1
Certain confidential portions of this Exhibit were omitted by means of blackout
of the text (the "▇▇▇▇"). This Exhibit has been filed separately with the
Secretary of the Commission without the ▇▇▇▇ pursuant to the Company's
Application Requesting Confidential Treatment under Rule 406 under the
Securities Act.
EXHIBIT 10.11
DEVELOPMENT AGREEMENT
by and between
ANTHRA PHARMACEUTICALS, INC.
and
MEDEVA CALIFORNIA INC.
Dated as of July 15, 1997
2
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS.................................................................. 2
ARTICLE II
OWNERSHIP INTEREST; PRODUCT DEVELOPMENT...................................... 8
2.1 Grant of Interest........................................ 8
2.2 Right to Payments........................................ 9
2.3 Transfer of Interests.................................... 9
2.4 Purchase Option.......................................... 9
2.5 Clinical Studies......................................... 10
2.6 NDA Filings.............................................. 11
2.7 Performance.............................................. 12
2.8 Communications with FDA.................................. 12
2.9 Ovarian Indication....................................... 13
2.10 Development Expenses..................................... 13
2.11 Further Funds............................................ 14
2.12 Continued Development.................................... 15
ARTICLE III
SUPPLY OF THE PRODUCT........................................................ 16
3.1 General.................................................. 16
3.2 Inventory of AD 32....................................... 17
3.3 Good Faith Forecasts..................................... 21
3.4 Issuance of Purchase Orders.............................. 21
3.5 Acceptance of Purchase Orders............................ 22
3.6 Delivery................................................. 22
3.7 Contract Manufacturing................................... 22
3.8 Inability to Supply...................................... 24
3.9 Alternate Supply......................................... 26
3.10 Warranty................................................. 27
3.11 Price ................................................... 27
3.12 Property Insurance....................................... 28
3.13 Records ................................................. 29
ARTICLE IV
QUALITY CONTROL ............................................................. 29
4.1 Product Specifications Amendments........................ 29
4.2 Nonconformance........................................... 30
4.3 Manufacturing Process.................................... 32
4.4 Inspection............................................... 32
4.5 Safety Procedures........................................ 33
4.6 Government Inspection.................................... 33
3
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ARTICLE V
LICENSE GRANTS .............................................................. 34
5.1 Grants................................................... 34
5.2 Sublicenses.............................................. 35
5.3 Other Countries.......................................... 35
5.4 Trademarks............................................... 36
5.5 Technical Assistance..................................... 37
ARTICLE VI
MARKETING AND SALE OF THE PRODUCT
UNDER THE LICENSING ARRANGEMENT.............................................. 37
6.1 General.................................................. 37
6.2 Compliance............................................... 38
6.3 Trademarks............................................... 38
6.4 Price of the Product..................................... 38
6.5 Marketing Materials...................................... 39
6.6 Product Liability Insurance.............................. 39
6.7 Competition.............................................. 39
6.8 Co-Promotion............................................. 40
6.9 Activities Outside the Territory......................... 41
ARTICLE VII
DEVELOPMENT FEES, LICENSE FEES AND ROYALTIES................................. 41
7.1 Development Fees......................................... 41
7.2 License Fees............................................. 43
7.3 Royalties................................................ 44
7.4 Payment.................................................. 45
7.5 Equity Interest.......................................... 46
7.6 Withholding Taxes........................................ 46
ARTICLE VIII
EXECUTIVE MANAGEMENT COMMITTEE............................................... 47
8.1 Formation of the EMC..................................... 47
8.2 Authority of the EMC..................................... 47
8.3 Procedural Rules of the EMC.............................. 48
ARTICLE IX
REPORTING ................................................................... 49
9.1 Reporting by Parties..................................... 49
9.2 Record Keeping........................................... 50
9.3 Audit of Records......................................... 50
ARTICLE X
ADVERSE EVENT AND OTHER INFORMATION EXCHANGE................................. 51
10.1 Notification............................................. 51
10.2 Material Communications.................................. 52
4
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ARTICLE XI
PRODUCT RECALL .............................................................. 53
11.1 Notification and Recall.................................. 53
11.2 Recall Expenses.......................................... 54
ARTICLE XII
INTELLECTUAL PROPERTY RIGHTS................................................. 55
12.1 Ownership of Product Know-how............................ 55
12.2 Ownership of Filings and Approvals....................... 56
12.3 Ownership of Data........................................ 56
12.4 Enforcement of Intellectual Property
Rights................................................... 56
12.5 Offset for Infringement.................................. 60
ARTICLE XIII
CONFIDENTIALITY ............................................................. 61
13.1 Confidential Information................................. 61
13.2 Certain Definitions...................................... 62
13.3 Disclosure of Confidential Information --
Internal................................................. 63
13.4 Disclosure of Confidential Information --
Third Parties............................................ 63
13.5 Care and Return of Confidential
Information.............................................. 65
13.6 Use of Names............................................. 66
ARTICLE XIV
WARRANTIES; INDEMNITIES...................................................... 66
14.1 Representations and Warranties........................... 66
14.2 Warranties of Anthra..................................... 67
14.3 Warranties of Medeva..................................... 70
14.4 Indemnification of Medeva................................ 71
14.5 Indemnification of Anthra................................ 72
14.6 Indemnification Procedure................................ 72
14.7 Limitation of Liability.................................. 75
ARTICLE XV
TERM AND TERMINATION......................................................... 75
15.1 Term .................................................... 75
15.2 Termination for Material Breach.......................... 76
15.3 Established Material Breach.............................. 76
15.4 Non-Binding, Non-Admissible Arbitration
Decision................................................. 77
15.5 Termination for Other Events............................. 78
15.6 Partial Termination by Medeva............................ 79
15.7 Effect of Expiration or Termination...................... 79
15.8 Survival of Rights and Obligations....................... 80
5
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ARTICLE XVI
GENERAL PROVISIONS .......................................................... 81
16.1 Force Majeure............................................ 81
16.2 Notice .................................................. 81
16.3 Further Assurances....................................... 82
16.4 Successors and Assigns................................... 83
16.5 Governing Law............................................ 83
16.6 Attorney's Fees.......................................... 84
16.7 Severability............................................. 84
16.8 Waiver .................................................. 85
16.9 Counterparts............................................. 85
16.10 Captions................................................. 85
16.11 Independent Contractors.................................. 86
16.12 Entire Agreement......................................... 86
ANNEX A ..................................................................... 88
ANNEX B ..................................................................... 89
ANNEX C ..................................................................... 90
ANNEX D ..................................................................... 91
ANNEX E ..................................................................... 92
6
THIS DEVELOPMENT AGREEMENT (this "Agreement"), made as of July 15,
1997, by and between Anthra Pharmaceuticals, Inc., a corporation organized under
the laws of the State of Delaware ("Anthra"), and Medeva California Inc., a
corporation organized under the laws of California ("Medeva"),
WITNESSETH:
WHEREAS, Anthra has developed certain proprietary know-how and data
with respect to N-Trifluoroacetyladriamycin-14 valerate, a doxorubicin
derivative ("AD 32"), as further described in Annex A hereto,
WHEREAS, Anthra intends to continue the development of, and secure
the regulatory approvals required in order to manufacture, promote, market and
sell AD 32 in the United States, including its territories, possessions and
commonwealths (the "Territory"),
WHEREAS, Medeva has considerable expertise in the development,
promotion, marketing and sale of pharmaceutical products in the Territory, and
has in place a large and experienced marketing staff that can expedite the
distribution of AD 32 in the Territory,
WHEREAS, Medeva and Anthra desire to enter into a co-ownership
arrangement with respect to the Product Know-how, as defined below, on the terms
set forth herein, and
WHEREAS, Anthra desires to grant Medeva an exclusive license in the
Territory with respect to the Product Know-how, on the terms set forth herein;
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NOW, THEREFORE, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.1 "AD 32" shall have the meaning set forth in the preamble hereto.
1.2 "Affiliate" of a person shall mean any corporation, partnership
or other entity that directly, or indirectly through one or more intermediaries,
Controls, is controlled by or is under common control with such person.
1.3 "Anthra" shall mean Anthra Pharmaceuticals, Inc.
1.4 "Anthra Patent Rights" shall mean all patents and patent
applications (which for purposes of this Agreement shall be deemed to include
certificates of invention, applications for certificates of invention, and
utility models) throughout the world, covering or relating to the Product,
including any substitutions, extensions, reissues, reexaminations, renewals,
divisions, continuations, or continuations-in-part, which Anthra owns or
controls and under which Anthra has the right to grant sublicenses to Medeva,
during the term of this Agreement.
1.5 "Arbitration Decision" shall have the meaning set forth in
Section 15.3.
1.6 "Arbitration Panel" shall have the meaning set forth in Section
15.3.
1.7 "CIS Approval" shall have the meaning set forth
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in Section 7.1(c).
1.8 "CIS Indication" shall mean the indication for refractory
bladder carcinoma in situ.
1.9 "Calendar Quarter" shall mean a three-month period starting on
January 1, April 1, July 1, or October 1 of any calendar year.
1.10 "Collateral" shall have the meaning set forth in Section
3.2(c).
1.11 "Control" and, with correlative meanings, the terms "controlled
by" and "under common control with" shall mean the power to direct or cause the
direction of the management or policies of a person, whether through the
ownership of voting securities, by contract, resolution, regulation or
otherwise.
1.12 "Development Activities" shall have the meaning set forth in
Section 2.5.
1.13 "Disclosing Party" shall have the meaning set forth in Section
13.1.
1.14 "EMC" shall mean the Executive Management Committee to be
established pursuant to Section 8.1.
1.15 "Established Material Breach" shall have the meaning set forth
in Section 15.3.
1.16 "FDA" shall mean the United States Food and Drug Administration
and any successor agency having substantially the same functions.
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1.17 "GMP" shall mean current Good Manufacturing Practices in effect
from time to time during the term of this Agreement.
1.18 "Improvement" shall mean any modification to a product, or any
discovery, technology, device or formulation, including, without limitation, any
enhancement in the presentation, means of delivery, dosage or packaging, of a
product, or any discovery or development of a new indication for a product.
1.19 "Inventory" shall have the meaning set forth in Section 3.2(c).
1.20 "Launch" shall mean the first commercial sale of the Product in
the Territory.
1.21 "Losses" shall have the meaning set forth in Section 14.4.
1.22 "Market" or "Marketing" shall mean all programs and activities
relating to the marketing and promotion of the Product in the Territory,
including but not limited to labeling, advertising, marketing studies, seminars,
symposia, training and education, and detailing.
1.23 "Medeva" shall mean Medeva California Inc.
1.24 "NDA" shall mean a New Drug Application or Supplemental New
Drug Application made in accordance with applicable regulations and requirements
of the FDA in effect from time to time.
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1.25 "Negotiation Period" shall have the meaning set forth in
Section 2.5.
1.26 "Net Sales" shall mean,***
1.27 "NAFTA Area" shall mean the countries, territories and
possessions covered by the North American Free Trade Agreement.
1.28 "Notice" shall have the meaning set forth in Section 16.2.
1.29 "Other Trademarks" shall have the meaning set forth in Section
1.40.
1.30 "Ovarian Agreement" shall mean the agreement that Medeva and
Anthra, on the one hand, and Medeva on the other hand, may enter into pursuant
to Section 2.9, setting forth the terms and conditions on which Anthra will
proceed with the preparation and filing of an NDA for the Product for the
Ovarian Indication, including without limitation appropriate license grants by
Anthra and Medeva and provisions for milestone and royalty payments by Medeva.
1.31 "Ovarian Indication" shall mean the indication for ovarian
cancer.
1.32 "Papillary Approval" shall have the meaning set forth in
Section 7.1(d).
1.33 "Papillary Indication" shall mean the indication for the
adjunctive treatment of papillary bladder tumors.
1.34 "Product" shall mean AD 32, in finished dosage
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form in 200 mg vials, for administration intravesically and intraperitoneally.
1.35 "Product Know-how" shall mean all technical knowledge,
expertise, skill, practice, proprietary rights, inventions, formulae, trade
secrets, analytical methodology, processes, preclinical, clinical, stability and
other data, toxicological information and all other experience in tangible or
intangible form relating to the Product in which Anthra has an ownership or
licensable interest and which is in the possession or under the control of
Anthra as of the date of this Agreement, or which Anthra may develop, acquire or
control (pursuant to an ownership or licensable interest) hereafter pursuant to
this Agreement. "Product Know-how" shall be deemed to include any and all Anthra
Patent Rights.
1.36 "Product Specifications" shall mean the specifications and
quality control testing procedures for the Product set forth in Annex A hereto,
as amended and/or supplemented from time to time pursuant to Section 4.1.
1.37 "Receiving Party" shall have the meaning set forth in Section
13.1.
1.38 "Sublicensee" shall have the meaning set forth in Section 5.2.
1.39 "Territory" shall have the meaning set forth in the preamble.
1.40 "Trademarks" shall mean those trademarks and
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trade names designed for and used by Medeva or its Affiliates or Sublicensees in
the Marketing and sale of the Product hereunder, but shall not include any other
trademark or trade name used by Medeva in connection with its other products
(even if also used in connection with the Product), particularly any ▇▇▇▇ or
name that identifies Medeva or any of its Affiliates or Sublicensees
(collectively, the "Other Trademarks").
ARTICLE II
OWNERSHIP INTEREST; PRODUCT DEVELOPMENT
2.1 Grant of Interest. Anthra hereby grants to Medeva *** ownership
interest (the "Medeva Interest") in all of its rights, title and interest in the
Product Know-how as exploited in the Territory (the remaining ownership interest
therein, the "Anthra Interest") (collectively, the "Interests"); provided,
however, that Medeva may not exploit the Product Know-how except to the extent
expressly set forth elsewhere in this Agreement; and provided, further, that
nothing in this Article II shall restrict the rights of Anthra with respect to
the ownership of, or exploitation of Product Know-how outside the Territory.
2.2 Right to payments. Anthra agrees to pay ***.
2.3 Transfer of Interests. Neither party shall have the right to
sell, transfer, encumber or otherwise assign its Interest without the prior
written consent of the other party, except in connection with a permitted
assignment of this Agreement by such party pursuant to Section 16.4.
2.4 Purchase Option. Upon the termination or expiration of this
Agreement, Anthra shall have the option (the "Purchase Option"), exercisable
upon written notice to Medeva, to purchase the Medeva Interest for an amount
equal to the fair market value thereof at the time of exercise. Upon receipt of
written notice from Anthra and receipt of payment of the fair market value of
the Medeva Interest, Medeva shall promptly return, assign, or otherwise effect
the complete
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transfer to Anthra of the entire Medeva Interest. The fair market value of the
Medeva Interest shall be determined in good faith by the parties; provided,
however, that if the parties are unable to agree on the fair market value
thereof, then an independent appraiser, mutually acceptable to the parties,
shall determine such fair market value; and provided, further, that any such
determination by such appraiser shall be conclusive and binding on the parties.
2.5 Clinical Studies. Anthra shall perform, directly or indirectly
(i) all tests, studies and other activities necessary in connection with the
preparation and filing of an NDA for the Product for each of the CIS Indication
and the Papillary Indication, as listed in the clinical plan set forth in Annex
B hereto, (ii) for a period beginning on the date hereof and ending on the
earlier to occur of (A) the first anniversary of the date hereof (the
"Negotiation Period") and (B) an impasse in negotiations pursuant to Section
2.9(b), all tests, studies and other activities set forth in Annex B hereto
relating to the preparation and filing of an NDA for the Product for the Ovarian
Indication, (iii) such other tests and studies of the Product as may be required
from time to time by the FDA with respect to indications for the Product as to
which Anthra is obligated to file an NDA pursuant to this Agreement, whether
prior to or after the approval of such NDA, and (iv) all other
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tests and studies of the Product that Medeva deems necessary or appropriate to
have conducted with respect to any such indication after the grant by the FDA of
an "approvable letter" with respect to such indication, including without
limitation all clinical studies to support the Marketing of the Product for such
indication (collectively, the "Development Activities").
2.6 NDA Filings. Anthra agrees to prepare and file an NDA for the
Product for each of the CIS Indication and the Papillary Indication and to use
commercially reasonable efforts to obtain approval thereof. Promptly upon the
completion (and prior to the filing) of each such NDA, Anthra shall provide
Medeva with a copy of the Chemistry, Manufacturing, and Controls (CMC) section
thereof, and agrees to delay the filing of such NDA with the FDA for a period of
sixty (60) days after the date such copy was provided to Medeva, unless the EMC
shall unanimously approve the filing of such NDA prior to the end of such
period. Insofar as timely received, Medeva's reasonable views and requests shall
be taken into account prior to the submission of such NDA. All such NDAs shall
be filed in the name of Anthra, but shall be held subject to the Medeva Interest
as herein provided, and Anthra shall use commercially reasonable efforts to
maintain such NDAs after approval thereof.
2.7 Performance. Anthra shall perform, or cause to
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be performed, the Development Activities in good scientific manner, and in
compliance in all material respects with all requirements of applicable laws,
rules, regulations and guidelines.
2.8 Communications with FDA. Anthra shall be responsible for all
communications with the FDA relating to the Product, whether occurring prior to
or after the Launch of the Product; provided, however, with respect to any such
communications after the Launch, whenever practicable Anthra shall consult with
Medeva prior to such communication and shall take account of Medeva's timely and
reasonable views and requests; provided, further, that if such advance
consultation is not possible, then Anthra shall promptly thereafter advise
Medeva of the content of such communications. After the approval of the NDA for
the Product for an indication, Medeva may initiate communications with the FDA
with regard to such indication, as required by applicable law, and may respond
to inquiries initiated by the FDA; provided, however, that Medeva shall consult
with Anthra prior to such communications and shall take account of Anthra's
timely and reasonable views and requests and, if such advance consultation is
not possible, then Medeva shall promptly thereafter advise Anthra of the content
of such communications.
*** CONFIDENTIAL TREATMENT REQUESTED.
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2.9 Ovarian Indication.
(a) During the Negotiation Period, Anthra shall provide to
Medeva such information concerning the Development Activities relating to the
Ovarian Indication as Medeva may reasonably request from time to time to assist
it in evaluating the efficacy of the Product for the Ovarian Indication.
(b) Upon the written request of Medeva, Anthra and Medeva
shall use good faith efforts to negotiate an Ovarian Agreement, until the
earlier to occur of an impasse in negotiations or the end of the Negotiation
Period; provided, however, that each party may decide, in its sole discretion,
whether to accept any and all terms and conditions proposed by the other party
for such agreement.
(c) Anthra shall have no obligation whatsoever to undertake or
complete any development work relating to the Ovarian Indication after the
earlier to occur of (i) an impasse in negotiations pursuant to Section 2.9(b)
and (ii) the end of the Negotiation Period, in the event that the parties have
not entered into an Ovarian Agreement.
2.10 Development Expenses. Medeva shall pay to Anthra the payments
set forth in Section 7.1 to cover the development of the Product. Except as
provided in Section 7.1, Anthra shall bear all costs and expenses arising out of
or relating to the Development Activities; provided, however,
*** CONFIDENTIAL TREATMENT REQUESTED.
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that Medeva shall promptly reimburse Anthra for all of its direct costs and
expenses (including without limitation disbursements to third parties, central
laboratory expenses, travel expenses, and salaries and benefits for relevant
Anthra employees) arising out of or relating to any tests, studies, and other
activities with respect to the CIS or Papillary Indications for the Product that
the FDA may require or that Medeva may request Anthra to conduct, after approval
of the NDA for such indication, exclusive of any such tests, studies or
activities that at the time of approval are specified by the FDA as conditions
subsequent to such approval.
2.11 Further Funds. In the event that Anthra shall be unable to
complete the development of the Product for either the CIS Indication or the
Papillary Indication due to a lack of funds, then Anthra shall provide written
notice to Medeva estimating the amount of funds required (in addition to the
development payments made or to be made by Medeva under Section 7.1) to complete
the development of the Product for such Indication. Medeva may, in its sole
discretion, elect to advance to Anthra all or a portion of such amount, and
Anthra shall have no obligation to pay interest on the funds so advanced, or to
repay the principal amount of such advance; provided, however, that Medeva may
set off an amount (the "Advance Reimbursement Amount") equal to *** against its
license fee payment obligations pursuant to Section 7.2 and royalty payment
obligations pursuant to Section 7.3, as they accrue, subject to a cap of ***.
2.12 Continued Development. In the event that Anthra reasonably
determines at any time that the NDA for an indication for the Product is
unlikely to be approved by the FDA, then it shall so notify Medeva, whereupon
Anthra shall have no further obligation pursuant to this Article II to conduct
any Development Activities with respect to such indication for the Product. Upon
receipt of such notice, Medeva shall elect, in its sole discretion, either to
terminate this Agreement with respect to such indication for the Product, or to
continue (or contract for a third party to continue) such Development Activities
at the sole expense of Medeva. Medeva shall notify Anthra of such election
within ninety (90) days after the receipt of the notice referred to
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in the first sentence of this Section 2.12. In the event that Medeva shall
decide to continue (or have continued) such Development Activities, then (i)
Anthra shall provide Medeva with copies of such data, information and regulatory
documentation relating to the Product as Anthra shall have developed in the
performance of its Development Activities with respect to such indication, (ii)
Anthra shall grant Medeva the right to reference the relevant drug master file
of Anthra and to use such data, information and regulatory documentation, all
solely for the purpose contemplated by this Section 2.12, and (iii) ***.
ARTICLE III
SUPPLY OF THE PRODUCT
3.1 General. Subject to the terms and conditions of
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this Agreement, Anthra agrees to use its commercially reasonable efforts to
supply Medeva with its requirements of the Product, and Medeva agrees to
purchase from Anthra its requirements of the Product, for resale in the
Territory pursuant to this Agreement.
3.2 Inventory of AD 32.
(a) In order to enable Anthra to meet its obligations under
this Article III with respect to the timely supply of Product to Medeva, the
parties agree that Anthra shall purchase and maintain in inventory, from time to
time, such quantities of AD 32 as the EMC shall decide, subject to contractual
restrictions in the supply agreement(s) in effect from time to time between
Anthra and its supplier(s) of AD 32 and subject to the terms and conditions of
this Section 3.2. Such inventory shall be utilized in the manufacture of the
Product on a first-in-first-out (FIFO) basis.
(b) Medeva agrees to reimburse Anthra, by check or wire
transfer, within ten days after receipt of an invoice therefor, for fifty
percent (50%) of the cost of each purchase made pursuant to Section 3.2(a) (each
such reimbursement amount, an "Advance"), which AD 32 shall be used exclusively
to meet Anthra's supply obligations under this Article III, except as otherwise
provided in Section 3.2(c). Anthra shall credit each Advance against the supply
price payable by Medeva pursuant to Section 3.11 for the purchase of Product
manufactured from that shipment of AD 32 in respect of which the Advance was
made; provided, however, that if, for any reason, Medeva shall fail to recoup,
pursuant to the foregoing recoupment provision, one hundred percent (100%) of
its Advances in respect of any shipment of AD 32 by the earlier to occur of (i)
the expiration date of such shipment of AD 32 and (ii) the date of delivery to
Medeva of Product manufactured from a subsequently-received shipment of AD 32,
then within five (5) days thereafter, Anthra shall pay to Medeva such
unrecouped amount.
(c) As collateral security for the due and punctual crediting
or repayment, as the case may be, by Anthra of all Advances pursuant to Section
3.2(b) hereof (collectively, the "Obligations"), Anthra hereby grants Medeva a
continuing security interest in and lien upon all right, title and interest of
Anthra, whether now existing or hereafter arising, in and to all inventory of AD
32 in respect of which Medeva has made Advances pursuant to Section 3.2(b),
wherever located, and all accessions thereto (collectively, the "Inventory") and
documents therefor, and all cash and non-cash proceeds of any and all of the
foregoing, including, without limitation, all payments under insurance, or any
indemnity, warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing (all of the foregoing items
collectively, the "Collateral").
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Anthra covenants and agrees with Medeva that: (i) Medeva's
sole duty with respect to the Collateral is to use such care as it uses for
similar property for its own account; (ii) Anthra will (a) be solely
responsible for all matters relating to the Collateral, except as otherwise
provided in this Agreement, (b) not, and will not purport to, grant or suffer
liens against, or sell, transfer or dispose of any Collateral other than to
Contract Manufacturer(s) in the ordinary course of business pursuant to this
Agreement, (c) from time to time take all actions, and make all filings and
recordations reasonably requested by Medeva in connection with Medeva's
security interest in the Collateral, at Medeva's expense, (d) maintain at all
times with respect to the Inventory insurance against risks customarily insured
against by companies engaged in a business similar to that of Anthra, and (e)
permit Medeva to inspect the Collateral, wherever located, at any reasonable
time and upon reasonable notice; (iii) Medeva is authorized to file financing
statements and give notice to third parties regarding the Collateral without
Anthra's signature to the extent permitted by law, at any time and from time to
time; (iv) Anthra will not change its name nor the location of the Collateral
(except for transfers to Contract Manufacturers for finishing into Product in
the ordinary course of its business pursuant to this Agreement) without the
prior written consent of Medeva, which consent shall not be unreasonably
withheld; and (v) Anthra will stamp or otherwise ▇▇▇▇ its books and records to
reflect the security interest of Medeva in the Collateral; provided, however,
that, with the prior consent of the EMC, Anthra may discharge Medeva's security
interest in one or more items of Collateral by payment to Medeva of an amount
equal to any unrecouped and unrepaid portion of its Advances made with respect
thereto, whereupon Medeva shall release its lien on such items and such items
shall cease to be deemed Inventory and Collateral or otherwise subject to the
provisions of this Agreement and Anthra may use such items in any manner and
for any purpose whatsoever, including without limitation the supply of AD 32 or
finished product to other licensees of Anthra outside the Territory.
Upon the occurrence of any default in the Obligations, Medeva
shall have all of the rights and remedies of a secured party under the Uniform
Commercial Code as in effect in the State of New York and any other applicable
law with respect thereto, and may exercise such rights and remedies without
advertisement or demand upon or notice to Anthra or right of redemption of
Anthra, all of which are hereby expressly waived to the fullest extent
permitted by applicable law.
Anthra hereby irrevocably designates and appoints each of
Medeva and its designees or agents (each an "Attorney") as attorney-in-fact of
Anthra, with power of substitution, each with authority acting alone, to take
all actions reasonably necessary or advisable to carry out and enforce the
rights of Medeva pursuant to this Section 3.2(c), including without limitation
signing or endorsing Anthra's name on notes, acceptances, checks, drafts,
instruments, certificates, powers, assignments and other documents in respect to
the Collateral, and executing proofs of claim and loss, releases, endorsements,
assignments and other instruments of conveyance in respect of the Collateral.
This power of attorney is irrevocable and coupled with an interest.
3.3 Good Faith Forecasts.
(a) No later than *** after Anthra files the NDA for the
Product for the CIS Indication or the Papillary Indication, whichever shall
occur first, Medeva shall provide Anthra with a good faith forecast estimating
Medeva's quarterly requirements of the Product (and the desired delivery dates
therefor) for the *** period commencing on the first day of the immediately
succeeding ***.
(b) Thereafter, not less than *** prior to the beginning of
each *** during the term hereof, Medeva shall provide Anthra with an updated
good faith forecast estimating Medeva's monthly requirements of the Product for
the *** period commencing on the first day of such ***.
3.4 Issuance of Purchase Orders. Medeva shall order a shipment of
the Product by issuing a purchase order to Anthra specifying the quantity and
desired delivery date thereof, not less than *** prior to the delivery date;
provided, however, that the aggregate quantity of Product ordered by Medeva for
delivery in any month shall not exceed
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the quantity of Product forecast to be ordered during such month, as set forth
in the latest forecast prepared by Medeva pursuant to Section 3.3 prior to the
first day of the *** in which the purchase order is issued.
3.5 Acceptance of Purchase Orders. Anthra shall accept each purchase
order issued by Medeva in conformity with Section 3.4 within *** after receipt
thereof, unless the inventory of AD 32 maintained by Anthra pursuant to Section
3.2 shall be insufficient to allow for the timely delivery of the ordered
quantity of the Product. Anthra shall give Medeva prompt written notice of the
rejection of any such purchase order specifying the basis for such rejection.
In the event that the terms of any purchase order received by Anthra
from Medeva shall be inconsistent with the terms of this Agreement, the terms of
this Agreement shall control.
3.6 Delivery. Delivery of each order of Product shall be made ***
Medeva's facility in Rochester, New York. Anthra shall arrange for *** of the
Product. *** at the time of delivery to the carrier.
3.7 Contract Manufacturing. Anthra may contract with one or more
unrelated third parties (each a "Contract Manufacturer") to manufacture AD 32 or
Product, provided that (i) Anthra permits Medeva to comment on the drafts of
each toll manufacturing agreement for AD 32 and/or Product (each a "Contract
Manufacturing Agreement") that Anthra may negotiate with a Contract Manufacturer
after the date hereof,
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(ii) Anthra provides Medeva with a true and accurate copy of each such Contract
Manufacturing Agreement, and (iii) Anthra uses commercially reasonable efforts
to cause each Contract Manufacturer to agree to execute and deliver to Medeva a
letter in the form of Annex C hereto, and to include the provisions set forth
therein in the relevant Contract Manufacturing Agreement. As to each Contract
Manufacturer that executes and delivers such a letter to Medeva, Anthra agrees
that Medeva may seek to enforce Anthra's remedies under such Contract
Manufacturing Agreement directly against such Contract Manufacturer without
first exhausting its remedies against Anthra if the Contract Manufacturer
breaches such Contract Manufacturing Agreement so as to cause Anthra to become
liable to Medeva for damages pursuant to Section 3.8 hereof; provided, however,
that if Medeva shall seek to exercise such remedies, Anthra shall remain
primarily liable and obligated to Medeva under all provisions of this Agreement.
Further, Anthra agrees to use commercially reasonable efforts to negotiate the
inclusion in each Contract Manufacturing Agreement of provisions (i) prohibiting
(A) the sublicensing by such Contract Manufacturer of any know-how, data or
technology licensed to it by Anthra and (B) the sale by such Contract
Manufacturer of (x) AD 32 for use in any product to be sold in the Territory, or
(y) Product for resale (other than by Anthra to Medeva, or by Medeva) in the
Territory, and (ii) giving Anthra the right to terminate such Contract
Manufacturing Agreement in the event of a breach of either of the provisions
described in (i) above. Notwithstanding any provision of this Agreement, Anthra
shall have no obligation under this Agreement with respect to Genchem Pharma
Ltd. as a Contract Manufacturer or the Supply Agreement between Anthra and
Genchem Pharma Ltd. as a Contract Manufacturing Agreement.
3.8 Inability to Supply.
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(a) In the event that Anthra shall fail to deliver to Medeva
at least two-thirds of the quantity of Product specified in a purchase order
accepted by Anthra pursuant to Section 3.5 (the "Minimum Quantity"), within 120
days after acceptance of such purchase order, then Anthra shall pay Medeva
liquidated damages in the amount of Five Thousand Dollars (US $5,000) for each
additional day of delay in the delivery to Medeva of the Minimum Quantity;
provided, however, that Anthra shall not be required to pay aggregate damages in
excess of Four Hundred Fifty Thousand Dollars (US $450,000) with respect to any
order; and provided, further, that no such damages shall be payable by Anthra in
the event that (i) at the time of acceptance of such purchase order, at least
fifty percent (50%) of the then-current inventory of AD 32 maintained by
Anthra pursuant to Section 3.2 would be needed in the manufacture of the
quantity of Product specified in such purchase order and (ii) Anthra timely
fills such purchase order to the extent of the aggregate of (A) the quantities
of Product that can be manufactured from the Inventory of AD 32 at the time of
acceptance of such purchase order and (B) Anthra's inventory, as of the delivery
date specified in such purchase order, of Product manufactured from AD 32 that
is collateral.
(b) Subject to the terms and conditions of this Agreement, in
the event that Anthra shall become obligated to pay Medeva liquidated damages in
the amount of Four Hundred Fifty Thousand Dollars (US $450,000) with respect to
an order of Product pursuant to Section 3.8(a), or Anthra shall become subject
involuntarily (which proceeding shall not be dismissed within sixty (60) days
after the commencement thereof) or voluntarily to a bankruptcy, insolvency,
liquidation or other similar proceeding, then Medeva shall have the continuing
right (the "Manufacturing Option"), in addition to all other rights granted
pursuant to this Agreement, to manufacture Product for the term of this
Agreement. Medeva may exercise the Manufacturing Option upon thirty (30) days'
prior written notice to Anthra. Upon Medeva's exercise of the Manufacturing
Option, (i) Anthra shall provide Medeva with copies of such data, information
and regulatory documentation in the possession or under the control of Anthra
(and not subject to a confidentiality obligation) relating to the Product as
Medeva may reasonably require in connection with the manufacturing of Product,
and (ii) Anthra shall grant Medeva the right to reference the relevant drug
master file of Anthra and to use such data, information and regulatory
documentation, all solely for the purpose contemplated by this Section 3.8(b).
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(c) Except for its rights under Sections 11.2 and 15.2, the
rights of Medeva under this Section 3.8 shall be exclusive and in lieu of all
other remedies otherwise available by law or under this Agreement with respect
to any breach by Anthra of its obligation to supply Medeva with Product on a
timely basis pursuant to this Article III. In the event of termination of this
Agreement by Medeva pursuant to Section 15.2 for any such breach by Anthra,
Medeva shall not be entitled to any damages other than those, if any, to which
it may be entitled under Section 3.8(a). For purposes of Section 15.2, if Anthra
shall deliver to Medeva at least two-thirds of the quantity of Product specified
in a purchase order accepted by Anthra pursuant to Section 3.5 within 120 days
after acceptance of such purchase order, then Anthra shall not be deemed to have
breached materially its supply obligation under this Article III with respect to
such purchase order.
3.9 Alternate Supply. Anthra agrees to use commercially reasonable
efforts to cause at least *** of supply of AD 32 to become and remain
pre-qualified during the term of this Agreement.
3.10 Warranty. Anthra warrants and represents that, at the time of
delivery of the Product to Medeva, the Product (i) will have been manufactured,
filled, packaged, stored and shipped in accordance with applicable GMPs and all
other applicable laws, rules, regulations or requirements, (ii) will have been
manufactured, filled, packaged and stored in accordance with the Product
Specifications and the applicable NDA, (iii) will not be adulterated or
misbranded under the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. ▇▇.▇▇. 321
et seq., as amended ("FFDCA"), or under any other applicable laws, rules,
regulations or requirements, (iv) may be introduced into interstate commerce
pursuant to the FFDCA, and (iv) will have expiration dating not less than ***
after the date of delivery thereof to Medeva, provided that the FDA shall have
approved expiration dating of the Product of not less than ***.
3.11 Price and Payment
(a) The parties hereby agree that the supply price for the
Product, ***.
(b) The supply price for each order of Product shall be
payable by Medeva ***.
3.12 Property Insurance. Anthra shall procure and maintain
throughout the term of this Agreement property insurance (in which Medeva shall
be named as an additional insured), with such types and amounts of coverage as
are customary in the industry, covering all Product intended for sale to Medeva
pursuant hereto, and all AD 32 purchased pursuant to Section 3.2, prior to such
time as the risk of loss thereof passes from Anthra to Medeva. All such
insurance policies shall require at least thirty (30) days prior written notice
to Medeva concerning cancellation thereof. Upon request, Anthra shall provide
Medeva with evidence that such insurance is in effect.
3.13 Records. Anthra shall maintain, and shall cause its Contract
Manufacturers and other agents to maintain, all
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records necessary to comply with all applicable laws, rules and regulations in
the Territory relating to the manufacturing and storage of the Product in bulk
or finished form. All such records shall be maintained for such period as may be
required by law, rule or regulation; provided, however, that all records
relating to the manufacture, stability and quality control of each batch of the
Product shall be retained at least until the first anniversary of the end of the
approved shelf life for all Product from such batch.
ARTICLE IV
QUALITY CONTROL
4.1 Product Specifications Amendments. Anthra reserves the right to
amend and/or supplement the Product Specifications unilaterally for the purpose
of complying with GMPs or other applicable laws, regulations or guidelines.
Further, Anthra may amend and/or supplement the Product Specifications in order
to incorporate Improvements or for any other reasonable business purpose,
subject to the grant of any FDA approvals required by applicable law in
connection with any such changes, with the prior written consent of Medeva,
which consent shall not be unreasonably withheld; provided, however, that
failure to agree on royalty terms with respect to any such Improvement pursuant
to Section 12.1 shall be deemed reasonable cause for withholding such consent.
4.2 Nonconformance.
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(a) In the event that Medeva determines that any shipment of
Product does not conform to the Product Specifications or the relevant Medeva
purchase order, then Medeva shall give Anthra notice thereof (including a sample
from such shipment) within fifteen days after receipt thereof, in the case of
non-conformities that may be ascertained by the exercise of reasonable diligence
(which shall not include laboratory testing or other chemical analysis, unless
required by the NDA) upon receipt thereof, and within fifteen days after
discovery thereof, in the case of other non-conformities (including, without
limitation, non-conformities relating to stability). If Medeva decides to
conduct routine laboratory testing and other chemical analysis of shipments of
Product, it shall conduct such tests and analyses within thirty (30) days after
receipt of the Product. If Anthra confirms such non-conformity, it shall
promptly so notify Medeva. If Anthra does not confirm such non-conformity, it
shall promptly so notify Medeva, and the parties shall submit the disputed
shipment for testing to an independent testing laboratory that is mutually
acceptable to the parties. The findings of the testing laboratory shall be
binding on the parties. The expenses of such testing shall be borne by Anthra if
the testing confirms the non-conformity, and otherwise by Medeva.
(b) If any Product delivered by Anthra hereunder does not
conform to the Product Specifications or
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the relevant Medeva purchase order for any reason other than the willful or
negligent acts or omissions of Medeva or its customers or agents which occur
after the date of shipment thereof by Anthra, Anthra shall credit Medeva with
the costs incurred by Medeva with respect to such non-conforming Product, which
costs shall be deemed equal to the sum of any amounts paid on account of such
Product pursuant to Section 3.11 and any and all transportation and storage
charges incurred by Medeva in connection with such Product. In addition, at
Medeva's option, (i) Anthra shall be relieved of any obligation to deliver any
Product in replacement of such non-conforming Product, or (ii) Anthra shall
replace the non-conforming Product with substitute Product that conforms to the
Product Specifications and purchase order, within ninety (90) days from the date
Medeva notifies Anthra of its election of option (ii) of this Section 4.2, in
which case Medeva shall pay to Anthra any unpaid amounts in respect of the
replacement Product in accordance with Section 3.11 following delivery of the
replacement Product. This remedy shall be in addition to any other rights that
Medeva may have hereunder or by law.
4.3 Manufacturing Process. In the event that any process event shall
occur in the manufacturing of any batch of Product, which event is likely
materially to affect the safety, efficacy or regulatory status of the Product,
then Anthra shall notify Medeva as soon as reasonably possible.
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Medeva and Anthra shall consult with each other as to the disposition of all
affected batches of the Product. Anthra agrees to report to Medeva, on an annual
basis, any atypical process events that are unlikely materially to affect the
safety, efficacy or regulatory status of the Product. Further, to the extent of
its knowledge, Anthra agrees to provide Medeva with notice of any out of process
steps which occur in the manufacture of Product. No Product may be reworked
unless the rework procedure is in conformity with FDA guidelines, except with
the prior written consent of Medeva, which consent may not be unreasonably
withheld.
4.4 Inspection. Anthra shall permit Medeva representatives to enter
Anthra's facilities and, to the extent permitted by the Contract Manufacturing
Agreements (which access Anthra agrees to use commercially reasonable efforts to
negotiate on behalf of Medeva), to enter the facilities of the Contract
Manufacturers in the company of, and separately from, Anthra representatives,
all upon reasonable prior notice and at reasonable intervals, during normal
business hours for the purpose of making quality assurance audits of those
facilities and of the procedures and processes used by Anthra and such Contract
Manufacturers in storing, manufacturing and shipping AD 32 and the Product. In
the event that Anthra shall enter into contracts with other vendors with respect
to Product to be supplied to Medeva
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pursuant hereto, or AD 32 to be used in the manufacture of such Product, then
Anthra shall use commercially reasonable efforts to negotiate, mutatis mutandis,
such rights of access for Medeva with respect to such vendors' facilities.
4.5 Safety Procedures. Anthra shall maintain and enforce safety
procedures for the handling and manufacture of the Product that comply in all
respects with Anthra's NDA and all federal, state and local occupational safety
and health requirements.
4.6 Government Inspection. Anthra agrees to advise Medeva
immediately of any proposed or announced visit or inspection, and as soon as
possible but in any case within twenty-four (24) hours (or, in the case of a
third party facility, within twenty-four (24) hours after receipt by Anthra of
notice thereof), of any unannounced visit or inspection, by any governmental or
regulatory agent of any facilities used by Anthra in the performance of its
obligations hereunder, including the processes or procedures used at such
facilities in the manufacture of Product. Anthra shall provide Medeva with a
reasonable description of each such visit or inspection promptly (but in no
event later than five (5) calendar days) thereafter, and with copies of any
letters, reports or other documents (including 483's) issued by any such agents
that relate to the Product or such facilities, processes or procedures. Medeva
shall also be
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entitled to review Anthra's responses to any such reports and communications
prior to their submission, if practicable, and, insofar as timely received,
Medeva's reasonable views and requests shall be taken into account prior to
submission of such reports and communications to the relevant agency. Anthra
shall also provide Medeva with the notice, information, documentation, and
opportunity to comment provided for above with respect to the Contract
Manufacturers, to the extent provided for in the relevant Contract Manufacturing
Agreement (which provisions Anthra shall use commercially reasonable efforts to
negotiate on behalf of Medeva). In the event that Anthra shall enter into
contracts with other vendors with respect to Product to be supplied to Medeva
pursuant hereto, or AD 32 to be used in the manufacture of such Product, then
Anthra shall use commercially reasonable efforts to negotiate, mutatis mutandis,
such rights for Medeva with respect to such vendors.
ARTICLE V
LICENSE GRANTS
5.1 Grants. Subject to the terms and conditions of this Agreement,
including without limitation Section 6.8, the parties hereby grant to Medeva an
exclusive, royalty-bearing license in the Territory under the Product Know-how
to Market, sell, distribute, and have Marketed, sold, and distributed the
Product for the CIS and Papillary Indications. Anthra agrees
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not to license any third party to Market, sell or distribute AD 32 in the
Territory, for pharmaceutical use in humans.
5.2 Sublicenses. Medeva shall have the right to grant to third
parties (each, a "Sublicensee") sublicenses under the licenses granted in
Section 5.1, subject to the prior written consent of Anthra, which shall not be
unreasonably withheld. Failure to approve or disapprove a proposed Sublicensee
within ten (10) business days after receipt by Anthra of a request for consent
from Medeva shall be deemed approval.
5.3 Other Countries. Anthra retains the right to grant licenses for
the sale, marketing and distribution of the Product in all countries outside the
Territory; provided, however, that Anthra agrees to impose on each such
licensee, to the extent permitted by applicable law, the covenants set forth in
Section 6.9, mutatis mutandis; ***.
5.4 Trademarks.
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(a) Subject to the terms and conditions of this Agreement,
Medeva hereby grants to Anthra a non-exclusive license (i) in the Territory, to
use the Trademarks to Market and have Marketed the Product for the CIS
Indication and the Papillary Indication, if Anthra shall have co-promotion
rights pursuant to Section 6.8, and (ii) outside the NAFTA Area, to use the
Trademarks to Market and have Marketed all formulations of AD 32, for all
indications. The license granted pursuant to clause (i) above is royalty-free,
and the license granted pursuant to clause (ii) shall be royalty-bearing, on
terms and conditions to be mutually agreed by the parties.
(b) Anthra shall be responsible for ensuring that all
labelling of the Products in the Territory complies with Anthra's NDA and all
applicable FDA regulations and does not cause the Product to which it relates to
be misbranded or violative of any Federal, State or local law, regulation or
rule. Subject to the preceding sentence, all such labelling shall contain one or
more Trademarks and such Other Trademarks as specified by Medeva in writing.
Nothing contained herein shall give Anthra any right to use any Other Trademark
except on the Products in the Territory as specified by Medeva in writing.
5.5 Technical Assistance. Upon the written request of Medeva, Anthra
shall provide Medeva with all information
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and reasonable technical assistance related to the Product Know-how as Medeva
may reasonably require in order to exploit the licenses granted in Sections 5.1
and 5.2.
ARTICLE VI
MARKETING AND SALE OF THE PRODUCT
UNDER THE LICENSING ARRANGEMENT
6.1 General.
(a) Subject to the grant of the license under Article V,
Medeva shall use commercially reasonable efforts to Market and sell the Product
in the Territory for the CIS Indication and Papillary Indication, as approved by
the FDA from time to time. Medeva shall commence Launch of the Product as soon
as practicable after the approval of the NDA for the Product for the CIS
Indication or the Papillary Indication, whichever shall occur first, but in no
event later than one hundred twenty (120) days after such approval, if Anthra
shall have timely supplied Medeva with all Product theretofore ordered in
accordance with Article III. All Product sales in the Territory shall be made
by, and for the account of, Medeva or its Affiliates or Sublicensees, as the
case may be. Anthra shall have no right to sell or distribute Product in the
Territory during the term of this Agreement.
(b) Subject to such exceptions as the parties may mutually
agree upon pursuant to Section 6.8, Medeva shall bear all costs and expenses
arising out of or relating to the Marketing, distribution and sale of the
Product in the
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Territory.
6.2 Compliance. Medeva shall comply with all applicable laws and
regulations in conducting the Marketing and sale of the Product in the
Territory, including without limitation all requirements as to pre-Marketing
approval of Product labelling.
6.3 Trademarks. Medeva shall be responsible for the selection,
registration and maintenance of all the Trademarks. Except as otherwise provided
in Sections 5.4 and 15.7, Anthra shall not acquire or assert any right, title,
and interest in and to any Trademark or Other Trademark.
6.4 Price of the Product. Medeva shall use commercially reasonable
efforts to obtain the best in-market price for the Product in the Territory
under the prevailing marketing conditions; provided, however, that nothing in
this Section 6.4 shall be deemed to restrict the freedom of Medeva to determine
in its sole discretion prices for the Product for approved indications in the
Territory; and provided, further, that in evaluating the best in-market price
Medeva need not make such determinations on an indication by indication basis
but may have due regard to the deleterious effects that pricing differentials
among the indications might have on any particular indication. Medeva shall keep
Anthra informed of its efforts in this regard in response to Anthra's reasonable
written requests from time to time.
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6.5 Marketing Materials. Medeva shall develop, at its sole expense,
appropriate Marketing and promotional materials for the Product for the CIS
Indication and the Papillary Indication in the Territory for use by Medeva, its
Affiliates and Sublicensees. Medeva agrees to provide Anthra with a sample copy
of each such item at least ten (10) business days before making use thereof, and
agrees to use such item only after receiving the written approval of Anthra;
provided, however, that failure by Anthra to approve or disapprove any such item
within ten (10) business days after Medeva has provided such item to Anthra
shall be deemed to be approval thereof. Medeva shall not, and shall cause its
Affiliates and Sublicensees not to, use any materials for the Marketing the
Product other than materials approved by Anthra for that purpose.
6.6 Product Liability Insurance. Medeva shall maintain, with an
insurance carrier reasonably acceptable to Anthra, at the sole expense of
Medeva, product liability insurance relating to the Product that is comparable
in type and amount to the insurance it maintains with respect to its most
similar other pharmaceutical products that are Marketed, distributed and sold in
the Territory.
6.7 Competition. Notwithstanding the exercise of the Purchase Option
under Section 2.4, each party agrees that, during the term of this Agreement and
for a period of one (1)
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year after the termination or expiration hereof, it shall not, and shall not
permit any of its Affiliates or Sublicensees to, develop, Market or sell in the
Territory any anthracycline (other than the Product, pursuant to this Agreement)
that is intended to receive, or has received, marketing approval in the
Territory for any urological indication; and provided, further, that this
Section 6.7 shall not apply to a party in the event that it shall terminate this
Agreement pursuant to Section 15.2. The parties acknowledge that all
restrictions contained in this Section 6.7 are reasonable, valid and necessary
for the adequate protection of the Product and the parties' rights therein.
6.8 Co-Promotion.***
6.9 Activities Outside the Territory. Medeva agrees that it will not
(i) seek approval, directly or indirectly, from the relevant regulatory
authorities, to (A) qualify facilities to manufacture or finish the Product
outside the Territory or (B) label or relabel the Product in a manner that would
permit it to be marketed or sold outside the Territory, or (ii) sell or export
the Product to any third party for use or resale outside the Territory, (iii) or
sell the Product to any third party that it has reason to believe intends to
resell or export the Product outside the Territory.
ARTICLE VII
DEVELOPMENT FEES, LICENSE FEES AND ROYALTIES
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7.1 Development Fees. For use in connection with, and for purposes
of the continued development of the Product, Medeva agrees to pay to Anthra the
following amounts:
(a) a single payment of Eight Million U.S. Dollars
(US$8,000,000) upon the signing of this Agreement;
(b) ***.
7.2 License Fees. In consideration of the license granted in
Article V, ***.
7.3 Royalties.
(a) Subject to Section 7.3(b), Medeva shall pay Anthra a
royalty equal to ***.
7.4 Payment. All development fees, license fees and royalties
payable by Medeva under this Article VII shall be paid in U.S. Dollars by wire
transfer of immediately available funds to *** or such other bank account as
Anthra may hereafter designate in writing not less than five (5) business days
before payment is due. Medeva shall pay all amounts owed to Anthra pursuant to
Section 7.3 on a quarterly basis within thirty (30) days following the end of
each full or partial Calendar Quarter during the term of this Agreement. Each
such payment shall be accompanied by written report, certified by an officer of
Medeva, providing a detailed breakdown of the Net Sales, and the components
thereof, for such Calendar Quarter.
7.5 Equity Interest. In the event that the FDA shall have granted
neither the CIS Approval nor the Papillary Approval by December 31, 2002, then,
in Medeva's sole discretion, Medeva shall have the right, exercisable upon
written notice in consideration of the payment made pursuant to Section 7.1(a)
and without payment of additional compensation, to acquire that number of shares
of the common stock of Anthra equal to twenty percent (20%) of the then-current
issued and outstanding voting equity securities of
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Anthra.
7.6 Withholding Taxes. Medeva shall pay any and all withholding
taxes or similar charges imposed by any government in the Territory on any
amounts due to Anthra from Medeva pursuant to this Article VII to the proper
taxing authority, and proof of payment of such taxes or charges shall be secured
and sent to Anthra as evidence of such payment. All amounts paid by Medeva
pursuant to this Section 7.6 shall be paid for the account of Anthra and
deducted from the amounts due from Medeva to Anthra pursuant to this Article.
ARTICLE VIII
EXECUTIVE MANAGEMENT COMMITTEE
8.1 Formation of the EMC. In order to facilitate the exchange of
information between the parties relating to their activities pursuant to this
Agreement, the parties agree to establish an Executive Management Committee (the
"EMC") comprised of six individuals. Medeva and Anthra shall each appoint three
members of the EMC. Each member of the EMC shall be an employee or member of the
Board of Directors of the party that appointed such member, or an Affiliate
thereof. Initial appointments shall be made within fourteen (14) days of the
date of this Agreement. A member of the EMC may be removed at any time, with or
without cause, by the party that originally appointed such member. A member of
the EMC shall serve until a successor is named by the party that appointed
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such member.
8.2 Authority of the EMC. Without limitation of the other provisions
hereof, the EMC shall (a) monitor and review the progress of the Development
Activities conducted by Anthra pursuant to this Agreement, (b) monitor and
review the progress of all Product Marketing and sales activities conducted by
Medeva and Anthra pursuant to this Agreement, (c) determine the level of
inventory of AD 32 to be maintained by Anthra pursuant to Section 3.2, (d)
determine whether Anthra may file an NDA prior to the expiration of the
sixty-day period after Anthra provides Medeva with a copy of the CMC section
thereof pursuant to Section 2.6, (e) determine whether, upon the written request
of Anthra, AD 32 purchased pursuant to Section 3.2(a) may be released from
Inventory upon repayment by Anthra to Medeva of the relevant Advance(s) pursuant
to Section 3.2(c), and (f) take such other actions as the parties may mutually
agree, except that the EMC may not take any action that would conflict with any
provision of this Agreement. Except as set forth in clause (c) of the preceding
sentence, it is not intended that the EMC have any power or authority to direct
the conduct of the affairs or the decision-making of either party hereto. Each
party to this Agreement shall retain the rights, powers, and discretion granted
to it under this Agreement, and no such rights, powers, or discretion shall be
delegated to or vested in the
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EMC unless such delegation or vesting of rights is expressly agreed to by the
parties in writing. The EMC shall not have the power to amend or modify this
Agreement, which may only be amended or modified as provided in Section 16.12.
8.3 Procedural Rules of the EMC.
(a) The EMC shall adopt such standing rules as shall be
necessary for its work.
(b) A quorum of the EMC shall consist of two members, provided
that at least one member appointed by each party is present. Members of the EMC
may attend a meeting either in person or by telephone conference call.
Representation by proxy shall not be allowed.
(c) The EMC may take action (1) by agreement of all the
members present at a meeting at which a quorum exists, or (2) by written
resolutions approved in writing by all of the members.
(d) The EMC shall have a chairperson and a secretary. The
first chairperson shall be a member of the EMC designated by Anthra. Each
chairperson shall serve a one-year term, and the office shall alternate between
a member appointed by Anthra and a member appointed by Medeva. The first
secretary shall be a member of the EMC designated by Medeva. Each secretary
shall serve a one-year term, and the office shall alternate between a member
appointed by Medeva and a member appointed by Anthra.
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(e) The EMC shall meet quarterly or more or less frequently as
mutually agreed upon by the members, at times and places to be mutually agreed
upon. Thirty (30) calendar days' prior written notice of any such meeting shall
be provided to the members, unless such notice is waived in writing by the
members.
ARTICLE IX
REPORTING
9.1 Reporting by Parties. The parties hereto shall use their
commercially reasonable efforts to keep each other informed of their activities
pursuant to this Agreement, including without limitation material developments
relating to the performance of their respective obligations under this
Agreement.
9.2 Record Keeping.
(a) Medeva shall, and shall cause its Affiliates and
Sublicensees to, keep complete and accurate books and records pertaining to the
sale and use of the Product, including the names and addresses and purchase
order details for each customer to which it sells the Product. Such books and
records shall be retained for at least one (1) year after the calendar year to
which they relate, or for such longer period if and as required by applicable
law.
(b) Anthra shall keep complete and accurate books and records
pertaining to Development Activities, to its
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purchases of AD 32 and the Product, to any co-promotion activities it shall
perform hereunder, and to any payments to Anthra in connection with the Product
Know-how, including but not limited to royalty payments. Such books and records
shall be retained for at least one (1) year after the calendar year to which
they relate, or for such longer period if and as required by Section 3.13 or
applicable law.
9.3 Audit of Records. At the request of either party, the other
party shall, and shall cause its Affiliates (and, in the case of Medeva, its
Sublicensees, and in the case of Anthra, the Contract Manufacturers, where
permitted by the relevant Contract Manufacturing Agreement (which provision
Anthra shall use commercially reasonable efforts to negotiate on behalf of
Medeva)) to, permit the requesting party and its representatives, at reasonable
times and upon reasonable notice, to examine and audit the books and records
maintained by such other party pursuant to this Article IX or Section 3.13;
provided, however, should Anthra wish to audit Medeva's reported Net Sales,
Anthra shall have the right to nominate a firm of independent certified public
accountants reasonably acceptable to Medeva to have access to the records of
Medeva during reasonable business hours for the purpose of verifying, at
Anthra's expense, Medeva's reported Net Sales of the Products. If the audit
shall establish inaccuracies in Anthra's favor of at least ten percent (10%)
from the Net
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Sales reported by Medeva, then the cost of such audit shall be reimbursed to
Anthra by Medeva. If the audit establishes that either party underpaid or
overpaid the other party any amount, the appropriate party shall promptly pay
the other the full amount of such underpayment or overpayment.
ARTICLE X
ADVERSE EVENT AND OTHER INFORMATION EXCHANGE
10.1 Notification. From and after the date of receipt by Anthra of
notice of approval of the NDA for the Product for any indication, and receipt by
Medeva of notice from Anthra of such approval, each party shall (i) provide
prompt written notice to the other party of information in or coming into its
possession or control concerning side effects, injury, toxicity or sensitivity
reaction ("Adverse Events") associated with commercial and clinical uses,
studies, investigations or tests of the Product (animal or human), whether or
not determined to be attributable to the Product, and whether arising out of
clinical studies or Marketing and sale of the Product, (ii) notify the other
party's responsible drug safety department by telephone and facsimile within
twenty-four (24) hours after such party first becomes aware of any Adverse Event
that gives cause for concern or is unexpected or that is fatal, life-threatening
(as it occurred), permanently disabling, requires (or prolongs) in-patient
hospitalization, represents a significant hazard, or
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is a cancer or a congenital anomaly or represents an overdose, or any other
circumstance that might necessitate a recall, expedited notification of the FDA
or any other relevant regulatory authorities or a significant change in the
label of the Product, including without limitation any deviation from the
specified environmental conditions for shipping or storage of Product, and (iii)
exchange information semi-annually in writing concerning other complaints, other
Adverse Events regarding the Product, and other deviations from specified
environmental conditions for shipping or storage of Product. Each party shall
make such reports as are necessary to comply with laws and regulations
applicable to it, at its sole expense.
10.2 Material Communications. Without limitation of any other
provision hereof (including Section 4.6), each party shall, within five (5)
business days, provide notice to the other party of any material communications
with any governmental agency concerning the Product in connection with any
indication for which an NDA has been filed for the Product in the Territory,
including, without limitation, Adverse Event reports and safety reports. Copies
of all such material communications shall be attached to the notice sent
pursuant to this Section 10.2. Notwithstanding the foregoing, in the event of a
communication or directive from a regulatory authority commencing or threatening
seizure of Product or
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other removal from the market of an approved Product, the party receiving such
information shall transmit such information to the other party within
twenty-four (24) hours.
ARTICLE XI
PRODUCT RECALL
11.1 Notification and Recall. In the event that any governmental
agency or authority issues or requests a recall or takes similar action in
connection with the Product, or in the event either party determines that an
event, incident or circumstance has occurred which may result in the need for a
recall or market withdrawal, the party notified of or wishing to call such
recall or similar action shall, within twenty-four (24) hours, advise the other
party thereof by telephone or facsimile, after which the parties shall promptly
discuss and work together to effect an appropriate course of action; provided,
however, that either party may initiate a recall or market withdrawal thereafter
if it deems such action necessary or appropriate. Notification to the FDA and
compliance with applicable law in conducting such recall shall be the
responsibility of Anthra.
11.2 Recall Expenses. Each of the parties hereto shall bear the full
expenses of both parties incurred in any recall resulting from breach of its
respective warranties or obligations hereunder. Such expenses of recall shall
include, without limitation, the expenses of notification and
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destruction or return of the recalled Product and the sum paid for the recalled
Product. Without limitation of the foregoing, if the failure to meet applicable
legal requirements is caused by the act or omission of Anthra, Anthra shall
further reimburse Medeva for (a) any amounts paid to Anthra by Medeva under this
Agreement (but excluding the development fees and license fees set forth in
Sections 7.1 and 7.2) for recalled Products and for all Products that cannot be
shipped by Medeva due to the condition requiring the recall and (b) all
liabilities incurred by Medeva by virtue of being unable to meet its supply
obligations to its customers because Products could not be timely shipped by
Anthra or Medeva due to the condition requiring recall. In the event, however,
that a recall is partially caused by Anthra's actions or omissions and partially
caused by Medeva's actions or omissions, then each party shall be responsible
for its proportionate share of the recall expenses based on its proportionate
share of causation.
ARTICLE XII
INTELLECTUAL PROPERTY RIGHTS
12.1 Ownership of Product Know-how. Anthra shall have the sole right
to file for, obtain, maintain, register and extend patent protection for the
Product Know-how, and to control the prosecution of applications therefor. If,
after a written request from Medeva, Anthra decides not to file for,
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obtain, maintain, register or extend patent protection for the Product Know-how
in the Territory, Medeva shall have the right, at its own expense, to take any
such action in the name of Anthra. For the avoidance of doubt, nothing in this
Section 12.1 shall be construed to require Medeva to assign to Anthra the rights
to any Improvements to AD 32, the Product or the Product Know-how that Medeva
may develop; provided, however, that if, during the term of this Agreement,
Medeva or any of its Affiliates or Sublicensees develops any such Improvements,
Medeva shall so notify Anthra and shall grant, or shall cause such Affiliate or
Sublicensee, as the case may be, to grant to Anthra (i) a royalty-free,
perpetual, non-exclusive license to use such Improvements in the Territory in
connection with the exercise of any co-promotion rights Anthra may have pursuant
to Section 6.8, and (ii) a royalty-bearing license to use such Improvements
elsewhere, and in the Territory for other purposes, on such terms and
conditions, if any, as the parties may mutually agree. Further, if during the
term of this Agreement, Anthra or any of its Affiliates develops any
Improvements to the Product or the Product Know-how, Anthra shall so notify
Medeva and shall grant, or shall cause such Affiliate to grant, to Medeva a
royalty-bearing license to use such Improvements in the Territory, on such terms
and conditions, if any, as the parties may mutually agree; provided, however,
that such license shall be royalty-
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free to the extent that such Improvement shall consist of a change in Product
Specifications made by Anthra pursuant to Section 4.1 in order to comply with
GMP's, applicable laws, regulations or guidelines.
12.2 Ownership of Filings and Approvals. Subject to the rights
granted to Medeva hereunder, Anthra shall own all rights, title and interest in
(a) all NDAs and other submissions by Anthra to governmental authorities made
pursuant to this Agreement, and (b) all approvals made or granted with respect
to the Product in the Territory.
12.3 Ownership of Data. Subject to the rights granted to Medeva
hereunder, Anthra shall own all rights, title and interest to the preclinical
and clinical data arising out of the Development Activities.
12.4 Enforcement of Intellectual Property Rights.
(a) The parties shall promptly report in writing to each other
any known or suspected activity of any kind that may constitute an infringement,
violation, unauthorized use or misappropriation of the Product Know-how in the
Territory. Within sixty (60) days after Anthra becomes, or is made, aware of any
of the foregoing, it shall decide whether or not to initiate an infringement or
other appropriate action or suit and shall advise Medeva of its decision in
writing. Failure to so notify Medeva within such sixty (60) day period shall be
deemed a decision not to
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initiate an infringement or other appropriate suit.
(b) Provided that Anthra shall have advised Medeva of its
decision to file suit within the sixty (60) day period provided in Section
12.4(a), Anthra shall have the right to institute proceedings to prevent any
such infringement, violation, unauthorized use or misappropriation or to take
all actions to defend against, and subject to the last sentence of Section
12.4(c), settle or compromise any such action or suit. Anthra shall keep Medeva
promptly informed of, and shall from time to time consult with Medeva regarding,
the status of any such suit and shall provide Medeva with copies of all
documents filed in, and all written communications relating to, such suit.
(c) Anthra shall select counsel for any suit referred to in
Section 12.4(b) and shall pay all expenses of the suit, including, without
limitation, attorneys' fees and expenses and court costs. Any damages,
settlement fees or other consideration for infringement received as a result of
such litigation shall be allocated first to reimburse Anthra for any costs and
expenses incurred in connection with such litigation and thereafter shared by
Anthra and Medeva, with Anthra receiving that proportion which corresponds to
its royalty percentage then in effect, and Medeva receiving the balance. Medeva
shall cooperate reasonably with Anthra in prosecuting such action, defending
against such action, claim
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or dispute, or otherwise asserting its rights against third parties at Anthra's
request and at Anthra's expense. Medeva shall also have the right to participate
and be represented in any such suit by its own counsel at its own expense.
Anthra shall not settle any such suit without Medeva's written consent if such
settlement would adversely affect Medeva's rights under this Agreement.
(d) If within sixty (60) days after receiving notice of a
continuing infringement or violation of any rights in the Product Know-how or of
any third party action, claim or dispute based upon or arising out of the rights
in the Product Know-how, Anthra fails to advise Medeva in writing of its
decision whether to commence a lawsuit directed towards restraining or enjoining
such infringement or violation or to take other diligent actions to cause the
cessation of or defend against, settle or compromise such action, claim or
dispute, or shall notify Medeva of its decision not to do so, then Medeva may
take such legal or other actions as it deems necessary or appropriate to prevent
or restrain such infringement or violation or to defend against, settle or
compromise such action, claim or dispute, in which event all damages or
settlement proceeds thereunder shall be allocated first to reimburse Medeva for
any costs and expenses incurred in connection with such litigation and
thereafter shared by Anthra and Medeva, with Anthra receiving that proportion
which
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corresponds to its royalty percentage then in effect, and Medeva receiving the
balance. To the extent not recovered in the manner set forth in the preceding
sentence, Medeva may set off its reasonable costs and expenses incurred in
connection therewith against future development fees, license fees and royalty
payments due Anthra under this Agreement as such development fees, license fees
and royalty payments become due (up to a maximum total credit in any calendar
year of one-quarter of such amount). Notwithstanding the foregoing, Medeva shall
not be entitled to settle any such claim or action without Anthra's written
consent if such settlement would adversely affect Anthra's rights in the Product
Know-how. Anthra agrees to cooperate reasonably in any such legal or other
action initiated by Medeva, at Medeva's request and at Medeva's cost.
(e) This subsection (e) shall apply only with respect to
infringement of the Trademarks and to the Other Trademarks. Anthra agrees to
give Medeva prompt written notice of any unlicensed use by third parties of
which Anthra has knowledge, throughout the world with respect to Other
Trademarks, and throughout the Territory with respect to the Trademarks, and
further agrees not, without Medeva's prior written consent, to bring or cause to
be brought any criminal prosecution, lawsuit or administrative action for
infringement, interference with or violation of any rights
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occurring anywhere in the world with respect to the Other Trademarks and
occurring in the Territory with respect to the Trademarks. Anthra agrees to
cooperate with Medeva, and if necessary, to be named by Medeva as a sole
complainant or co-complainant in any action against an infringer of the
Trademarks or Other Trademarks, and, notwithstanding any right of Anthra to
recover same, legal or otherwise, Anthra agrees to pay to Medeva, and hereby
waives all claims to, all damages or other monetary relief recovered in such
action by reason of a judgment or settlement whether or not such damages or
other monetary relief, or any part thereof, represent or are intended to
represent injury sustained by Anthra. In any such action against an infringer,
Medeva agrees to reimburse Anthra for all costs and expenses incurred at
Medeva's request, including attorneys' fees and expenses if Medeva has requested
Anthra to retain counsel.
12.5 Offset for Infringement. If Medeva is required, at any time
during the term of this Agreement, to pay any royalty or damages to any person
or entity as a result of a judgment, settlement or agreement relating to the
past and/or future sale of the Product in the Territory ("Third Party
Payments"), except insofar as such Third Party Payments are attributable to the
willful misconduct, negligence, or breach of this Agreement by Medeva, its
Affiliates or Sublicensees, then Medeva may offset the amount of such Third
Party Payments
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actually paid by Medeva against future development fees, license fees and
royalty payments due Anthra under this Agreement as such development fees,
license fees and royalty payments become due (up to a maximum total credit in
any calendar year of one-quarter of such amount). Should such future development
fees, license fees and royalty payments prove insufficient to cover all Third
Party Payments (as determined at the end of any calendar year during the term
hereof), Medeva may assert such further rights as it may have under Article XIV
in respect of the shortfall.
ARTICLE XIII
CONFIDENTIALITY
13.1 Confidential Information. Except to the extent permitted by
this Agreement or as otherwise agreed by the parties in writing, the parties
agree that, at all times during the term of this Agreement and for a five (5)
year period following termination or expiration hereof, the party receiving
information (the "Receiving Party") shall keep completely confidential, shall
not publish or otherwise disclose and, except as permitted hereby, shall not use
directly or indirectly for any purpose any Confidential Information (as defined
in Section 13.2) furnished to it by the other party (the "Disclosing Party")
pursuant to this Agreement or otherwise relating to any transaction contemplated
hereby, including information heretofore
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furnished to it.
13.2 Certain Definitions. For purposes of this Article XIII,
"Confidential Information" means any and all non-public, proprietary or
confidential information and data (including all documents, reports, analyses,
compilations, studies and data bases containing such information or data) of
either party hereto or its Affiliates, whether disclosed by such party to the
other prior to or after the date hereof. Confidential Information shall also
include information which is designated as confidential in writing by the
Disclosing Party, whether by letter or by the use of an appropriate stamp or
legend, prior to or at the time any such information is disclosed by the
Disclosing Party to the Receiving Party; provided further that information which
is orally or visually disclosed, or is disclosed in writing without an
appropriate letter, stamp, or legend, shall constitute Confidential Information
if the Disclosing Party, within thirty (30) days after such disclosure, delivers
to the Receiving Party a written document or documents describing the
information and referencing the place and date of such oral, visual, or written
disclosure and the names of the persons to whom such disclosure was made.
Notwithstanding anything to the contrary in this Agreement, Confidential
Information shall not include information which the Receiving Party can
establish by competent proof,
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(a) became publicly known other than through a breach of this
Agreement by the Receiving Party, its Affiliates, or their officers, employees,
agents or consultants; or
(b) was in the possession of the Receiving Party, without
obligation of confidentiality prior to the disclosure thereof, or is
subsequently disclosed to the Receiving Party by a third party who did not
receive it under any obligation of confidentiality; or
(c) was independently developed by the Receiving Party prior
to disclosure. Confidential Information shall belong to and remain the property
of the Disclosing Party.
13.3 Disclosure of Confidential Information -- Internal. The
Receiving Party shall disclose Confidential Information only to such of the
Receiving Party's or its Affiliates' or Sublicensees' officers, employees,
agents or consultants as is necessary to carry out the purposes of this
Agreement. Each party shall ensure that its, and its Affiliates' and
Sublicensees' officers, employees, agents and consultants are bound by, and take
reasonable efforts to ensure compliance with, the confidentiality terms hereof.
13.4 Disclosure of Confidential Information -- Third Parties. The
Receiving Party may disclose Confidential Information to the extent that such
disclosure is reasonably
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necessary in filing or prosecuting patent applications, pursuing or defending
litigation, or complying with applicable governmental regulations, provided that
if the Receiving Party intends to make any such disclosure, it shall give
reasonable advance written notice to the Disclosing Party of such intention.
Notwithstanding the foregoing, in the event the Receiving Party or anyone to
whom it has transmitted Confidential Information pursuant to this Agreement
becomes legally required to disclose any of the Confidential Information, the
Receiving Party shall provide the Disclosing Party with prompt notice so that it
may seek a protective order or other appropriate remedy and/or waive compliance
with the provisions of this Agreement. In the event that such protective order
or other remedy is not obtained or that compliance with the provisions of this
Agreement is waived by the Disclosing Party, the Receiving Party shall furnish
only that portion of the Confidential Information which is legally required and
shall exercise its reasonable efforts to obtain reliable assurance that
confidential treatment will be accorded the information required to be
disclosed.
Furthermore, nothing in this Article XIII shall be construed to
preclude either party from disclosing such information to such third parties as
may be necessary in connection with the development and commercialization of the
Product as contemplated by this Agreement, including, without
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limitation, subcontracting and sublicensing transactions in connection
therewith, provided that the Receiving Party shall in each case obtain from the
proposed third party recipient a written confidentiality undertaking containing
confidentiality obligations no less onerous than those set forth in this Article
XIII. Notwithstanding anything in this Article XIII to the contrary, Medeva
shall have the right, subject to Section 6.5, to disclose preclinical and
clinical data and results relating to the Product to qualified medical
professionals for the limited purposes of Marketing the Product and conducting
medical education initiatives reasonably designed to increase Net Sales in the
Territory.
13.5 Care and Return of Confidential Information. The Receiving
Party shall keep Confidential Information belonging to the Disclosing Party in
appropriately secure locations. Upon the expiration or termination of this
Agreement, subject to Section 15.7 and 15.8, any and all Confidential
Information possessed in tangible form by a Receiving Party, its Affiliates or
Sublicensees, or its or any of their officers, employees, agents or consultants
and belonging to the Disclosing Party, shall, upon written request, be
immediately returned to the Disclosing Party (or destroyed if so requested) and
not retained by the Receiving Party, its Affiliates or Sublicensees, or any of
their officers, employees, agents or consultants, provided however
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that the Receiving Party required to return Confidential Information may keep a
copy thereof for archival purposes but only in one restricted, secure area, and
provided, further however, that any Confidential Information required to be kept
and retained with respect to FDA rules, regulations and procedures shall be
retained, stored and disposed of according to such FDA rules, regulations and
procedures.
13.6 Use of Names. Except as required for Product labelling, neither
party to this Agreement shall use the name of the other in any public
announcement, press release or other public document without the written consent
of such other party.
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ARTICLE XIV
WARRANTIES; INDEMNITIES
14.1 Representations and Warranties. Each party represents and
warrants to the other party as follows: (i) it has full corporate power and
authority and has taken all corporate action necessary to enter into and perform
this Agreement; (ii) the execution and performance by it of its obligations
hereunder will not constitute a breach of, or conflict with, any agreement or
arrangement, including without limitation its certificate of incorporation or
by-laws, whether written or oral, by which it is bound; and (iii) this Agreement
is its legal, valid and binding obligation, enforceable in accordance with the
terms and conditions hereof.
14.2 Warranties of Anthra. Anthra represents and warrants to Medeva,
in addition to the warranties set forth in Section 3.10, that: (i) the
execution, delivery and performance by Anthra of this Agreement does not
contravene or constitute any default under its certificate of incorporation or
by-laws, any applicable law or regulation or any judgment, injunction, order or
decree binding upon Anthra or to which AD 32 or the Product is subject or any
indenture, bank loan, credit or other agreement binding upon Anthra or to which
AD 32 or the Product is subject, (ii) Anthra has the right, power and authority
to grant the license set forth in Section 5.1, (iii) Anthra has conducted or has
caused its contractors
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or consultants to conduct, and will in the future conduct, the preclinical and
clinical studies of the Product in accordance with known or published standards
of the FDA, (iv) Anthra has employed and will in the future employ individuals
of appropriate education, knowledge, and experience to conduct or oversee the
conduct of the clinical and preclinical studies of the Product, (v) Anthra and
its Contract Manufacturer(s) are and will remain in compliance with all laws,
regulations, ordinances, orders, injunctions, decrees and requirements
applicable to the manufacture, supply and sale of the Product, and Anthra will
maintain in effect all governmental permits, licenses, orders, applications and
approvals necessary to manufacture, supply and sell the Product and will
manufacture and supply all Product in accordance with the same; (vi) all
labelling for Product supplied by Anthra hereunder will comply with the
applicable NDA and all applicable requirements of the FDA; (vii) Anthra
maintains and shall maintain throughout the term of this Agreement a work force
suitably qualified and trained, and facilities and equipment sufficient, to
enable Anthra to perform its obligations hereunder; (viii) to the best knowledge
of Anthra, there are not now nor have there been over the last five years any
lawsuits, arbitrations, legal or administrative or regulatory proceedings,
charges, complaints or investigations by the FDA, DEA, Department of Justice,
any state regulatory agency or any other person or
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entity threatened, commenced or pending against Anthra, or any other person,
relating to AD 32; (ix) the exercise by Medeva of its rights under the licenses
granted in Article V will not infringe any rights owned by any other person and
there is no pending or, to the best of Anthra's knowledge, threatened claim,
litigation or legal proceeding against Anthra contesting the right of Anthra to
distribute, sell or use AD 32 in the Territory; (x) Anthra will terminate any
license agreement that it may enter into with any licensee, for breach by such
licensee of the covenant included in such license agreement pursuant to Section
5.3; (xi) Anthra owns or has the sole right to use in the Territory all rights
in and to the Product Know-how (including without limitation the Anthra Patent
Rights), free and clear of any lien, claim, charge, encumbrance or rights of
third parties; (xii) Anthra has filed a request (the "Request") for designation
of AD 32 as an orphan drug product for the CIS Indication under the Orphan Drug
Act (Pub.L. 97-414) and the Orphan Drug Amendments of 1985 (Pub.L. 99-91)
(collectively, the "Orphan Drug Laws"), as partially codified pursuant to 21
U.S.C. ▇▇.▇▇. 360bb et seq.; (xiii) to the best knowledge of Anthra, the CIS
Indication afflicts less than 200,000 United States citizens; (xiv) in the event
that the FDA grants the CIS Approval, AD 32 will be designated as an orphan drug
product under the Orphan Drug Laws and will enjoy a marketing exclusivity period
through the
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seventh anniversary of the CIS Approval (or such other period as may be provided
by the Orphan Drug Laws from time to time) for the Product for the CIS
Indication; (xv) prior to and during any such marketing exclusivity period,
Anthra agrees not to give its consent pursuant to 21 U.S.C. ss. 360cc (or
pursuant to any other statute or regulation) for the approval of other NDA's,
the issuance of other certifications or the issuance of other licenses (except
to Medeva or Medeva's Affiliates) for use of AD 32 in the Territory for
pharmaceutical use in humans, without the prior written consent of Medeva, which
consent shall not be unreasonably withheld; (xvi) Anthra will provide copies of
any notices received from the FDA in connection with AD 32 as an orphan drug
product, and if the FDA finds that Anthra is unable to assure availability of
sufficient quantities of AD 32 for the approved indications and provides Anthra
with a notice to such effect, then Anthra will promptly forward to Medeva a copy
of such notice and will respond to the FDA after allowing Medeva a reasonable
period (determined in light of the circumstances) to comment to Anthra on such
notice; (xvii) prior to payment of applicable taxes, Anthra will provide Medeva
with written notice of the amount of any tax credit to which Anthra is entitled
by virtue of AD 32's status as an orphan drug (as set forth in 26 U.S.C. ss.
45C); and (xvii) ***. EXCEPT AS SET FORTH IN THE PRECEDING SENTENCE AND IN
SECTION 3.10, ANTHRA
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HEREBY DISCLAIMS ANY AND ALL WARRANTIES WITH RESPECT TO THE PRODUCT KNOW-HOW, AD
32 OR THE PRODUCT, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
14.3 Warranties of Medeva. Medeva represents and warrants to Anthra
that (i) the execution, delivery and performance by Medeva of this Agreement
does not contravene or constitute any default under its certificate of
incorporation or by-laws, any applicable law or regulation or any judgment,
injunction, order or decree binding upon Medeva or any indenture, bank loan,
credit or other agreement binding upon Medeva; (ii) Medeva is and will remain in
compliance with all laws, regulations, ordinances, orders, injunctions, decrees
and requirements applicable to the Marketing and sale of the Product, and,
except as otherwise provided in this Agreement, Medeva will maintain in effect
all governmental permits, licenses, orders, applications and approvals necessary
to Market and sell the Product and will Market and sell the Product in
accordance with the same; and (iii) Medeva maintains and will maintain
throughout the term of this Agreement a work force suitably qualified and
trained, and facilities and equipment sufficient, to enable Medeva to perform
its obligations hereunder.
14.4 Indemnification of Medeva. Anthra shall indemnify Medeva, its
Affiliates and their respective
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directors, officers, employees and agents, and defend and save each of them
harmless, from and against any and all suits, losses, actions, demands,
investigations, claims, damages, liabilities, costs and expenses (including,
without limitation, reasonable attorneys' fees and expenses) (collectively,
"Losses") arising from or occurring as a result of (i) any breach (or alleged
breach) by Anthra of its representations, warranties, or obligations under this
Agreement, (ii) the manufacture, use, or consumption of the Product, or the
storage of the Product prior to the date of shipment thereof to Medeva, all
except to the extent caused by the negligence or willful misconduct of Medeva or
its officers, agents, employees, Affiliates, Sublicensees or customers, or (iii)
the negligence or willful misconduct of Anthra or its officers, agents,
employees or Affiliates.
14.5 Indemnification of Anthra. Medeva shall indemnify Anthra, its
Affiliates and their respective directors, officers, employees and agents, and
defend and save each of them harmless, from and against any and all Losses
arising from or occurring as a result of (i) any breach (or alleged breach) by
Medeva of its representations, warranties, or obligations under this Agreement,
(ii) the storage or distribution of the Product after the date of shipment
thereof to Medeva, all except to the extent caused by the negligence or willful
misconduct of Anthra or its officers, agents,
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employees, or Affiliates, or (iii) the negligence or willful misconduct of
Medeva or its officers, agents, employees, Affiliates, Sublicensees or
customers.
14.6 Indemnification Procedure.
(a) Each indemnified party (the "indemnitee") agrees to give
the indemnifying party (the "indemnitor") prompt written notice of any Losses or
discovery of fact upon which such indemnified party intends to base a request
for indemnification under Section 14.4 or 14.5. Notwithstanding the foregoing,
the failure to give timely notice to the indemnitor shall not release the
indemnitor from any liability to the indemnitee to the extent the indemnitor is
not prejudiced thereby.
(b) The indemnitee shall furnish promptly to the indemnitor
copies of all papers and official documents in the indemnitee's possession or
control which relate to any Losses; provided, however, that if the indemnitee
defends or participates in the defense of any Losses, then the indemnitor shall
also provide such papers and documents to the indemnitee. The indemnitee shall
cooperate with the indemnitor in providing witnesses and records necessary in
the defense against any Losses.
(c) The indemnitor shall have the right, by prompt notice to
the indemnitee, to participate in the defense of any third party claim forming
the basis of such Losses with
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counsel reasonably satisfactory to the indemnitee, and at the sole cost of the
indemnitor so long as (i) the indemnitor shall promptly notify the indemnitee in
writing (but in no event more than 60 days after its receipt of notice of the
claim) that it will indemnify the indemnitee from and against any Losses the
indemnitee may suffer arising out of the claim and (ii) the indemnitor
diligently participates the defense of the claim.
(d) If the indemnitor participates in the defense of the claim
as provided above the indemnitee may at its option relinquish total control to
the indemnitor or participate in such joint defense with its own counsel who
shall be retained, at the indemnitee's sole cost and expense; provided, however,
that neither the indemnitee nor the indemnitor shall consent to the entry of any
judgment or enter into any settlement with respect to the claim without the
prior written consent of the other party, which consent shall not be
unreasonably withheld or delayed. If the indemnitee withholds consent in respect
of a judgment or settlement involving only the payment of money and which would
not involve any stipulation or admission of liability or result in the
indemnitee becoming subject to injunctive relief or other relief, the indemnitor
shall have the right, upon notice to the indemnitee within five (5) days of
receipt of the indemnitee's written denial of consent, to pay to the
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indemnitee the full amount of such proposed judgment or settlement, including
all interest, costs or other charges relating thereto, and shall pay all
attorneys' fees incurred to such date for which the indemnitor is obligated
under this Agreement, if any, at which time the indemnitor's rights and
obligations with respect to the claim shall cease.
(e) If the indemnitor does not so participate in the defense
of such claim, the indemnitee may conduct such defense with counsel of its
choice and at the sole cost of the indemnitor and may settle such case as it
shall determine in the exercise of its reasonable discretion.
(f) Except as provided in subsection (e) above, the indemnitor
shall not be liable for any settlement or other disposition of a Loss by the
indemnitee which is reached without the written consent of the indemnitor.
(g) Except as provided above, the costs and expenses,
including fees and disbursements of counsel, incurred by any indemnitee in
connection with any claim shall be reimbursed on a calendar quarter basis by the
indemnitor, without prejudice to the indemnitor's right to contest the
indemnitee's right to indemnification and subject to refund in the event the
indemnitor is ultimately held not to be obligated to indemnify the indemnitee.
14.7 Limitation of Liability. Except as provided in Section 3.8
hereof, Anthra shall not be liable to Medeva for
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any special, incidental, or consequential damages arising out of or related to
any failure by Anthra to supply Product to Medeva pursuant to Article III.
ARTICLE XV
TERM AND TERMINATION
15.1 Term. The term of this Agreement shall commence as of the date
hereof and, unless earlier terminated pursuant to this Article XV, shall expire
upon the later of (i) the last to expire of any Product orphan drug exclusivity
periods granted in the Territory, (ii) the last to expire of any patents from
time to time within the scope of the Product Know-how, and (iii) the twelfth
anniversary of the Launch.
15.2 Termination for Material Breach. This Agreement shall be
subject to termination by either party in the event of a material breach hereof
by the other party with respect to its obligations, which breach is not cured
within sixty (60) days (or, in the case of a payment default, ten (10) business
days) following written Notice thereof by the non-breaching party; provided,
however, this Agreement may be terminated by either party prior to a final
adjudication of the existence of such material breach under Section 16.5 only
(i) in the case of a payment default or (ii) for an "Established Material
Breach" (as defined in Section 15.3), if such Established Material Breach is not
cured within sixty (60) days following receipt of an "Arbitration Decision" (as
defined in Section 15.3).
15.3 Established Material Breach. In order to establish a material
breach (other than a payment default) entitling a party to terminate this
Agreement under the
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proviso to Section 15.2, the party alleging the occurrence of such material
breach (the "Requesting Party") shall submit the issue to an expedited,
non-binding arbitration (the "Material Breach Arbitration") before a mutually
agreed upon arbitrator, or in the event the parties cannot agree upon an
arbitrator, before a panel of three American Arbitration Association approved
arbitrators consisting of one arbitrator chosen by each party and one arbitrator
selected by the two party-chosen arbitrators, (one arbitrator or three
arbitrators, the "Arbitration Panel"). The Arbitration Panel will determine
whether the other party (the "Breaching Party") has committed the material
breach alleged by the Requesting Party, whether the Requesting Party had
committed a prior material breach that justified the subsequent breach by the
Breaching Party, and if the material breach alleged by the Requesting Party has
been committed, whether there is any other evidence which may excuse the
Breaching Party's material breach. An "Established Material Breach" shall mean a
determination (the "Arbitration Decision") by the Arbitration Panel that the
Breaching Party committed the alleged material breach, that the Requesting Party
did not commit a material breach sufficient to excuse the subsequent material
breach by the Breaching Party, and that no other sufficient reason exists to
excuse the breach by the Breaching Party (such sufficiency to be determined by
the Arbitration Panel in its sole discretion). The Arbitration
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Decision shall identify any ways by which the Established Material Breach may be
cured. For purposes of determining an Established Material Breach as
contemplated by Section 15.2, the Arbitration Decision shall be deemed final.
The rules of the American Arbitration Association shall govern any Material
Breach Arbitration.
15.4 Non-Binding, Non-Admissible Arbitration Decision.
Notwithstanding the procedure set forth under Section 15.3 and any resulting
outcome, the parties acknowledge and agree that an Arbitration Decision does not
constitute a binding decision on either party with respect to the existence (or
non-existence) of a breach of the Agreement, nor justify the subsequent
termination of the Agreement (or exercise of some other remedy). Either party
may contest the other party's actions following an Arbitration Decision by
commencing a court action pursuant to Section 16.5. The parties further
acknowledge and agree that the Arbitration Decision, the findings by the
Arbitration Panel and any testimony from the Arbitration Panel (or testimony
from any person or entity appearing before the Arbitration Panel to the extent
that such testimony relates specifically to the Arbitration Decision) shall not
be admissible either as res judicata (or collateral estoppel) or as evidence in
any court proceedings of any nature whatsoever, including without limitation
proceedings related to equitable remedies or
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damages; provided further that the fact that an Arbitration Decision was
rendered shall not be given any weight by any fact finder, judge or jury.
15.5 Termination for Other Events. Either party may terminate this
Agreement if, at any time, the other party shall file in any court or agency
pursuant to any statute or regulation of any state or country, a petition in
bankruptcy or insolvency or for reorganization or for an arrangement or for the
appointment of a receiver or trustee of that party or of its assets, or if the
other party shall be served with an involuntary petition against it, filed in
any insolvency proceeding, and such petition shall not be dismissed within sixty
(60) days after the filing thereof, or if the other party shall propose or be a
party to any dissolution or liquidation, or if the other party shall make an
assignment for the benefit of its creditors.
15.6 Partial Termination by Medeva. Medeva may terminate this
Agreement with respect to any indications for the Product pursuant to Section
2.12, by written notice to Anthra.
15.7 Effect of Expiration or Termination. The expiration or
termination of this Agreement shall be without prejudice to any rights or
obligations of the parties that may have accrued prior to such expiration or
termination. Termination of this Agreement in accordance with the
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provisions hereof shall not limit remedies which may otherwise be available in
law or equity. Medeva agrees to cooperate with Anthra in transferring to Anthra
or a third party, as Anthra may direct, within thirty (30) days of the
expiration or termination hereof, all data, files and other materials in the
possession or under the control of Medeva, relating to the Product, except to
the extent that Medeva requires such data, files and materials for the purpose
of exercising any rights under this Agreement that may survive such termination
or expiration, in which case Medeva shall provide copies thereof to Anthra or
such third party.
15.8 Survival of Rights and Obligations. The rights and obligations
of the parties under Sections 2.2 and 2.3 (only in the event that the Purchase
Option is not exercised), 2.4, 3.2(c), 3.13, 4.2, 6.7, 7.6, 9.2 and 9.3,
Articles X and XI (with respect to Product supplied by Anthra to Medeva),
Section 12.1, Article XIII, Sections 14.4, 14.5, 14.6, 15.7, 15.8, 16.2, 16.5,
16.6 and 16.7, shall survive the expiration or termination of this Agreement.
In the event of the termination of this Agreement by Medeva pursuant
to Sections 15.2 or 15.5 after the approval of the NDA for the Product for one
or more indications, the license granted to Medeva in Section 5.1 with respect
to such indications, and the royalty obligations of Medeva under Section 7.3,
shall remain in full force and effect through the
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twelfth anniversary of the Launch; provided, however, that Medeva may set off
against any such royalty payment obligations any damages that Medeva may have
incurred, in the case of a termination pursuant to Section 15.2, as a result of
the material breach by Anthra. In the event of the termination of this Agreement
by Anthra pursuant to this Article XV, no license granted to Medeva in Section
5.1 shall survive such termination.
In the event of termination of this Agreement by Anthra pursuant to
Section 15.2 or 15.5, Medeva shall promptly, but not later than thirty (30) days
after such termination, at its own expense assign and transfer, or cause to be
assigned and transferred, to Anthra, or any third party designated by Anthra,
any Trademarks then or previously used by Medeva or any of its Affiliates or
Sublicensees in Marketing, distributing or selling the Product in the Territory.
ARTICLE XVI
GENERAL PROVISIONS
16.1 Force Majeure. If a party's performance of this Agreement or of
any obligation hereunder, except for the payment of any amounts hereunder, is
prevented, restricted or interfered with by reason of any cause beyond the
reasonable control of the affected party, such party, upon prompt written Notice
to the other party, shall be excused from such
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performance to such extent, provided that the party so affected shall use its
best efforts to avoid or remove such causes of nonperformance and shall continue
performance hereunder with the utmost dispatch whenever such causes are removed.
16.2 Notice. All notices, requests, reports, statements and other
communications to either party (each a "Notice") shall be in writing, in the
English language, shall refer specifically to this Agreement and shall be hand
delivered or sent by express courier service, carriage costs prepaid, or mailed
by certified first class mail, postage prepaid and return receipt requested, or
sent by facsimile or other agreed method of written electronic communication to
the respective addresses specified below (or to such other address as may be
specified by Notice to the other party):
If to Anthra:
Anthra Pharmaceuticals, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ ▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
If to Medeva:
Medeva California Inc.
c/o Medeva Legal Group
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Any Notice delivered by facsimile or similar means
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shall be confirmed by a hard copy delivered as soon as practicable. The
effective date of any Notice shall be: (a) the date of the addressee's receipt,
if delivered by hand or express courier; (b) five (5) days after being mailed,
as evidenced by the postmark at the point of mailing, if mailed; (c) the date of
transmission if received by 5:00 p.m. local time on a business day or, if not,
the first business day after such date, if sent by facsimile or other similar
means.
16.3 Further Assurances. Each party shall duly execute and deliver,
or cause to be duly executed and delivered, such further instruments and do and
cause to be done such further acts and things, including, without limitation,
the filing of such assignments, agreements, documents and instruments, as may be
necessary or as the other party may reasonably request in connection with this
Agreement or to carry out more effectively the provisions and purposes hereof,
or to better assure and confirm unto such other party its rights and remedies
under, this Agreement.
16.4 Successors and Assigns. The terms and provisions hereof shall
inure to the benefit of, and be binding upon, Anthra, Medeva and their
respective successors and permitted assigns. Except as expressly provided
herein, neither party may, without the prior written consent of the other party,
assign or otherwise transfer any of its rights and interests, or delegate any of
its obligations, hereunder;
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provided, however, that either party may assign its rights and delegate its
duties hereunder to an Affiliate thereof without obtaining such consent,
provided that the assigning party agrees to remain primarily (and not
secondarily or derivatively) liable for the full and timely performance by such
Affiliate of all its obligations hereunder. In the event of any such transfer or
designation under this Section, the transferee or designated Affiliate must
first assume in writing and agree to be bound by the provisions of this
Agreement. Any attempt to assign or delegate any portion of this Agreement in
violation of this Section 16.4 shall be null and void.
16.5 Governing Law. This Agreement shall be governed by, construed,
and enforced in accordance with the laws of the State of New York, without
regard to the principles of conflicts of law. Each party agrees that any action
to enforce any provision of the Agreement may be commenced in a state or federal
court located in the City of New York, New York. Each party consents to the
jurisdiction and venue of any such court. The parties further acknowledge that
proper service of process on a party may be made on an agent designated by such
party located in the City of New York, New York or by certified mail.
16.6 Attorney's Fees. Without limitation of Article XIV, in the
event that either party hereto shall bring an
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action to enforce any provision of this Agreement, the prevailing party shall be
entitled to collect its reasonable attorneys' fees and out-of-pocket costs
incurred in connection therewith, as well as such party's actual damages and
such other amounts as shall be payable hereunder or under applicable law.
16.7 Severability. If any provision hereof, other than the
requirements to pay development fees, license fees and royalties pursuant to
Article VII and the license grants in Article V, should be held invalid, illegal
or unenforceable in any respect by any court of competent jurisdiction, then, to
the fullest extent permitted by applicable law, (a) all other provisions hereof
shall remain in full force and effect and shall be liberally construed in order
to carry out the intent of the parties as nearly as may be possible, (b) such
invalidity, illegality or unenforceability shall not affect the validity,
legality or enforceability of such provision in any other jurisdiction, and (c)
such court may substitute therefor lawful and enforceable provisions that so far
as possible result in the same economic effect, in the absence of which the
parties agree to use their best efforts to negotiate a provision, in replacement
of the provision held invalid, illegal or unenforceable, that is consistent with
applicable law and accomplishes, as nearly as possible, the original intention
of the parties with respect thereto. To the fullest
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extent permitted by applicable law, each party hereby waives any provision of
law that would render any provision hereof prohibited or unenforceable in any
respect.
16.8 Waiver. No failure on the part of any party hereto to exercise,
and no delay in exercising, any right, privilege or power hereunder shall
operate as a waiver (or continuing waiver) or relinquishment thereof; nor shall
any single or partial exercise by any party thereto of any right, privilege or
power hereunder preclude any other or further exercise thereof, or the exercise
of any other right, privilege or power.
16.9 Counterparts. This Agreement shall be executed in two
counterparts, each of which shall be deemed to be an original, and all of which,
taken together, shall constitute one and the same instrument.
16.10 Captions. The captions of this Agreement are for convenience
of reference only and in no way define, describe, extend or limit the scope or
intent of this Agreement or the intent of any provision contained in this
Agreement.
16.11 Independent Contractors. The status of the parties under this
Agreement shall be that of independent contractors. No party shall have the
right to enter into any agreements on behalf of the other party, nor shall it
represent to any person that it has any such right or
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authority. Nothing in this Agreement shall be construed as establishing a
partnership or joint venture relationship between the parties hereto.
16.12 Entire Agreement. This Agreement constitutes, on and as of the
date hereof, the entire agreement of the parties with respect to the subject
matter hereof, and all prior or contemporaneous understandings or agreements,
whether written or oral, between the parties with respect to such subject matter
are hereby superseded in their entireties. This Agreement shall not be amended
in any respect whatsoever except by a further agreement, in writing, fully
executed by each of the parties.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed and delivered as of the date first above written.
ANTHRA PHARMACEUTICALS, INC. MEDEVA CALIFORNIA INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇. ▇▇▇▇▇▇
-------------------------- --------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Name: ▇. ▇▇▇▇▇▇
Title: President Title: Controller
Medeva PLC, the ultimate parent of Medeva California Inc., hereby
unconditionally guarantees the full and prompt performance by Medeva California
Inc. of its obligations under this Agreement, including without limitation its
obligations under Article VII. Medeva PLC hereby expressly waives notice from
Anthra of Anthra's acceptance and reliance on this guarantee or of any action
taken or omitted in reliance hereon, and agrees that Anthra may enforce its
rights under this guarantee without first exhausting its remedies against Medeva
California Inc. under this Agreement. No assignment of this Agreement shall
relieve Medeva PLC of its obligations under this guarantee except as may be
expressly agreed to by Anthra in writing.
MEDEVA PLC
By: /s/ Gwatts
--------------------------
Name: Gwatts
Title: Finance Director
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