EXHIBIT 10.2
CONFIDENTIAL TREATMENT
DEVELOPMENT AND MANUFACTURING AGREEMENT
This development and manufacturing agreement is made and entered into on this
12th day of July 2000.
BY AND BETWEEN: CYTOGEN CORPORATION, a company
incorporated under New Jersey law, having its
registered address at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇ of America (hereinafter referred to as
"CYTOGEN"), of the one part;
AND: DSM BIOLOGICS COMPANY B.V., a company
incorporated under Dutch law, having its
registered address at 72/2 ▇▇▇▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ (hereinafter
referred to as "DSM Biologics"), of the other
part;
CYTOGEN and DSM Biologics hereinafter sometimes individually referred to as
"Party" and collectively as "Parties".
SECTION 1 - PREAMBLE
--------------------
WHEREAS, CYTOGEN avails of a hybridoma cell line for expressing a protein for
inclusion in a product known by CYTOGEN as Prostascint(R) and wishes to have a
manufacturing process developed for this cell line and have manufactured three
(3) cGMP batches of this protein which will thereafter be conjugated by DSM
Biologics;
WHEREAS, DSM Biologics has expertise and know-how in the area of development and
production of biopharmaceutical products;
WHEREAS, the Parties have signed a letter of commitment dated January 26, 2000
for the commencement by DSM Biologics of some development activities for the
CYTOGEN hybridoma cell line;
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS AND AGREEMENTS HEREIN
CONTAINED, IT IS HEREBY AGREED BY THE PARTIES HERETO AS FOLLOWS:
SECTION 2 - DEFINlTIONS
-----------------------
In this Agreement the following terms, whether used in the singular or plural,
shall, as used herein, have the following respective meanings:
2.1 "Acceptance" has the meaning ascribed thereto in Section 5.3;
2.2 "Affiliates" means any individual, company, partnership or other
entity which directly or indirectly, at present or in the future,
controls, is controlled by or is under common control with a Party;
2.3 "Agreement" means this development and manufacturing agreement;
2.4 "Batch Records" means for each batch of Product manufactured in Step
5, the production protocols showing how the batch was manufactured;
2.5 "▇▇▇▇ of Testing" means a document carrying Product and/or Project
identification, and stating for the Process the list of analytical
tests, their standard methods and procedures, and the criteria to be
met during the cGMP manufacturing Product, and all amendments thereto,
to be agreed upon between the Parties;
2.6 "CCN" means a so-called contemplated change notification describing
any material deviation from the Project, which notice is provided in
writing by DSM Biologics to CYTOGEN and must be approved by CYTOGEN in
writing prior to taking effect;
2.7 "cGMP" means current good manufacturing practices and general
biological products standards as promulgated under the United States
Federal Food, Drug and Cosmetic Act at 21 CFR, Canadian Good
Manufacturing Practices and the EEC Guide to Good Manufacturing
Practices for Medical Products (Vol. IV rules governing medical
products in the European Community 1989);
2.8 "Claims" means any and all claims, demands, losses, obligations,
liabilities, damages, deficiencies, actions, settlements, judgments,
cost and expenses which a Party may incur or suffer (including
reasonable costs and legal fees incident thereto or in seeking
indemnification therefor);
2.9 "Costs" means the costs for the Project, which costs shall exclude the
Price but shall include the costs of raw materials, filters, resins,
Product release testing, external testing, any royalties to be paid to
third parties, subcontractor costs, out of pocket expenses, travel and
lodging costs, capital investments, shipping Product, insuring shipped
Products, and all brokers fees, customs duties, import duties, excise
taxes and other taxes payable in connection with the delivery of
Product;
2.10 "CYTOGEN" means Cytogen Corporation;
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2.11 "CYTOGEN Proprietary Information" has the meaning ascribed thereto in
Section 14.1;
2.12 "CYTOGEN Technology" means any and all current and future Intellectual
Property Rights proprietary to CYTOGEN in so far as provided, granted,
divulged or disclosed, either directly or indirectly by CYTOGEN to DSM
Biologics, pertaining to the Project.
2.13 "Defaulting Party" has the meaning ascribed thereto in Section 15.3;
2.14 "Documents" means the Specifications, ▇▇▇▇ of Testing, Batch Records,
certificate of analysis containing the outcome of the tests on the
Product and Release statement;
2.15 "DSM Biologics" means DSM Biologics Company B.V.;
2.16 "DSM Biologics Technology" means any and all current and
future-Intellectual Property Rights proprietary to DSM Biologics in so
far as provided, granted, divulged or disclosed, either directly or
indirectly, by DSM Biologics to CYTOGEN in the process of performing
the Project, pertaining to fermentation, primary recovery and
purification of biopharmaceutical products;
2.17 "Force Majeure" has the meaning ascribed thereto in Section 20.1;
2.18 "Intellectual Property Rights" means, whether or not protected or
protectible under any particular law, all patents, patent
applications, patentable subject matter, copyrights, copyrightable
subject matter, ideas, inventions, discoveries, devices, designs,
apparatuses, practices, processes, methods, products, cell lines,
progeny, engineered cell lines, clones, samples, trade secrets,
technology, know-how, software, hardware, improvements, trademarks and
service marks (and the goodwill pertaining thereto);
2.19 Letter of Commitment" means the letter agreement entered into between
the Parties dated January 26, 2000 for the commencement by DSM
Biologics of some development activities for the Product cell line;
2.20 "Manufacturing Instructions" means the protocols for manufacturing
Product in Step 5 and all amendments thereto, to be agreed upon
between the Parties. It is understood between the Parties that these
protocols may be amended at all times, including during manufacturing
of Product;
2.21 "Parties" means DSM Biologics and CYTOGEN collectively;
2.22 "Party" means either DSM Biologics or CYTOGEN;
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2.23 "Price" means the price for the Project as specified in Section 6,
which price shall exclude Costs;
2.24 "Process" means the stirred tank perfusion bioreactor process to
manufacture Product, as well as purification and conjugation, if
reduced to practice as a result of Step 1 and Step 4 of the Project;
2.25 "Product" means purified bulk conjugated antibody known by CYTOGEN as
CYT 356;
2.26 "Project" means development-, upscaling-, cell banking-, manufacturing-
and validation activities, and providing regulatory support, by DSM
Biologics, comprising of Step 1, Step 2, Step 3, Step 4, Step 5 and
Step 6 as further described in the Schedule annexed hereto and being a
part hereof, and all amendments thereto, to be agreed upon between the
Parties;
2.27 "Project Manager" means the individual assigned by DSM Biologics who
will be responsible for the scientific management and technical
components of the Project;
2.28 "Release" means that, after Product has been manufactured in Step 5,
the Product meets the Specifications and was manufactured according to
cGMP and the Manufacturing Instructions;
2.29 "Specifications" means the specifications, technical data and/or
formulae of the Product manufactured in Step 5, and all amendments
thereto, to be agreed upon between the Parties;
2.30 "Steering Committee" means a committee with an equal number of
representatives from each Party;
2.31 "Step 1" means developing a Process under non-cGMP conditions by
adapting the CYTOGEN Product cell line to a serum free media
formulation and by performing upstream and downstream development
activities, including a seven (7) liter fermentation run and a fifty
(50) liter so called pilot fermentation with a lab scale down stream
processing step and conjugation;
2.32 "Step 2" means transfer, development and optimization of CYTOGEN
quality control assays;
2.33 "Step 3" means preparing under cGMP conditions a master cell bank and a
manufacturer working cell bank
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2.34 "Step 4" means using the Process as developed in Step I to perform at
fifty (50) liter scale, under non-cGMP conditions, one (1) so cal1ed
shakedown run including one (1) conjugation;
2.35 "Step 5" means cGMP manufacturing three (3) batches of Product using
the Process for a Biologics License Application (BLA) supplement and
market distribution;
2.37 "Step 6" means:
i) writing a Process and assay master validation plan and
subsequently executing this plan during the performance of
Step 5;
ii) means providing support for CYTOGEN's preparation of a
chemistry manufacturing and control (CMC) data package for
filing the Process for a United States BLA supplement and a
European Marketing Authorization Application (MAA) supplement.
SECTION 3 - OBJECTIVES AND OBLIGATIONS OF THE PARTIES
-----------------------------------------------------
3.1 It is the intention of the Parties to hereby establish a lasting and
mutually profitable relationship and for that purpose to inform and
assist one another in a spirit of co-operation during the execution of
the Project.
3.2 Subject to the terms and conditions of this Agreement, CYTOGEN hereby
engages DSM Biologics to carry out the Project and DSM Biologics,
subject to the terms and conditions of this Agreement, hereby
undertakes to use its best reasonable efforts to carry out the Project
in accordance with the Schedule annexed hereto and being a part hereof.
3.3 The Parties hereby acknowledge and agree that there is absolutely
no guarantee:
i.) that the Product and the Process will be commercially
exploitable, profitable or approved by any regulatory
authority;
ii.) that the milestones identified in the Schedule to this
Agreement for Step 1, Step 2 and Step 4 will be achieved;
iii.) that any Product resulting from Step 1 or Step 4 will fulfill
certain specifications, certain yields or will be delivered in
time for any further use intended therefor by CYTOGEN; or
iv.) that the Product to be manufactured in Step 5 will be
delivered in time for a BLA and MAA supplement submission and
approval or for market distribution.
3.4 CYTOGEN shall timely provide all CYTOGEN Technology necessary for the
performance of the Project as well as, if so
requested by DSM Biologics,
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provide reasonable technical assistance needed by DSM Biologics for
the performance of the Project.
Any material change to the scope of the Project shall not take effect
unless approved in writing by CYTOGEN through a CCN.
The Parties acknowledge that this Agreement is only for certain
development activities and the delivery of three (3) batches of
Product and not for commercially manufacturing Product. Therefore,
during the performance of Step 5 of the Project, the Parties shall in
good faith negotiate a long term supply agreement in respect of the
Product under the proviso that the aforementioned three (3) batches
comply with the Specifications and that all relevant governmental
authority is granted to commercially use the Product on human
subjects. If the Parties do not enter into such an agreement, at
CYTOGEN's request, the Parties will enter into good faith
negotiations for CYTOGEN to - license the DSM Biologics Technology
pursuant to a license agreement on terms and conditions to be agreed
upon. Such terms and conditions shall be as competitive as DSM
Biologics offers to any third party.
The Parties will elect, at their convenience, a Steering Committee,
that will oversee the general execution of the Project and the
Agreement and will discuss, both during the performance of the
Project and after completion of the Project, the further plans of
CYTOGEN for the Product and the Process, including the status and
outcome of clinical trials, registration activities and future
requirements by CYTOGEN of Product, whether for further clinical
trials or for marketing.
SECTION 4 - STEP 1, STEP 2, STEP 3 AND STEP 4 OF THE PROJECT
------------------------------------------------------------
4.1 The different parts of the Project are estimated to require the
periods of time identified in the Schedule to this Agreement. DSM
Biologics shall timely notify CYTOGEN if it expects performance of a
part of the Project not to be possible within the timeframe as
described in the Schedule, and shall take all reasonable efforts to
perform that part of the Project as soon as possible thereafter.
4.2 The Parties shall, during and after completion of Step 1, discuss
whether the milestones identified in the Schedule to this Agreement for
Step 1 have been achieved and shall, based upon such discussion, decide
on whether to perform additional work with regard to Step 1, proceed
with Step 2 according to the Schedule or terminate the Project. If the
Parties decide to perform additional work with regard to Step 1, the
duration, scope, price and costs thereof shall be separately agreed
upon between the Parties.
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4.3 During the performance and after completion of Step 2, if and when
performed, the Parties shall, based upon the milestones identified in
the Schedule to this Agreement for Step 2, decide on whether to perform
additional work with regard to Step 2, proceed with Step 4 according to
the Schedule or terminate the Project. If the Parties decide to perform
additional work with regard to Step 2, the duration, scope, price and
costs thereof shall be separately agreed upon between the Parties.
4.4 If the Parties agree Step 3 is necessary, and as described in the
Schedule to this Agreement, DSM Biologics shall commence with
performing Step 3 of the Project as outlined in the Schedule.
4.5 During the performance and after completion of Step 4, if and when
performed, the Parties shall, based upon technical reasons such as the
robustness of the Process, decide on whether to perform additional work
with regard to Step 4, proceed with Step 5 according to the Schedule or
terminate the Project. If the Parties decide to perform additional work
with regard to Step 4, the duration, scope, price and costs thereof
shall be separately agreed upon between the Parties.
SECTION 5 - STEP 5 AND STEP 6 OF THE PROJECT
--------------------------------------------
5.1 DSM Biologics shall commence with performing Step 5 of the Project if
and when the Parties decide thereto according to Section 4.5. DSM
Biologics shall timely notify CYTOGEN if it expects delivery of Product
not to be possible within the timeframe described in the Schedule to
this Agreement, and shall take all efforts to deliver Product as soon
as possible thereafter.
5.2 The Product shall be manufactured in accordance with the Manufacturing
Instructions and under cGMP conditions. Each batch of Product will be
sampled and tested by the quality control department of DSM Biologics
against the Specifications. The quality assurance department of DSM
Biologics will review the Batch Records and will assess if the
manufacturing has taken place in compliance with the Manufacturing
Instructions and cGMP regulations.
5.3 If based upon such tests, a batch of Product conforms to the
Specifications and was manufactured according to cGMP and the
Manufacturing Instructions, a Release statement will be completed and
approved by the quality assurance department of DSM Biologics. This
certificate together with all other Documents will be delivered to
CYTOGEN or a third party appointed by Cytogen. The batch of Product
will be delivered to CYTOGEN or a third party appointed by Cytogen.
DSM Biologics shall retain sample of the batch to be delivered and
shall have the batch shipped and insured according to
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CYTOGEN's instructions. Responsibility for the batch shall pass after
delivery by DSM Biologics of the batch to the carrier (CIP as defined
in the INCO Terms 1990).
5.4 CYTOGEN will test the batch for compliance with the Specifications
through analyzing the Documents delivered by DSM Biologics, within two
(2) weeks of delivery of the Documents and will Accept the batch in
case of such compliance ("Acceptance"). CYTOGEN has no obligation to
accept the batch if such batch does not comply with the Specifications.
CYTOGEN will notify DSM Biologics in writing of its Acceptance or
rejection of the batch within two (2) weeks of delivery of the
Documents. In the absence of any such written confirmation to DSM
Biologics, the batch shall be deemed to comply with the Specifications
and Accepted by CYTOGEN. During the aforementioned two (2) weeks
CYTOGEN shall store or have stored the batch- under controlled
conditions.
5.5 If there is any dispute concerning whether Product complies with the
Specifications or not or whether such failure is due (in whole or in
part) to acts or omissions of CYTOGEN or a CYTOGEN designee after
delivery of Product, a sample of the rejected Product and a sample
retained by DSM Biologics as set forth above shall be exchanged between
CYTOGEN and DSM Biologics for a counter check. If such counter-check
does not resolve the dispute, a sample of the rejected Product and a
sample retained by DSM Biologics shall be submitted to an independent,
qualified third-party laboratory that is mutually acceptable and
selected by the Parties promptly in good faith. Such laboratory shall
determine whether the rejected Product met the Specifications at the
time of delivery to the carrier and such laboratory's determinations
shall be final and determinative for purposes of this Agreement save
for manifest error on the face of decision. The Party against whom the
laboratory rules shall bear all costs of the third-party laboratory
activities.
5.6 If a batch of Product does not conform to the Specifications, and this
nonconformity is not due to DSM Biologics' failure to comply with the
Manufacturing Instructions or with cGMP, CYTOGEN shall have to pay the
Price and Costs for this batch. DSM Biologic shall at CYTOGEN's
request, cost and expense, either obtain new raw materials and produce
a new batch of Product as soon as reasonably possible or rework the
batch.
5.7 Regardless of whether a batch of Product conforms to the Specifications
or not, if this batch was not manufactured according to cGMP and/or the
Manufacturing Instructions, thereby making the Product unsuitable for
its intended purpose, CYTOGEN shall not have to pay the Price and Costs
for this batch. DSM Biologics shall at CYTOGEN's request, cost and
expense, obtain new raw materials and produce a new batch of Product as
soon as reasonably possible. However, in the event it is possible to
rework the Product in such a
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way that the batch can be deemed to have been manufactured according to
cGMP and the Manufacturing Instructions, then CYTOGEN shall have to pay
the Price and Costs for batch of Product but not the costs of the
reworking, which shall be for DSM Biologics' account.
5.8 The Parties shall in good faith separately agree upon the scope of work
for Step 6, the commencement date and expected duration, and the price
and costs thereof.
SECTION 6 - PRICE AND COSTS
---------------------------
6.1 It is understood between the Parties that the Price for the Project
shall be based upon the assumptions contained in the Schedule hereto
and the limited information available to DSM Biologics up to the
effective date of this Agreement. If, during the preparation for or the
performance of the Project, itbecomes clear that these assumptions are
not correct, and have consequences for the Project which cannot be
dealt with through a CCN, or the detailed information further exchanged
between the Parties indicates more labor and/or occupancy is needed to
perform the Project, the Parties shall renegotiate the Price in good
faith. ID addition, the Price for Step 4 and Step 5 is based upon the
expected process steps to be defined in the Process. Should the Step 1
and/or Step 4 activities lead to a Process which differs significantly
in the expected number of process steps and/or the time for executing
the Process, the Price for Step 4 and Step 5 shall be adjusted
accordingly.
6.2 The Price, excluding VAT, for the work to be performed in Step 1 of the
Project shall be ***** United States dollars (US $ *****). Under the
Letter of Commitment, Cytogen has paid an amount of ***** United States
dollars (US $ *****) as an upfront payment for the performance by DSM
Biologics of Step 1. The remainder of the Price, including VAT if
applicable, for Step 1, being ***** United States dollars (US $ *****)
shall be invoiced as follows:
i.) ***** United States dollars (US $*****)
upon completion of the seven (7) liter fermentation run in
Step 1;
ii) ***** United States dollars (US $ *****)
upon completion in Step 1 of the fifty (50) liter so called
pilot fermentation with a lab scale down stream processing
step and conjugation.
6.3 The Price, excluding VAT, for the work performed in Step 2 of the
Project shall be based on ***** United States dollars (US $ *****) per
hour worked.
-----------------------------
***** Confidential portion omitted and filed separately with the Securities and
Exchange Commission
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This Price, including VAT if applicable, shall be invoiced
every month based on the actual man-hours spent by DSM
Biologics in the previous month on performing Step 2.
6.4 The Price, excluding VAT, for the work performed in Step 3 of the
Project shall be ***** United States dollars (US $*****). This Price,
including VAT if applicable, shall be invoiced to and paid by CYTOGEN
as follows: i) ***** percent (***** %) one (1) month prior to
commencement of Step 3; ii) ***** percent (***** %) at completion of
Step 3.
6.5 The Price, excluding VAT, for the work performed in Step 4 of the
project shall be ***** United States dollars (US $ *****). This Price,
including VAT if applicable, shall be invoiced to and paid by CYTOGEN
as follows:
i) ***** percent (***** %) one (1) month prior to commencement of
Step 4;
ii) ***** percent (***** %) at completion of fermentation;
iii) ***** percent (***** %) at complexion of downstream
processing;
iv) ***** percent (***** %) upon delivery by DSM Biologics of any
resulting Product.
6.6 The Price, excluding VAT, for the cGMP batches of Product manufactured
in Step 5 of the Project shall be ***** United States dollars (US $
*****) per batch. The total Price for manufacturing three (3) batches
of Product shall thus be ***** United States dollars (US $ *****).
The Price per batch of Product, including VAT if applicable, shall be
invoiced to and paid by CYTOGEN as follows:
iii) ***** percent (***** %) one (1) month prior to commencement of
the manufacture of the Product;
iv) ***** percent (***** %) at completion of fermentation of the
Product;
v) ***** percent (***** %) at completion of downstream processing
the Product;
vi) ***** percent (***** %) upon delivery by DSM Biologics of
Product, all related Documents and Acceptance.
6.7 The Price, excluding VAT, for Step 6 of the Project shall separately be
agreed upon in good faith between the Parties.
-----------------------------
***** Confidential portion omitted and filed separately with the Securities and
Exchange Commission
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6.8 The Costs for the Project, including VAT if applicable, shall be
invoiced to and paid by CYTOGEN when the Costs are made by DSM
Biologics. However, in respect of raw materials, CYTOGEN shall, two
(2) months prior to commencement of Step 5, make an advance payment of
***** United States dollars (US $ *****), which amount DSM Biologics
shall use to pay the first invoices for raw materials to be ordered
for Step 5.
6.9 All invoices shall be payable by CYTOGEN within thirty (30) days of
receipt of an invoice into the bank account specified on the invoice.
Any delay in the payment by CYTOGEN of the Price and/or the Costs,
except in the event of a dispute in respect of Price and/or Costs,
shall carry an interest rate as of the first day of delayed payment,
which interest rate shall be based on a annual interest rate of
fifteen percent (15%).
SECTION 7 - MANAGEMENT OF THE PROJECT
-------------------------------------
7.1 The Parties hereby agree that the Project shall be under the day-today
supervision of a Project Manager.
7.2 The Parties shall work in conjunction with the Project Manager to
ensure the satisfactory performance of the Project.
7.3 The Project Manager shall be entitled to propose recommendations to
the Parties to ensure that the Project meets its objectives.
7.4 The Project Manager shall be in charge of all managerial and
scientific aspects of the Project and shall maintain communication
with the Parties in connection therewith.
7.5 DSM Biologics shall permit any individual so authorized by CYTOGEN to
visit, during regular business hours, the site where the Project is
being conducted to evaluate the progress thereof, unless such visit
would conflict with a prearranged visit by another client or an
inspection by or for another client. Except in exigent circumstances,
said visit shall be made subject to ten (10) days notice of the
requirement of such visit, such notice to be given to DSM Biologics by
CYTOGEN.
7.6 The Parties may use electronic mail to communicate during the
performance of the Project. The Parties shall use all reasonable
measures to ensure the confidentiality of information so communicated.
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***** Confidential portion omitted and filed separately with the Securities and
Exchange Commission
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SECTION 8 - RECORDS AND REPORTS
-------------------------------
DSM Biologics hereby undertakes that it shall have the Project Manager submit to
CYTOGEN, after completion of Step 1 and Step 2 a report detailing the progress
and results of these Steps and highlighting any major issues encountered during
the previous period.
SECTION 9 - AUDITS AND CYTOGEN REGULATORY APPROVALS
---------------------------------------------------
9.1 DSM Biologics grants CYTOGEN the right to audit or to appoint third
parties to audit, under applicable confidentiality provisions, at any
reasonable time, the facilities employed and the documentation utilized
by DSM Biologics for performing the Project. Except in exigent
circumstances, CYTOGEN will notify DSM Biologics at least twenty (20)
business days in advance of such an audit by CYTOGEN and thirty (30)
business days in advance of such an audit by a third party. All DSM
Biologics' expenses associated with such audits shall be borne by
CYTOGEN.
9.2 DSM Biologics permits inspections of DSM Biologics' facilities by
governmental authorities (such as the United States of America Food and
Drug Administration and equivalent European regulatory authorities) for
any registration or pending registration for manufacturing of Product.
All DSM Biologics' expenses associated with inspections as they relate
directly to manufacturing of Product shall be borne by CYTOGEN.
SECTION 10 - SUBCONTRACTING
---------------------------
DSM Biologics shall be entitled to subcontract portions of the Project to those
subcontractors identified in the Schedule to this Agreement. In addition, DSM
Biologics shall be entitled to subcontract any portion of its obligations
hereunder to its Affiliates. Subcontracting by DSM Biologics of any portion of
its obligations hereunder to any other third party requires CYTOGEN's prior
written permission thereto which permission shall not be unreasonably or
untimely withheld.
SECTION 11 - INTELLECTUAL PROPERTY RIGHTS
-----------------------------------------
11.1 CYTOGEN declares that it has the full right and title to make available
the CYTOGEN Technology to DSM Biologics. DSM Biologics shall use the
CYTOGEN Technology solely to perform the Project.
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11.2 CYTOGEN Technology shall remain the sole and exclusive property of
CYTOGEN. All DSM Biologics Technology shall remain the sole and
exclusive property of DSM Biologics. The Product manufactured in the
Project, the Documents and the reports referred to in Section 8 shall
be the sole and exclusive property of CYTOGEN and all rights and tide
thereto shall vest in and to CYTOGEN. In addition, CYTOGEN shall
exclusively own all Intellectual Property Rights obtained in the
Project specifically related to the Process. DSM Biologics shall, as
soon as possible, execute and do all instruments and things reasonably
necessary to transfer or vest such Intellectual Property Rights in
CYTOGEN. DSM Biologics shall, however, have the right to freely use all
Intellectual Property Rights obtained in the Project in the general
field of fermentation, primary recovery and purification of
biopharmaceutical products.
SECTION 12 - WARRANTY, LIABILITY AND INDEMNIFICATION
----------------------------------------------------
12.1 DSM Biologics does not grant any warranty, either expressed or implied,
legal or conventional, with regard to the Project other than as
explicitly contained or incorporated in this Agreement and disclaims
all implied warranties of merchantability and fitness for a particular
purpose except to the extent of DSM Biologics' own processes and
facilities. DSM Biologics in particular does not warrant, either
expressed or implied, that the performance by it of the activities
contemplated by the Project in accordance with this Agreement will not
infringe upon Intellectual Property Rights of any third party.
12.2 DSM Biologics shall indemnify, defend and hold harmless CYTOGEN against
and in respect of any and all Claims arising out of or based upon:
i) the breach by DSM Biologics of any representations,
warranties, covenants or terms contained or incorporated in
this Agreement; or
ii) any gross negligence or willful misconduct by DSM Biologics or
its employees, agents, sub-contractors or suppliers of raw
materials in connection with the performance of the Project;
except to the extent of Claims being due to CYTOGEN's or its
supplier's negligence or fault and provided that DSM Biologics
shall not be liable for any consequential, indirect or
exemplary damages suffered by CYTOGEN and provided further
that the total of any damages, other than as to Claims against
CYTOGEN for personal injury, to be paid by DSM Biologics shall
not exceed the Price.
DSM Biologics shall, at the request of CYTOGEN, assume the defense of
any demand, claim, action, suit or proceeding brought against CYTOGEN
by reason of the foregoing and shall pay any and all damages up to the
Price that are
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assessed or that are payable by CYTOGEN as a result of the disposition
of any such demand, claim, action, suit or proceeding. Notwithstanding
the foregoing, CYTOGEN may be represented in any such action, suit or
proceeding at its own expense and by its own counsel.
12.3 CYTOGEN shall indemnify, defend and hold harmless DSM Biologics against
and in respect of any and all Claims arising out of or based upon:
i) the breach by CYTOGEN of any representations, warranties,
covenants or terms contained or incorporated in this
Agreement; or
ii) any gross negligence or willful misconduct by CYTOGEN or its
employees, agents, or suppliers of raw materials in connection
with the performance of the Project;
except to the extent of Claims being due to DSM Biologics' or its
supplier's negligence or fault and provided that CYTOGEN shall not be
liable for any consequential, indirect or exemplary damages suffered by
DSM Biologics and provided further that the total of any damages, other
than as to Claims against DSM Biologics for personal injury, to be paid
by CYTOGEN shall not exceed the Price.
12.4 CYTOGEN shall, at the request of DSM Biologics' assume the defense of
any demand, claim, action, suit or proceeding brought against DSM
Biologics by reason of the foregoing and shall pay any and all damages
up to the Price that are assessed or that are payable by DSM Biologics
as a result of the disposition of any such demand, claim, action, suit
or proceeding. Notwithstanding the foregoing, DSM Biologics may be
represented in any such action, suit or proceeding at its own expense
and by its own counsel.
Furthermore, CYTOGEN agrees to indemnify DSM Biologics and save and
hold it harmless from and against any Claims which DSM Biologics is or
may become liable for or may incur or may be called upon to pay or may
pay and that result from or are alleged to result from the
infringement of any Intellectual Property Rights through the use by
DSM Biologics or its subcontractors of CYTOGEN Technology, or the
development, use or manufacturing by DSM Biologics or its
subcontractors of the Process or the Product, provided that DSM
Biologics notifies CYTOGEN immediately of any demand, claim, action,
suit or other proceeding. CYTOGEN shall however not be liable to
indemnify or hold harmless DSM Biologics for payment of any settlement
unless . : CYTOGEN has consented to the settlement.
CYTOGEN shall, at the request of DSM Biologics, assume the defense of
any demand, claim, action, suit or proceeding brought against DSM
Biologics by reason of the foregoing and pay any and all damages
assessed or that are payable by DSM Biologics as a result of the
disposition of any such demand, claim, action, suit or proceeding.
Notwithstanding the foregoing, DSM
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Biologics may be represented in any such action, suit or proceeding at
its own expense and by its own counsel.
12.5 DSM Biologics agrees to indemnify CYTOGEN and save and hold it
harmless from and against any Claims which CYTOGEN is or may become
liable for or may incur or may be called upon to pay or may pay and
that result from or are alleged to result from the infringement of any
Intellectual Property Rights through the use by DSM Biologics or its
subcontractors of DSM Biologics Technology for the Project, provided
that CYTOGEN notifies DSM Biologics immediately of any demand, claim,
action, suit or other proceeding. DSM Biologics shall however not be
liable to indemnify or hold harmless CYTOGEN for payment of any
settlement unless DSM Biologics has consented to the settlement.
DSM Biologics shall, at the request of CYTOGEN, assume the defense of
any demand, claim, action, suit or proceeding brought against CYTOGEN
by reason of the foregoing and pay any and all damages assessed or that
are payable by CYTOGEN as a result of the disposition of any such
demand, claim, action, suit or proceeding. Notwithstanding the
foregoing. CYTOGEN may be represented in any such action, suit or
proceeding at its own expense and by its own counsel.
SECTION 13 - REPRESENTATIONS AND WARRANTIES
-------------------------------------------
13.1 DSM Biologics hereby represents and warrants to CYTOGEN that:
i) it is a corporation duly organized, validly existing and in
good standing under the laws of The Netherlands, and has full
corporate power to conduct the business in which it is
presently engaged and to enter into and perform its
obligations under this Agreement;
ii) it has taken all necessary corporate action under the
applicable laws and its articles of incorporation and bylaws
to authorize the execution by its undersigned officers and
consummation of this Agreement. This Agreement constitutes a
valid and legally binding agreement, enforceable against it
in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or
affecting creditors' rights and to general equity
principles;
iii) the performance by it of its obligations contemplated by the
Project in accordance with this Agreement will not violate
the terms of any other agreement to which it is subject to
or by which it is bound;
iv) it has the right and power to perform the activities
contemplated by the Project;
15
v) it will not use in any capacity, in connection with performing
the Project, any individual who has been debarred pursuant to
the United States Federal Food, Drug and Cosmetic Act; and
vi) to its knowledge, the performance by it of the activities
contemplated by the Project in accordance with this Agreement
will not conflict with any law or regulation applicable to DSM
Biologics.
13.2 CYTOGEN hereby represents and warrants to DSM Biologics that:
i) it is a corporation duly organized, validly existing and in
good standing under the laws of New Jersey, and has full
corporate power to conduct the business in which it is
presently engaged and to enter into and perform its
obligations under this Agreement:
ii) it has taken all necessary corporate action under the
applicable laws and its articles of incorporation and bylaws
to authorize the execution by its undersigned officers and
consummation of this Agreement. This Agreement constitutes a
valid and legally binding agreement, enforceable against it
in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or
affecting creditors' rights and to general equity
principles;
iii) the performance by it of its obligations contemplated by the
Project in accordance with this Agreement will not violate
the terms of any other agreement to which it is subject to
or by which it is bound; iv) it has the right and power to
perform the activities contemplated by the Project; and v)
to its knowledge, the performance by it of the activities
contemplated by the Project in accordance with this
Agreement will not conflict with any law or regulation
applicable to CYTOGEN.
SECTION 14 - CONFIDENTALITY
---------------------------
14.1 Unless agreed to otherwise in this Agreement, DSM Biologics shall
maintain the confidentiality of the CYTOGEN Technology, the Documents,
the reports referred to in Section 8, the Manufacturing Instructions
and the Process (jointly the "CYTOGEN Proprietary Information") and
CYTOGEN shall maintain the confidentiality of the DSM Biologics
Technology, and the Parties shall not in any way or at any time make
use thereof for any purpose other than pursuant to and in order to
carry out the terms and objectives of this Agreement.
14.2 DSM Biologics' obligations contained in Section 14.1 shall not apply to
CYTOGEN Proprietary Information, and CYTOGEN's obligations contained in
Section 14.1 shall not apply to DSM Biologics Technology which:
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i) at the time of disclosure either is or was part of the public
knowledge or literature;
ii) after disclosure becomes part of the public knowledge or
literature through no fault or action of the receiving Party;
iii) the receiving Party can establish by competent proof either is
or was at the time of disclosure in its lawful possession from
a source other than the disclosing Party;
iv) after disclosure is acquired by the receiving Party from a
third party who did not obtain such CYTOGEN Proprietary
Information respectively DSM Biologics Technology, directly or
indirectly, from the disclosing Party;
v) is independently developed by CYTOGEN or DSM Biologics without
the use of DSM Biologics Technology respectively CYTOGEN
Proprietary Information:
14.3 The obligations set forth under Section 14.1 shall, furthermore, not
apply to CYTOGEN Proprietary Information or DSM Biologics Technology
which the receiving Party is required to disclose in prosecuting or
defending litigation or in complying with applicable governmental
regulations in such case reasonable advance notice shall be given to
the disclosing Party.
14.4 DSM Biologics shall not disclose CYTOGEN Proprietary Information and
CYTOGEN shall not disclose DSM Biologics Technology to any persons
other than to its shareholders, Affiliates, agents, employees,
consultants, subcontractors and other authorized representatives
necessarily connected with the Project. From all such persons the
Parties will, prior to his or her receipt of CYTOGEN Proprietary
Information respectively DSM Biologics Technology, obtain undertakings
to maintain the confidentiality of any such disclosure containing the
obligations as set forth in Section 14.1.
14.5 The obligations as set forth in this Section 14 shall expire five (5)
years from the date this Agreement terminates.
14.6 The provisions of this Section 14 replace and annul the terms and
conditions of the mutual confidential disclosure agreement entered
into on October 8, 1998 by CYTOGEN and DSM Biologics' Affiliate
Gist-Brocades/Bio-Intermediair Inc., now named DSM Biologics Company
Inc.
SECTION 15 - TERM AND TERMINATION
---------------------------------
15.1 This Agreement shall enter into force as of the date it is signed by
both Parties and shall remain in effect until the earlier date of the
Project being completed or the Agreement being terminated by either
Party as provided herein. As per the
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date this Agreement enters into force, the Letter of Commitment
shall terminate.
15.2 This Agreement shall terminate if a go/no go decision to be taken in
accordance with the Schedule to this Agreement is a no go decision. In
such event the Agreement shall terminate as per the date the Parties
take this decision. In the event of such termination, CYTOGEN shall
compensate DSM Biologics for the following costs: i) the Price for all
work performed in the Project up to the date of termination; ii)
close-out costs being the Price for the work that is scheduled for the
three (3) months following the date of termination as detailed in the
Schedule. CYTOGEN however retains the right to have such scheduled
work performed in those three (3) months. In the event CYTOGEN does
not make use of this right, and DSM Biologics is able to resell part
or whole of this three (3) month capacity to a third party, DSM
Biologics will so inform CYTOGEN and will provide a good faith
discount to CYTOGEN in respect of the close-out costs; iii) raw
materials and supplies already ordered by DSM Biologics iv) third
party commitments, such as in respect of external testing, already
entered into by DSM Biologics.
15.3 Either Party shall have the right to terminate this Agreement in the
event that:
i) the other Party (the "Defaulting Party") fails to perform
any material obligations, warranty, duty or responsibility
or is in default with respect to any material term or
condition undertaken by the Defaulting Party under this
Agreement and such failure or default continues unremedied
for a period of ninety (90) days after written notice
thereof by the aggrieved Party to the Defaulting Party;
provided that if such breach cannot be reasonably cured
within ninety (90) days, such breach shall be deemed cured
if the Defaulting Party commences to cure such breach within
such ninety (90) day period and diligently continues such
cure and no material adverse impact will result from the
delay; ii) the Defaulting Party is affected by a Force
Majeure which cannot be removed, overcome or abated within
six (6) months (or such-other period as the Parties jointly
shall determine) from the date the Defaulting Party first
became affected; or
iii) the Defaulting Party ceases or takes material steps to cease
carrying on its business, or takes any action to liquidate
its assets; if the Defaulting Party files a voluntary
petition in bankruptcy or for arrangement, reorganization or
other relief under any bankruptcy legislation or any similar
law, now or hereafter in effect; or files an answer or other
pleading in any proceeding admitting insolvency, bankruptcy
or inability to pay its debts as they mature; or within
thirty (30) days after the filing
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of any involuntary proceedings under any bankruptcy
legislation or similar law, now or hereafter in effect, such
proceedings shall not have been vacated; or all or a
substantial part of its assets are attached, seized,
subjected to a writ or distress warrant, or are levied upon,
unless such attachment, seizure, writ, warrant or levy is
vacated within thirty (30) days, or shall be adjudicated as
bankrupt; or shall make an assignment for the benefit of
creditors or shall admit in writing its inability to pay its
debts generally as they become due or shall consent to the
appointment of a receiver or trustee or liquidator of all or
the substantial part of its property; or any order
appointing a receiver, trustee or liquidator of the
Defaulting Party of all or a substantial part of its
property is not vacated within sixty (60) days following the
entry thereof; if an order shall be made or resolution
passed for the winding-up or the liquidation of the
Defaulting Party or if the Defaulting Party adopts or takes
any corporate proceedings for its dissolution or
liquidation.
15.4 The effective date of termination will be the date stated in any
termination notice given hereunder, which date will not be before the
expiration of any applicable cure period provided for in this
Agreement.
15.5 Termination of this Agreement will not affect the rights and
obligations of the Parties accrued under this Agreement prior to
termination nor the provisions contained in this Agreement which by
their purpose have a term beyond the termination of this Agreement.
15.6 Upon the termination of this Agreement:
i) DSM Biologics shall return to CYTOGEN or destroy,
immediately upon CYTOGEN's first request, any and all
CYTOGEN Proprietary Information which is in DSM Biologics'
possession and all documents containing such CYTOGEN
Proprietary Information or any part thereof, and all copies
and extracts made thereof, provided however that DSM
Biologics may keep one (1) copy of all CYTOGEN Proprietary
Information received by it for its legal files to enable it
to determine its obligations hereunder and for regulatory
compliance;
ii) CYTOGEN shall return to DSM Biologics or destroy,
immediately upon DSM Biologics' first request, any and all
DSM Biologics Technology which is in CYTOGEN's possession
and all documents containing such DSM Biologics Technology
or any part thereof, and all copies and extracts made
thereof, provided however that CYTOGEN may keep one (1) copy
of all DSM Biologics Technology received by it for its legal
files to enable it to determine its obligations hereunder
and for regulatory compliance;
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iii) DSM Biologics shall at CYTOGEN's request and expense, ship
to CYTOGEN any capital investment and raw materials
purchased in the course of and for the Project;
iv) unless DSM Biologics shall have terminated the Agreement
pursuant to Section 15.3, DSM Biologics shall assist CYTOGEN
in transferring the Process to such facility as indicated by
CYTOGEN. Any costs therefor shall be borne by CYTOGEN.
SECTION 16 - NOTICES
--------------------
All notices, requests, demands and other communications hereunder shall be given
in writing and shall be given by prepaid registered mail, receipt return
requested, or by telecopier, to the other Party at the following addresses:
if to CYTOGEN: Cytogen Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ of America
FaxTelecopier: ▇-▇▇▇-▇▇▇▇▇▇▇
Attention: ▇▇. ▇. ▇▇▇▇▇
with a copy to: General Counsel
if to DSM Biologics: DSM Biologics Company B.V.
72/2 ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
FaxTelecopier: ▇▇-▇▇-▇▇▇▇▇▇▇
Attention: CEO
with a copy to: Legal Counsel
or at such other address as a Party may have previously indicated to the other
Party in writing in conformity with the foregoing. Any such notice, request,
demand or other communication shall be deemed to have been received on the
seventh (7th) business day following the date of its mailing if sent by
registered mail, or the next business day immediately following the date of
transmission if sent by telecopier.
SECTION 17 - ASSIGNMENT
-----------------------
This Agreement will be to the benefit of the permitted successors and assign of
the Parties hereto. Neither Party will be entitled to assign its rights under
this Agreement to any
20
individual, partnership or other entity, including Affiliates, without the prior
written consent of the other Party hereto and any attempted assignments without
such written consent shall be of no effect. Notwithstanding the foregoing,
either Party shall be entitled, without the prior written consent of the other
Party, to assign all or part of its rights under this Agreement to a purchaser
of all or substantially all of its assets, or an entity with which it may merge,
provided that the assignee agrees in writing to assume all obligations
undertaken by its assignor in this Agreement. No assignment shall relieve the
assigning Party of responsibility for the performance of any of its obligations
hereunder.
SECTION 18 - DISPUTES AND APPLICABLE LAW
----------------------------------------
18.1 In the event of a dispute between the Parties, the Parties shall
firstly make every effort to find an amicable settlement to such
dispute. Before having recourse to litigation under Section 18.2, the
Chief Executive Officers of the Parties, or their nominees, shall
within one (1) month (which time may be extended by mutual agreement)
from a request by either Party meet and use their best efforts to
resolve any disputes. Failing such settlement, the provisions of
Section 18.2 shall apply.
18.2 All disputes which cannot be settled amicably shall be finally settled
by binding arbitration under the rules of conciliation and arbitration
of the International Chamber of Commerce.
18.3 This Agreement is governed by and interpreted in accordance with the
laws of England without regard to conflicts of laws principles.
SECTION 19 - FAILURE TO ACT
---------------------------
Notwithstanding any other provision of this Agreement, whenever a Party is given
a time period pursuant to this Agreement in which to exercise an option, make an
election, give a notice or the like, failure to act during such time period will
be conclusively deemed a decision not to exercise the option, make the election,
give the notice or the like, as fully as if the Party with the option, election,
right to give notice or the like had provided written notice of a decision not
to exercise the option, make the election, give the notice or the like.
SECTION 20 - FORCE MAJEURE
--------------------------
20.1 The obligations of either Party hereunder shall be suspended during the
time and
21
circumstance beyond the control and without the fault or negligence of
that Party so affected ("Force Majeure") including but not limited to
inevitable accidents, perils of navigation, floods, fire, storms,
epidemics, acts of god, earthquakes, explosions, hostilities, civil
commotion, war (declared or undeclared), orders, requisitions,
regulations or acts of any government or governmental authority,
whether de jure or de facto or any official purporting to act under the
authority of any such government, illegality arising from domestic or
foreign laws or regulations, insurrections, failure or slowdown of
public utilities or common carriers, inability to procure raw materials
or other circumstances or conditions of a similar nature, quarantine or
custom restrictions, damage in factories or warehouses, strikes,
lockouts or any other labor difficulty at the Parties and/or suppliers
of goods, raw materials and/or excipients, lack of conveyance,
resulting in hindrance of this Agreement.
20.2 As soon as possible after being affected by a Force Majeure, the Party
so affected shall furnish to the other Party all particulars of the
Force Majeure and the manner in which its performance is thereby
prevented or delayed. The Party whose obligations hereunder have been
suspended shall promptly and diligently pursue appropriate action to
enable it to perform such obligations, except that the Parties shall
not be obligated to settle any strike, lockout or other labor
difficulty on terms contrary to their wishes.
20.3 In the event that any Force Majeure cannot be removed, overcome or
abated within six (6) months (or such other period as the Parties
jointly shall determine) from the date the Party affected first became
affected, then either Party may, at the expiration of such period by
notice to the other Party terminate this Agreement.
SECITION 21 - MISCELLANEOUS PROVISIONS
--------------------------------------
21.1 DSM Biologics shall obtain all permits and governmental licenses
required in connection with its activities under this Agreement and
shall, in addition, comply with applicable law in performing its
obligations hereunder.
21.2 All rights and recourses of a Parts, under this Agreement are
cumulative and the exercise by a Party of any of its rights or
recourses will not prevent it from exercising any other right or
recourse available under this Agreement or at law. All obligations of
the Parties under this Agreement are indivisible.
21.3 If any covenant, obligation or term hereunder or the application of any
part of this Agreement to any person, party or circumstance shall, to
any extent, be invalid or unenforceable, the remainder of this
Agreement or the application of such covenants, agreements or
obligations other than those which are held to be
22
invalid or unenforceable shall not be affected thereby and each
covenant, obligation and agreement contained herein shall be separately
valid and enforceable to the full extent permitted by law.
21.4 This is an agreement between separate entities and neither is the
agent, representative, master or servant of or possesses the power to
obligate the other or to make any warranties or representations on
behalf of the other. Nothing in this Agreement will be interpreted so
as to create a relationship of partners' joint ventures, agents,
mandate, fiduciaries or any other similar relationship between the
Parties.
21.5 Failure by either Party to take action against the other will not
affect its right to require full performance of this Agreement at any
time thereafter. The waiver by either Party of the breach of any term
of this Agreement by the other Party will not operate or be interpreted
as a waiver of any subsequent breach by such Party. No term of this
Agreement will be deemed to have been waived by either Party unless
such waiver is in writing.
21.6 This Agreement and the documents referred to in it or attached to this
Agreement constitute the entire agreement between the Parties with
respect to the subject matter hereof and supersede all prior
discussions, negotiations and agreements with respect thereto. No
amendment of, change to or variance from this Agreement will be binding
on either Party unless in writing and signed by the Parties.
21.7 Each of the Parties agrees to perform such acts, sign and deliver such
other agreements' cause such meetings to be held, resolutions passed
and by-laws enacted, exercise their vote and influence as may be
necessary or desirable from time to time in order to give full effect
to this Agreement.
21.8 This Agreement may be executed in two (2) counterparts, each of which
shall be an original and all of which shall constitute together but one
and the same document.
21.9 The headings and subheadings of the sections of this Agreement have
been included solely for ease of reference and do not form part of this
Agreement.
21.10 All words and personal pronouns relating thereto shall be read and
construed as the number and gender of the Party or Parties referred to
in each case require and the verb shall be construed as agreeing with
the required word and/or pronoun.
23
21.11 This Agreement will not be binding upon the Parties until it has been
signed below on behalf of each Party, in which event it shall be
effective as of the date of signing.
IN WITNESS WHEREOF, the Parties have signed on the date first hereinabove
mentioned.
DSM BIOLOGICS COMPANY B.V. CYTOGEN CORPORATION
/s/ ▇.▇. ▇▇▇▇▇ /s/ J.W.R. den Toom
------------------ -----------------------------
▇.▇. ▇▇▇▇▇ J.W.R. den Toom
President & CEO Director Marketing, Sales and
Strategic Development
24