EXHIBIT 10.11
DATA FLOW CONTINUATION AGREEMENT
BETWEEN
MERCK & CO., INC.
AND
MEDCO HEALTH SOLUTIONS, INC.
DATA FLOW CONTINUATION AGREEMENT
THIS DATA FLOW CONTINUATION AGREEMENT, dated as of June 28, 2002, is
entered into among Merck & Co., Inc., a New Jersey corporation ("Merck") and
Medco Health Solutions, Inc., a Delaware corporation ("Medco"). Merck and Medco
are referred to collectively as the "Parties."
RECITALS
A. Medco currently provides (directly or through a subsidiary) certain
non-patient identifiable and non plan identifiable data to IMS Health
Incorporated ("IMS"), pursuant to an agreement dated January 1, 2000 which
requires Medco to continue to provide data to IMS through December 31, 2002 and
consistent with applicable laws.
B. IMS currently provides certain data and information services to Merck
pursuant to an Information Services Agreement between IMS and Merck dated
January 1, 2000, as amended (the "Information Services Agreement"). The
Information Services Agreement requires IMS to continue to provide data and
services through the December 31, 2004 data month.
C. Medco is a Data Supplier (as defined in section 6 of the Information
Services Agreement) and allows information that it furnishes to IMS ("Medco
Data") to be included in Data (as defined in the Information Services Agreement)
that IMS in turn furnishes to Merck.
D. Merck and Medco are undergoing a change in corporate structure which is
not intended to affect the performance of either of the referenced agreements,
and the Parties wish to preserve the flow of information that currently exists
between them under those agreements.
ACCORDINGLY, the Parties agree as follows:
ARTICLE I
DATA TO BE PROVIDED
1.1 Medco agrees that it will continue to provide information to IMS
consistent with the information it has provided since January 1, 2000, and that
for so long as it remains a Data Supplier to IMS, Medco Data may continue to be
provided to Merck under the terms of the Information Services Agreement and
consistent with the way such Data has been provided by IMS to Merck since
January 1, 2000.
1.2 In the event that Medco ceases to be a Data Supplier to IMS at any time
prior to December 31, 2004, Medco agrees that it will provide Medco Data to
Merck directly through the data month ending December 31, 2004.
1.3 Medco agrees that from the date of this Agreement through December 31,
2004, it shall continue to provide to Merck, either directly or through IMS, the
data listed in Schedule 1A, subject to the restrictions contained in that
Schedule.
ARTICLE II
COMPENSATION AND TERMINATION
2.1 Merck shall pay Medco the fees set forth in Schedule 2A.
2.2 Merck may terminate this Agreement for any reason or no reason,
effective January 1, 2003 or at any later date, upon at least 90 days prior
written notice to Medco. In the event of termination, the fees payable under
Section 2.1 shall be reduced pro rata for the number of months left in the year
if the services are terminated mid-year.
ARTICLE III
RELATIONSHIP BETWEEN THE PARTIES
3.1 The relationship between the Parties established under this Agreement
is that of independent contractors and neither Party is an employee, agent,
partner, or joint venturer of or with the other.
ARTICLE IV
PATIENT PRIVACY
4.1 Medco represents and warrants that it will perform all of its duties
under this Agreement in compliance with all applicable federal, state, local and
foreign laws and regulations and licensing requirements, including but not
limited to those related to patient notification, authorization and consent,
privacy of medical records and medical information. By way of example, Medco is
required under the Standards adopted pursuant to the Health Insurance
Portability and Accountability Act of 1996, either directly as a covered entity
or in its role as a business associate of its health plan clients, to assure
that protected health information (all as defined in such Standards) is used or
disclosed only in accordance with such Standards.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.1 Intellectual Property. Medco represents and warrants that it has the
right to provide the Medco Data, and that its provision of Medco Data shall not
infringe the intellectual property rights of any third party.
ARTICLE VI
INDEMNIFICATION
6.1 Indemnification. Medco shall indemnify and hold harmless the Merck
Indemnitees (as defined in the Indemnification and Insurance Agreement to be
entered into by the Parties (the "Indemnification Agreement")) in respect of all
Liabilities (as defined in the Indemnification Agreement) related to, arising
from, asserted against or associated with Medco's providing data hereunder. Such
indemnification obligation shall be a Medco Liability for purposes of the
Indemnification Agreement, and the provisions of Article I thereof with respect
to indemnification shall govern with respect thereto.
6.2 Additional Indemnification. In addition to, and not in limitation of,
the indemnification provided under Section 6.1, Medco shall indemnify and hold
harmless the Merck Indemnitees from and against any and all loss, damage or
expense, including reasonable attorneys' fees, that Merck may sustain or incur
as a result of any claim, suit or proceeding arising out of or in connection
with: (1) any actual or alleged negligent or willful act or omission of Medco,
or any of its employees, agents or subcontractors; (2) any actual or alleged
violation by Medco, or any of its employees, agents or subcontractors of any
law, statute, ordinance or regulation; (3) any failure to obtain necessary
consents, authorizations, approvals or releases for use of the Medco Data and
any violation or alleged violation of any third party or individual's privacy
right by the Medco Data provided to Merck under this Agreement; (4) any
infringement or alleged infringement by the Medco Data provided to Merck under
this Agreement upon any intellectual property right of any third party; or (5)
any failure to perform any obligation under this Agreement. Such indemnification
obligation shall be a Medco Liability for purposes of the Indemnification
Agreement, and the provisions of Article I of that agreement with respect to
indemnification shall govern with respect to that liability.
ARTICLE VII
DISPUTE RESOLUTION
7.1 Any dispute, controversy or claim arising between the Parties relating
to the interpretation, validity or performance of this Agreement shall be
resolved in accordance with the provisions of Article III of the Indemnification
Agreement.
7.2 Injunctive Relief. Notwithstanding the provisions of Section 7.1, Medco
acknowledges that any violation of Article I of this Agreement will cause Merck
immediate and irreparable harm that monetary damages cannot adequately remedy.
The parties agree that, upon any actual or impending violation of Article I of
this Agreement, in addition to any money damages or other legal remedy that
Merck may have, Merck shall also be entitled to equitable relief, including
injunctive relief and specific performance (and Medco shall not plead in defense
thereto that there would be an adequate remedy at law), without bond or proof of
damages. Such equitable relief may be sought in an arbitration proceeding
pursuant to Section 3.1(c) of the Indemnification Agreement (without first
complying with the negotiation provisions of Section 3.1(a) thereof) or in a
court, subject to Section 8.2. In the event of litigation relating to this
Agreement, if a court of competent jurisdiction determines that Medco has
breached Article I of this Agreement, Medco shall be liable and pay to Merck the
reasonable legal fees and costs incurred in connection with such litigation,
including any appeal from such litigation.
ARTCLE VIII
MISCELLANEOUS
8.1 Entire Agreement. This Agreement and any other agreements specifically
referred to in this Agreement constitute the entire agreement between the
Parties with respect to the subject matter of this Agreement and shall supersede
all prior or contemporaneous written or oral agreements or understandings with
respect to the same subject matter.
8.2 Governing Law; Forum. This Agreement shall be construed in accordance
with, and all Disputes hereunder shall be governed by, the procedural (except to
the extent inconsistent with the procedures set forth in Article III of the
Indemnification Agreement) and substantive laws of the State of New York as to
all matters regardless of the laws that might otherwise govern under principles
of conflicts of laws applicable thereto. Under no circumstances may any party
seek or be awarded punitive damages under this Agreement. Any state court
sitting in New York county, New York and/or the United States District Court for
the Southern District of New York shall have exclusive jurisdiction and venue,
and each party hereto hereby submits to such jurisdiction and venue and
irrevocably waives, to the fullest extent permitted by applicable law, any
objection it may now or hereafter have to such jurisdiction or the laying of
such venue over any Disputes between the parties that are permitted to be
brought in a court, or the enforcement of any decision of an arbitrator,
pursuant to Article III of the Indemnification Agreement. Each of the parties
hereby irrevocably waives any right to a jury trial with respect to a Dispute.
8.3 Interpretation. The headings contained in this Agreement, including its
Schedules and table of contents, are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement. Any
capitalized term used in any Schedule but not otherwise defined therein, shall
have the meaning assigned to such term in this Agreement. When a reference is
made in this Agreement to an Article or a Section, such reference shall be to an
Article or Section of this Agreement unless otherwise indicated.
8.4 Notices. All notices and other communications required or permitted to
be given by either Party pursuant to the terms of this Agreement shall be in
writing to and shall be deemed to have been duly given when delivered in person,
by express or overnight mail delivery by a nationally recognized courier
(delivery charges prepaid), or by registered or certified mail (postage prepaid,
return receipt requested), as follows:
if to Merck:
Merck & Co., Inc.
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Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
Executive Director, Information Management
and Development
With a copy to:
Merck & Co., Inc.
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Attention: General Counsel
if to Medco:
Medco Health Solutions, Inc.
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Attention: General Counsel
or to such other address as the Party to whom notice is given may have
previously furnished to the other in writing in the manner set forth above. All
notices and other communication shall be deemed to have been given and received
on the date of actual delivery.
8.5 Binding Effect; Assignment; Third-Party Beneficiaries. Medco may not,
directly or indirectly, in whole or in part, whether by operation of law or
otherwise, assign or transfer this Agreement or its rights or obligations
hereunder, without Merck's prior written consent and, except as otherwise
permitted hereby, any attempted assignment, transfer or delegation without such
prior written consent shall be voidable at the sole option of Merck. Nothing in
this Agreement shall restrict any transfer of this Agreement by Merck, whether
by operation of law or otherwise. Without limiting the foregoing, this Agreement
shall be binding upon Merck and the other members of the Merck Group and Medco
and the other members of the Medco Group and their respective legal
representatives, successors and permitted assigns, and nothing in this
Agreement, express or implied, is intended to confer upon any other Person any
rights or remedies of any nature whatsoever under or by reason of this
Agreement.
8.6 Offset. In addition to, and not in limitation of, any other remedies
any member of the Merck Group or any Merck Indemnitee (as defined in the
Indemnification Agreement) may be entitled to under the Separation Agreement (as
defined in the Indemnification Agreement), any Ancillary Agreement (as defined
in the Separation Agreement) (including this Agreement) or any Intercompany
Agreement (as defined in the Indemnification Agreement) , any member of the
Merck Group or any Merck Indemnitee may satisfy any amounts owed to such member
of the Merck Group or Merck Indemnitee by any member of the Medco Group by means
of an offset against any amounts any member of the Merck Group may from time to
time owe to any member of the Medco Group or an Medco Indemnitee, whether under
the Separation Agreement, any Ancillary Agreement (including this Agreement),
any Intercompany Agreement, any other agreement or arrangement existing between
any member of the Merck Group and any member of the Medco Group, or otherwise.
8.7 Severability. If any term or other provision of this Agreement is
determined by a court, administrative agency or arbitrator, by any court or in
any binding arbitration, to be invalid, illegal or incapable of being enforced
by any rule of law or public policy, all other conditions and provisions of this
Agreement will nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any Party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the Parties shall negotiate in good faith to modify this Agreement so
as to effect the original intent of the Parties as closely as possible in an
acceptable manner to the end that transactions contemplated hereby are fulfilled
to the fullest extent possible. If the Parties are unable to reach an agreement
on any such modification, the arbitrator selected in accordance with Article III
of the Indemnification Agreement shall have the authority to determine such
modification.
8.8 Failure or Indulgence Not Waiver. No failure or delay on the part of
either Party hereto in the exercise of any right hereunder shall impair such
right or be construed to be a waiver of, or acquiescence in, any breach of any
representation, warranty or agreement herein, nor shall any single or partial
exercise of any such right preclude other or further exercise thereof or of any
other right.
8.9 Amendment. No change or amendment will be made to this Agreement
except by an instrument in writing signed on behalf of each of the Parties
hereto.
8.10 Counterparts. This Agreement and the other documents referred to
herein may be executed in counterparts, each of which shall be deemed an
original but all of which, taken together, shall constitute one and the same
instrument.
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed
in duplicate originals by its duly authorized representatives.
MERCK & CO., INC. MEDCO HEALTH SOLUTIONS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President Title: Executive Vice President
USHH-The Americas Operations and Technology