordance with this Section, then the parties shall develop such Blood Screening Assay or Blood Screening Instrument as set forth in Section 3.1.3. (c) If one party wishes to develop the Product and the other party does not, the party wishing to conduct such development shall have the right to proceed at its sole expense, in accordance with a Development Program, including a budget, to be updated annually, approved by the Supervisory Board (which approval shall not be unreasonably withheld or delayed), provided that such developing party may elect to cease such development at any time in its discretion. The other party shall have no obligation to fund any of the Development Costs of conducting the Development Program for such Product. In any event, subject to all terms of this Agreement, Novartis shall have the exclusive right and obligation to market and sell all Products for use in the Blood Screening Field pursuant to Section 3.1.9.