EXHIBIT 10.57
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PROCESSING AND SUPPLY AGREEMENT - Natrecor(R) BNP
between
▇▇▇▇▇▇ LABORATORIES and SCIOS INC.
This Agreement is made effective as of December 1, 1997 (the "Effective
Date"), by and between SCIOS INC., a Delaware corporation having its principal
place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
("Scios"), and ▇▇▇▇▇▇ LABORATORIES, an Illinois corporation having its principal
place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
("Abbott").
BACKGROUND
▇. ▇▇▇▇▇▇ represents to Scios that its manufacturing facility in ▇▇▇▇▇▇▇▇▇,
Kansas doing business as ▇▇▇▇▇▇ Laboratories-▇▇▇▇▇▇▇▇▇ has experience, suitable
facilities and the capability to compound, fill and finish, and test
pharmaceutical compounds, and experience in the commercial manufacture of
pharmaceutical compounds according to current good manufacturing practices
(cGMP) and other applicable requirements.
B. Scios desires to have Abbott undertake, using bulk material supplied by
Scios, the preparation of finished vials of Natrecor(R) BNP ("BNP") for use in
clinical trials and subsequent commercialization if the product is approved for
marketing by the appropriate regulatory authorities.
▇. ▇▇▇▇▇▇ desires to perform the services specified in this Agreement, both
during Scios' clinical trials of BNP and subsequent commercialization if the
product is approved for marketing by the appropriate regulatory authorities.
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth
herein, the parties agree as follows:
Section 1. - Definitions
The following terms shall have the indicated meanings for purposes of this
Agreement:
1.1 "Affiliate" of a party hereto means an entity which controls, is
controlled by, or is under common control with such party. For purposes of this
definition, an entity shall be deemed to control another entity if it owns or
controls, directly or indirectly, at least fifty percent (50%) of the voting
equity of such other entity (or other comparable ownership interest for any
entity other than a corporation).
1.2 "BNP" means the pharmacologically active compound known as Natrecor(R)
BNP, a form of b-type natriuretic peptide.
1.3 "Bulk BNP" means BNP in bulk form meeting the Specifications listed in
Exhibit B to be supplied by Scios to Abbott.
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1.4 "Scios Know-How" means all know-how, inventions, technical and other
information and data supplied by Scios to Abbott in connection with the work,
including, without limitation, design and manufacturing drawings or sketches;
formulae; compositions; processes and procedures; apparatus; correlation data;
flow sheets; reports; operating, test and performance data; and process,
mechanical, material and product specifications related to the production of
Product, including any patents or know-how acquired or licensed by Scios from a
third party, to the extent Scios is permitted to grant a license to Abbott in
such third party technology.
1.5 "Scios Patents" means Scios' patents in all countries, including
improvement patents, patents of addition, patents of importation, certificates
of invention, utility model and design patents, and all reissues, renewals and
extensions thereof; and applications for such patents, including original,
divisional, continuation and continuation-in-part applications pending before
any patent office related to the production of Product.
1.6 "Containers and Packaging" means the containers and closures and the
packaging and labeling used in the manufacture and shipping of Product pursuant
to the Specifications.
1.7 "Data" means all books, records, batch records, reports, lab
notebooks, charts, graphs, comments, computations, analyses, recordings,
photographs, computer programs and documentation thereof, computer information
storage means, sample of materials and other graphic or written data which
relate to the Manufacturing and Testing of the Product pursuant to this
Agreement, including any data required to be maintained pursuant to applicable
FDA or other governmental regulations.
1.8 "FDA" means the United States Food and Drug Administration.
1.9 "Fill and Finish Program" or "Fill and Finish Work" means the
manufacture (including all processes necessary to supply Product), testing,
packaging, labeling and delivery of Product pursuant to the Specifications
described in Exhibit B and cGMP standards.
1.10 "Abbott Know-How" means all of ▇▇▇▇▇▇'▇ inventions, technical and
other information and data, including, without limitation, design and
manufacturing drawings or sketches; formulae; compositions; processes and
procedures; apparatus; correlation data; flow sheets; reports; operating, test
and performance data; and process, mechanical, material and product
specifications directly related to the production of Product including any
patents or know-how acquired or licensed by Abbott from a third party, to the
extent Abbott is permitted to grant a license to Scios in such third party
technology.
1.11 "Abbott Patents" means ▇▇▇▇▇▇'▇ patents in all countries, including
improvement patents, patents of addition, patents of importation, certificates
of invention, utility model and design patents, and all reissues, renewals and
extensions thereof; and applications for such patents, including original,
divisional, continuation and continuation-in-part applications pending before
any patent office related to the production of Product.
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1.12 "Master Production and Control Records" means the records and data to
be generated in the Manufacturing and Testing of Product by Abbott to
demonstrate that all applicable standard operating procedures and methods have
been followed as specified in Exhibit B and Exhibit C and such modifications or
changes thereto specified by Scios and Abbott pursuant to Section 2.5 and
otherwise satisfy cGMP standards. Master Production and Control Records shall
not include the operating procedures and related data of Abbott that are
produced in connection with its general operations.
1.13 "NDA" means a New Drug Application or other equivalent application
seeking approval to market Product, and any supplement or amendment relating
thereto, filed with the FDA by or on behalf of Scios or any licensee or
commercial partner of Scios.
1.14 "Placebo" means the form of Product meeting the Specifications
respectively described in Exhibit B that lacks BNP.
1.15 "Final Product" means the form of Product meeting the Specifications
respectively described in Exhibit B that contains BNP.
1.16 "Product" means both Final Product and/or Placebo meeting the
respective Specifications set forth in Exhibit B.
1.17 "Raw Materials" shall mean all components of Product excluding Bulk
BNP and Containers and Packaging, all of which shall meet the Specifications for
Raw Materials.
1.18 "Regulatory Approval" or words of similar import means approval by the
FDA of Scios' NDA or other marketing application for Products for the first
indication.
1.19 "Specifications" means the specifications for each of BNP, Bulk BNP,
Containers and Packaging, Raw Materials and Product as established by Scios in
Exhibit B and such modifications or changes thereto specified by Scios pursuant
to Section 2.5.
1.20 "Processing Order" or "Purchase Order" means an instruction submitted
in writing to Abbott by Scios requesting Abbott to perform Fill and Finish Work
for a specified quantity of Product for delivery upon specified terms. Such
Processing Order will be in substantially the form of Exhibit A, and shall be in
compliance with this Agreement.
1.21 "cGMP" means current Good Manufacturing Practices under 21 C.F.R.
Parts 200 and 211.
Section 2. - Fill and Finish Program
2.1 Supply.
2.1.1 General. Abbott agrees to perform Fill and Finish Work as
requested by Scios or a third party licensee or partner designated by Scios from
time to time pursuant to this
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Agreement. Subject to the other provisions set forth below, Abbott shall provide
such facilities, equipment and services as may be required to perform Fill and
Finish Work of Product under this Agreement. In preparing Product, Abbott shall
adhere to (a) the compounding, processing, lyophilization, manufacturing,
testing and control procedures as set forth in Exhibit C (as modified pursuant
to Section 2.2 to reflect the size of each batch requested by a Processing
Order), (b) information provided by Scios and agreed to in writing by Abbott and
(c) cGMP standards.'
2.1.2 Requirements. For orders placed before [*****], Scios agrees to
purchase, and Abbott agrees to supply, [*****] of Scios' requirements for the
fill and finish of Final Product that is intended for distribution in the United
States. For orders placed between [*****], Scios agrees to purchase, and Abbott
agrees to supply, [*****] of Scios' requirements for the fill and finish of
Final Product that is intended for distribution in the United States. After
[*****], Scios may [*****]. If at anytime prior to [*****], Abbott is unable to
fulfill Scios' requirements as stated above either from ▇▇▇▇▇▇'▇ McPherson
facility or as described in Section 2.8 any other Abbott facility acceptable to
Scios that is capable of producing Final Product in a manner and quality
comparable to the ▇▇▇▇▇▇▇▇▇ facility, then Scios may, notwithstanding this
Section 2.1.2, [*****].
2.2 Processing Orders. From time to time as detailed herein, Scios shall
submit to Abbott Processing Orders in substantially the form of Exhibit A for
such quantities of Product as Scios requests.
2.2.1 Scios shall, within [*****] after filing its NDA for the
Product, provide Abbott with a written estimate of Scios' monthly orders for the
Product from Abbott for the first contract year. Abbott acknowledges that such
quantities are estimates only.
2.2.2 Abbott and Scios shall cooperate fully in estimating and
scheduling production for the first commercial order to be placed by Scios in
anticipation of FDA approval of the Product.
2.2.3 Scios shall place its first firm Purchase Order approximately
[*****] in advance of the anticipated NDA approval date or desired Product
availability date. At the same time, Scios shall provide to Abbott Scios'
estimate of its monthly orders for [*****].
2.2.4 Thereafter, Scios shall provide [*****] to Abbott a [*****]
forecast of orders with the [*****] consisting of firm Purchase Orders and the
[*****] consisting of Scios' best estimate forecast of its Product orders.
Within [*****], Abbott shall advise Scios of the date Abbott will perform the
Fill and Finish Work specified by such forecast. Each Processing Order submitted
by Scios to Abbott shall reference the Fill and Finish date provided by Abbott
in response to the most recent forecast and shall become firm and non-cancelable
by Scios if not modified by notice from Scios to Abbott [*****].
2.2.5 If, due to significant unforeseen circumstances, Scios requests
changes to firm orders [*****], Abbott shall attempt within reasonable
manufacturing capabilities and
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efficiencies to accommodate the changes. Abbott shall advise Scios of the costs
associated with making any such change and Scios shall be deemed to have
accepted the obligation to pay Abbott for such costs if Scios indicates to
Abbott that Abbott should proceed to make the change.
2.2.6 Each Purchase Order or any acknowledgment thereof, whether
printed, stamped, typed or, written, shall be governed by the terms of this
Agreement and none of the provisions of such Purchase Order or acknowledgment
shall be applicable except those specifying quantity ordered, delivery dates,
special shipping instructions and invoice information.
2.2.7 Not later than [*****], Abbott shall provide to Scios the
suggested modifications to Exhibit C necessary to reflect the size of the batch
to be processed and the parties shall then work together to finalize the Exhibit
C to be applicable for that Process Order.
2.2.8 Within [*****], Abbott shall deliver the requested Product to
Scios' Mountain View, California facilities (or such other destination specified
in the Processing Order), F.O.B. McPherson, Kansas. Abbott shall use carriers
requested by Scios. Risk of Loss of Product shall be determined in accordance
with the provisions of Section 6.2(b) hereof. The foregoing [*****] is
contingent on Scios paying a one-time stocking fee to Abbott for the purchase of
[*****] stoppers, vials and seals to be maintained in inventory by Abbott for
the purpose of fulfilling Processing Orders hereunder. Such payment shall not
exceed [*****] and shall be made prior to Scios' delivery of its initial
Processing Order. To the extent such stoppers, vials and seals are consumed in
the fulfillment of a particular Processing Order, Abbott will restock them for
use in manufacturing Product under this Agreement, or the cost of such materials
shall be credited back to Scios. To the extent the terms of any Processing Order
are inconsistent with the terms of this Agreement, this Agreement shall control.
2.2.9 Each July, Scios and Abbott shall develop a [*****] forecast and
implementation plan containing both an upside and downside forecast of Scios'
anticipated orders and ▇▇▇▇▇▇'▇ plans for meeting Scios' anticipated needs. Such
long-term forecast shall be non-binding.
2.3 Bulk BNP. Scios shall supply all Bulk BNP for the manufacture of the
Product, F.O.B. McPherson, Kansas, freight prepaid, with an accompanying
certificate of analysis and accompanying identification sample attached, to
▇▇▇▇▇▇'▇ Product manufacturing plant in McPherson, Kansas, at least [*****].
Such Bulk BNP shall meet the appropriate Specifications as set forth in Exhibit
B. Upon receipt of each quantity of Bulk BNP supplied by Scios, and before all
of the Bulk BNP is removed from individual containers, Abbott shall accept such
Bulk BNP, and perform an ID test on samples of the Bulk BNP within a reasonable
time (but in no event later than [*****] following receipt) in the manner set
forth in the Specifications for Bulk BNP in Exhibit B, and shall give Scios
prompt written notice of the results of the test. If the Bulk BNP passes the ID
test it shall be accepted by Abbott as meeting such Specifications, and it may
be used by Abbott in performing work under this Agreement. Scios shall endeavor
to give Abbott at least [*****] notice if Scios anticipates that it will not be
able to use a scheduled
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production date. If Abbott is unable to complete any Processing Order due to
Scios' failure to supply an adequate quantity of Bulk BNP meeting
Specifications, then (A) Abbott shall, if requested by Scios, perform the run to
the extent material is available and deliver the resulting Product to Scios,
whereupon Scios shall pay Abbott in accordance with Section 4 or (B) the run
shall be postponed until a mutually agreed date and a sufficient quantity of
Bulk BNP becomes available whereupon Abbott shall endeavor to utilize for
another client's or one of ▇▇▇▇▇▇'▇ own products the facility time allocated to
that Processing Order and (i) if Abbott is successful in finding such
replacement work then Scios shall owe Abbott for such inconvenience an amount
not to exceed [*****] (ii) if Abbott is unable after reasonable efforts to find
such replacement work then Scios shall owe Abbott for such inconvenience an
amount not to exceed [*****].
2.4 Raw Materials, Containers and Packaging, Special Equipment. Abbott
shall manufacture and supply, or purchase from a third party approved by Scios
and supply where indicated in Exhibit B, Raw Materials, Containers and Packaging
meeting the applicable Specification necessary to produce Product. Suppliers
with whom Abbott contracts are listed in Exhibit B, and after a supplier has
been chosen by Abbott and approved by Scios, Abbott shall not change such source
of supply without Scios' prior written approval. Abbott shall be responsible for
performing supplier audits on suppliers providing Raw Materials to Abbott. Scios
shall be responsible for performing the FDA-required annual supplier audit on
Raw Material suppliers providing material to Scios which in turn provides said
Raw Material to Abbott. When Raw Materials and Containers and Packaging are
received by Abbott from the supplier, Abbott shall confirm conformity with the
applicable Specification set forth in Exhibit B, and prepare a release document
documenting such conformity and the suitability of each item to be released for
use in Manufacture of Product. Scios shall provide the text and format for all
necessary labels/labeling for the Containers and Packaging for each unit of
Product, as well as for the shipping container, and unless otherwise agreed,
Abbott shall arrange for the printing of such labels/labeling in a timely
matter. Scios shall have approved proofs of all such labels/labeling in writing
in advance of printing. Labels/labeling approved by Scios shall be the only
labels/labeling used by Abbott for Product, provided, that such labels and
package inserts shall be consistent with FDA's and ▇▇▇▇▇▇'▇ requirements with
regard to physical dimensions and specifications relating to the methods of
handling and affixing on containers. Scios shall provide Abbott with the
authorization to purchase printed materials and all other Raw Materials,
Containers and Packaging on the Processing Orders placed by Scios. Scios shall
reimburse Abbott for the cost of any inventories of printed materials, Raw
Materials and Container Closures ordered by Abbott based on Scios' authorization
that become obsolete due to labeling changes required by Scios or the FDA and a
reasonable charge based on [*****]. Any revision by Scios in the labeling or
packaging material will be implemented by Abbott but the cost of preparing die
changes shall be paid by Scios.
In the event that Abbott requires special equipment in order to perform the
Fill and Finish Work and such equipment will only be used to produce Product,
then Abbott shall define the cost of the required equipment. Scios must give its
prior written approval before the actual purchase of the equipment. The parties
shall agree in an addendum to this Agreement to the terms of the purchase and
issues relating to ownership and use.
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2.5 Specification Changes. All Product shall be produced in accordance with
the procedures set forth in the Batch Record attached as Exhibit C and amended
from time to time and all Product shall meet the applicable Specifications set
forth solely in Exhibit B as of the date of manufacturing at ▇▇▇▇▇▇. ▇▇▇▇▇▇
shall perform all analytical and in-process testing necessary to show conformity
to the Specifications set forth in Exhibit B. If Abbott is unable to perform all
such services, the fee payable to Abbott shall be reduced by [*****]. Abbott
shall provide [*****] prior notice of any intended change to equipment that
Abbott is aware will be, or was listed in, the NDA filed by Scios for the
Product. Abbott shall without additional charge assist Scios in preparing any
submission of information and/or conducting any validation required to obtain
FDA approval for such change of equipment. Abbott shall at its cost be
responsible for the completion of any validation required in connection with
obtaining FDA approval for the equipment change. No modification in the control
documents (as defined in 21 C.F.R. Part 211.186) relating to the manufacturing
procedure, quality assurance/control procedures or procedures to assure
compliance with the Specifications shall be made without Scios' prior written
approval. Scios shall have the right to modify the Specifications (Exhibit B)
and Batch Record (Exhibit C) from time to time. Any change made shall apply only
to production batches produced after changes are accepted by Abbott. If Scios
notifies Abbott of a proposed modification, Abbott shall advise Scios within
[*****] whether the modification is feasible and if it is, the estimated
changes, if any, in the costs, delivery time or other terms which would result
from such modification. Notwithstanding the foregoing, the modification shall be
implemented by Abbott only upon ▇▇▇▇▇▇'▇ reasonable consent and specific written
authorization by Scios after receipt of such estimate and agreement on
appropriate modifications to Exhibit B or Exhibit ▇. ▇▇▇▇▇▇ shall notify Scios
of equipment and/or facility changes that might effect any Scios filing with the
FDA, providing Abbott is aware of said filing. Abbott and Scios shall work
together to prepare regulatory filings or amendments on said equipment and/or
fileable changes.
2.6 Lot Numbering. Scios shall designate on each Processing Order the lot
number to be used by Abbott in its records concerning Product Manufactured and
Tested according to that Processing Order and to identify such Product.
2.7 Process Documentation. Scios shall be responsible for obtaining all
necessary Regulatory Approval for the clinical testing, marketing and sale of
Product. Abbott agrees to provide to Scios all information necessary for Scios
to prepare the Chemistry Manufacturing and Controls Section of Scios' NDA for
the Product. Abbott presently has a single Type 1 Drug Master File #2869 on file
with the FDA. Abbott shall make available to Scios for inspection and copying
(at reasonable times and upon reasonable notice to Abbott) any of the procedures
and methods listed in Exhibit B as the same may be amended from time to time and
shall, upon Scios' written request, send a letter to the FDA authorizing FDA to
reference any appropriate Drug Master File on behalf of the Scios application,
as might be necessary for Scios' filings with the FDA or to obtain NDA approval
from the FDA based on ▇▇▇▇▇▇'▇ participation as formulator and manufacturer of
the Product as contemplated by this Agreement. Abbott shall also provide such
other assistance (including granting Scios the right to reference any of
▇▇▇▇▇▇'▇ Drug Master Files if additional filings are made by Abbott) as Abbott
can reasonably provide to
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support Scios' efforts to obtain Regulatory Approval for Fill and Finish Work of
Product by Abbott.
2.8 Batch Records. Abbott shall manufacture all batches in accordance with
the procedures set forth in the Specifications (Exhibit B) and Batch Record
(Exhibit C), as modified from time to time, and in compliance with current Good
Manufacturing Practices. Abbott will not release any batch except in conformance
with FDA regulations. If requested by Scios, Abbott shall make available to
Scios for each Product batch, copies of the Master Production and Control
Records and a certificate of analysis, all appropriately signed and dated, as
might be necessary to demonstrate compliance with current Good Manufacturing
Practices and the procedures set forth in Exhibit B and Exhibit C. In addition,
Abbott shall, if requested by Scios, allow review of its primary laboratory and
process documents relating to such Master Production and Control Records and
with good cause provide selective copies if requested by Scios. If Abbott
intends to make any material deviations from Exhibit B or Exhibit C for a
particular Processing Order, Abbott shall notify Scios and obtain Scios' prior
approval before implementing any such material deviation. If Abbott becomes
aware of any unplanned material deviation from such procedures and controls it
shall advise Scios promptly and also specifically describe the unplanned
material deviation in such Procedures in the batch records delivered to Scios.
Scios shall have the right to take into account the effect of any unplanned
material deviation in determining whether Product meets the warranties set forth
in Section 11.1. Abbott shall maintain all Master Production and Control Records
for the time period required by FDA regulations.
2.9 Inventory, Storage and Shipping Requirements. Scios and Abbott will
cooperate to maintain adequate inventory at Abbott of Raw Materials and
Containers and Packaging so that delivery of all Product to Scios pursuant to an
applicable Processing Order will be made in accordance with Section 2.2. Abbott
shall store all supplies related to the Fill and Finish Work in accordance with
applicable FDA regulations. Abbott shall also furnish cold storage
(2-8(degrees)C) for Product, in-process material and Bulk BNP. Abbott shall
store Product free of cost to Scios until completion of quality acceptance by
Scios. After quality acceptance, Scios shall pay Abbott at the rate of [*****].
Abbott shall not be obligated to store more than [*****] at any one time. Abbott
shall ship Product to Scios or a location designated by Scios on cold storage
(2-8(degrees)C) using carriers specified by Scios.
2.10 Recovery of Bulk BNP; Destruction of Line Rejects. If requested by
Scios, Abbott shall, to the extent reasonably practicable under the
circumstances, recover all Bulk BNP which it is unable to convert into Product
and return all such recovered Bulk BNP to Scios. Abbott shall destroy normal
line rejects in accordance with the Material Safety Data Sheet (Exhibit D) and
account to Scios for the materials consumed on the batch record.
2.11 Location. Except for subcontracts permitted pursuant to Section 2.12
below, all Fill and Finish Work to be performed by Abbott under this Agreement
shall be performed at ▇▇▇▇▇▇'▇ plant in McPherson, Kansas.
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2.12 Subcontracting. No Fill and Finish Work under this Agreement shall be
subcontracted without Scios' prior written consent. Abbott shall ensure that all
permitted subcontracts shall include appropriate provisions providing Scios with
the same rights as set forth in Section 2.7 and 2.8 in respect of the
subcontracted work, including but not limited to, rights to obtain documentation
of processing and validations which can be used in Scios' own filings for
Regulatory Approval of such subcontractor.
2.13 Delivery and Acceptance. Unless otherwise directed by Scios, Product
shall be shipped to Scios' facility in Mountain View, California. In the event
Scios directs Abbott to ship Product directly to another recipient, then Scios'
shipping order shall evidence acceptance of the Product. It will be the
responsibility of Scios to ensure that any alternate recipient has adequate
storage facilities to receive and store Product under proper storage conditions.
Scios shall have the responsibility for acceptance or rejection of Product as
meeting the requirements of Section 10.1 which shall occur [*****]. If Scios
fails to notify Abbott by the end of the [*****] period, the lot shall be
automatically accepted by Scios as meeting all testing requirements.
2.14 Validation. All components, equipment and processes used by Abbott
shall be validated consistent with the requirements of all applicable FDA
regulations. If Abbott receives any directive from the FDA concerning validation
of Product required at ▇▇▇▇▇▇, ▇▇▇▇▇▇ shall inform Scios and the parties shall
discuss the alternative means to satisfy the FDA's directives. Abbott shall be
responsible for all validation activities for components, equipment, and
processes that are currently used in ▇▇▇▇▇▇'▇ manufacturing facility as related
to the manufacture of Product. If additional validation is required to be
performed for Product, such additional validation shall be performed by Abbott
and at Scios' cost. Scios will have approval signature for all validation
projects initiated upon Scios' request. ▇▇▇▇▇▇'▇ estimated validation costs
based on Scios' validation protocol at the present time are [*****]. Three lots
shall be validated by Abbott by obtaining and marking distribution samples from
the lyophilization process which will be shipped to Scios for Scios' testing and
approval at Scios' cost. No validation shall be performed for the secondary
packaging, since the final secondary packaging shall be a replica of existing
packaging of Product that Abbott is using at its McPherson facility. All costs
for validation work under this Section 2.14 must be agreed to by Scios prior to
commencement of any validation work for which Scios is financially responsible.
In addition, as detailed in 3.2, Scios has the right to review all protocols,
data and summary reports that detail validation activities related to
components, equipment, and processes directly related to the manufacture of
Product.
2.15 Quality Assurance Audits by Scios. So that Scios may discharge its
obligations under FDA regulations, Abbott agrees that Scios may conduct annual
quality assurance inspections and audits of the records and manufacturing and
storage facilities of Abbott by up to two representatives of Scios at a time
during normal working hours for the purpose of confirming that the Fill and
Finish Work is being performed in compliance with this Agreement and applicable
regulatory requirements. Scios employees shall follow the safety procedures of
the Abbott facility.
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2.16 Facility and Organizational Changes. Abbott shall inform Scios in
advance of any planned facility and organizational changes that could affect or
modify manufacture of Product. Should any proposed modification raise concerns
by Scios, the parties shall meet and endeavor to accommodate the reasonable
needs of both parties; provided, however, that Abbott shall have the right to
make such change so long as the Product shall continue to be subject and meet
the Specifications and the Fill and Finish Work shall continue to be subject to
the requirements of this Agreement.
2.17 Kansas Administrative Requirements. Abbott agrees to use its
reasonable efforts to maintain all necessary Kansas administrative approvals
required to perform the Fill and Finish Work. Abbott shall be responsible for
[*****] and Scios shall be responsible for [*****].
2.18 Alternative Abbott Facilities. In the event that Abbott is unable at
any time to Fill and Finish Product in its McPherson, Kansas facility, Abbott
will, at Scios' request, transfer as promptly as is commercially reasonable the
manufacture of Product for Scios to another facility of ▇▇▇▇▇▇ which has
available, comparable capacity and quality. In such event, Scios shall be
responsible for reimbursing ▇▇▇▇▇▇ for the reasonable additional costs to ▇▇▇▇▇▇
of validating such alternative facilities as agreed by the parties in advance of
the transfer.
Section 3. - Fill and Finish Program Management
3.1 Control. The parties will cooperate in the management of the Fill and
Finish Work so as to assure its completion in the most effective manner. Subject
to Section 2.5 hereof, it will be the responsibility of Scios to make all final
decisions with regard to the Specifications for the Fill and Finish Work
required to be performed by ▇▇▇▇▇▇ hereunder, except any specific directives
that ▇▇▇▇▇▇ may receive from the FDA, provided that Scios shall first be
informed of the directive, and ▇▇▇▇▇▇ and Scios shall discuss any alternative
means to satisfy the FDA's requests. ▇▇▇▇▇▇ shall be notified in advance of any
specification changes for Fill and Finish work.
3.2 Access. Representatives of Scios (including representatives of any BNP
licensee of Scios), upon reasonable notice to ▇▇▇▇▇▇, shall have such full and
complete access as is reasonably necessary to observe, monitor and inspect any
Fill and Finish Work performed under this Agreement, the manufacture and control
of any batch, all equipment and materials employed therein, all Product produced
thereby and all Data as specified in Section 3.3. All representatives of Scios
and its licensees shall follow the safety procedures of ▇▇▇▇▇▇. Any
representative of Scios or a BNP licensee of Scios shall execute a reasonable
confidentiality agreement in favor of ▇▇▇▇▇▇ before being allowed access to
▇▇▇▇▇▇'▇ facilities.
3.3 Data Collection. ▇▇▇▇▇▇ shall maintain good and sufficient records of
the results of testing and manufacture of Bulk BNP, Raw Materials, Containers
and Packaging and Product in sufficient detail and in accordance with good
manufacturing practices as will properly reflect all Fill and Finish Work done
and results achieved in the performance of the Fill and Finish Program
(including all Data in the form required under any applicable regulations
promulgated by the FDA and including any work done under permitted
subcontracts). Copies of any Data
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produced, generated or procured during the Fill and Finish Program and Master
Production and Control Records, including relating to work done under any
permitted subcontracts, shall be delivered to Scios within 7 days of any written
request by Scios. In lieu of delivery of any such records to Scios, ▇▇▇▇▇▇
agrees to permit a representative of Scios pursuant to Section 3.2 above to
examine and review, at reasonable times upon reasonable notice to ▇▇▇▇▇▇, such
records then in ▇▇▇▇▇▇'▇ possession and to make or have made copies of any such
records (at Scios' expense) as Scios may reasonably request. ▇▇▇▇▇▇ shall use
such records that are specific and unique to Scios only as required by ▇▇▇▇▇▇ in
the fulfillment of its obligations under this Agreement or for the review by
management personnel, by regulatory authorities during IND or NDA review or
during facility compliance audits by the FDA, State of Kansas or any other
regulatory authority having jurisdiction over ▇▇▇▇▇▇'▇ Fill and Finish business.
Section 4. - Price and Payment
4.1 Scios shall pay ▇▇▇▇▇▇ for supplying Product as requested by Scios on
each Processing Order pursuant to Section 2.2 above at the Price per Vial. The
Price per Vial includes [*****]. Scios' payment shall be due [*****]. ▇▇▇▇▇▇
shall maintain accurate records and shall maintain accurate supporting documents
to verify each invoice it submits. Such records and documents shall be available
for audit by Scios during normal business hours and on reasonable notice but not
later than the end of the calendar month after the calendar month in which the
invoice is rendered; provided, that records and documents relating to any
charges in dispute shall be retained until the disagreement is resolved. Except
as specifically set forth in this Agreement (including, without limitation,
Sections 2.3 and 2.4), Scios shall only be obligated to pay for services related
to Product meeting the Specifications. The "Price per Vial" shall mean [*****].
The final vial label and packaging shall be defined by Scios, and ▇▇▇▇▇▇ shall
prepare for approval by Scios a revised Price per Vial that also includes
[*****].
4.2 ▇▇▇▇▇▇ shall process [*****] to Scios of Product per batch at no
processing charge to Scios. Any additional shipments requested by Scios shall be
provided at a processing fee of [*****]. Product shall be shipped F.O.B.
▇▇▇▇▇▇-▇▇▇▇▇▇▇▇▇.
Section 5. - Interactions with Governmental Agencies
5.1 Each party agrees to promptly provide the other with copies of any
letters, reports, or the like received by such party from the FDA or other
governmental agency including: Form 483s, Form 482s, warning letters, inspection
reports, seizure notices, prosecution, injunction, and market withdrawals;
provided, such letter, report, or the like either (1) relates to Product or
components thereof or (2) does not relate to Product or components thereof but
does relate to other pharmaceutical manufacturing activities or practices
affecting ▇▇▇▇▇▇'▇ processing of BULK BNP or that may directly relate to the
Fill and Finish Work of Product. In particular, if either party is notified that
the FDA wishes to inspect its facility in connection with Fill and Finish Work
of Product or the records related thereto, the notified party shall immediately
advise Scios of such inspection and report to Scios the outcome of such
inspection and consult with Scios on any responses that may concern the
manufacturing and testing operations directly related to the Fill and Finish
Work of Product. If the inspection is specifically to observe the Fill
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and Finish Work of Product or is specifically related to the production of
Product, ▇▇▇▇▇▇ shall permit Scios to observe such inspection if Scios can
arrange for a representative to attend the inspection at the time desired by the
FDA. ▇▇▇▇▇▇ shall be in charge of any and all regulatory inspections of its
facilities, and Scios shall be present as an observer.
Section 6. - Title and Risk of Loss
6.1 Title. Title to all Bulk BNP shall at all times be in Scios and Bulk
BNP shall be used by ▇▇▇▇▇▇ only for the purposes of and in accordance with this
Agreement. Except for title to Bulk BNP, title to all in-process materials, Raw
Materials, Containers, and Product shall be in ▇▇▇▇▇▇ until shipped to Scios.
6.2 Risk of Loss.
(a) Transit to ▇▇▇▇▇▇. Scios shall bear the risk of loss of Bulk BNP,
including the risk of spoilage, until delivered to ▇▇▇▇▇▇'▇ McPherson, Kansas
facility.
(b) At ▇▇▇▇▇▇'▇ Facility. Except as otherwise set forth below
concerning the time ▇▇▇▇▇▇ is actually conducting Fill and Finish Work, the risk
of loss of all Bulk BNP, in-process materials, Raw Materials, Containers and
Product shall be in ▇▇▇▇▇▇ until shipped as Product or otherwise to Scios. In
the event of such loss, ▇▇▇▇▇▇ shall be liable for the cost to replace such
materials. The risk of loss of Bulk BNP, in-process materials, Raw Materials,
Containers and Product during the time that ▇▇▇▇▇▇ is actually conducting Fill
and Finish Work shall be in Scios so long as ▇▇▇▇▇▇ conducts all such Fill and
Finish Work in adherence with the then current Specifications (Exhibit B) and
Batch Record (Exhibit C) but shall be in ▇▇▇▇▇▇ when any such materials are
consumed or rendered unusable because ▇▇▇▇▇▇ did not adhere to the then current
Specifications or Batch Record; provided, however, that ▇▇▇▇▇▇'▇ maximum
obligation to reimburse Scios for the cost of Bulk BNP consumed or rendered
unusable due to failure to adhere to such Specifications or Batch Record by
▇▇▇▇▇▇ shall not exceed [*****]. In the event Bulk BNP is consumed or rendered
unusable due to such a failure by ▇▇▇▇▇▇ to adhere to the Specifications or
Batch Record, Scios shall incur no charge from ▇▇▇▇▇▇ with respect to processing
such lot.
(c) Cost of Recovery. In the event the yield of Product from the Bulk
BNP supplied by Scios is less than that number of vials that is called for by
the Specifications, ▇▇▇▇▇▇ shall attempt to recover as much of the Bulk BNP as
feasible, taking into account reasonable line losses. The expense of such
recovery and shipping costs shall be borne by ▇▇▇▇▇▇ if the failure to produce
Product meeting the applicable Specifications was due to ▇▇▇▇▇▇'▇ failure to
adhere to all of the procedures set forth in Exhibit C, and shall be borne by
Scios if the failure was not due to ▇▇▇▇▇▇'▇ failure to adhere to all of the
procedures set forth in Exhibit C. For purposes of this subsection 9(c),
"recover" shall mean physically collect from tailings or vessels, or rework or
re-lyophilize within the limits of the Fill and Finish Program and within the
Regulatory Approval documentation.
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Section 7. - Inventions and Licenses
7.1 Exchange of Know-How. Scios and ▇▇▇▇▇▇ intend to cooperate and
exchange as required Scios Patents, Scios Know-How, ▇▇▇▇▇▇ Patents and ▇▇▇▇▇▇
Know-How which relate to or are required for the production of Product, all for
the purpose and with the objective of completing the Fill and Finish Work in an
expeditious and efficient manner. Such exchange shall include without limitation
the disclosure by ▇▇▇▇▇▇ of improvements relating to the manufacture of Product
when performing Fill and Finish Work. This exchange is not intended to negate
the parties' obligations under Section 9 nor shall anything in this Section 7.1
be construed to modify the provisions of Section 10.3 hereof.
7.2 Ownership of Fill and Finish Technology. [*****].
7.3 Licenses.
(a) License from Scios to ▇▇▇▇▇▇. For the sole purpose of performing
Fill and Finish Work of Product under this Agreement, Scios hereby grants
▇▇▇▇▇▇, and ▇▇▇▇▇▇ hereby accepts from Scios, a nonexclusive, nontransferable,
royalty-free, non-sublicensable license to use Scios Patents and Scios Know-How
to manufacture Product exclusively for Scios and to perform its other
obligations hereunder.
(b) License from ▇▇▇▇▇▇ to Scios Upon Inability to Perform. In the
event ▇▇▇▇▇▇ fails for any reason (including without limitation bankruptcy,
fire, refusal to supply or insufficient capacity, but excluding a breach of
material term of this Agreement by Scios) to deliver Product pursuant to the
terms of this Agreement for [*****], ▇▇▇▇▇▇ shall grant, and does hereby grant
to Scios, and Scios hereby accepts from ▇▇▇▇▇▇, a nonexclusive, royalty-free,
license to use ▇▇▇▇▇▇ Patents, ▇▇▇▇▇▇ Know-How and Improvements directly
relating to ▇▇▇▇▇▇'▇ Fill and Finish Work of Product, to manufacture Product
solely for the manufacture of Product for Scios. Such license shall include the
right of sublicense solely for purposes of fulfilling Scios' requirements for
Product, shall not extend to a sub-sublicensee, and shall be under obligations
of confidentiality no less stringent than those contained in this Agreement. The
foregoing license shall not include any ▇▇▇▇▇▇ patents or other technology not
used in the production of the Product.
7.4 Patent Infringement.
(a) ▇▇▇▇▇▇. ▇▇▇▇▇▇ shall defend at its own expense any actions brought
against itself or Scios, alleging that the manufacture of Product produced by
▇▇▇▇▇▇ infringes any claim of any United States or foreign patent or other
proprietary right of a third party and shall pay all damages and costs finally
awarded in such action; provided however, that this obligation shall arise only
to the extent that such alleged infringement arises out of ▇▇▇▇▇▇'▇ use of
▇▇▇▇▇▇ Patents, ▇▇▇▇▇▇ Know-How or Improvements, and no obligation shall arise
to ▇▇▇▇▇▇ to the extent the infringement is alleged to be the result of the use
of Scios Patents or Scios Know-How.
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(b) Scios. Scios shall defend at its own expense any actions brought
against itself or ▇▇▇▇▇▇, alleging that the manufacture, use or sale by or for
Scios of Product infringes any claim of any United States or foreign patent or
other proprietary right of a third party and shall pay all damages and costs
finally awarded in said action; provided however, that this obligation shall
arise only to the extent that such alleged infringement arises out of Scios
Patents or Scios Know-How, or to the extent that such claim is based solely on
the fact that the subject matter of ▇▇▇▇▇▇'▇ work is BNP, and no obligation
shall arise to the extent the infringement is alleged to be the result of the
use of ▇▇▇▇▇▇ Patents, ▇▇▇▇▇▇ Know-How or Improvements.
Section 8. - Trademarks and Names on Labels
Scios shall have the sole authority to select and use trademarks for the
Product and shall bear all the costs associated with such selection. Scios shall
be responsible for filing and prosecuting applications for such trademarks, as
well as maintaining such trademarks, all in the manner it deems appropriate and
shall be the owner of record for all applications and registrations that issue
from these applications. Scios shall bear all costs associated with any of the
foregoing. ▇▇▇▇▇▇ shall provide such assistance, at Scios' expense, as Scios
reasonably deems necessary in accomplishing any of the foregoing. Scios shall
defend, indemnify and hold ▇▇▇▇▇▇ harmless from and against all claims, demands,
liabilities, damages, costs and expenses (including attorneys' fees) in respect
to the alleged infringement of trademark, trade name or other similar rights of
third parties arising out of the sale and marketing of the Product by Scios. In
no event shall ▇▇▇▇▇▇ be responsible for the content of any label or otherwise
liable for any failure to supply adequate warnings or to comply with the
requirements of 21 C.F.R. Part 201, except as such failure is due to ▇▇▇▇▇▇'▇
failure to (i) provide Scios with relevant information regarding Products
produced by ▇▇▇▇▇▇, or (ii) affix such labels or package inserts on or in the
Product pursuant to the Specifications. ▇▇▇▇▇▇ consents to the appearance of its
name on labels to the extent required by FDA regulations or the regulations of
any comparable governmental agency outside of the United States subject to
▇▇▇▇▇▇'▇ reasonable approval of conformity with ▇▇▇▇▇▇'▇ trademark protection
program.
Section 9. - Confidentiality
9.1 Nondisclosure. In connection with its activities relating to this
Agreement, either party may disclose to the other confidential, proprietary
information including, but not limited to, all business plans, testing methods,
and market plans, drawings, specifications, flow sheets, reports, pre-clinical
and clinical studies, market studies, software and other technical and marketing
information as well as, proprietary know-how ("Proprietary Information").
Proprietary Information shall also include Scios Patents, Scios Know-How, ▇▇▇▇▇▇
Patents, ▇▇▇▇▇▇ Know-how, and Improvements. During the term of this Agreement
and for [*****], neither party shall disclose or use Proprietary Information
provided to it hereunder by the other party, or allow it to be used, for its own
benefit or for the benefit of others, and shall protect Proprietary Information
using the same degree of care used to protect its own information of a similar
nature. Proprietary Information shall mean that which is disclosed, directly or
indirectly, by either party to the other, in writing, marked "confidential,"
"restricted," "proprietary" or the like, or, if transmitted orally or by
observation of equipment, confirmed in writing within thirty
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(30) days of its oral or observed disclosure hereunder and marked
"confidential," "restricted," "proprietary," or the like, or with words having
the same effect, except any portion thereof which:
(a) enters the public domain through no fault of the party to whom the same
were disclosed (th "receiving party"); or
(b) is in the future legally received by the receiving party from a third
party free of any obligation to keep it confidential; or
(c) is lawfully in the possession of the receiving party prior to receipt
from the disclosing party, which fact shall be provable by contemporaneous
documentary evidence; or
(d) is independently developed by the receiving party without the use of
Proprietary Information, as evidenced by its written records; or
(e) is required to be disclosed pursuant to a lawful request, order or
demand of any governmental agency or judicial authority; provided, however, that
protective orders or other reasonable assurances of confidentiality are received
to the extent reasonable available from such agency or authority; and provided,
further, that the disclosing party (i) gives the other party notice of the
request or order and reasonable time to object, (ii) follows any proper
instructions of the other party regarding such disclosure or objections, and
(iii) limits the disclosure to compliance with the lawful request.
9.2 Duties Upon Termination. This Section 9 shall inure to the benefit and
be enforceable by the parties and their respective successors. Except to the
extent reasonably necessary for exercising its rights which survive termination
of this Agreement, upon request by the disclosing party after such termination,
the receiving party shall return all Proprietary Information of the disclosing
party in its possession, and in any event shall make no further use of such
Proprietary Information, except that one copy of the Proprietary Information be
retained in the legal department of the company for purpose of documenting the
Proprietary Information which was received.
9.3 Publicity Releases. Except as required by law or provided otherwise by
this Agreement, neither party may disclose the existence or terms of this
Agreement without the prior written approval of the other party. ▇▇▇▇▇▇ may not
use the name or trademarks or tradenames of Scios in any manner, and Scios may
not use the name or trademarks or tradenames of ▇▇▇▇▇▇ in any manner, without
the prior written approval of the other. Notwithstanding any provision hereof,
each party may disclose that which (a) may be required by Regulatory Authorities
in order to receive Product approval or (b) is disclosed pursuant to a written
nondisclosure agreement with a third party for the purpose of evaluating a
proposed purchase of all or a portion of the business of Scios or ▇▇▇▇▇▇ or
Scios' sublicensing of rights to market the Product. Any inquiry ▇▇▇▇▇▇ receives
from news media concerning this Agreement will be reviewed with Scios prior to
response.
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9.4 Technical Publications. Except as required by law, (a) no technical
paper, abstract, article, publication or announcement relating to the Scios
Patents or Scios Know-How, whether during the period of performance of this
Agreement or in the future, shall be made by ▇▇▇▇▇▇ without the written consent
of Scios and (b) no technical paper, abstract, article, publication or
announcement relating to ▇▇▇▇▇▇ Patents, ▇▇▇▇▇▇ Know-How or Improvements,
whether during the period of performance of this Agreement or in the future,
shall be made by Scios without the written consent of ▇▇▇▇▇▇.
Section 10. - Warranties
10.1 By ▇▇▇▇▇▇.
(a) Product. ▇▇▇▇▇▇ warrants that all Product delivered to Scios by
▇▇▇▇▇▇ hereunder shall conform to the Specifications as modified from time to
time. ▇▇▇▇▇▇ further warrants that (i) Product shall be manufactured in
accordance with applicable FDA regulations, shall be free from defects in
manufacturing workmanship, shall not be adulterated or misbranded, as defined
under Section 501 of the Food, Drug & Cosmetic Act (21 U.S.C. Section 501) (the
"Act"); (ii) the water for injection used as a Raw Material shall meet U.S.P.
specifications; (iii) the Raw Materials acquired or manufactured by ▇▇▇▇▇▇ shall
meet the Specifications as modified from time to time; (iv) materials supplied
but not manufactured by ▇▇▇▇▇▇ (including bottles, stoppers, packaging and any
administration device) shall be tested according to ▇▇▇▇▇▇'▇ quality assurance
procedures and meet the Specifications when so tested; and (v) ▇▇▇▇▇▇ shall at
all times when manufacturing, processing or controlling the Product be, to the
extent necessary, properly licensed and registered with all applicable
governmental agencies. These warranties shall not apply to any Product (1) to
the extent the nonconformity or adulteration results from the Bulk BNP provided
by Scios, provided such Bulk BNP met the Specifications as evidenced by the
certificate of analysis sent from Scios to ▇▇▇▇▇▇ with each shipment of Bulk
BNP, and as determined by the ID test procedures performed by ▇▇▇▇▇▇ on Bulk BNP
under Exhibit B to the extent determinable by such ID test and conformed to the
Certificate of Analysis for such Lot; or (2) which, after risk of loss thereto
has transferred to Scios, (A) has been tampered with or otherwise altered; (B)
has been subjected to misuse, negligence or accident other than by ▇▇▇▇▇▇; (C)
has been stored, handled or used by others in a manner contrary to current Good
Manufacturing Practices, used in a manner other than for what was approved by
the FDA or any foreign government, or similar requirements; or (D) has expired
its stated shelf life.
(b) Remedy. Should Scios reject any shipment as nonconforming or
should any failure to conform with the foregoing warranty appear, Scios shall
give prompt written notice to ▇▇▇▇▇▇ of the basis for rejection or
nonconformity. The parties shall then promptly confer to discuss the rejection
or nonconformity and attempt to determine what action to take. If after such
discussion ▇▇▇▇▇▇ believes that the Product is conforming and Scios continues to
believe that it is nonconforming and the basis for rejection is the failure to
conform to the Specifications, then the parties shall retain a mutually agreed
independent testing firm capable of performing the tests and assays specified in
Exhibit B (the "Testing Firm") to determine conformity or nonconformity with the
Specifications and foregoing warranty. The decision of
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Testing Firm shall be binding on both parties in the determination of whether
Scios is obligated to pay for ▇▇▇▇▇▇'▇ services in connection with that
delivery. The costs of employing Testing Firm shall be paid by ▇▇▇▇▇▇ if Testing
Firm finds that the Product is nonconforming and by Scios if the Product is
found to be conforming. At Scios' option and as Scios' sole and exclusive remedy
hereunder, ▇▇▇▇▇▇ promptly shall, at ▇▇▇▇▇▇'▇ own cost, either (1) replace all
nonconforming Product with reworked conforming Product provided that the rework
procedure has been previously submitted to the regulatory authorities, (2)
conduct rework according to a plan submitted to and accepted by the FDA, or (3)
refund any payments by Scios to ▇▇▇▇▇▇ for such nonconforming Product and, in
any event, (x) reimburse Scios for Scios' cost of any Bulk BNP contained therein
that has not been converted to Final Product up to the limit of ▇▇▇▇▇▇'▇
liability under Section 7.2(b). If Scios selects option (1) or (2) above, then
upon delivery of Product meeting the Specifications it shall pay ▇▇▇▇▇▇ for
performing the Fill and Finish of such Lot.
10.2 By Scios.
(a) Bulk BNP. Scios warrants that the Bulk BNP, at the time supplied
by Scios to ▇▇▇▇▇▇, shall conform to the Specifications, shall be manufactured
in accordance with applicable FDA regulations, shall be free from defects in
manufacturing workmanship, conform to the certificate of analysis related to
that batch of Bulk BNP, and that the Bulk BNP shall not be adulterated, as
defined under Section 501 of the Act. This warranty shall not apply to any Bulk
BNP after risk of loss thereto has transferred to ▇▇▇▇▇▇ that (i) has been
tampered with or otherwise altered after shipment from Scios; (ii) has been
subjected to misuse, negligence or accident other than by Scios; (iii) has been
stored, handled or used by others in a manner contrary to FDA or similar
requirements or Scios' written instructions; (iv) has expired its stated shelf
life which shall be predetermined and defined by Scios to ▇▇▇▇▇▇, including
methods for retain and release if Bulk BNP should expire while in possession of
▇▇▇▇▇▇; (v) has failed to meet the Specifications as determined by the test
procedures pursuant to Section 2.3, or (vi) where the nonconformity would have
been discovered if tested in the manner set forth in Section 2.3.
(b) Remedy. Should any failure to conform with the foregoing warranty
appear prior to payment for Product Scios shall correct such nonconformity by
replacement of the nonconforming Bulk BNP and by Scios' reimbursement of ▇▇▇▇▇▇
for all reasonable costs incurred by ▇▇▇▇▇▇ in connection with such
nonconforming material, such costs not to exceed the amounts payable to ▇▇▇▇▇▇
for the Fill and Finish Work for such Products or any rework performed by ▇▇▇▇▇▇
in an effort to minimize product loss.
10.3 Title. ▇▇▇▇▇▇ and Scios warrant that, except as otherwise provided in
this Agreement, each has good and sufficient title, or the right to transfer as
provided for herein, to all materials, supplies, processes, patents, know-how
and technology furnished to the other or used in the performance of this
Agreement.
10.4 Product Recall. Except to the extent attributable to a nonconformity
with ▇▇▇▇▇▇'▇ warranties under Section 10.1 or a subject of indemnification
under Section 11.2, Scios
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shall reimburse ▇▇▇▇▇▇ and indemnify it from all reasonable costs and expenses
in respect of activities arising out of any necessary recall of Product
authorized by Scios or directed to ▇▇▇▇▇▇ by the FDA or in respect of activities
arising out of and necessarily required by any recall of Product made pursuant
to a final judicial order, including, but not limited to, reshipment, storage
and disposal of recalled Product, preparing and maintaining reports and records,
and reasonable internal costs. To the extent attributable to a nonconformity
with ▇▇▇▇▇▇'▇ warranties under Section 10.1 or a subject of indemnification
under Section 11.2, ▇▇▇▇▇▇ shall reimburse Scios and indemnify it from all
reasonable costs and expenses in respect of activities arising out of any
necessary recall of Product authorized by Scios or in respect of activities
arising out of and necessarily required by any recall of Product made pursuant
to a directive from a Regulatory Authority, including, but not limited to,
reshipment, storage and disposal of recalled Product, preparing and maintaining
reports and record, notifications to any user, and reasonable internal costs, up
to [*****]. ▇▇▇▇▇▇ shall provide all reasonable assistance to Scios in carrying
out any necessary recall.
10.5 Exclusive Warranties. Except as expressly provided for in Section 10,
▇▇▇▇▇▇ and Scios make no additional representation or warranties of any nature
whatsoever to each other with respect to the Product, Bulk BNP, Raw Materials,
Containers and Packaging or other materials supplied hereunder, by either of
them to the other, and ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
IMPLIED WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE
ARE HEREBY DISCLAIMED BY ABBOTT, SCIOS, THEIR AFFILIATES AND THEIR
SUBCONTRACTORS.
Section 11. - Indemnification
11.1 By Scios. Scios shall be solely responsible for and shall defend,
indemnify and hold ▇▇▇▇▇▇ harmless from and against all claims, causes of
action, settlement costs, including reasonable legal expenses, losses or
liabilities of any kind asserted by third persons which arise out of or are
attributable to personal injury suffered or incurred by anyone (including any of
▇▇▇▇▇▇'▇ employees) and property damages of any third party to the extent caused
by: (i) design or composition defects in the Product, exclusive of components
thereof manufactured or purchased by ▇▇▇▇▇▇ to the extent that the design or
composition of such components was not specified by Scios; (ii) failure by Scios
to comply with the Act and the regulations thereunder; (iii) failure to provide
warnings as required by law; (iv) the handling, transfusion, perfusion,
injection or other use of or exposure to the Bulk BNP or the Product; (v) the
Bulk BNP or other materials supplied by Scios; (vi) any willful act or omission
or negligence of Scios or its employees, agents or other contractors in work
performed in the production of the Product; (vii) a nonconformity with the
warranty under Section 10.2; and (viii) the use of Product as a pharmaceutical
product or the safety or efficacy of Product, except in each of the foregoing to
the extent specifically assumed by ▇▇▇▇▇▇ under this Agreement or arising out of
▇▇▇▇▇▇'▇ failure to perform its contractual obligations hereunder.
11.2 By ▇▇▇▇▇▇. ▇▇▇▇▇▇ shall be solely responsible for and shall defend,
indemnify and hold Scios and its third party designees and their distributors
harmless from and against all damages attributable to all claims, cause of
action, settlement costs, including reasonable legal
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expenses, losses or liabilities of any kind asserted by third persons which
arise out of or are attributable to any negligent act or omission or willful
misconduct on the part of ▇▇▇▇▇▇'▇ employees, agents and representatives.
11.3 Employees. Except as provided above in this Section 11, each party
shall indemnify and hold the other party harmless, and hereby forever releases
and discharges the other party, from and against all claims, demands,
liabilities, damages and expenses (including attorney's fees) arising out of
personal injury (including death) or property damage incurred or suffered by the
indemnifying party, its contractors or its employees (regular or contract)
arising out of or in connection with the work performed hereunder, except to the
extent caused by the sole negligence of such other party, its employees or
agents.
11.4 Notice and Assistance. No indemnity under this Section 11 shall be
applicable unless the indemnified party gives the indemnifying party prompt
notice of any claim, suit, or action brought against the indemnified party and
allows the indemnifying party to defend, manage the defense of, and/or settle
the same and renders the indemnifying party all assistance reasonably necessary
in defending against such claim, suit, or action. Unless specifically agreed to
in writing and in advance, the indemnified party shall not be liable to
participate in paying or reimbursing the costs of any settlement, litigation
costs or expenses in and by the indemnifying party.
11.5 Unenforceability. The foregoing indemnity obligations of this Section
12 shall not be deemed to extend to any type of claim, act or omission by Abbott
or Scios for which the indemnity obligation would be void, unenforceable or
otherwise not permitted by applicable law, and if any are deemed to so extend,
it shall be interpreted and restricted to the extent to which it is permitted by
applicable law.
Section 12. - Termination
12.1 Term of Agreement. Unless terminated earlier as provided in Sections
12.2 or 12.3 below, this Agreement shall continue in full force and effect for 7
years from the Effective Date. This Agreement shall be automatically extended
for each successive calendar year unless written notice is given by one party to
the other at least six months prior to the end of the then current term (initial
or extended) that the party does not wish to continue the Agreement beyond such
term. If such notice is given, then this Agreement shall terminate at the end of
the then current term (initial or extended).
12.2 Termination for Cause. Without prejudice to any other rights it may
have hereunder or at law or in equity, either party may terminate this Agreement
immediately by written notice to the other party upon the occurrence of any of
the following:
(a) the other party becomes insolvent, an order for relief is entered
against the other party under any bankruptcy or insolvency laws or laws of
similar import, or fails generally to pay its debts as they become due;
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(b) the other party makes an assignment for the benefit of its
creditors or a receiver or custodian is appointed for it, or its business is
placed under attachment, garnishment or other process involving a significant
portion of its business;
(c) the other party fails to maintain operations as a going business
for more than twenty days;
(d) after sixty days' written notice from the terminating party, the
other party fails to remedy any material breach of this Agreement.
12.3 Rights and Duties Upon Termination. Termination of this Agreement, for
whatever reason, shall not affect any rights or obligations accrued by either
party prior to the effective date of termination, including completion of a
Processing Order for Product delivered by Scios prior to the effective date of
termination. Without limiting the generality of the foregoing, upon termination
of this Agreement after commencement of any Fill and Finish Work:
(a) provided that Scios provides adequate assurances for payment,
Abbott shall sell to Scios ▇▇▇▇▇▇'▇ inventory of Product and/or to return to
Scios its inventory of Bulk BNP, in whole or in part, within thirty (30) days
following termination.
(b) upon any termination, Abbott shall continue to cooperate with
Scios pursuant to Section 2.7 and Section 5 in respect of all requirements of
the FDA and this Agreement regarding previously produced Product.
(c) upon any termination, both parties shall immediately cease using
the other party's Proprietary Information except as permitted by Sections 9.1
and 12.3;
(d) subject to any limitation, restriction, prohibition or other
regulation of a bankruptcy court of trustee, upon any termination by Scios
pursuant to Section 12.2, Abbott shall be deemed to have granted to Scios the
license specified in Section 7.3(b).
Sections 10, 11, 12, 15, 16 and 17 shall survive any termination of the
Agreement, and Section 9 shall survive any termination of the Agreement for the
period specified in Section 9.1.
Section 13. - Insurance.
Scios shall obtain and maintain, at its own cost and expense, and keep in place
general liability insurance, with bodily injury and property limits of two
million dollars ($2,000,000) covering product liability and contractual
liability for the indemnity and hold harmless provisions contained in Section
11.
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Section 14. - Compliance With Law
14.1 Scope. In the performance of its work under this Agreement, Abbott and
Scios shall comply with all applicable federal, state and local laws,
regulations and executive orders, including, but not limited to, current Good
Manufacturing Practices in accordance with 21 C.F.R. Parts 210, 211 and 600, any
applicable state or Federal law or regulation insofar as applicable to the
performance of their respective obligations hereunder.
14.2 Assistance by Scios. Scios shall furnish reasonable assistance for
compliance with Section 14.1 above to the extent such compliance involves the
composition, toxicity, safety and other chemical or physical characteristics of
Bulk BNP, including, but not limited to, furnishing the technical data required
by all OSHA, EPA, health, safety and fire laws.
Section 15. - Dispute Resolution
15.1 Mediation. If a dispute arises under this Agreement which cannot be
resolved by the personnel directly involved, either party may give written
notice to the other party, designating an executive officer with appropriate
authority to be its representative in negotiations relating to the dispute. Upon
receipt of such notice, the other party shall, within five (5) business days,
designate an executive officer with similar authority to be its representative.
The designated executive officers shall, following whatever investigation each
reasonably deems appropriate, promptly enter into discussions concerning the
dispute and if the dispute is not resolved within sixty (60) days as a result of
such discussion, either party may elect to initiate such other action as it is
reasonably entitled under the governing law.
Section 16. - Limitation of Liability
IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR SPECIAL,
INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, WHETHER IN CONTRACT, WARRANTY,
TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE, including, but not limited to,
loss of profits or revenue, loss of use of any equipment, cost of capital, down
time costs, delays, or claims of customers of any of them or other third parties
for such or other damages, except to the extent such damages are allocated under
Section 7 or Section 11.
Section 17. - Miscellaneous
17.1 Choice of Law. This Agreement shall be governed and interpreted, and
all rights and obligations of the parties shall be determined, in accordance
with the laws of the State of Delaware.
17.2 Force Majeure. Abbott and Scios shall not be deemed to be in default
nor be liable for any delay in performance, when and to the extent due to causes
beyond its reasonable control or from fire, war, acts of God, strike, labor
difficulties, act or omission of any governmental authority, compliance with
governmental regulations, insurrection or riot,
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embargo, delays or shortages in transportation or inability to obtain necessary
labor, materials, or laboratory or manufacturing facilities from usual sources
or from defects or delays in the performance of its suppliers or permitted
subcontractors due to any of the foregoing enumerated causes.
17.3 Notices. All notices, requests, demands, waivers, consents, approval
or other communications to any party hereunder shall be in writing and shall be
deemed to have been duly given if delivered personally to such party or sent to
such party by telegram or confirmed telefax or by registered or certified mail,
postage prepaid, to its address as shown below:
Scios, Inc.: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Vice President of Development
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: General Counsel
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ Laboratories: P. O. Box 1247
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Plant Manager
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to: Hospital Products Division
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: President, Hospital Products Division
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
and ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Associate ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇, ▇▇▇▇
Telefax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communications will be deemed to have been given as
of the date so delivered, telegraphed, telexed, or five days after so mailed.
17.4 Partial Invalidity. If, for any reason, any provision of this
Agreement shall be deemed by a court of competent jurisdiction to be illegal,
invalid or unenforceable, the validity, legality or enforceability of the
remaining provisions of this Agreement shall not in any way be
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affected or impaired, and such provision consistent with applicable law, and in
its modified form, such provision shall be enforceable and enforced.
17.5 Entire Agreement. This instrument states the entire agreement reached
between the parties hereto with respect to the transactions contemplated hereby
(▇▇▇▇▇▇'▇ Fill and Finish Work) and may not be amended or modified except by
written instrument duly executed by the parties hereto. Any and all previous
agreements and understandings between the parties regarding Production of
Product after the date of this Agreement, whether written or oral, are
superseded by this Agreement. To the extent the terms of any purchase order or
Processing Orders are inconsistent with the terms of this Agreement, this
Agreement shall control. The failure of either party hereto to enforce at any
time, or for any period of time, any provision of this Agreement shall not be
construed as a waiver of such provision or of the right of such party thereafter
to enforce each and every provision. The parties agree that all references to
Sanofi Winthrop in the attached exhibits are references to ▇▇▇▇▇▇ Laboratories
which has acquired the McPherson facility from Sanofi Winthrop subsequent to the
creation of the exhibit.
17.6 Assignment, Binding Effect. Neither party shall assign this Agreement,
by operation of law or otherwise, without the prior written consent of the other
party, such consent not to be withheld unreasonably and any such attempted
assignment without such consent shall be void, except that, subject to Section
13.2 hereof, either party may assign this Agreement to an Affiliate. No
assignment shall be effective until the assignee shall have unconditionally
assumed in writing all of the assignor's obligations hereunder and a written
notice of such assignment is given to all the other parties. When duly assigned
in accordance with the foregoing, this Agreement shall be binding upon and inure
to the benefit of the assignee.
17.7 Independent Contractor. Each party shall be and shall endeavor to act
as the independent contractor of the other party. Neither party shall be the
legal agent of the other for any purpose whatsoever and therefore has no right
or authority to make or underwrite any promise, warranty or representation, to
execute any contract or otherwise to assume any obligation or responsibility in
the name of or in behalf of the other party, except to the extent specifically
authorized in writing by the other party. Neither of the parties hereto shall be
bound by or liable to any third persons for any act or for any obligation or
debt incurred by the other toward such third party, except to the extent
specifically agreed to in writing by the party so to be bound.
17.8 Headings. All section headings contained in this Agreement are for
convenience of reference only, do not form a part of this Agreement and shall
not affect in any way the meaning or interpretation of this Agreement.
17.9 Debarment Warrant. Abbott and Scios represent and warrant that neither
party does now or in the future use in any capacity the service of any person
debarred under subsection (a) or (b) of 21 U.S.C.(S)335a.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
and year above written.
SCIOS INC. ▇▇▇▇▇▇ LABORATORIES
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------- -----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------- -----------------------------
Title: Vice President and Secretary Title: President Hospital
-------------------------------------- ----------------------------
Products Division
-------------------------------------------- ---------------------------------
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Exhibits:
A - Form of Processing Order
B - Specifications
C - Batch Record
D - Material Safety Data Sheet
See Section 17.5 regarding references to Sanofi Winthrop in the Exhibits
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EXHIBIT A
PROCESSING ORDER
Order Number: _______________
Date: _______________________
To: ▇▇▇▇▇▇ Laboratories
P.O. Box 1247
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Scios hereby places the following order under the Processing and Supply
Agreement between us concerning ▇▇▇▇▇▇'▇ Manufacturing and Testing of
Natrecor(R) BNP for Scios:
Quantity
Placebo: _______ vials
Final Product: _______ vials
Lot Number to be used for this Product: _____________ Product Code # __________
Delivery Dates:
Bulk BNP to be delivered by Scios to Abbott: not later than ____________, 199__,
(which date shall not be [*****].
Product to be delivered by Abbott to Scios: not later than ____________, 199__,
(which date shall not be [*****].
This Processing Order authorizes Abbott to use the following printed Material,
Raw Materials, Containers and Packaging.
Special instructions (if any):
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EXHIBIT B
SPECIFICATIONS
The following documents contain the specifications for Product, Placebo and Raw
Materials used to produce Product. Copies of the current version of the
specifications are attached.
Exhibit Document Type Issued by Sanofi Raw Material Vendor
[*****]
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EXHIBIT C
BATCH RECORD
(PROCEDURES AND CONTROLS)
[*****]
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EXHIBIT D
MATERIAL SAFETY DATA SHEET
[*****]
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