RESEARCH, DEVELOPMENT AND
COMMERCIALIZATION AGREEMENT/1/
by and among
ELAN PHARMA INTERNATIONAL LIMITED
and
CAMBRIDGE ANTIBODY TECHNOLOGY LIMITED
January 24, 2001
_______________________
/1/ [***] indicates that text has been deleted which is the subject of a
confidential treatment request. This text has been filed separately with the
SEC.
TABLE OF CONTENTS
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1. DEFINITIONS...................................................... 1
2. SCOPE OF THE COLLABORATION....................................... 18
2.1 Collaboration Goals....................................... 18
2.2 Exclusive Working Relationship............................ 19
2.3 Further Exclusions........................................ 22
2.4 Safeguard Procedures...................................... 22
3. LICENSES......................................................... 23
3.1 Licenses to CAT........................................... 23
3.2 Licenses to ELAN.......................................... 24
3.3 Licensing and Sublicensing to Third Parties............... 25
3.4 No Other Rights........................................... 26
4. MANAGEMENT OF COLLABORATION...................................... 26
4.1 Joint Steering Committee.................................. 26
4.2 Project Coordinators...................................... 30
4.3 Compliance with Laws...................................... 30
5. RESEARCH AND DEVELOPMENT......................................... 30
5.1 The Research and Development Programs..................... 30
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5.2 The Research and Development Plans............................. 31
5.3 Funding of the Annual Research Plan and the Annual
Development Plan............................................... 33
5.4 Reporting and Disclosure....................................... 37
5.5 Disclosure and Cooperation..................................... 37
5.6 CAT Exclusive Antibody......................................... 38
5.7 Hybrid R&D Candidates.......................................... 40
6. MANUFACTURING AND REGULATORY MATTERS.................................. 41
6.1 Manufacture and Supply......................................... 41
6.2 Regulatory Matters............................................. 42
7. COMMERCIALIZATION OF PRODUCTS......................................... 44
7.1 Commercialization in the Territory............................. 44
7.2 Reports and Payments........................................... 49
7.3 Maintenance of Records; Audits................................. 49
7.4 Interest....................................................... 51
7.5 GAAP........................................................... 51
8. INTELLECTUAL PROPERTY................................................. 51
8.1 Ownership...................................................... 51
8.2 Joint Patent Committee......................................... 52
8.3 Prosecution and Maintenance of Patent Rights................... 52
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8.4 Trademarks ......................................................... 53
8.5 Enforcement of Jointly Owned or Controlled Patent Rights ........... 53
8.6 Enforcement of Individually Owned or Controlled Patent Rights ...... 55
8.7 Third Party Claims ................................................. 55
8.8 Third Party Licenses ............................................... 56
8.9 Patent Marking ..................................................... 57
8.10 Patent Certifications .............................................. 57
8.11 Limitation ......................................................... 57
8.12 Patent Attorneys ................................................... 58
9. CONFIDENTIALITY .......................................................... 58
9.1 Confidentiality .................................................... 58
9.2 Terms of Agreement ................................................. 58
9.3 Permitted Disclosures .............................................. 59
9.4 Publications ....................................................... 59
10. REPRESENTATIONS AND WARRANTIES ........................................... 60
10.1 Representations and Warranties of Each Party ....................... 60
10.2 Additional Representations and Warranties of CAT ................... 60
10.3 Additional Representations and Warranties of ELAN .................. 61
10.4 Representation by Legal Counsel .................................... 62
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10.5 No Inconsistent Agreements .................................... 62
10.6 Disclaimer .................................................... 62
11. GOVERNMENT APPROVALS ................................................... 63
11.1 ELAN's and CAT's Obligations .................................. 63
11.2 Additional Approvals .......................................... 63
12. TERM AND TERMINATION ................................................... 63
12.1 Term .......................................................... 63
12.2 Termination for Cause ......................................... 63
12.3 Effect of a Termination for Cause on Licenses ................. 64
12.4 Termination Pursuant to Section 12.2 .......................... 66
12.5 Provisions For Change Of Control .............................. 67
12.6 Provision for Insolvency ...................................... 67
13. WITHDRAWAL TO A ROYALTY POSITION ....................................... 70
13.1 Right to Terminate ............................................ 70
13.2 Effect of Termination for Convenience by ELAN ................. 71
13.3 Effect of Termination for Convenience by CAT .................. 73
13.4 Payments ...................................................... 75
13.5 Royalty Cost Adjustment ....................................... 78
13.6 Survival of Obligations ....................................... 78
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13.7 Net Profit ....................................................... 79
13.8 Withdrawal Royalty Stacking Provision ............................ 79
14. PRODUCT LIABILITY, INDEMNIFICATION AND INSURANCE ....................... 79
14.1 Sharing of Collaboration Product Liability Expenses .............. 79
14.2 Indemnification by CAT ........................................... 79
14.3 Indemnification by ELAN .......................................... 80
14.4 Procedure ........................................................ 81
14.5 Insurance ........................................................ 81
15. DISPUTE RESOLUTION ..................................................... 82
15.1 Disputes ......................................................... 82
15.2 Discretionary Dispute Resolution ................................. 82
15.3 Discretionary Dispute Resolution ................................. 82
15.4 Determination of Patent Disputes ................................. 82
16. ASSIGNMENTS; CHANGES OF CONTROL ........................................ 83
16.1 Assignments ...................................................... 83
17. MISCELLANEOUS .......................................................... 83
17.1 Further Actions .................................................. 83
17.2 Force Majeure .................................................... 83
17.3 Notices .......................................................... 83
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17.4 Amendment ...................................................... 84
17.5 Waiver ......................................................... 84
17.6 Severability ................................................... 84
17.7 Descriptive Headings ........................................... 85
17.8 Governing Law; Venue and Jurisdiction .......................... 85
17.9 Entire Agreement of the Parties ................................ 85
17.10 Independent Contractors ........................................ 85
17.11 Debarment ...................................................... 85
17.12 Counterparts ................................................... 86
17.13 NO CONSEQUENTIAL DAMAGES ....................................... 86
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EXHIBITS
1.10 CAT Gatekeeping Procedure
1.11 CAT In-Licenses
1.15 CAT Patent Rights
1.17 CAT Technology
1.41 ELAN Patent Rights
1.43 ELAN Technology
1.95 Specific Targets
2.2(a)(ii) Specified Antibody Companies
2.2(d)(ii) CAT Preexisting Obligations
5.2.1 Elements of Annual Research Plan
5.3.5 Third Party License Fees
10.2.6 CAT Third Party Claims
10.3.4 ELAN Third Party Claims
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RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT
THIS RESEARCH, DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (the
"Agreement") is entered into on this 24th day of January, 2001, by and
among Cambridge Antibody Technology Limited, a corporation formed under the
laws of England and Wales on behalf of itself and its Affiliates,
(collectively, "CAT"), and Elan Pharma International Limited, an Irish
Corporation having offices at WIL House, ▇▇▇▇▇▇▇ Business ▇▇▇▇, ▇▇▇▇▇▇▇,
Country Clare, Ireland, on behalf of itself and its Affiliates. CAT and
ELAN (as defined below) may each be referred to herein individually as a
"Party" and collectively as the "Parties".
BACKGROUND
1. CAT is engaged in research, discovery and development of antibodies for use
as human pharmaceutical products.
2. ELAN has expertise in research, development and commercialization of human
pharmaceutical products.
3. CAT and ELAN have agreed to collaborate, on the terms and conditions set
forth in this Agreement, on the discovery, research, development and
commercialization of antibodies for the diagnosis, treatment and/or
prevention of human diseases.
NOW, THEREFORE, in consideration of the mutual promises and covenants set
forth below and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:
1. DEFINITIONS.
1.1 "Affiliate(s)". Affiliate(s) shall mean, with respect to any person or
entity, any other person or entity which controls, is controlled by or is
under common control with such person or entity. A person or entity shall
be regarded as being in control of another entity if it owns or controls at
least fifty percent (50%) of the equity securities of the subject entity
entitled to vote in the election of directors (or, in the case of an entity
that is not a corporation, for the election of the corresponding managing
authority). Specifically excluded from the definition of "Affiliate" shall
be any Third Party subject to an Elan Acquisition or CAT Acquisition.
1.2 "Antibody". Antibody shall mean a molecule or a gene encoding a molecule
with a molecular weight greater than [***] and which comprises one or more
immunoglobu-
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lin variable domains or parts of such domains or any existing or future
fragments, variants, modifications or derivatives thereof; provided,
however, that such fragments, variants, modifications or derivatives retain
at least a functional portion of an immunoglobulin variable domain.
1.3 "BLA". BLA shall mean a Biologics License Application or similar
application filed with the FDA after completion of one or more human
clinical trials to obtain Regulatory Approval for a Collaboration Product.
1.4 "Blocking Third Party Intellectual Property". With respect to any country
in the Territory, on a country-by-country basis, Blocking Third Party
Intellectual Property shall mean valid Patent Rights in such country which
are owned or otherwise controlled by a Third Party, in the absence of a
license to which the Research and/or Development of an R&D Candidate and/or
the Manufacture and/or Commercialization of a Collaboration Product would
infringe such valid Patent Rights.
1.5 "Calendar Quarter". Calendar Quarter shall mean the respective periods of
three (3) consecutive calendar months ending on March 31, June 30,
September 30 or December 31.
1.6 "CAT Antibody Library". CAT Antibody Library shall mean the collection of
bacteriophages each of which displays an Antibody or a collection of host
cells containing such collections of bacteriophages which is Controlled by
CAT at the Effective Date. CAT Antibody Library shall include all updates,
additions and improvements to any CAT Antibody Library Controlled by CAT
during the term of this Agreement.
1.7 "CAT Collaboration Know How". CAT Collaboration Know How shall mean Know
How discovered, made or conceived solely by employees of, or others acting
on behalf of, CAT in performing its obligations under the Research Program,
the Development Program, Manufacturing or in performing any Post Approval
Research.
1.8 "CAT Collaboration Patent Rights". CAT Collaboration Patent Rights shall
mean Patent Rights which claim CAT Inventions and (i) which are made during
the term of this Agreement or (ii) which come into the Control of CAT
during the term of this Agreement.
1.9 "CAT Exclusive Antibody". CAT Exclusive Antibody shall mean any Antibody
which was identified, isolated and/or discovered as a result of Research
conducted pursuant to this Agreement and which binds to a Specific Target
in a manner defined by written criteria agreed to, from time to time, by
the JSC and which (a) within [***] after its identification, isolation or
discovery has not been designated by the JSC as an
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R&D Candidate, or (b) within [***] of its designation as an R&D Candidate
has not been selected by the JSC for Development, or (c) having been
identified on an Annual Development Plan, ceases, for a period of [***],
to be identified on any subsequent Annual Development Plan.
1.10 "CAT Gatekeeping Procedure". CAT Gatekeeping Procedure shall mean such
procedures which prevent any Target from being a Specific Target unless
and until CAT can grant to ELAN the licenses contemplated under this
Agreement in accordance with those procedures identified in Exhibit 1.10
------------
hereto.
1.11 "CAT In-License". CAT In-License shall mean any agreement between CAT and
any Third Party pursuant to which CAT Controls those CAT Patent Rights
which claim CAT Technology, R&D Candidates or Collaboration Products or
any Patent Rights which are used in the Research conducted under this
Agreement, and/or the Development, Manufacture or Commercialization of any
R&D Candidate or Collaboration Product. Annexed hereto as Exhibit 1.11 is
------------
a list of each CAT In-License and the royalty obligations thereof.
1.12 "CAT Intellectual Property". CAT Intellectual Property shall mean (a) the
CAT Know How, (b) the CAT Patent Rights, (c) the CAT Collaboration Know
How, (d) the CAT Collaboration Patent Rights and (e) CAT's interest in the
Joint Collaboration Know How, the Joint Collaboration Patent Rights, the
Patent Rights and Know How subject to Section 8.1.3, the Copyrights and
the Trademark.
1.13 "CAT Inventions". CAT Inventions shall mean all Inventions which are made
or conceived solely by CAT's employees, agents or subcontractors in the
performance of CAT's obligations under the Research Program and the
Development Program, Manufacturing or in performing any Post-Approval
Research.
1.14 "CAT Know How". CAT Know How shall mean Know How, other than CAT
Collaboration Know How, that CAT Controls as of the Effective Date or that
comes into the Control of CAT during the term of this Agreement.
1.15 "CAT Patent Rights". CAT Patent Rights shall mean Patent Rights, other
than CAT Collaboration Patent Rights, that CAT Controls as of the
Effective Date or that come into the Control of CAT during the term of
this Agreement and which claim any Invention or CAT Prior Invention. Those
CAT Patent Rights known to be existing as of the Effective Date are listed
on Exhibit 1.15 attached hereto, which Exhibit 1.15 shall be updated from
------------ ------------
time to time.
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1.16 "CAT Prior Invention". CAT Prior Invention shall mean a Prior Invention
Controlled by CAT.
1.17 "CAT Technology". CAT Technology shall mean the CAT Antibody Library and
associated technologies, including, without limitation, the assays
described in Exhibit 1.17, as amended from time to time by the JSC.
------------
1.18 "Change of Control". Change of Control shall mean any of the following:
(a) the sale or disposition of all or substantially all of the assets of a
Party to a Third Party, (b) the acquisition by a Third Party, other than
an employee benefit plan (or related trust) sponsored or maintained by a
Party or any of its Affiliates, of more than [***] of such Party's
outstanding shares of voting capital stock, or (c) the merger or
consolidation of a Party with or into another corporation, other than, in
the case of (b) or (c) of this Section, an acquisition or a merger or
consolidation of a Party in which holders of shares of such Party's voting
capital stock immediately prior to the acquisition, merger or
consolidation will have at least [***]of the ownership of voting capital
stock of the acquiring Third Party or the surviving corporation in such
merger or consolidation, as the case may be, immediately after the merger
or consolidation.
1.19 "Clinical Supplies". Clinical Supplies shall mean supplies of R&D
Candidate(s) in packaged form, Manufactured in compliance with GMP, ready
to be used for the conduct of pre-clinical and/or human clinical trials by
the Parties pursuant to the applicable Annual Development Plan.
1.20 "Collaboration Product". Collaboration Product shall mean any
pharmaceutical, diagnostic, therapeutic or medicinal agent, item, product
or formulation sold or offered for sale in the Territory and in the Field
which contains an R&D Candidate as an active ingredient and for which
Regulatory Approval has been received.
1.21 "Combination Product". Combination Product shall mean a product that
contains a Collaboration Product as active component and at least one
other active component.
1.22 "Commercialization". Commercialization shall mean any and all activities
of using, importing, marketing, promoting, distributing, offering for sale
and selling a Collaboration Product in the Field. When used as a verb,
"Commercialize" shall mean to engage in Commercialization.
1.23 "Commercially Reasonable Efforts". Commercially Reasonable Efforts shall
mean, in the conduct of the Research Program and the Development Program,
application of those scientific, technical and other efforts or resources
normally used by a Party in the conduct of discovery, research and
development of a product or compound owned by
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it or to which it has rights, which is of similar market potential at a
similar stage in its research, development or product life, taking into
account, without limitation, issues of safety and efficacy, product
profile, the proprietary position of, the applicable Specific Target,
R&D Candidate, CAT Exclusive Antibody, Non-Antibody or Product, and the
then current regulatory environment and status of the applicable R&D
Candidate, CAT Exclusive Antibody, Non-Antibody or Product, as well as
other relevant scientific factors. Without limiting the foregoing,
Commercially Reasonable Efforts as it applies to the clinical
development of any Specific Targets, R&D Candidates and/or
Collaboration Product hereunder shall mean adherence to the activities
and time lines (to the extent adherence to such activities and time
lines is controllable by the Party responsible for performing such
activities) set forth in the applicable Annual Research Plan and or
Annual Development Plans prepared by the JSC, as may be amended from
time to time based on the results of studies conducted with such
Specific Target, R&D Candidate or Collaboration Product, and regulatory
factors. To the extent that the performance of a Party's obligations
hereunder is adversely affected by the other Party's failure to perform
its obligations hereunder, such Party shall not be deemed to have
failed to use its Commercially Reasonable Efforts in performing such
obligations.
1.24 "Confidential Information". Confidential Information shall mean, with
respect to a Party, all information (and all tangible and intangible
embodiments thereof), which is Controlled by such Party, is disclosed
by such Party to the other Party pursuant to this Agreement, and is
designated as confidential in writing by the disclosing Party whether
by letter or by use of an appropriate stamp or legend, prior to or at
the time any such information is disclosed by the disclosing Party to
the other Party. In addition, any information which is orally,
electronically or visually disclosed by a Party, 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 disclosed
and referencing the place and date of such oral, visual, electronic or
written disclosure and the names of the person(s) to whom such
disclosure was made; provided, however, that any technical information
disclosed at a meeting of the JSC shall constitute Confidential
Information unless otherwise specified. Notwithstanding the foregoing,
Confidential Information of a Party shall not include information
which, and only to the extent, the receiving Party can establish by
written documentation (a) has been publicly known prior to disclosure
of such information by the disclosing Party to the receiving Party, (b)
has become publicly known, without breach of this Agreement on the part
of the receiving Party, subsequent to disclosure of such information by
the disclosing Party to the receiving Party, (c) has been received by
the receiving Party at any time from a source, other than the
disclosing Party, rightfully having possession of and the right to
disclose such information free of confidentiality
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obligations, (d) has been otherwise known by the receiving Party free
of confidentiality obligations to the disclosing Party prior to
disclosure of such information by the disclosing Party to the receiving
Party, or (e) has been independently developed by employees or others
on behalf of the receiving Party without the aid, application or use of
such information disclosed by the disclosing Party to the receiving
Party.
1.25 "Control" or "Controlled". Control or Controlled shall mean with
respect to any (a) item of information, including, without limitation,
Know How, or (b) intellectual property right, the possession (whether
by ownership or license, other than pursuant to this Agreement) by a
Party of the ability to grant to the other Party access and/or a
license as provided herein under such item or right without violating
the terms of any agreement or other arrangements with any Third Party
existing before or after the Effective Date.
1.26 "Copyright". Copyright shall mean any copyright Controlled by a Party
or by both Parties, which copyright pertains to the promotional
materials and literature that is selected for use by the JSC in
connection with the promotion of Collaboration Products in the
Territory.
1.27 "Cost of Goods Manufactured for Clinical Supplies". Cost of Goods
Manufactured for Clinical Supplies shall mean a Party's costs to
Manufacture Clinical Supplies, but solely to the extent that such costs
could be included as an inventory cost under U.S. GAAP and shall
include, but not be limited to, [***].
1.28 "Cost of Goods Manufactured for Commercialization". Cost of Goods
Manufactured for Commercialization shall mean a Party's costs to
Manufacture Collaboration Products, but solely to the extent that such
costs could be included as an inventory cost under U.S. GAAP and shall
include, but not be limited to, [***].
1.29 "Development". Development shall mean, on an R&D Candidate-by-R&D
Candidate and country-by-country basis, all activities performed by or
on behalf of either Party pursuant to the Annual Research Plan and the
Annual Development Plan on such R&D Candidate in the Field, and, solely
with respect to a Hybrid R&D Candidate, outside of the Field, from the
date on which the JSC designates such R&D Candidate for further
pre-clinical development toward IND filing until Regulatory Approval of
a Collaboration Product containing such R&D Candidate is obtained in
such country for the indication under study. Development shall include,
without limitation, all activities related to [***]. When used as a
verb, "Develop" shall mean to engage in Development.
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1.30 "Development Costs". Development Costs shall mean the costs and
expenses associated with Development activities actually incurred by
either Party from the Effective Date through the later of (a) the date
of the last Regulatory Approval obtained (including thereafter costs to
maintain or expand such Regulatory Approval) in the Territory, or (b)
the date of termination of Development of the final indication for
which Regulatory Approval is to be sought in the Territory. The costs
and expenses associated with Development activities shall include those
costs required to obtain, maintain and/or expand the authorization
and/or ability to Manufacture, formulate, fill, and/or ship Clinical
Supplies and, for the avoidance of doubt, no cost or expenses
associated with the Manufacture or preparation to Manufacture
commercial supplies of a Collaboration Product shall be deemed to be a
"Development Cost". "Development Costs" shall also include, but are not
limited to, [***]. "Development Costs" shall also include [***]. In
determining "Development Costs" chargeable under this Agreement, each
Party will use its respective project accounting systems, and will
review and approve its respective project accounting systems and
methodologies with the other Party. The Parties hereby agree that
efforts of the employees of a Party or its Affiliates in performing its
activities hereunder shall be charged as Development Costs at the
applicable FTE Rate. Notwithstanding anything in this Section 1.30 to
the contrary [***]. All payments made by a Party to a Third Party in
connection with the performance of its activities under the Annual
Development Plan and an Annual Development Budget shall be charged as
Development Costs at such Party's actual out-of-pocket cost. The costs
of Manufacturing Clinical Supplies shall be charged as Development Cost
in an amount equal to one hundred percent (100%) of the Cost of Goods
Manufactured for Clinical Supplies. Except to the extent included in
Cost of Goods Manufactured for Clinical Supplies under the preceding
sentence such expenses incurred by each Party for equipment, materials
and supplies utilized in performing its activities under the Annual
Research Plan and the Annual Development Plan and an Annual Development
Budget shall not be separately charged as Developments Costs, except
for those expenses incurred by a Party, with the prior written consent
of the JSC as set forth in the Annual Research Plan and the Annual
Development Plan and Annual Development Budget, [***], which expenses
shall be charged as Development Costs at such Party's actual
out-of-pocket expense incurred in purchasing or making such equipment,
materials or supplies.
1.31 "Distribution Costs". Distribution Costs shall mean the FTE costs and
other costs specifically identifiable or allocable to the distribution
of a Collaboration Product by a Party and described in an Annual
Commercialization Plan including [***]. For purposes of this
definition, FTE costs shall be charged at the applicable FTE Rate.
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1.32 "Drug Delivery Technology". Drug Delivery Technology shall mean
formulation, delivery and/or excipient systems and technologies which
are proprietary to or subject to Patent Rights within the Control of
ELAN, its licensees, licensors, and joint venture partners which are
used for or related to delivery of pharmaceutical, diagnostic,
therapeutic or medicinal agent, item or product, including without
limitation an Antibody or Non-Antibody, to an animal and which is
primarily intended to allow such agent, item or product to be
administered on an optimized schedule and/or superior diagnostic
utility and/or to be administered with reduced side effects and/or to
be administered with enhanced efficacy and/or to be administered with
better patient compliance and/or to be administered in reduced dosages.
Drug Delivery Technologies shall expressly not include non-proprietary
injection or infusion means of delivering an Antibody.
1.33 "Day" or "day". Day or day shall mean 9:00 a.m. to 6:00 p.m. on any day
other than Saturday, Sunday, bank or other holiday or other public
holiday in England and Wales, Ireland or the United States.
1.34 "Effective Date". Effective Date shall mean the execution date hereof.
1.35 "ELAN". ELAN shall mean Elan Pharma International Limited, an Irish
Corporation, and those Affiliates which, in particular jurisdictions,
Elan Pharma International Limited specifies to carry out its
obligations under this Agreement.
1.36 "ELAN Collaboration Know How". ELAN Collaboration Know How shall mean
Know How discovered, made or conceived solely by employees of, or
others acting on behalf of, ELAN in performing its obligations under
the Research Program, the Development Program, Manufacturing, or in
performing any Post-Approval Research.
1.37 "ELAN Collaboration Patent Rights". ELAN Collaboration Patent Rights
shall mean Patent Rights which claim ELAN Inventions and which are (i)
made during the term of this Agreement or (ii) which come into the
Control of ELAN during the term of this Agreement.
1.38 "ELAN Intellectual Property". ELAN Intellectual Property shall mean (a)
the ELAN Know How, (b) the ELAN Patent Rights, (c) the ELAN
Collaboration Know How, (d) the ELAN Collaboration Patent Rights and
(e) ELAN's interest in the Joint Collaboration Know How, the Joint
Collaboration Patent Rights, the Patent Rights and Know How subject to
Section 8.1.3, the Copyrights and the Trademark.
1.39 "ELAN Inventions". ELAN Inventions shall mean all Inventions which are
made or conceived solely by ELAN's employees, agents or subcontractors
in the performance
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of ELAN's obligations under the Research Program, the Development Program,
Manufacturing or in performing any Post-Approval Research.
1.40 "ELAN Know How". ELAN Know How shall mean Know How other than ELAN
Collaboration Know How that ELAN Controls as of the Effective Date or that
comes into the Control of ELAN during the term of this Agreement.
1.41 "ELAN Patent Rights". ELAN Patent Rights shall mean Patent Rights, other
than ELAN Collaboration Patent Rights, that ELAN Controls as of the
Effective Date or that come into the Control of ELAN during the term of
this Agreement and which claim any Invention or ELAN Prior Invention.
Those ELAN Patent Rights known to be existing as of the Effective Date are
listed on Exhibit 1.41 attached hereto.
------------
1.42 "ELAN Prior Invention". ELAN Prior Invention shall mean a Prior Invention
Controlled by ELAN excluding any ELAN Technology.
1.43 "ELAN Technology". ELAN Technology shall mean those assays described in
Exhibit 1.43.
------------
1.44 "Enhancing Third Party Intellectual Property". Enhancing Third Party
Intellectual Property shall mean, with respect to any country in the
Territory, on a country-by-country basis, valid Patent Rights in such
country owned or otherwise controlled by a Third Party that cover an
invention which, if utilized by the Parties under this Agreement would
facilitate Research conducted under this Agreement, and/or Development
and/or Manufacture of an R&D Candidate or Collaboration Product, as the
case may be, and/or if included in a Collaboration Product would
materially enhance the commercial value of such Collaboration Product. For
purposes of clarity, Enhancing Third Party Intellectual Property shall not
include Blocking Third Party Intellectual Property.
1.45 "FDA". FDA shall mean the United States Food and Drug Administration or
any successor agency thereto or the equivalent Regulatory Authority in any
other country.
1.46 "FD&C Act". FD&C Act shall mean the United States Federal Food, Drug, and
Cosmetic Act, as amended, and the regulations promulgated thereunder.
1.47 "Excepted Antibody". Excepted Antibody shall mean [***].
1.48 "Field". Field shall mean the discovery, isolation, characterization,
research, development, and/or commercialization of an Antibody useful for
the diagnosis, treatment and/or prevention of one or more of the following
disease conditions [***].
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(a) neurodegenerative conditions [***].
For the purpose of this Agreement, the term "Field" shall exclude
antagonists of [***] and antagonists of those [***] Targets which are
identified in a sealed and dated envelope provided by CAT to the [***] on
or before the Effective Date. The London office of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ shall
keep such envelope in a safe and secure manner until such time as
instructed in a written document signed by both Parties to open such
envelope or to release such envelope as may be directed in such document.
1.49 "First Commercial Sale". First Commercial Sale shall mean, with respect to
any Product and any country in the Territory, the first sale of Product
under this Agreement to a Third Party in such country, after such Product
has been granted Regulatory Approval under this Agreement by the competent
Regulatory Authorities in such country.
1.50 "Full Time Equivalent" or "FTE". Full Time Equivalent or FTE shall mean a
total of [***] each, as applicable, on the Research to be conducted under
this Agreement, and/or the Development or Manufacturing of an R&D
Candidate or Collaboration Product carried out by employees of a Party
having the appropriate scientific expertise to conduct such activities.
From the date hereof and for two (2) years thereafter, the "applicable FTE
rate" shall mean [***]. The FTE rate for the period commencing [***] from
date hereof, shall be negotiated in good faith by and between the Parties,
proposed by the Joint Project Team and approved or ratified by the JSC.
The FTE rate for the initial period shall not be taken as indicative of
the FTE rate for periods after the [***] period identified. The Parties
shall include within the determination of FTE rate only [***].
1.51 "Good Clinical Practice" or "GCP". Good Clinical Practice or GCP shall
mean the then current standards for clinical trials for pharmaceuticals,
as set forth in the FD&C Act and applicable regulations promulgated
thereunder, as amended from time to time, and such standards of good
clinical practice as are required by the European Union and other
organizations and governmental agencies in countries in which the
applicable Product is intended to be sold, to the extent such standards
are not less stringent than United States GCP.
1.52 "Good Laboratory Practice" or "GLP". Good Laboratory Practice or GLP shall
mean the then current standards for laboratory activities for
pharmaceuticals, as set forth in the FD&C Act and applicable regulations
promulgated thereunder, as amended from time to time, and such standards
of good laboratory practice as are required by the European Union and
other organizations and governmental agencies in countries in which the
applicable Product is intended to be sold, to the extent such standards
are not less stringent than United States GLP.
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1.53 "Good Manufacturing Practice" or "GMP". Good Manufacturing Practice or GMP
shall mean the then current standards for manufacturing activities for
pharmaceuticals, as set forth in the FD&C Act and applicable regulations
promulgated thereunder, as amended from time to time, and such standards
of good manufacturing practice as are required by the European Union and
other organizations and governmental agencies in countries in which the
applicable Product is intended to be manufactured or sold, to the extent
such standards are not less stringent than United States GMP.
1.54 "Gross Sales". Gross Sales shall mean the gross amount invoiced by either
Party, their Affiliates or permitted sublicensees for sales of a Product
to Third Parties in each country of the Territory.
1.55 "IND". IND shall mean an Investigational New Drug Application, as defined
in the FD&C Act, that is required to be filed with the FDA before
beginning clinical testing of an R&D Candidate in human subjects, or an
equivalent foreign filing.
1.56 "Invention". Invention shall mean any process, method, composition of
matter, article of manufacture, discovery or finding which is necessary
for the Research conducted under this Agreement and/or which is necessary
to the Research, Development, Manufacture or Commercialization of any
Antibody, CAT Exclusive Antibody, Non-Antibody, R&D Candidate or Product.
1.57 "Joint Collaboration Inventions". Joint Collaboration Inventions shall
mean all Inventions discovered, made or conceived jointly by employees of
CAT and ELAN, or others acting jointly on their behalf, in performing
their obligations under the Research Program, the Development Program,
Manufacturing or in performing any Post-Approval Research.
1.58 "Joint Collaboration Know How". Joint Collaboration Know How shall mean
Know How discovered, made or conceived jointly by employees of CAT and
ELAN, or others acting jointly on their behalf, in performing their
obligations under the Research Program or Development Program,
Manufacturing or in performing any Post-Approval Research.
1.59 "Joint Collaboration Patent Rights". Joint Collaboration Patent Rights
shall mean Patent Rights that claim Joint Collaboration Inventions.
1.60 "Know How". Know How shall mean all Inventions, discoveries, data,
information, processes, methods, techniques, materials, technology,
results or other know how, whether or not patentable but which are not
generally known, that are useful for the Research conducted under this
Agreement and/or the Development, Commercializa-
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tion or Manufacture of any Antibody, R&D Candidate, CAT Exclusive
Antibody, Non-Antibody and/or Product and/or any method of making an
Antibody, R&D Candidate, CAT Exclusive Antibody, Non-Antibody and/or
Product.
1.61 "Major Market Country". Major Market Country shall mean any of the [***].
1.62 "Manufacture", "Manufactured" or "Manufacturing". Manufacture,
Manufactured or Manufacturing shall mean all activities involved in the
production of an R&D Candidate or Collaboration Product to be Developed
and/or Commercialized under this Agreement.
1.63 "Marketing Costs". Marketing Costs shall mean the FTE costs and other
costs of marketing, promotion and advertising [***]. Such costs will
include both internal FTE costs and outside services and expenses (e.g.,
consultants, agency fees, meeting costs, etc.). "Marketing Costs" shall
also include [***]. "Marketing Costs" will specifically exclude [***]. For
purposes of this definition, FTE costs shall be charged at the applicable
FTE Rate.
1.64 "Mild Cognitive Impairment" or "MCI". Mild Cognitive Impairment or MCI
shall mean a state in which memory and/or cognition has declined and is
abnormal for age and education, but the severity of which is insufficient
to be consistent with dementia and/or Alzheimer's disease.
1.65 "Net Commercialization Revenues". Net Commercialization Revenues shall
mean any signature fees, upfront, lump sum and milestone payments which
either Party receives from Third Party sublicensees of such Party in
respect of an applicable CAT Exclusive Antibody, Party Exclusive Product
and/or Collaboration Product in consideration for the rights granted to
such Third Party sublicensees.
1.66 "Net Sales". Net Sales shall mean Gross Sales of a Product less applicable
Sales Returns and Allowances. In the case of Combination Products, Net
Sales means the Gross Sales billed or invoiced on sales of such a
Combination Product less applicable Sales Returns and Allowances
multiplied by a proration factor. The prorated component value shall be
mutually agreed upon by the Parties in writing prior to product launch of
such a Combination Product. If all components of the Combination Product
were sold separately during the same or immediately preceding royalty
period, the proration factor shall be determined by the formula [***].
1.67 "Non-Antibody". Non-Antibody shall mean any molecule other than an
Antibody which interacts with a Specific Target.
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1.68 "Non-Antibody Product". Non-Antibody Product shall mean any
pharmaceutical, therapeutic or medicinal agent, item, product or
formulation sold or offered for sale in the Territory which contains a
Non-Antibody as an active ingredient; provided, however, that such
Non-Antibody interacts with a Specific Target which (a) as a direct result
of the Research conducted by the Parties under this Agreement resulted in
the selection of an Antibody that binds to that Specific Target in a
manner set out in written criteria agreed from time to time by the JSC and
(b) satisfies clause (iv) of the definition of Specific Targets.
1.69 "Ongoing Development Costs". Ongoing Development Costs shall mean FTE
costs and other costs and expenses borne by either Party with respect to
Post Approval Research approved by the JSC and other expenses approved by
the JSC associated with market positioning of a Collaboration Product to
the extent not otherwise included within Development Costs, Marketing
Costs or Sales Costs. For purposes of this definition, FTE costs shall be
charged at the applicable FTE Rate.
1.70 "Other Out-Of-Pocket Costs". Other Out-Of-Pocket Costs shall mean the
following:
. Third Party License Fees (other than those related to the Manufacture
of Clinical Supplies or Collaboration Products);
. Patent Costs and trademark costs;
. product liability insurance to the extent the Parties obtain a joint
policy; and
. such other costs and expenses identified and approved to be Other
Out-Of-Pocket Costs by the JSC.
1.71 "Party Exclusive Product". Party Exclusive Product shall mean any
pharmaceutical, diagnostic, therapeutic, or medicinal agent, item or
product sold or offered for sale in the Territory, both within and without
the Field, which is subject to the provisions of Section 5.6 and which
contains as an active ingredient a CAT Exclusive Antibody.
1.72 "Patent Costs". Patent Costs shall mean the fees and expenses paid to
outside legal counsel and experts, and filing and maintenance expenses,
incurred after the Effective Date, in connection with the establishment
and maintenance of Joint Collaboration Patent Rights and under Patent
Rights covering any Collaboration Product (to the extent to be shared by
the Parties under the Agreement), including, to the extent specified
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in Section 8 of the Agreement, costs of patent interference,
reexamination, reissue, opposition and revocation proceedings.
1.73 "Patent Rights". Patent Rights shall mean any and all (a) patents, (b)
pending patent applications, including, without limitation, all
provisional applications, substitutions, continuations,
continuations-in-part, continued prosecution applications, requests for
continued examination, divisions, renewals, and all patents granted
thereon, and (c) all patents-of-addition, reissues, reexaminations and
extensions or restorations by existing or future extension or restoration
mechanisms, including, without limitation, supplementary protection
certificates or the equivalent thereof.
1.74 "Phase I Clinical Trial". Phase I Clinical Trial shall mean studies in
humans to obtain initial data regarding solely the safety of an R&D
Candidate.
1.75 "Phase IIa Clinical Trial". Phase IIa Clinical Trial shall mean a clinical
study in humans that provides sufficient efficacy data to support the
validity of a therapeutic concept and adequate safety data in a relevant
patient population to reasonably support further investigation of the
safety and efficacy of the therapeutic candidate in further clinical
studies. A Phase IIa trial may not include, except upon the approval of
the Joint Project Team, fewer than [***] patients.
1.76 "Phase IIb Clinical Trial". Phase IIb Clinical Trial shall mean a clinical
study in humans which provides for one or more definitive, well-controlled
clinical trials in the relevant patient population for the purpose of
determining the safe and effective dose range in the proposed therapeutic
indications as more fully described in 21 C.F.R. 312.21 (b).
1.77 "Phase III Clinical Trial". Phase III Clinical Trial shall mean one or
more controlled studies in humans of the efficacy and safety of an R&D
Candidate, which is prospectively designed to demonstrate statistically
whether the R&D Candidate is safe and effective for use in a particular
indication, in a manner intended to be sufficient to obtain Regulatory
Approval to market that R&D Candidate and which the Joint Project Team
designates as a Phase III Clinical Trial.
1.78 "Phase IV Clinical Trial". Phase IV Clinical Trial shall mean any clinical
trial in humans with a Collaboration Product in an indication to be
conducted after a Regulatory Approval in such indication which was
mandated by the applicable Regulatory Authority as a condition of such
Regulatory Approval.
1.79 "Post-Approval Research". Post-Approval Research shall mean ongoing
research and development of a Collaboration Product, pursuant to this
Agreement, after such
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Collaboration Product has received Regulatory Approval in a country of the
Territory, including, without limitation, Phase IV Clinical Trials and
clinical studies in support of additional indications within the Field or
label changes for such Collaboration Product in such country during the
term of this Agreement.
1.80 "Pre-Marketing Costs". Pre-Marketing Costs shall mean FTE Costs and those
out-of-pocket expenses incurred on a country-by-country basis and
region-by-region basis, by either Party, other than Development Costs,
before Regulatory Approval of a Collaboration Product, in such country,
directly attributable to the carrying out of such Party's obligations
under the Commercialization Plan or an Annual Commercialization Plan, as
applicable, in preparation for Commercialization in such country. Such
expenses may include, without limitation, [***]. For purposes of this
definition, FTE costs shall be charged at the applicable FTE Rate.
1.81 "Primary Application". Primary Application shall mean a major application
of an Antibody or Target as ascertained at the time of assessment using
objective and reasonable scientific and/or commercial criteria, data
and/or information . Primary Application shall not mean any minor or
incidental application.
1.82 "Prior Invention". Prior Invention of a Party shall mean an Invention
Controlled by either Party, which Invention is made by that Party's
employees, agents or subcontractors before the Effective Date or which
otherwise came into the Control of such Party before the Effective Date.
1.83 "Product". Product shall mean a Collaboration Product, Non-Antibody
Product or Party Exclusive Product, as the case may be.
1.84 "Pro-Forma Net Profit". Pro-Forma Net Profit shall mean, on a
Collaboration Product-by-Collaboration Product and country-by-country
basis, the Net Sales obtained from the sale of such Collaboration Product
in such country less, as applicable, in respect of such Collaboration
Product (i) the Cost of Goods Manufactured for Commercialization or the
Cost of Goods Manufactured for Clinical Supplies and (ii) Reimbursable
Commercial Costs.
1.85 "Research Expenses". Research Expenses shall mean the expenses (other than
Third Party License Fees) of the Parties incurred in performing Research
and/or activities other than Development which support the Development
Program and/or are useful in obtaining Regulatory Approval for an R&D
Candidate pursuant to the Annual Research Plan or as expressly provided
for in an Annual Development Plan.
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1.86 "Regulatory Approval". Regulatory Approval shall mean the technical,
medical and scientific licenses, registrations, authorizations and
approvals (including, without limitation, approvals of BLAs or their
foreign equivalents, supplements and amendments, pre- and post-approvals,
pricing and third party reimbursement approvals, and labeling approvals)
of any national, supra-national, regional, state or local regulatory
agency, department, bureau, commission, council or other governmental
entity, necessary for the commercial manufacture, distribution, marketing,
promotion, offer for sale, use, import, export and sale of Collaboration
Product(s) in a regulatory jurisdiction. For the sake of clarity,
Regulatory Approval shall not be achieved for a Collaboration Product in a
country until any applicable pricing and governmental third party
reimbursement approvals (other than those required by Medicaid or
Medicare) have also been obtained in such country.
1.87 "Regulatory Approval Filing". Regulatory Approval Filing shall mean, on a
country by country basis, the submission of an application for Regulatory
Approval of an R&D Candidate to the appropriate Regulatory Authorities in
such country and the acceptance, by such Regulatory Authorities, of such
application for review.
1.88 "Regulatory Authority". Regulatory Authority shall mean any national
(e.g., the FDA), supra-national (e.g., the European Commission, the
Council of the European Union, or the European Agency for the Evaluation
of Medicinal Products), regional, state or local regulatory agency,
department, bureau, commission, council or other governmental entity in
each country of the world involved in the granting of Regulatory Approval
for an R&D Candidate.
1.89 "Reimbursable Commercial Costs". Reimbursable Commercial Costs shall mean
Distribution Costs, Marketing Costs, Sales Costs, Development Costs,
Ongoing Development Costs, Other Out-of-Pocket Costs, Research Expenses
and Pre-Marketing Costs and post-commercialisation Research Expenses.
1.90 "Research". Research shall mean, on a Specific Target-by-Specific-Target
basis, any activity undertaken with respect to an Antibody, a Specific
Target or a R&D Candidate or all activities undertaken by or on behalf of
either Party under this Agreement, prior to Development, including,
without limitation, identification of Specific Targets, use of the CAT
Technology with respect to a Specific Target, immunochemistry, immunology,
cell biology, pharmacology, preclinical toxicology, and formulation.
1.91 "Research Term". Research Term shall mean a four (4) year period
commencing on the Effective Date and expiring on the fourth anniversary of
the Effective Date, unless extended as otherwise provided by this
Agreement or by mutual agreement of the Parties.
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1.92 "R&D Candidate". Research and Development Candidate or R&D Candidate shall
mean any Antibody to a Specific Target (other than a CAT Exclusive
Antibody) that the Joint Steering Committee designates as a R&D Candidate
by determining that such Antibody should proceed with GLP toxicology
studies.
1.93 "Sales Costs". Sales Costs shall mean FTE costs and other costs submitted
by ELAN as part of the Commercialization Plan and an Annual
Commercialization Plan and specifically attributable to sales of
Collaboration Product in the Territory and shall include, without
limitation, [***]. Sales Costs will not include [***]. For purposes of
this definition, FTE costs shall be charged at the applicable FTE Rate.
1.94 "Sales Returns and Allowances". Sales Returns and Allowances shall mean
the sum of (a) and (b), where: (a) is a provision, determined by a Party
under U.S. GAAP for sales of Products in the Territory for (i) trade, cash
and quantity discounts on Products (other than price discounts granted at
the time of invoicing and which are already included in the determination
of Gross Sales), (ii) credits or allowances given or made for rejection or
return of, and for uncollectible amounts on, previously sold Products or
for rebates or retroactive price reductions (including Medicare, Medicaid
and similar types of rebates and charge backs), (iii) taxes, duties or
other governmental charges levied on or measured by the billing amount for
Products, as adjusted for rebates and refunds, (iv) charges for freight
and insurance directly related to the distribution of Products, to the
extent included in Gross Sales, and (v) credits for allowances given or
made for wastage replacement, indigent patient and any other sales
programs agreed to by the Parties for Products; and (b) is a periodic
adjustment of the provision determined in (a) to reflect amounts actually
incurred by a Party in the Territory for items (i), (ii), (iii), (iv) and
(v) in clause (a). For Collaboration Products, the provision allowed in
clause (a) and adjustments made in clause (b) (if any) will be reviewed by
the Joint Commercialization Team and approved by the JSC.
1.95 "Specific Target". Specific Targets shall mean (i) the Targets listed on
Exhibit 1.95 as may be amended in writing by the Parties from time to time
------------
during the term of this Agreement, [***]
1.96 "Sublicensee". Sublicensee shall mean a Third Party that is granted a
license and/or sublicense under this Agreement pursuant to Section 3.3 to
both make and sell Collaboration Products. "Sublicensee" shall also
include a Third Party that is granted the right to distribute
Collaboration Product; provided that such Third Party is also responsible
for marketing and promotion of the Collaboration Product within the
applicable territory. "Sublicense" shall mean an agreement or arrangement
pursuant to which such a sublicense or distribution right has been
granted.
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1.97 "Target". Target shall mean[***].
1.98 "Territory". Territory shall mean the entire world.
1.99 "Third Part(y/ies)". Third Part(y/ies) shall mean any person(s) or
entity(y/ies) other than CAT or ELAN.
1.100 "Third Party License". Third Party License shall mean any agreement with
a Third Party for a license under intellectual property rights or
technology necessary or useful for the Research, Development,
Manufacture or Commercialization of an R&D Candidate or a Collaboration
Product, which license is entered into, during the term of this
Agreement, by a Party pursuant to Section 8.8.
1.101 "Third Party License Fee". Third Party License Fee shall mean license
fees, royalties and other amounts paid to any Third Party under each
Third Party License or CAT In-License specified pursuant to Exhibit
-------
1.11.
----
1.102 "Trademark". Trademark shall mean any trademark Controlled by ELAN that
is selected for use by ELAN in connection with the Commercialization of
any Collaboration Product hereunder; provided, however, that the term
"Trademark" shall not include the tradename of either Party or any
trademark or trade dress of either Party which is not used exclusively
in connection with the Collaboration Products Commercialized under this
Agreement.
2. Scope of THE Collaboration.
2.1 Collaboration Goals. {TC "2.1 Collaboration Goals" \f C\1 "2"}. Pursuant
and subject to the terms of this Agreement, the Parties agree to: (a)
engage in discovery and Research activities with the goal of identifying
one or more R&D Candidates in the Field, (b) engage in Development
activities with the goal of obtaining Regulatory Approval for
Collaboration Products in the Territory where it makes commercial sense
to do so given the size of the potential market and the safety and
efficacy profile of each Collaboration Product and (c) engage in
Commercialization of Collaboration Products with the goal of optimizing
the profit available to each Party. For purposes of clarity, it is
understood by the Parties that the JSC may decide that it does not make
commercial sense for the Parties to Develop or Commercialize a
Collaboration Product in a particular country in the Territory. Each
Party agrees to use Commercially Reasonable Efforts in performing its
tasks and responsibilities and in conducting all activities ascribed or
assigned to it under this Agreement, the then current Annual Research
Plan, Annual Development Plan, any Annual Research Budget, Annual
Development Budget, the then current Commercialization Plan and any
Annual Commer-
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cialization Plan. Each Party shall cooperate with and provide reasonable
support to the other Party in performing its activities with respect to
the Research, Development and Commercialization work contemplated
hereunder. Each Party agrees, during the term of this Agreement, to
Develop, Manufacture, and Commercialize, as applicable, Collaboration
Products, Party Exclusive Products and Non-Antibody Products, only under
the terms of this Agreement.
2.2 Exclusive Working Relationship. {TC "2.2 Exclusive Working Relationship"
\f C\1 "2"}. Except as expressly set forth in this Agreement and subject
to the other terms and conditions of this Agreement, for separate and
valuable consideration, it is understood and agreed by the Parties that:
(a) During the Research Term, with respect solely to Research and
Development in the Field and subject to Section 13.1, each Party
shall work exclusively with the other Party.
(i) In discharge of its obligations pursuant to this Section
2.2(a), but without limiting its obligations thereunder, CAT
shall refuse to permit, on a Target by Target basis, use of,
access to or grant a license for, as applicable, both the CAT
Technology and/or the CAT Intellectual Property to any Third
Party whom, having discharged its obligations under Section
2.4, [***]. Nothing in Section 2.2(a) shall preclude
incidental activities by CAT in the Field utilizing
technologies, including without limitation the CAT Technology
and any technology other than the ELAN Technology so long as
such activities are not pursuant to any arrangement, written
or otherwise, [***].
(ii) In discharge of its obligations pursuant to this Section
2.2(a), but without limiting its obligations thereunder, ELAN
shall refuse to permit, on a Target by Target basis, use of,
access to or grant a license for, as applicable, both the
ELAN Technology and/or the ELAN Intellectual Property (other
than any ELAN Prior Invention and solely to the extent such
ELAN Intellectual Property directly claims a Specific Target
or the use thereof as a pharmaceutical, therapeutic or
medicinal agent, item, or product) to any Third Party whom
ELAN, having discharged its obligations under Section 2.4
[***] provided, however, that the provisions of this Section
2.2(a)(ii) shall only apply (unless CAT otherwise consents in
writing) to [***]. Nothing in Section 2.2(a) shall preclude
incidental activities by ELAN in the Field utilizing
technologies, including without limitation the ELAN
Technology and any tech-
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nology other than the CAT Technology, so long as such
activities are not pursuant to any arrangement, written or
otherwise, [***].
(b) Except as otherwise provided for in Sections 2.2(d)(ii) through
2.2(d)(iii), during the Research Term, the Parties shall work
exclusively with each other on Specific Targets, R&D Candidates
and Collaboration Products.
(c) Following the expiration of the Research Term, the Parties shall
work exclusively with each other to Research, Develop, Manufacture
and Commercialize R&D Candidates and Collaboration Products in the
Territory.
(d) Notwithstanding anything in Sections 2.2(a) and (b) to the
contrary:
(i) Throughout the term of the Agreement and thereafter ELAN
may:
(A) either by itself or with a Third Party, discover,
research, develop, and commercialize any composition of
matter [***] without any obligations to CAT, other than
as expressly provided for Non-Antibodies, Non-Antibody
Products and Hybrid R&D Candidates in Sections 7.1.8,
5.7. and 12.4; and/or
(B) either by itself or with a Third Party, utilize
filamentous bacteriophages for purposes [***];
provided, however, that such use shall not be deemed to
be licensed or free of any claims of infringement under
the CAT Intellectual Property;
(C) except with respect to Specific Targets, enter into one
or more written contractual arrangements, including
joint ventures, with Third Parties wherein such
arrangements utilize technology other than CAT
Technology to [***] provided, however, that ELAN (i)
shall, if CAT provides significant material assistance
therewith, use commercially diligent efforts to
persuade the Third Party to use the CAT Technology on
the same terms as set forth in this Agreement in any
proposed arrangement relating to the [***] unless CAT
consents otherwise; and/or
(ii) Throughout the Research Term ELAN may:
(A) permit use of, access to and/or grant a license to any
Third Party under, as applicable, the ELAN Technology
and/or the ELAN Intellectual Property provided always
that ELAN has discharged
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its obligations under Section 2.4. It shall not be
considered a breach of Section 2.2(a)(ii) if subsequent to
its being subjected to the ELAN Technology it is determined
that any [***].
(iii) Throughout the Research Term CAT may:
(A) permit use of, access to and/or grant a license to any Third
Party under, as applicable, the CAT Technology and/or the
CAT Intellectual Property provided always that CAT has
discharged its obligations under Section 2.4 and provided
further that (i) CAT has drawn its obligations under this
Section 2 to the attention of such Third Party including
[***] and [***]. It shall not be considered a breach of
Section 2.2(a)(i) if (i) subsequent to its being subjected
to the CAT Technology it is determined [***] or (ii) if CAT
permits use of, access to and/or grants a license to a Third
Party to the CAT Technology and/or the CAT Intellectual
Property in accordance with this Section provided that [***]
and/or
(B) permit use of, access to and/or grant a license to a Third
Party under the CAT Technology and/or the CAT Intellectual
Property where [***]. Notwithstanding the foregoing, CAT
shall use reasonable efforts, to the extent it is legally
able to do so, not to grant any rights to a Target (save as
provided in Section 2.2(d)(iii)(A) above) if to do so would
breach the provisions of Section 2.2(a)(i). [***]. CAT shall
not solicit submission by the Third Party of such Target
where it knows or should reasonably know that such [***]. In
addition CAT shall, to the extent it is legally able to do
so on a regular basis but no less than once every [***], (i)
notify ELAN [***] and (ii) notify ELAN when a Target is
rejected because it has been [***] and accepted by CAT due
to [***] and/or
(iv) Throughout the term of this Agreement and thereafter:
(A) Other than with respect to Specific Targets and subject to
the CAT Gatekeeping Procedure, throughout the term of the
Agreement and thereafter, CAT, either by itself or with a
Third Party, may use the assays listed in Exhibit 1.17,
------------
[***].
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(B) On a Target by Target basis, either Party may be
excused from so much of its obligations to the other
Party pursuant to Section 2.2(a) through (c) as which
[***].
(C) ELAN, at its option, shall be freed from any
obligations pursuant to Section 2.2(a) and 2.2(b) of
this Agreement if the activity at issue constitutes the
discovery, research, development, manufacturing,
commercialization or the other operations [***]
provided, however, that (i) ELAN shall use commercially
reasonable efforts to encompass any activities subject
to this Section 2.2(d)(iv)(C) within the terms and
conditions of this Agreement and [***] unless CAT
otherwise consents.
(D) CAT, at its option, shall be freed from any obligations
pursuant to Section 2.2(a) and 2.2(b) of this Agreement
if the activity at issue constitutes the discovery,
research, development, manufacturing, commercialization
or the other operations [***] provided, however, that
CAT shall use commercially reasonable efforts to
encompass any activities subject to this Section
2.2(d)(iv)(D) within the terms and conditions of this
Agreement [***].
2.3 Further Exclusions{TC "2.3 Further Exclusions" \f C \1 "2"}.
Notwithstanding any other provision of this Agreement, nothing herein
shall be deemed to extend to or include any Drug Delivery Technology or
an Excepted Antibody. Each of the rights and licenses granted by each
Party and each of the obligations placed upon each Party hereby shall
be deemed to exclude and shall not extend to Drug Delivery Technology,
any Excepted Antibody and/or the use of Drug Delivery Technology or any
Excepted Antibody, within and without the Field, and/or any research,
development and/or commercialization activities, including those
conducted by ELAN or CAT with a Third Party relating solely to the use
or potential use of Drug Delivery Technology or an Excepted Antibody;
provided, however, [***].
2.4 Safeguard Procedures{TC "2.4 Safeguard Procedures" \f C \1 "2"}. Each
Party will exercise reasonable diligence in the discharge of its
obligations under this Article 2, including, without limitation,
undertaking such investigations and initiating such inquiries of Third
Parties as are commercially reasonable in order to obtain sufficient
information regarding the intended or actual use of any Patent Rights,
Know How or ELAN Technology or CAT Technology to be licensed, used
internally or shared with or licensed to a Third Party so as to permit
a reasonable assessment of the intended or
-23-
actual use thereof. [***]. In the discharge of its obligations under
this Section 2.4, CAT shall subject any Target [***] to such family,
motif, sequence analyses or other customary or scientifically
established techniques as may reasonably be used to determine whether
such Target should be subject to the restrictions of Article 2.2(a) of
this Agreement.
3. LICENSES.
3.1 Licenses to CAT{TC "3.1 Licenses to ▇▇▇" \▇ ▇ \▇ "▇"}.
(▇) Subject to the terms and conditions of this Agreement, including,
without limitation, Section 3.4, ELAN hereby grants to CAT:
(i) a world-wide, non-exclusive license or sublicense, as the
case may be, without the right to grant sublicenses (except
pursuant to the terms set forth in Section 3.3) under the
ELAN Intellectual Property solely to the extent necessary
for CAT to exercise its rights and perform its activities,
under this Agreement, in the conduct of the Research
Program, the Development Program and any Post-Approval
Research;
(ii) a worldwide, exclusive (except to the extent necessary for
ELAN or its Sublicensees to Manufacture Collaboration
Products and/or Commercialize Collaboration Products
pursuant to this Agreement) license or sublicense, as the
case may be, without the right to grant sublicenses (except
pursuant to the terms set forth in Section 3.3) under the
ELAN Intellectual Property solely as is necessary for the
Manufacture of Clinical Supplies and, as may be required by
the JSC, the Manufacture of Collaboration Products; and
(iii) subject to the provisions of Section 5.6, an exclusive,
worldwide license or sublicense, as the case may be, with a
limited right to grant sublicenses pursuant to the terms set
forth in Section 3.3, under the Joint Collaboration Know
How, the Joint Collaboration Patent Rights and the Patent
Rights and Know How subject to Section 8.1.3 to research,
develop, manufacture and commercialize, both within and
without the Field, each CAT Exclusive Antibody and Party
Exclusive Products.
(b) Subject to the other provisions of this Agreement, in the event
that, during the applicable term of this Agreement, the Research
to be conducted under this Agreement and/or the Development of R&D
Candidates under this Agreement
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and/or the Manufacture of, as applicable, Clinical Supplies or
Collaboration Products in the Territory by CAT, and/or the
enjoyment of CAT's rights pursuant to Section 5.6 to research,
develop and commercialize any CAT Exclusive Antibody and Party
Exclusive Products would misappropriate any Know How and/or
infringe any Patent Rights Controlled by ELAN that are not covered
by the licenses and sublicenses granted to CAT in Section
3.1(a)(i) through (a)(iii), ELAN hereby grants to CAT, to the
extent ELAN is legally able to do so, a worldwide, non-exclusive
license (subject to the provisions of Sections 13 (Withdraw to
Royalty Position) and 5.6 (CAT Exclusive Antibodies) under such
Know How and Patent Rights, to enable CAT and/or its Sublicensees
to conduct Research and/or Develop R&D Candidates under the terms
of this Agreement and/or Manufacture of, as applicable, Clinical
Supplies or Collaboration Products in the Territory and/or
research, develop and commercialize any CAT Exclusive Antibody and
Party Exclusive Product in accordance with the licenses and
sublicenses granted in Section 3.1(a)(i) through (a)(iii).
3.2 Licenses to ELAN{TC "3.2 Licenses to ▇▇▇▇" \▇ ▇ \▇ "▇"}.
(▇) Subject to the terms and conditions of this Agreement, including,
without limitation, Section 3.4, CAT hereby grants to ELAN:
(i) a worldwide, non-exclusive license or sublicense, as the
case may be, without the right to grant sublicenses (except
pursuant to the terms set forth in Section 3.3) under the
CAT Intellectual Property solely to the extent necessary for
ELAN to exercise its rights and perform its activities,
under this Agreement, in the conduct of the Research
Program, the Development Program and any Post-Approval
Research;
(ii) a worldwide, exclusive (except to the extent necessary for
CAT to conduct Research under this Agreement and/or Develop
R&D Candidates and/or to Manufacture, as applicable Clinical
Supplies or Collaboration Products pursuant to this
Agreement) license or sublicense, as the case may be,
without the right to grant sublicenses (except pursuant to
the terms set forth in Section 3.3) under the CAT
Intellectual Property to conduct Research and/or Develop R&D
Candidates and/or Manufacture or Commercialize Collaboration
Products in the Field and, as required, a grant of such
license rights outside of the Field with respect to Hybrid
R&D Candidates and Collaboration Product containing Hybrid
R&D Candidates which are also being Commercialized within
the Field by ELAN; and
-25-
(iii) Subject to the provisions of Sections 5.6 and 7.1.8, an
exclusive, worldwide license or sublicense, as the case may
be, with a limited right to grant sublicenses pursuant to the
terms set forth in Section 3.3, under the CAT Intellectual
Property, Joint Collaboration Know How and the Joint
Collaboration Patent Rights to research, develop, manufacture
and commercialize any Non-Antibody and/or Non-Antibody
Product within the Territory and, where applicable, CAT
Exclusive Antibodies and Party Exclusive Products which are
subject to the provisions of Section 5.6.2.
(b) Subject to the other provisions of this Agreement and during its
term, in the event that the Research to be conducted under this
Agreement and/or the Development of R&D Candidates under this
Agreement and/or the Manufacture of, as applicable, Collaboration
Products in the Territory by ELAN would, and/or the enjoyment of
ELAN's rights pursuant to Sections 3.2(a)(ii), 5.6, 7.1.8, 12.3 and
13.2.5 to research, develop and commercialize any Non-Antibody or
Non-Antibody Product or, as applicable, CAT Exclusive Antibodies and
Party Exclusive Products subject to Section 5.6, would
misappropriate any Know How and/or infringe any Patent Rights
Controlled by CAT that are not covered by the licenses and
sublicenses granted to ELAN in Section 3.2(a)(i) through (a)(iii),
CAT hereby grants to ELAN, to the extent CAT is legally able to do
so, a worldwide, non-exclusive license (subject to the provisions of
Sections 7.1.8, 5.6 and 13) under such Know How and Patent Rights,
to enable ELAN and/or its Sublicensees to conduct Research and/or
Develop R&D Candidates under the terms of this Agreement and/or
Manufacture of, as applicable, Clinical Supplies or Collaboration
Products in the Territory and/or research, develop and commercialize
any Non-Antibody or Non-Antibody Product and/or, as applicable, CAT
Exclusive Antibodies and Party Exclusive Products subject to Section
5.6, in accordance with the licenses and sublicenses granted in
Section 3.2(a)(i) through (a)(iii).
3.3 Licensing and Sublicensing to Third Parties{TC "3.3 Licensing and
Sublicensing to Third Parties" \f C \1 "2"}. If pursuant to Section 5.2.2,
the JSC approves the utilization of one or more Third Parties to perform
certain tasks in the conduct of the Research Program, the Development
Program or any Post-Approval Research, the Party entering into a contract
with such Third Party for the performance of such services, may, as part of
such contract, grant to such Third Party a nonexclusive, nontransferable
license or sublicense, as applicable, without the right to grant
sublicenses, under the CAT Intellectual Property or the ELAN Intellectual
Property, as applicable, only to the extent and only for so long as such
license or sublicense is necessary for
-26-
such Third Party to perform such tasks. All such contracts and
sublicenses entered into by either Party with any such Third Party shall:
(a) be subject to the prior written approval of the JSC with the
prior review of each Party's legal department, which
approval shall not be unreasonably withheld or delayed;
(b) provide that as between the appointing Party and the Third
Party all results emerging from such work and any related
intellectual property shall, as provided for under this
Agreement, be owned jointly by ELAN and CAT;
(c) provide that, where applicable, such Third Party shall
permit the appointing Party to access all data required to
be disclosed to any applicable Regulatory Authority with
respect to any proposed Regulatory Approval.
3.4 No Other Rights{TC "3.4 No Other Rights" \f C \1 "2"}. No rights, other
than those expressly set forth in this Agreement are granted to either
Party hereunder, and no additional rights shall be deemed granted to
either Party by implication, estoppel or otherwise.
4. MANAGEMENT OF COLLABORATION.
4.1 Joint Steering Committee{TC "4.1 Joint Steering Committee" \f C \1 "2"}.
4.1.1 Formation, Membership. Within [***] after the date first written
above, ELAN and CAT shall establish a "Joint Steering Committee"
or "JSC" to oversee and direct the conduct of Research and the
Development of each Specific Target and R&D Candidate and to
oversee and coordinate those activities that are necessary for the
successful Commercialization for a Collaboration Product in the
Territory, as further described below in this Agreement. The JSC
shall be comprised of [***] representatives from each Party as
appointed by such Party, which representatives shall be senior
representatives of each Party and shall have expertise suitable to
the then-current activities of the collaboration. The JSC may
change its size from time to time by mutual consent of its
members. A Party may replace one (1) or more of its
representatives from time to time upon written notice to the other
Party. The JSC will exist until the termination of this Agreement
unless the Parties otherwise agree in writing.
-27-
4.1.2 Chairperson; Secretary. The chairperson and secretary of the JSC
shall rotate on an annual basis between the Parties. The
chairperson and secretary shall not be from the same Party at the
same time. The first chairperson shall be designated by ELAN. The
first secretary shall be designated by CAT. The chairperson will
be responsible for scheduling meetings of the JSC, preparing
agendas for meetings, sending to all JSC members notices of all
regular meetings and agendas for such meetings at least [***]
before such meetings. The secretary shall record the minutes of
the meeting, circulate copies of meeting minutes to the Parties
and each JSC member promptly following the meeting for review,
comment and approval, and shall finalize approved meeting
minutes. The chairperson shall be a member of the JSC but the
secretary need not be a member of the JSC.
4.1.3 Meetings. The JSC shall meet at least once each Calendar Quarter
during the term of this Agreement, unless otherwise mutually
agreed by the Parties. Either Party may call a special meeting of
the JSC on [***] written notice to the other Party and each of
the JSC members. Such written notice shall include an agenda for
the special meeting. Meetings, including, without limitation,
special meetings, of the JSC will alternate between the offices
of the Parties, unless otherwise agreed by the members of the
JSC, or may be held telephonically or by video-conference.
Meetings of the JSC shall be effective only if at least one (1)
representative of each Party is in attendance or participating in
the meeting. Members of the JSC shall have the right to
participate in and vote at meetings by telephone. The most senior
attending representative of each Party on the JSC shall have the
right to vote on behalf of any members of the JSC from such Party
not attending a JSC meeting in person or by telephone. Each Party
shall be responsible for expenses incurred by its employees and
its members of the JSC in attending or otherwise participating in
JSC meetings and, for the avoidance of doubt, such expenses shall
not be considered Research Expenses, Development Costs or
Reimbursable Commercial Costs.
4.1.4 Responsibilities of the JSC. In addition to its general
responsibility to oversee and coordinate the conduct of Research
under this Agreement and the Development according to the
Research Program and the Development Program, ensure a regular
flow of Research and Development information between the Parties
and to oversee and coordinate the Commercialization of
Collaboration Products in the Territory, the JSC shall in
particular:
(a) [***];
-28-
(b) [***];
(c) [***];
(d) approve the Annual Research Plan for the period from Effective
Date first written above through calendar year 2001 in accordance
with Section 5.2.1, and prepare and approve an updated Annual
Research Plan during each subsequent year in which the Parties
engage in Research activities;
(e) review, update and/or approve, as necessary, each applicable and
subsequent Annual Research Plan, Annual Research Budget, Annual
Development Plan and Annual Development Budget;
(f) review and approve any substantive departure from any Annual
Research Plan or Annual Research Budget pursuant to Sections
5.2.2 and 5.3.3;
(g) approve, as necessary, the Annual Development Plan for the period
from the Effective Date through calendar year 2001 in accordance
with Section 5.2.1, and prepare and approve an updated Annual
Development Plan and Annual Development Budget during each
subsequent year in which the Parties engage in Development
activities;
(h) review and approve any substantive departure from any Annual
Development Plan or Annual Development Budget pursuant to
Sections 5.2.2 and 5.3.3;
(i) oversee the activities of the project team(s) that is/are
performing the Party's activities under the Research Program and
the Development Program;
(j) facilitate the flow of information between the Parties with
respect to all Research and Development work being conducted for
each R&D Candidate in the Field and in the Territory;
(k) [***];
(l) review and approve any recommendations by the Joint Patent
Committee that a Third Party License should be entered pursuant
to Section 8.8;
(m) [***];
-29-
(n) review and approve all scientific and clinical protocols,
which shall provide that, where appropriate, all preclinical
and clinical Development work under this Agreement shall be
conducted in accordance with GLPs and GCPs;
(o) review and approve the contents and filings of INDs,
applications for Regulatory Approval, and related and
supporting submissions to Regulatory Authorities;
(p) review and approve the Commercialization Plan pursuant to
Section 7.1.4;
(q) review and approve a Post BLA Filing Plan pursuant to
Section 7.1.4; and
(r) at least [***] prior to the beginning of each calendar year,
prepare an estimate of Pro-Forma Net Profits on a
Collaboration Product-by-Collaboration Product and
country-by-country basis.
4.1.5 Authority. The Parties agree that, in voting on matters pursuant
to the procedures, it shall be conclusively presumed that each
voting member of the JSC has the authority and approval of such
member's respective senior management in casting his or her vote
and that decisions of the JSC made in accordance with this
Article 4 shall be binding upon each of the Parties; provided,
however, that the JSC shall not have the authority to amend or
modify this Agreement.
4.1.6 Appointment of Subteams or Subcommittees. In addition to the
creation of the Joint Project Team, the JSC shall be empowered
to create such subteams or subcommittees of itself as it may
deem appropriate or necessary. Each such subteam or
subcommittee shall report to the JSC, who shall have authority
to approve all recommendations or actions proposed thereby.
Each Party, unless the JSC determines to the contrary, shall
have equal representation on any such subteam or subcommittee.
4.1.7 Voting and Dispute Resolution. Any approval decision or other
action of the JSC shall be by the unanimous consent of the
JSC. Issues coming before the JSC that require action,
approval or resolution and for which the JSC is unable to
reach agreement on a mutually acceptable action, approval or
resolution shall be resolved by the Parties under the terms of
Article 15 below.
-30-
4.2 Project Coordinators{TC "4.2 Project Coordinators" \f C \1 "2"}. Each Party
shall designate [***] of its employees as project coordinator(s) for all of
the activities contemplated under this Agreement. Such project coordinators
will be responsible for the day-to-day coordination of the collaboration
contemplated by this Agreement and will serve to facilitate communication
between the Parties. A Party may, from time to time, replace its designated
project coordinator(s) upon providing the other Party with written notice
to that effect.
4.3 Compliance with Laws{TC "4.3 Project Coordinators" \f C \1 "2"}. Each Party
agrees that, in conducting its activities under this Agreement, it shall at
all times comply with all applicable laws, rules and regulations.
5. RESEARCH AND DEVELOPMENT.
5.1 The Research and Development Programs{TC "5.1 The Research and Development
Programs" \f C \1 "2"}.
5.1.1 Conduct of the Research and Development Programs. CAT and ELAN shall
collaborate through a Joint Project Team ("JPT") in the conduct of a
collaborative research program (the "Research Program") and a
collaborative development program (the "Development Program")
intended for and directed to the discovery, characterization,
isolation, Research and potential Development in the Field of any
Antibody which binds to a Specific Target, for the identification
of R&D Candidates, and for the pre-clinical and clinical Research
and Development of R&D Candidates in the Field. The JSC shall
have the authority to specify [***]. If the JSC declines to
approve a Target as a Specific Target for the collaboration, then
such Target shall not be part of the collaboration and shall
revert to the Party that first identified such Target for
inclusion in the Research Program. Each R&D Candidate shall be
advanced from the Research Program into the Development Program
on the date that the JSC designates such R&D Candidate for GLP
toxicology studies. An R&D Candidate shall remain in the
Development Program until such time as (i) the JSC determines
that such R&D Candidate should be returned to the Research
Program for the conduct of further Research, (ii) such R&D
Candidate is dropped from the Development Program or (iii) such
R&D Candidate becomes a Collaboration Product. [***] In the event
either Party proposes that a Target be a Specific Target and the
JSC declines to accept such a nomination, then the Parties shall
enter into such written acknowledgments as may be required to
maintain each Party's rights with respect to such Target as if
the Target had never been submitted. All decisions of the JSC
hereunder in respect of any Target shall be
-31-
unanimous and no provisions of either Article 4.1.7 or Article 15
shall apply in respect thereof.
5.1.2 The Research Program. The Research Program shall be conducted
for the Research Term. Subject to the other terms of this
Agreement, the Research Term shall automatically be extended for
an additional period of one (1) year unless, within [***] prior
to the expiration of the Research Term, the JSC determines that
additional Specific Targets should not be evaluated using the CAT
Technology. The Research Term or any extensions thereof may also
be extended upon mutual agreement of the Parties, which extension
must be agreed upon at least ***] in advance of the end of the
Research Term or the then current extension. At the first meeting
of the JSC, on a regular basis thereafter, but in no event less
than once every [***], and [***] after the end of the Research
Term, the JSC shall [***]. Each list provided for by the
proceeding shall be transmitted by reliable means to each member
of the JSC who shall, at either the next meeting of the JSC or
[***] after receipt thereof, confirm the accuracy of the content
of each applicable list. No Specific Target on any list provided
for under this Section 5.1.2 shall continue to be deemed a
Specific Target under this Agreement if within [***] of
designation by a Party such Party has not provided quantities of
suitable materials sufficient to permit such Specific Target to
be subjected to the CAT Technology.
5.1.3 The Development Program. The Development Program shall have a
term (the "Development Term") which commences upon the date an
R&D Candidate is selected for Development and shall continue
until the JSC agrees to cease the Development of the last
remaining R&D Candidate or until all Regulatory Approvals for
all R&D Candidates have been received in the Territory.
5.2 The Research and Development Plans{TC "5.2 The Research and Development
Plans" \f C \1 "2"}.
5.2.1 Annual Research Plan and Annual Development Plan. Within [***]
after the date first written above, the Parties shall prepare a
written annual research plan (the "Annual Research Plan") for the
Research activities to be conducted with respect to each Specific
Target, any Antibody candidate which bind thereto and each R&D
Candidate. The Annual Research Plan shall be updated and
maintained by the JPT and ratified by the JSC on an annual basis
during the Term of this Agreement. Furthermore, within [***] of
the first specification of an R&D Candidate for potential
Development, the JSC shall prepare a written annual development
plan (the "Annual Development Plan")
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setting forth, for each applicable R&D Candidate in the
Development Program the details of the specific Research
and/or Development activities of the Parties to be conducted
during each calendar year from the date of such Annual
Development Plan through to the end of the [***] from the
commencement of the applicable Annual Development Plan. As
determined and approved by the JSC, each Annual Research
Plan and/or Annual Development Plan may include activities
which extend beyond the applicable calendar year. The
initial Annual Research Plan shall address the elements set
forth in Exhibit 5.2.1 to this Agreement, as well as other
-------------
elements that may be appropriate for inclusion therein.
Within [***] following the provision of the initial draft
thereof, the JSC shall review and approve, as applicable,
the initial Annual Research Plan or Annual Development Plan.
Thereafter, on or before August 31 of each year (commencing
in 2001), the JSC shall prepare and approve, as applicable,
a revised Annual Research Plan and/or Annual Development
Plan addressing the collaborative Research and Development
activities (as applicable) to be undertaken by the Parties
during the following calendar year. Each Annual Research
Plan and each Annual Development Plan shall include, without
limitation, [***] (the "Annual Research Budget" and the
"Annual Development Budget"). During the Research Term all
decisions of the JSC in respect of any Annual Research
Budget or Annual Development Budget for each R&D Candidate
shall be unanimous and no provisions of either Article 4.1.7
or Article 15 shall apply in respect thereof until the
filing of an IND for such R&D Candidate. Following the
filing of an IND for each R&D Candidate Sections 4.1.7 and
15 shall apply in respect of the Annual Research Budget or
Annual Development Budget for that R&D Candidate. Subject to
Section 3.3, should the JSC determine that a specific
activity would best be undertaken by a Third Party
contractor, the JSC shall indicate which Party shall manage
such Third Party contractor. The Annual Research Plan and
Annual Development Plan may only be modified or amended upon
written approval of the JSC.
5.2.2 Conduct of the Annual Research Plan and Annual Development
Plans. ELAN and CAT shall each use Commercially Reasonable
Efforts to perform its respective activities under the then
current Annual Research Plan and Annual Development Plan and
each Party shall, where appropriate, perform such activities
in accordance with applicable GLPs and GCPs. All activities to
be undertaken in the performance of an Annual Research Plan or
Annual Development Plan shall be carried out by employees of
the Parties and/or their respective Affiliates; provided,
however, that if either Party is able to reasonably
demonstrate, and the JSC agrees, that (a) it would be in the
best interests of both Parties to contract with one (1) or
more Third Parties to perform certain
-33-
tasks under either an Annual Research Plan or Annual Development
Plan, and (b) any such Third Party is capable of performing such
tasks in a manner competitive with the Parties in terms of cost
and quality, then, the Party responsible for such task may enter
into a contract meeting the requirements of Section 3.3 with a
Third Party to perform such task, which contract shall be subject
to the prior written approval of the JSC. In determining whether
to utilize the services of any Third Party in conducting
activities under an Annual Research Plan or Annual Development
Plan, the Parties shall consider, inter alia, [***]. The
responsibility for performing clinical studies of each R&D
Candidate will be assigned to CAT, ELAN and/or Third Party
contractors selected by the JSC in accordance with this Section.
5.2.3 Periodic Inspections. With respect to any facility or site at which
a Party conducts Research, Development or Manufacturing pursuant
to this Agreement, including, where commercially reasonable and
within the control of the other Party, Third Party facilities or
sites, each Party and any relevant Regulatory Authority shall
have the right, at its expense, upon reasonable written notice
and during normal business hours, to inspect such site and
facility and any records relating thereto as is reasonably
necessary to verify the other Party's compliance with the terms
of this Agreement relating to GLP, GCP and GMP. Such inspection
shall be subject to the confidentiality provisions of this
Agreement. Each Party agrees, to the maximum extent possible, to
include in any agreement with a Third Party relating to such
facilities and sites a clause permitting the other Party and any
relevant Regulatory Authority to exercise its rights under this
Section. Each Party shall, upon the request of the other Party or
a relevant Regulatory Authority, cause appropriate individuals
working on its or any Third Party's behalf on the Research
Program and/or Development Program, on reasonable terms and
timing, to be available for meetings and to answer questions at
the facilities or sites where such individuals are employed
during normal business hours and on days mutually convenient to
the Party or the Third Party in question. The requesting Party
shall be responsible for all costs and expenses relating to the
exercise of any right granted pursuant to the preceding sentence.
5.3 Funding of the Annual Research Plan and the Annual Development Plan{TC "5.3
Funding of the Annual Research Plan and the Annual Development Plan" \f C
\1 "2"}.
-34-
5.3.1 Research and Development Expenses. From the Effective Date forward, the
Parties shall be obligated to and shall fund all Research Expenses and
Development Costs on an equal basis, subject to the limitations of
Section 5.3.3.
5.3.2 Payment of Expenses; R&D Accounts. Subject to reconciliation as
provided in Section 5.3.4, each Party shall be responsible and pay for
all Research Expenses and Development Costs incurred by it in
performing its activities under the Research Program and the
Development Program. Subject to the limitations set forth in Section
5.3.3, each Party shall charge all such expenses so incurred by it or
its Affiliates to a separate account created by such Party on its books
and records solely for the purpose of tracking expenses incurred in
connection with the Research Program and Development Program (each, an
"R&D Account"). Within [***] after the end of each Calendar Quarter,
each Party shall submit to the other Party a written summary of all
expenses charged to its R&D Account during such Calendar Quarter, which
summary shall be accompanied by reasonable supporting documentation for
such expenses. The Parties will work together to report to each other
estimates of the amounts to be included in such reports prior to the
expiration of the reporting period provided for in this Section 5.3.2.
5.3.3 Expense Limitations. The expenses charged by either Party to its R&D
Account in accordance with Section 5.3.2 shall not, subject to Section
7.1.4, be an amount in excess of [***] the amount included for such
expenses in the then current Annual Research Budget, Annual Development
Budget or Post BLA Filing Annual Budget, as appropriate, unless the JSC
recommends and each Party approves such excess expenses. Additionally,
the Parties hereby agree that efforts of the employees of a Party or
its Affiliates in performing its activities hereunder shall be charged
to such Party's R&D Account at the applicable FTE rate set forth in the
applicable Annual Research Budget or Annual Development Budget;
provided, however, that only those efforts that are contemplated by the
Annual Research Plan and the Annual Development Plan shall be
chargeable by a Party to its R&D Account, except as otherwise approved
in writing by the JSC. The FTE rates set forth in any Annual Research
Budget or Annual Development Budget shall be based upon [***]. All
payments made by a Party to a Third Party in connection with the
performance of its activities under an Annual Research Plan or Annual
Development Plan shall be charged to such Party's R&D Account at such
Party's actual out-of-pocket cost. Expenses incurred by each Party for
equipment, materials and supplies utilized in performing its activities
under an Annual Research Plan or Annual Development Plan shall not be
separately charged to such Party's R&D Account, ex-
-35-
cept for those expenses incurred by a Party, with the prior written
consent of the JSC, [***], which expenses shall be charged to such
Party's R&D Account at such Party's actual out-of-pocket expense
incurred in purchasing or making such equipment, materials or supplies.
Notwithstanding the foregoing, in the case of materials supplied to the
Parties by either Party for use in clinical trials of R&D Candidates or
Collaboration Products, the supplying Party shall charge to its R&D
Account its Cost of Goods Manufactured for Clinical Supplies for such
materials, as adjusted to account for customary and usual manufacturing
cost variances allocable to such materials.
5.3.4 Reconciliation of Expenses. Within [***] after the end of each Calendar
Quarter, ELAN shall prepare a reconciliation report, accompanied by
reasonable supporting documents and calculations, which reconciles the
amounts charged to each Party's R&D Account during such Calendar
Quarter pursuant to Section 5.3.2, including, without limitation,
making any necessary adjustments for prior period Manufacturing cost
variances allocable to R&D Candidates utilized in Development, and the
share of the Parties' aggregate Research Expenses to be allocated to
each of the Parties for such Calendar Quarter in accordance with
Section 5.3.1. Within [***] after ELAN delivers such reconciliation
report to CAT, the net amount shown as being due either to CAT or to
ELAN will be paid via same day wire transfer by the Party owing such
amount.
5.3.5 Third Party License Fees. A description of each Party's Third Party
License obligations with respect to Know How or Patent Rights
Controlled by such Party and to be used during the course of the
collaboration is set forth on Exhibit 1.11. Until such date as an R&D
------------
Candidate becomes a Collaboration Product the Parties shall equally
share in the costs of any Third Party License Fees relating to the
Research and/or Development under this Agreement of each R&D Candidate
subject to a Third Party License Fee obligation disclosed upon Exhibit
-------
1.11; provided, however, that CAT shall be solely responsible for any
----
Third Party License Fee (other than any Third Party License Fee
attributable to antigens being screened as part of the Operation of the
CAT Antibody Library which shall be shared equally in accordance with
this Section) arising out of the Operation of the CAT Antibody Library
which is in excess of [***], individually or in the aggregate. Third
Party License Fees to be shared equally in accordance with this Section
5.3.5 should be charged by the relevant Party to its R&D Account. For
the purposes of this Section 5.3.5, "Operation of the CAT Antibody
Library" shall mean the screening of antigens against the CAT Antibody
Library and the isolation of single-chain Fv fragments (and Antibodies
derived therefrom) from the CAT Antibody Library.
-36-
5.3.6 Records and Audits. During the term of this Agreement, each Party shall
keep and maintain accurate and complete records showing the expenses
incurred by it in performing its activities under the Annual Research
Plans and Annual Development Plans during the [***] preceding calendar
years, which books and records shall be in sufficient detail such that
Research Expenses and Development Costs can accurately be determined.
Upon [***] prior written notice from a Party (the "Auditing Party"),
the other Party (the "Audited Party") shall permit an independent
certified public accounting firm of nationally recognized standing
selected by the Auditing Party and reasonably acceptable to the Audited
Party, to examine the relevant books and records of the Audited Party
and its Affiliates as may be reasonably necessary to verify the reports
submitted by the Audited Party in accordance with Section 5.3.2 and the
accuracy of the reconciliation report prepared in accordance with
Section 5.3.4. An examination by a Party under this Section 5.3.6 shall
occur not more than once in any calendar year during the term of this
Agreement and not more than once during the [***] following the
termination of this Agreement and shall be limited to the pertinent
books and records for any calendar year ending not more than [***]
before the date of the request. The accounting firm shall be provided
access to such books and records at the Audited Party's facility(ies)
where such books and records are normally kept and such examination
shall be conducted during the Audited Party's normal business hours.
The Audited Party may require the accounting firm to sign a
non-disclosure agreement before providing the accounting firm access to
the Audited Party's facilities or records. Upon completion of the
audit, the accounting firm shall provide both CAT and ELAN a written
report disclosing whether the reports submitted by the Audited Party
are correct or incorrect and the specific details concerning any
discrepancies. No other information shall be provided to the Auditing
Party. If the accountant determines that, based on errors in the
reports so submitted, the reconciliation report prepared in accordance
with Section 5.3.4 is incorrect, the Parties shall promptly revise the
reconciliation report and any additional amount owed by one Party to
the other shall be paid within [***] after receipt of the accountant's
report, along with interest at the annual interest rate of [***],
compounded monthly from the date that such additional amount should
have first been paid; provided, however, that no such interest shall be
payable if the errors leading to the reconciliation report being
incorrect were in the reports provided by the Party to receive such
additional amount. Additionally, if the accountant determines that the
reports submitted by the Audited Party overstate the Audited Party's
expenses by more than [***], the Audited Party shall reimburse the
Auditing Party for the reasonable expenses incurred by the Auditing
Party in conducting the audit, including, without limitation,
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those arising out of the retention of the reputable and
internationally recognized independent accounting firm
undertaking the audit.
5.4 Reporting and Disclosure{TC "5.4 Reporting and Disclosure"\f C\1 "2"}.
5.4.1 Reports. Before each quarterly meeting of the JSC, ELAN and CAT
will each provide the other with written copies of all
materials they intend to present at the JSC meeting plus, to
the extent not set forth in the JSC materials, a written report
summarizing any other material data and information arising out
of the conduct of the Research Program and/or Development
Program including, without limitation, data and information
relating to any Inventions made by such Party. If after receipt
of any such report, either Party shall request additional data
or information relating to an Annual Research Plan or Annual
Development Plan or the intellectual property licensed
hereunder, the Party to whom such request is made shall
promptly provide to the other Party such data or information
that such Party reasonably believes is necessary for the
continued conduct of the Research Program or the Development
Program.
5.4.2 Quarterly Meeting. At the quarterly meeting of the JSC, CAT and
ELAN will review in reasonable detail (i) all data and
information generated in the conduct of the applicable Annual
Research Plan and Annual Development Plan by each Party, and
(ii) all matters arising out of or relating to the Joint
Collaboration Patent Rights, the Joint Collaboration Know How,
the Elan Collaboration Patent Rights, the Elan Collaboration
Know How, the CAT Collaboration Patent Rights and the CAT
Collaboration Know How.
5.5 Disclosure and Cooperation{TC "5.5 Disclosure and Cooperation"\f
C\1 "2"}. During the term of this Agreement, the Parties will promptly
disclose to one another all data, information, Inventions, techniques
and discoveries (whether patentable or not) arising out of the conduct
of the Research Program and the Development Program, and all Inventions,
techniques and discoveries (whether patentable or not) included within
the Joint Collaboration Patent Rights, the Joint Collaboration Know How,
the Elan Collaboration Patent Rights, the Elan Collaboration Know How,
the CAT Collaboration Patent Rights and the CAT Collaboration Know How,
the Patent Rights and Know How subject to the Section 8.1.3 and any
other rights licensed hereunder. Such disclosures may include the form
of limited visits by ELAN and CAT personnel to the facilities being
utilized for the Research Program and the Development Program to permit
observation of the procedures being employed. The Parties agree to
cooperate with each other to protect all matters arising out of or
relating to the Patent Rights and Know How licensed or utilized pursuant
to this Agreement and to
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prepare and execute whatever documents and instruments may be
reasonably necessary or desirable to effect such protection.
5.6 CAT Exclusive Antibody{TC "5.6 CAT Exclusive Antibody" \f C\1 "2"}.
5.6.1 CAT Obligation To Research And Develop. During the term of
this Agreement CAT shall, on a regular basis, but not less
than every [***] or upon ELAN's reasonable written request,
create and transmit to ELAN a written summary providing the
identity of each CAT Exclusive Antibody as to which
Commercially Reasonable Efforts have been undertaken by CAT to
research, develop, manufacture and commercialize such CAT
Exclusive Antibody both inside and outside the Field and
specifying, with a reasonable level of detail, the exact scope
and nature of all activities undertaken by CAT with respect to
each CAT Exclusive Antibody so identified. Notwithstanding the
foregoing, CAT shall, upon [***] written notice, provide to
ELAN reasonable access to all information, materials or other
items as may be necessary or sufficient to permit ELAN to
review and analyze each Antibody identified, isolated and/or
discovered as a result of Research conducted pursuant to this
Agreement. CAT covenants to and shall maintain any materials
or information relating to any CAT Exclusive Antibody for a
period of [***] from the creation of such materials or
information. From time to time, either Party may request an
affirmation from the other Party of the status of an Antibody
as either an CAT Exclusive Antibody or an R&D Candidate. For
the avoidance of doubt, nothing herein shall oblige CAT to
research, develop, manufacture or commercialize any CAT
Exclusive Antibody in respect of which CAT reasonably believes
it cannot or should not exercise Commercially Reasonable
Efforts.
5.6.2 ELAN Right To Research And Develop. If, after the later of
either [***] after the discovery thereof or its obtaining the
status of a CAT Exclusive Antibody, an Antibody has neither
been identified in the reports provided for in Section 5.6.1
nor has it been the subject of the Commercially Reasonable
Efforts required by that Section, ELAN may, upon written
notice and at is option, require CAT to enter into an
exclusive license, both within and without the Field, to all
of CAT's right, title, and interest in each such CAT Exclusive
Antibody; provided, however, that ELAN must first, in a
written offer, grant to CAT the right, at CAT's sole option,
to enter into a mutually exclusive collaboration arrangement,
upon the same financial and other terms provided for in this
Agreement, to complete, as applicable, the research,
development, manufacture, and/or commercialization of each
Antibody identified therein. If CAT fails to respond in
writing to ELAN's written offer within [***] after re
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ceipt thereof, ELAN's sole remaining obligation to CAT with respect to
each Antibody identified in any such initial offer to CAT under this
Section 5.6.2 shall be to pay to CAT on a country by country basis, a
royalty of [***] of the Net Sales of any Party Exclusive Product
containing such a CAT Exclusive Antibody until the later of either ten
(10) years following First Commercial Sale of such Party Exclusive
Product in such country or until the expiry in such country of the last
to expire Patent Right comprised in the CAT Patent Rights in existence
as of the Effective Date. ELAN shall exercise Commercially Reasonable
Efforts to research, develop, manufacture and commercialize each CAT
Exclusive Antibody and Party Exclusive Product as to which it obtains
any rights pursuant to this Section 5.6.2.
5.6.3 ELAN Exclusivity Provisions. Up to, but no later than [***] prior to
the submission under CAT's sponsorship of any written clinical protocol
to a Regulatory Authority for a Phase III Clinical Trial relating to a
CAT Exclusive Antibody, CAT must provide written notice to ELAN which
shall contain a detailed offer of all the material terms and conditions
upon which CAT would be willing to enter into a mutually exclusive
arrangement respecting, as applicable, the further research,
development, manufacturing and/or commercialization of the applicable
CAT Exclusive Antibody. With transmittal of its written offer and
during the evaluation period provided for below, CAT shall provide to
ELAN all relevant scientific, regulatory, and commercial information
reasonably necessary for ELAN to evaluate the offer. ELAN shall have
[***] to accept or refuse such offer; provided, however, that ELAN
shall, [***] prior to such date, be provided by CAT with sufficient
information as ELAN may reasonably request concerning the applicable
CAT Exclusive Antibody. CAT may not enter into any discussions or
commercial negotiations respecting the CAT Exclusive Antibody which
will be the subject of a written offer to ELAN prior to the submission
of the written offer to ELAN, but shall thereafter be free to enter
into such discussions and negotiations; provided, however, [***]. Upon
acceptance of CAT's offer by ELAN, any additional terms and conditions
of the arrangement shall be determined solely by reference to the
written offer or, as applicable, good faith negotiation and shall be
documented in a written agreement signed by authorized representatives
of the Parties. Failure by ELAN to accept CAT's written offer in regard
to a CAT Exclusive Antibody within the applicable review period shall
constitute a refusal of such offer. If ELAN refuses CAT's offer, then,
within [***] after such refusal, CAT may enter into an arrangement with
a Third Party; provided, however, that such arrangement is not on
economic terms and conditions better for CAT than those offered to
ELAN. If CAT does not enter into such an arrangement within
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the time period provided in the proceeding sentence, then CAT
shall again be obligated to make a written offer to ELAN under
the terms of this Section 5.6.3 prior to entering into any
arrangement with a Third Party to, as applicable, conduct further
research, development, manufacturing and/or commercialization of
the applicable CAT Exclusive Antibody. In the event that CAT does
not enter into an arrangement with ELAN with respect to any CAT
Exclusive Antibody under this Section 5.6.3, then CAT shall pay
to ELAN for ten (10) years following First Commercial Sale of a
Party Exclusive Product containing such a CAT Exclusive Antibody,
a royalty of [***] of the Net Sales of such Party Exclusive
Product.
5.7 Hybrid R&D Candidates{TC "5.7 Hybrid R&D Candidates" \f C\1 "2"}.
5.7.1 Duty To Develop Hybrid R&D Candidates. On a regular basis the
JSC shall determine whether any R&D Candidate which binds to a
Specific Target and was discovered, isolated and/or characterized
by a Party under this Agreement should be the subject of Research
and/or Development activities outside of the Field. Each Party
shall be obligated to provide the JSC with such scientific,
technical and other information within its Control which is
reasonably related to the determinations to be made under this
Section 5.7.1. [***]. In the event that the JSC determines a
reasonable scientific rationale exists for Research and/or
Development of an Antibody outside the Field, the JSC shall have
the authority to designate such an Antibody an R&D Candidate
notwithstanding the fact that the applicable Research and/or
Activities will be outside of the Field; provided, however, that
such R&D Candidate was also selected for such activities within
the Field. Each R&D Candidate so designated for Research and/or
Development activities outside of the Field shall be known as a
"Hybrid R&D Candidate". As applicable, each Annual Research Plan,
Annual Research Budget, Development Plan and/or Development
Budget shall make provisions for activities outside the Field for
the Research, Development and/or Manufacture of Clinical Supplies
of any Hybrid R&D Candidate. For all other purposes, except as
otherwise provided for, each Hybrid R&D Candidate shall be
subject to the same terms, conditions and other obligations
applicable to any other R&D Candidate.
5.7.2 Commercialization of Certain Hybrid R&D Candidates. The JSC
shall, on a regular basis, but no less than once a year or as
frequently as may be reasonably requested to by either Party,
determine whether to continue any Research and/or Development of
a Hybrid R&D Candidate outside of the Field. If the JSC
determines, taking into account all relevant commercial,
scientific and/or
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other information, not to continue either the Research and/or
Development outside of the Field of a Hybrid R&D Candidate,
then one of the Parties shall be appointed on behalf of both
the Parties to arrange for the commercial disposition of both
Parties' interest and rights thereto; provided, however, that
no rights to Research, Develop, Manufacture or Commercialize
such an Hybrid R&D Candidate in the Field may be granted
unless both Parties execute a written acknowledgement and the
Party proposing such a disposition can, using objective
scientific and commercial data, establish that the primary
economic value of the applicable Hybrid R&D Candidate is
outside of the Field. The appointments under this Section
5.7.2 shall rotate with first appointment being CAT. The Party
appointed shall have discretion, subject to final approval by
the JSC, to arrange for the license of each Hybrid R&D
Candidate, but shall at all time act in the best interests of
both Parties. No disposition or license provided for under
this Section 5.7.2 shall be on terms permitting the payment of
a royalty which is less than the Third Party License Fees
payable by the Parties with respect to such Hybrid R&D
Candidate. The Parties shall share equally in any monetary
consideration received from any license or grant of rights
encompassing a Hybrid R&D Candidate, including, without
limitation, sharing all Net Commercialization Revenues.
6. MANUFACTURING AND REGULATORY MATTERS.
6.1 Manufacture and Supply{TC "6.1 Manufacture and Supply" \f C\1 "2"}. For
the purposes of this Article 6 and Article 13, "Collaboration Product"
shall mean Collaboration Product in bulk active ingredient and finished
dosage form.
6.1.1 Responsible Party. CAT shall be responsible for the
Manufacture and supply of Clinical Supplies. The JSC shall
determine whether CAT, ELAN or a Third Party shall be
responsible for the Manufacture and supply of Collaboration
Product for Commercialization. As applicable, and subject to
the provisions of Section 6.1.2, the Parties shall negotiate
and enter into separate written agreements pertaining to the
provision of Clinical Supplies or Collaboration Products
consistent with the other terms of this Agreement. In the
event that CAT is not competitive with Third Parties with
respect to price, quality, and capacity of Collaboration
Product, then ELAN shall, upon written notice to CAT, have the
right to either (a) retain a Third Party contract manufacturer
to Manufacture and supply such Collaboration Products to ELAN
on commercially reasonable terms, or (b) optimally, to
Manufacture such Collaboration Products itself; provided that,
ELAN is competitive with Third Parties in Cost of Goods
Manufactured for Commercialization with respect to price,
quality and capacity
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of Collaboration Product. Notwithstanding the foregoing, immediately
following Regulatory Approval, a mutually agreed upon secondary
manufacturer shall be qualified for the back-up Manufacture and
supply of each Collaboration Product.
6.1.2 Agreement for Supply of Collaboration Product to ELAN. If the JSC
determines that CAT shall Manufacture and supply Collaboration
Products to ELAN, then at least [***] prior to the date of any
anticipated Regulatory Approval of such a Collaboration Product, ELAN
and CAT shall negotiate, in good faith, and enter into a written
supply agreement which sets forth the rights and obligations of the
Parties in connection with CAT's supply of Collaboration Product to
ELAN for worldwid e sale and distribution by ELAN (each one a "Supply
Agreement"). Such Supply Agreement shall not be inconsistent with the
terms and conditions of this Agreement and shall include [***]. The
purchase price, on a country-by-country basis, to be paid to CAT by
ELAN for each unit of Collaboration Product delivered to ELAN under
such supply agreement for distribution in such country shall be equal
to [***]. The purchase price shall be payable within [***] after such
Collaboration Product is delivered to ELAN.
6.2 Regulatory Matters{TC "6.2 Regulatory Matters" \f C\1 "2"}.
6.2.1 Clinical Trials. ELAN shall own all clinical trial data accumulated
from all clinical trials of R&D Candidates conducted as part of the
Development Program or otherwise funded or partially funded by the
Parties. Each Party shall use, and shall cause its permitted Third
Party Sublicensees to use, commercially reasonable and diligent
efforts to disclose to the other Party all material information
relating to any R&D Candidate or Collaboration Product promptly after
it is learned or its materiality appreciated. ELAN shall maintain,
and shall cause its permitted Third Party Sublicensees to maintain,
the database of clinical trial data accumulated from all clinical
trials of R&D Candidate and of adverse reaction information for all
such R&D Candidate or Collaboration Products. Such database shall be
maintained in accordance with the Medical Dictionary for Regulatory
Activities standard, as in effect from time to time. Each Party shall
also keep the JSC informed as to its or its permitted Third Party
Sublicensees' progress in the Development Program. [***]. Within
[***] following the end of each Calendar Quarter during the
Development Program, each Party shall provide the other Party with a
reasonably detailed written report which shall describe the progress
to date of all activities for which such
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Party and its Affiliates were allocated responsibility during such
Calendar Quarter under the Development Program.
6.2.2 Regulatory Approvals. ELAN shall file, in its own name, all
applications for Regulatory Approval for Collaboration Products in all
countries of the Territory other than those applications relating to
the facilities to be used by CAT to Manufacture Collaboration Product
which shall be filed in the name of CAT. ELAN shall have the primary
responsibility for communicating with any Regulatory Authority
regarding any such application for Regulatory Approval or any
Regulatory Approval once granted; provided, however, that the Parties
shall, through the JSC, consult and cooperate in (i) developing a
Regulatory Approval filing strategy for R&D Candidates, (ii) reviewing
study reports from clinical trials on R&D Candidates, (iii) preparing
applications for Regulatory Approval for Collaboration Products, (iv)
preparing supplements to applications for Regulatory Approval for
Collaboration Products, (v) responding to questions from Regulatory
Authorities regarding applications for Regulatory Approval or any
supplement thereto and (vi) participating in interactions with
Regulatory Authorities concerning the Collaboration Products.
6.2.3 Regulatory Reporting. ELAN shall be responsible for filing all
reports required to be filed in order to maintain any Regulatory
Approvals granted for Collaboration Products in all countries of the
Territory, including, without limitation, adverse drug experience
reports. CAT shall cooperate with ELAN in preparing and filing all
such reports and, upon ELAN's request, provide ELAN with any
information in CAT's possession or Control which ELAN reasonably deems
to be relevant to any such reports. Notwithstanding the foregoing, to
the extent CAT has or receives any information regarding any adverse
drug experience which may be related to the use of any R&D Candidate
or Collaboration Product, CAT shall promptly provide ELAN with all
such information in accordance with the adverse event reporting
procedures to be established by the JSC no later than [***] (as may be
amended from time to time upon mutual agreement of the Parties).
Expenses (both internal expenses and out-of-pocket costs paid to a
Third Party) incurred by a Party in performing its regulatory
reporting obligations under this Section in connection with Regulatory
Approvals in the Territory shall be charged by such Party to such
Party's Marketing Account for such Collaboration Product as an Ongoing
Development Cost.
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7. COMMERCIALIZATION OF PRODUCTS.
7.1 Commercialization in the Territory{TC "7.1 Commercialization in the
Territory" \f C\1"2"}.
7.1.1 [***]:
(a) [***]
(b) [***].
Each Party, in exchange for the licenses granted to the entity
provided for under this Section 7.1.1 and pursuant to Article 3
of this Agreement, upon their mutual consent, shall receive equal
royalty payments in an amount ranging between [***] of the Gross
Sales of any Collaboration Products.
7.1.2 Share of Pro-Forma Net Profits. From the First Commercial Sale
of each Collaboration Product, the Parties shall, subject to the
deductions provided for in Section 7.1.10, share equally all
Pro-Forma Net Profits in respect of such Collaboration Product.
7.1.3 Responsibility. ELAN shall (a) have the exclusive right to
undertake the Commercialization of Collaboration Product(s) in
the Territory, and (b) use Commercially Reasonable Efforts to
Commercialize each Collaboration Product, promptly and in such a
manner, subject to the royalty provisions of Section 7.1.1, as to
maximize the overall profitability of each such Collaboration
Product. CAT shall provide such support as may be reasonably
requested by ELAN in connection with such Commercialization.
Except as otherwise set forth in this Article 7, all activities
shall be undertaken by the Parties in accordance with the
Commercialization Plan.
7.1.4 Commercialization Plan. On a Collaboration
Product-by-Collaboration Product basis, not later than [***]
after commencement of the first Phase III Clinical Trial of a R&D
Candidate in the Territory, ELAN shall prepare and the JSC shall
review, and after due consideration by ELAN of any suggestions or
comments, accept ELAN's rolling multi-year (being not less
than[***]) plan for Commercializing the Collaboration Product in
the Territory (the "Commercialization Plan"), which plan shall
include without limitation [***]. The Commercialization Plan
shall be updated by the ELAN at least once each calendar year.
Not later than [***] after the filing of the first BLA for an R&D
Candidate in the Territory and thereafter on or before August 31
of each calen
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dar year, ELAN shall prepare and the JSC shall review, and after
due consideration by ELAN of any suggestions or comments, accept
a long term plan (the "Post BLA Filing Plan"), which plan shall
be based on and shall supersede the then current
Commercialization Plan and which shall include [***]. The Post
BLA Filing Budget shall be based on and shall supersede the
relevant Commercialization Budget. The Post BLA Filing Plan will
specify [***]. In preparing and updating the Commercialization
Plan, Commercialization Budget, each Post BLA Filing Plan and
each Post BLA Filing Budget, ELAN will take into consideration
factors such as market conditions, regulatory issues and
competition. If in any year of a Post BLA Filing Plan the
aggregate expenses incurred by the Parties are in excess of [***]
of the amounts set out in the Post BLA Filing Budget for that
year (a "Post BLA Excess Year") then each Party shall charge to
its R&D Account [***] of such [***] and, in addition, ELAN shall
charge to its R&D Account any amounts in excess of such [***]
(the "Post BLA Excess Charge"). All expenses incurred by the
Parties in respect of any Post BLA Filing Budget and charged to
their respective R&D Accounts shall be shared equally by the
Parties in accordance with Section 5.3.1 and Section 5.3.4;
provided, however, in any years following a Post BLA Excess Year
CAT shall, in addition to any sums which may be due to ELAN under
Section 5.3.4 for that year in respect of the then current Post
BLA Filing Budget, pay to ELAN [***] of any Post BLA Excess
Charges charged by ELAN to is R&D Account in each Post BLA Excess
Year provided always that CAT's liability hereunder in any year
shall not exceed [***] of [***] of the relevant Post BLA Filing
Budget. If CAT's liability hereunder in any year does exceed
[***] of [***] of the relevant Post BLA Filing Budget then this
Section shall apply mutatis mutandis thereto.
7.1.5 Pricing and Commercial Diligence. ELAN, as the exclusive
distributing party within the Territory, shall have the sole
decision-making authority and discretion with respect to all
pricing decisions in such Territory on a country by country
basis; provided, however, that such pricing strategy shall be
commercially reasonable in light of commercially relevant factors
relating to such Collaboration Product including market,
competition, indication, reimbursement and related issues.
7.1.6 ELAN's Responsibilities. In Commercializing Collaboration
Products ELAN shall comply with all applicable rules and
regulations related thereto including but not limited to those
related to "off-label" promotion of biopharmaceutical products;
provided, however, that nothing shall preclude ELAN from
conducting lawful promotional activities directed to such
"off-label" uses.
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7.1.7 CAT's Responsibilities. CAT shall not, and shall cause its
Affiliates not to, solicit for its, or their, own account,
sales of Collaboration Products. Any solicitations or requests
to purchase Collaboration Products received by CAT or any of
its Affiliates from any customer or prospective customer shall
be immediately referred to ELAN. In Commercializing Party
Exclusive Products CAT shall comply with all applicable rules
and regulations related thereto including but not limited to
those related to "off-label" promotion of biopharmaceutical
products; provided, however, that nothing shall preclude CAT
from conducting lawful promotional activities directed to such
"off-label" uses.
7.1.8 Non-Antibody Product Royalty Obligation. For a period of ten
(10) years following the First Commercial Sale of any
Non-Antibody Product in any Major Market Country, ELAN shall
pay to CAT a royalty of [***] of Net Sales of Non-Antibody
Products.
7.1.9 Recalls; Customer Support.
(a) Recalls. The determination of whether a Product recall
is required shall be made by the Party distributing
such Product, in its sole discretion; provided that,
each Party shall promptly notify the other Party in
writing of such a recall decision. During the term of
this Agreement, ELAN shall be responsible for handling
and implementing all recalls and market withdrawals of
any Collaboration Product in the Territory. CAT will
make available to ELAN, upon request, all of CAT's
records that ELAN may reasonably request to assist it
in effecting any recall or market withdrawals. The
Parties shall share equally all costs of a recall or
marketing withdrawal of a Collaboration Product in the
Territory. Neither Party shall have the obligation to
reimburse or otherwise compensate the other Party for
any lost profits or income that may arise in connection
with any such recall or market withdrawal of a Product.
(b) Customer Support. Each Party shall, using Commercially
Reasonable Efforts, perform, and in consultation with
the other Party, be responsible for all customer
support services necessary to discharge its obligations
to Commercialize Products hereunder. For the avoidance
of any doubt, any customer support services which
require regulatory approval, acquiescence or oversight,
including, without limitation, pharmacovigilance,
responding to physician inquiries, or professional
education, relating to Collaboration Product shall be
conducted solely by ELAN and shall constitute a
Reimbursable Commercial Cost.
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7.1.10 Commercialization Expenses.
(a) Premarketing Expenses. On a Collaboration Product by
Collaboration Product and country by country basis,
before Regulatory Approval of such Collaboration
Product in such country of the Territory, the
Pre-Marketing Costs incurred by ELAN with respect to
such Collaboration Product in anticipation of obtaining
Regulatory Approval of such Collaboration Product in
such country shall be shared equally by the Parties,
consistent with plans and budgets established in the
applicable Annual Development Plan. As such
Pre-Marketing Costs are incurred they shall be paid for
by ELAN, subject to reimbursement as set forth in
Section 7.1.10(d).
(b) Payment of Expenses; ELAN Marketing Accounts. Subject
to reconciliation as provided in Section 7.1.10(c) and
(d), as applicable, ELAN shall be responsible and pay
for all Reimbursable Commercial Costs incurred by it in
performing its activities in connection with the
Commercialization of Collaboration Products in the
Territory. Subject to the limitations set forth in
Section 7.1.10(d), ELAN shall charge all such expenses
so incurred by it or its Affiliates to a separate
account created on its books and records solely for the
purpose of tracking expenses incurred in connection
with the Commercialization of Collaboration Products in
the Territory (each, a "Marketing Account"). Within
[***] after the end of each Calendar Quarter, ELAN
shall submit to CAT a written summary of all
Reimbursable Commercial Costs incurred by it in
performing its activities in connection with the
Commercialization of Collaboration Products in the
Territory, charged to its Marketing Account during such
Calendar Quarter, which summary shall be accompanied,
upon prior written request, by reasonable supporting
documentation for such expenses. The report provided
for in this Section 7.1.10(b) shall include a
reasonable estimate of the Sales Returns and Allowances
charged to ELAN's Marketing Account.
(c) Expense Limitations. Reimbursable Commercial Costs
charged by ELAN to its Marketing Account in accordance
shall not be in an amount in excess of [***] of the
amount included for such expenses in the then current
Annual Commercialization Plan, unless the JSC approves
such excess expenses. All payments made by ELAN to any
Third Party in connection with the performance of its
activities in connection with the Commercialization of
a Product in the Territory shall
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be charged to ELAN's Marketing Account at ELAN's actual
out-of-pocket cost incurred in connection with such
Third Party relationships.
(d) Reimbursement of Certain Expenses. At the time ELAN or
the entity provided for in Section 7.1.1 distributes to
CAT CAT's share of the Pro-Forma Net Profits obtained
from the sale of a Collaboration Product in a country
of the Territory during any Calendar Quarter, ELAN
shall be reimbursed for those Reimbursable Commercial
Costs that are (i) directly allocable to the
Commercialization of such Product in such country
during such Calendar Quarter, (ii) properly charged by
ELAN to its Marketing Account in accordance with
Section 7.1.10 (b) and (iii) reported to CAT in
accordance with this Section. If the amount obtained
from sales of Collaboration Products are insufficient
in any Calendar Quarter to fully reimburse ELAN as set
forth above, reimbursement payments shall be made in a
sequential manner first for the Cost of Goods
Manufactured for Clinical Supplies and the Cost of
Goods Manufactured for Commercialization, second for
the Third Party License Fees and third for the Sales
Costs, Marketing Costs, Distribution Costs,
Post-Approval Research and Regulatory Expenses charged
to ELAN's Marketing Account with respect to such
Calendar Quarter. After such sequential reimbursement
payments have been made, CAT shall pay to ELAN an
amount equal to fifty percent (50%) of any remaining
shortfall except to the extent that the reimbursement
of such shortfall is limited by the provisions of
Section 7.1.4.
7.1.11 Marketing and Promotional Materials. ELAN shall, in its sole
discretion, determine the content, quantity and method of
distribution of any promotional materials related to the
Collaboration Product in the Territory. All Copyright and
other intellectual property rights in said promotional
materials shall remain vested in ELAN.
7.1.12 Promotional Claims. ELAN shall limit the claims of safety and
efficacy that ELAN or its sales force makes for a
Collaboration Product in the Territory to those that are
consistent with the approved labeling for such Collaboration
Product in such country of the Territory. ELAN's detailing and
promotion of a Collaboration Product in the Territory shall be
in strict adherence to all regulatory, professional and legal
requirements including, without limitation, FDA's regulations
and guidelines concerning the advertising of prescription drug
products and any updates thereto.
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7.2 Reports and Payments{TC "7.2 Reports and Payments" \f C \1 "2"}.
7.2.1 Pre-tax Profit Statements and Payments. After the First
Commercial Sale of a Product in the Territory, each Party
shall, within [***] after the end of each Calendar Quarter,
deliver to the other Party a report setting forth, on a
Product-by-Product and country-by-country basis, for such
Calendar Quarter the following information, (i) the Gross
Sales and Net Sales of each Product in each country of the
Territory and (ii) solely in the case of Collaboration
Products, the Pro-Forma Net Profit obtained from the sale of
such Product in each country of the Territory and the
deductions made from Net Sales in calculating such Pro-Forma
Net Profit, including, without limitation, [***]. The report
provided in (ii) above shall identify for each Collaboration
Product [***]. No such reports shall be due with respect to
any Product before the First Commercial Sale of such Product
in the Territory. Without prejudice to either Party's audit
rights under Section 7.3.2, a reasonable degree of reporting
error which does not result in an underpayment to either Party
shall not constitute a material breach of this Section 7.2.1.
7.2.2 Currency. All amounts payable and calculations hereunder shall
be in United States dollars and all references to "dollars" or
to "$" shall refer to United States dollars. As applicable,
Gross Sales, Sales Returns and Allowances, Net Sales,
Reimbursable Commercial Costs incurred by ELAN shall be
translated into United States dollars in accordance with
ELAN's customary and usual currency conversion procedures,
consistently applied. If, due to restrictions or prohibitions
imposed by national or international authority, payments
cannot be made as provided in this Article 7, the Parties
shall consult with a view to finding a prompt and acceptable
solution, and the paying Party will deal with such monies as
the other Party may lawfully direct at no additional
out-of-pocket expense to the paying Party.
7.3 Maintenance of Records; Audits{TC "7.3 Maintenance of Records;
Audits" \f C \1 "2"}.
7.3.1 Record Keeping for the Territory. Each Party shall keep and
maintain accurate and complete records in connection with the
sale of Products in the Territory and each Party shall keep
and maintain accurate and complete records showing the
expenses incurred and efforts employed by or on behalf of it
with respect to Products hereunder, which books and records
shall be in sufficient detail to permit the accurate
determination of Gross Sales, Net Sales, Pro-Forma Net Profits
and all other figures necessary for the verification of the
al-
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location of Pro-Forma Net Profits or royalties to be paid
under this Agreement. Each Party shall maintain and cause its
Affiliates to maintain such records for a period of at least
[***] after the end of the calendar year in which they were
generated.
7.3.2 Audits. With [***] prior written notice from a Party (the
"Auditing Party"), the other Party (the "Audited Party") shall
permit an independent certified public accounting firm of
internationally recognized standing selected by the Auditing
Party and reasonably acceptable to the Audited Party, to examine,
at the Auditing Party's sole expense, the relevant books and
records of the Audited Party as may be reasonably necessary to
verify the accuracy of the reports submitted by the Audited Party
in accordance with Section 7.2.1 and the calculation and
allocation of Pro-Forma Net Profits and royalties to be paid
under this Agreement. An examination by a Party under this
Section 7.3.2 shall occur not more than once in any calendar year
during the term of this Agreement and not more than once during
each successive calendar year thereafter and shall be limited to
the pertinent books and records for any calendar year ending not
more than [***] before the date of the request. The accounting
firm shall be provided access to such books and records at the
Audited Party's facility(ies) where such books and records are
normally kept and such examination shall be conducted during the
Audited Party's normal business hours. The Audited Party may
require the accounting firm to sign a standard non-disclosure
agreement before providing the accounting firm access to the
Audited Party's facilities or records. Upon completion of the
audit, the accounting firm shall provide both CAT and ELAN a
written report disclosing whether the reports submitted by the
Audited Party are correct or incorrect, whether the calculation
and allocation of Pro-Forma Net Profits or royalties to be paid
under this Agreement are correct or incorrect, and, in each case,
the specific details concerning any discrepancies. No other
information shall be provided to the Auditing Party.
7.3.3 Underpayments/Overpayments. If such accounting firm correctly
concludes that additional Pro-Forma Net Profits or royalties
were due to a Party, the other Party shall pay to such Party
such additional Pro-Forma Net Profits or royalties together
with any interest that may be due thereon as provided for
within [***] of the date the Parties receives such
accountant's written report so correctly concluding. If an
underpayment to an Auditing Party exceeds [***] of the
Pro-Forma Net Profits or royalties to be paid under this
Agreement that were to be distributed to such Auditing Party,
the other Party also shall reimburse the Auditing Party for
the out-of-pocket expenses incurred in conducting the audit,
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except in the event that such underpayment was due to any
inaccurate information provided by the Auditing Party in
conducting the audit, including, without limitation, those
arising out of the retention of the reputable and
internationally recognized independent accounting firm
undertaking the audit.
7.3.4 Confidentiality. All financial information of a Party which is
subject to review under this Section 7.3 shall be deemed to be
Confidential Information subject to the provisions of Article
9, and such Confidential Information shall not be disclosed to
any Third Party or used for any purpose other than verifying
payments to be made by one Party to the other hereunder;
provided, however, that such Confidential Information may be
disclosed to Third Parties only to the extent necessary to
enforce a Party's rights under this Agreement.
7.4 Interest{TC "7.4 Interest"\f C\1 "2"}. Any payment under this
Article 7 that is more than [***] past due shall thereafter be subject
to interest at [***]. Likewise, any overpayment that is not refunded
within [***] after the date such overpayment was identified shall
thereafter be subject to interest at an annual percentage rate [***]
compounded monthly; provided, however, that if the overpayment is due
to errors in reports provided by the overpaid Party, such interest
shall accrue from the date the overpayment was made.
7.5 GAAP{TC "7.5 GAAP"\f C\1 "2"}. The calculation of all expenditures,
payments and reimbursements made by either Party under this Agreement
shall be made in accordance with United States generally accepted
accounting procedures.
8. INTELLECTUAL PROPERTY.
8.1 Ownership{TC "8.1 Ownership"\f C\1 "2"}.
8.1.1 Sole Ownership By CAT. Subject to the provisions of Section 3
and Section 8.1.3, CAT shall have sole and exclusive ownership
of the CAT Patent Rights, the CAT Know How, the CAT Antibody
Library, CAT Technology, the CAT Inventions, the CAT
Collaboration Know How and the CAT Collaboration Patent
Rights.
8.1.2 Sole Ownership By ELAN. Subject to the provisions of Section 3
and Section 8.1.3, ELAN shall have sole and exclusive
ownership of the ELAN Patent Rights, the ELAN Technology, the
ELAN Know How, the ELAN Inventions, the ELAN Collaboration
Know How and the ELAN Collaboration Patent Rights.
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8.1.3 Joint Ownership. Ownership of all of the Joint Collaboration
Inventions, the Joint Collaboration Know How and the Joint
Collaboration Patent Rights shall vest in and be owned by the
Parties jointly in equal and undivided shares. To the extent
any CAT Collaboration Know How, CAT Collaboration Patent
Rights, ELAN Collaboration Know How and/or ELAN Collaboration
Patent Rights claims, or covers any Antibody discovered,
isolated or identified by the Parties pursuant to the Research
Program or Development Program or any use, medicinal or
otherwise, thereof, and/or any Collaboration Product or Party
Exclusive Product, it shall vest in and be owned by the
Parties jointly in equal and undivided shares. Any Patent
Rights subject to the provisions of this Section 8.1.3 shall
be filed for jointly in the name of both Parties and each
Party covenants to file with the appropriate entity such
recordation of the other Party's equal and undivided interest
in such Patent Rights as may be reasonably requested.
8.1.4 Prior Inventions. Nothing in this Agreement shall affect the
ownership of Prior Inventions.
8.2 Joint Patent Committee{TC "8.2 Joint Patent Committee"\f C\1 "2"}.
8.2.1 Membership. Within [***] after the Effective Date, ELAN and
CAT shall establish a "Joint Patent Committee" or "JPC" to
oversee and direct the clearance of Specific Targets and the
review and analysis of Enhancing Third Party Intellectual
Property or Blocking Third Party Intellectual Property. The
JPC shall be comprised of one (1) senior patent attorney from
each Party as appointed by such Party. A Party may replace its
representative from time to time upon written notice to the
other Party. The JPC shall exist until the termination of this
Agreement.
8.2.2 Decisions. All decisions of the JPC shall be unanimous, and in
the event that a decision cannot be reached by the JPC, the
matter shall be first referred to the highest level officer of
ELAN and CAT with day to day responsibility for oversight of
intellectual property matters. In the event that such officers
are unable to reach a decision with respect to any such
matter, then such matter shall be resolved in accordance with
the provisions of Section 15.
8.3 Prosecution and Maintenance of Patent Rights{TC "8.3 Prosecution and
Maintenance of Patent Rights"\f C\1 "2"}.
8.3.1 Joint Prosecution. Decisions as to whether to file, prosecute
and maintain, and in which countries to do so, Patent Rights
subject to the provisions of Sec-
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tion 8.1.3, along with other strategic decisions relating
thereto, shall be made by the JPC; provided, however, [***].
Any disputes regarding the prosecution of Patent Rights
subject to this Section 8.3.1 shall be resolved in accordance
with the provisions of Section 15, but shall not be subject to
the first sentence of Section 15.4.
8.3.2 Patent Term Extensions. The Parties shall cooperate, if
necessary and appropriate, with each other in gaining patent
term extension, including without limitation, supplementary
protection certificates and any other extensions that are now
or become available in the future wherever applicable to
Patent Rights covering Collaboration Products. The Parties
shall, if necessary and appropriate, use reasonable efforts to
agree upon a joint strategy relating to patent term
extensions, but, in the absence of mutual agreement with
respect to any extension issue, a patent shall be extended if
either Party elects to extend such patent. All filings for
such extension shall be made by the Party which controls the
patent or patent application in question; provided, however,
that in the event that the Party whom controls the patent in
question elects not to file for an extension, such Party shall
(i) inform the other Party of its intention not to file and
(ii) grant the other Party the right to file for such
extension.
8.3.3 Costs and Expenses. The Parties shall [bear equally] all costs
and expenses of filing, prosecuting, maintaining and extending
the Joint Collaboration Patent Rights, the CAT Collaboration
Patent Rights, the ELAN Collaboration Patent Rights and/or any
other Patent Rights subject to the provisions of Section
8.1.3.
8.4 Trademarks{TC "8.4 Trademarks"\f C\1 "2"}. All Collaboration Products
shall be sold in the Territory under Trademarks selected by ELAN. ELAN
shall own such Trademarks and shall be responsible for the filing,
prosecution and maintenance of such Trademarks in each country of the
Territory. ELAN shall use Commercially Reasonable Efforts to select a
world-wide Trademark for each Collaboration Product. The costs of
obtaining and maintaining said Trademarks shall be shared equally by
the Parties.
8.5 Enforcement of Jointly Owned or Controlled Patent Rights{TC "8.5
Enforcement of Jointly Owned or Controlled Patent Rights"\f C\1 "2"}.
8.5.1 Notice. If ELAN or CAT becomes aware that any ELAN
Intellectual Property, CAT Intellectual Property, Joint
Collaboration Patent Rights and/or Joint Collaboration Know
How relating to the Research Program, the Development Program
and/or any Product upon which a royalty may be due to the
other Party is
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being infringed or misappropriated by a Third Party or is subject to a
declaratory judgment action arising from such infringement, ELAN or
CAT, as the case may be, shall promptly notify the other Party.
8.5.2 Enforcement by ELAN. ELAN shall have the first right (but not the
obligation), at its sole expense, to enforce any the Joint
Collaboration Patent Rights, the Joint Collaboration Know How, the
Patent Rights or Know How either jointly owned by the Parties pursuant
to Section 8.1.3 or exclusively licensed to the other Party within the
Field, CAT shall, at CAT's own expense, cooperate with ELAN as may be
reasonably necessary in ELAN `s enforcement activities. ELAN shall
keep CAT reasonably informed on a quarterly basis, in person or by
telephone, prior to and during any such enforcement. CAT shall execute
such additional instruments, including, without limitation, assignment
of causes of actions, as may be reasonably required under this Section
8.5.2.
8.5.3 Enforcement by CAT. If ELAN fails to ▇▇▇▇▇ an infringement of any the
Joint Collaboration Patent Rights, the Joint Collaboration Know How,
Patent Rights or Know How either jointly owned by the Parties pursuant
to Section 8.1.3 or exclusively licensed to the other Party within the
Field, or to file an action to ▇▇▇▇▇ such infringement, within [***]
after a written request from CAT to do so, or if ELAN discontinues the
prosecution of any such action, CAT at its expense may, in its
discretion, undertake such action as it determines appropriate (other
than the grant of a license to the allegedly infringing Third Party)
to enforce any such Joint Collaboration Patent Rights, Joint
Collaboration Know How, Patent Rights or Know How either jointly owned
by the Parties pursuant to Section 8.1.3 or exclusively licensed to
the other Party within the Field. CAT shall keep ELAN reasonably
informed on a quarterly basis, in person or by telephone, prior to and
during any such enforcement. In such case, ELAN shall assist CAT, upon
request and [at ELAN's sole expense,] in taking any action to enforce
any Patent Rights or Know How either jointly owned by the Parties
pursuant to Section 8.1.3 or exclusively licensed to the other Party
within the Field. ELAN shall execute such additional instruments,
including, without limitation, assignment of causes of actions, as may
be reasonably required under this Section 8.5.3.
8.5.4 Recoveries. All monies recovered upon the final judgment or
settlement of any such action shall be used first, to reimburse the
costs and expenses (including reasonable attorneys' fees and costs) of
CAT and ELAN and thereafter the Parties shall share in any remaining
recovery as follows: the Party enforcing Jointly Owned or Controlled
Patent Rights under either Section 8.5.2 or 8.5.3
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shall receive [***] of any remaining recovery and the other Party
shall receive [***] of any remaining recovery.
8.6 Enforcement of Individually Owned or Controlled Patent Rights{TC "8.6
Enforcement of Individually Owned or Controlled Patent Rights"/f C\1
"2"}. Neither Party shall have any obligation to the other Party to
▇▇▇▇▇ or prevent infringement of any Patent Right or Know How neither
jointly owned nor exclusively licensed to the other Party in the Field
under this Agreement.
8.7 Third Party Claims{TC "8.7 Third Party Claims" \f C\1 "2"}.
8.7.1 Third Party Claims - Course of Action. If the Research to be
conducted under this Agreement, the Development of any R&D
Candidate, Manufacture of Clinical Supplies or Collaboration
Products and/or Commercialization of any Collaboration Product is
alleged by a Third Party to infringe a Third Party's patent or
misappropriate a Third Party's Know How, the Party becoming aware
of such allegation shall promptly notify the other Party thereof,
in writing, reasonably detailing the claim.
8.7.2 Negotiation with Third Party. The JSC shall determine which
Party shall negotiate with said Third Party for a suitable
license or assignment and execute such license or assignment;
provided, however, that such Party shall enter into no such
agreement unless it has first obtained the other Party's written
approval of the terms of such agreement, including the amounts of
any royalties or payments, which approval shall not be
unreasonably withheld. If such negotiation results in a
consummated agreement, such Party shall make all payments to the
Third Party and such payments shall be deemed Third Party License
Fees for purposes of this Agreement and such Party shall be
reimbursed for payment of such fees in accordance with Section
5.3.5, 7.1 and 8.8, as applicable.
8.7.3 Third Party Suit. If a Third Party sues a Party (the "Sued
Party") alleging that the Sued Party's or the Sued Party's
Sublicensees' Research to be conducted under this Agreement,
Development of any R&D Candidate, Manufacture of Clinical
Supplies or Collaboration Products and/or Commercialization of
any Collaboration Product infringes or will infringe said Third
Party's patent or misappropriates said Third Party's Know How,
then upon the Sued Party's request and in connection with the
Sued Party's defense of any such Third Party suit, the other
Party shall provide reasonable assistance to the Sued Party for
such defense and shall join such suit if deemed a necessary
party. The Sued Party shall keep the other Party, if such other
Party has not joined in such suit, reasonably informed on a
quarterly basis, in person or by telephone, prior to
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and during the pendency of any such suit. The Sued Party shall
not admit the invalidity of any Patent Rights within the CAT
Patent Rights, the CAT Collaboration Patent Rights, the ELAN
Collaboration Patent Rights, the ELAN Patent Rights and/or the
Joint Collaboration Patent Rights, nor settle any such suit,
without written consent of the other Party. [***].
8.8 Third Party Licenses{TC "8.8 Third Party Licenses" \f C \1 "2"}.
8.8.1 General. If either Party believes that there exists Third Party
intellectual property that constitutes Blocking Third Party
Intellectual Property or Enhancing Third Party Intellectual
Property, as the case may be, it shall notify the JSC and the
JPC. The JPC shall then determine whether or not such Third Party
Intellectual Property constitutes Blocking Third Party
Intellectual Property or Enhancing Third Party Intellectual
Property, as the case may be. If the determination of the JPC is
affirmative, the JSC shall determine whether, on what terms
(economic or otherwise), and by which Party (the "Licensing
Party") such Blocking Third Party Intellectual Property or
Enhancing Third Party Intellectual Property, as the case may be,
shall be licensed for the purposes of this Agreement. Prior to
entering into a license agreement with respect to such Blocking
Third Party Intellectual Property or Enhancing Third Party
Intellectual Property, as the case may be, the Licensing Party
shall submit the proposed license agreement to the JSC for
approval. If the JSC approves the proposed license agreement, the
Licensing Party shall enter into such license agreement and shall
pay the Third Party License Fees due thereunder, subject to
reimbursement in accordance with and subject to Section 5.3.5 or
7.1.10(d), as applicable. Any agreement entered into pursuant to
this Section 8.8.1 shall not be amended without the prior written
consent of the JSC.
8.8.2 Failure to Obtain a Third Party License. If, within [***], or
such other period as may be agreed to by the JSC, after a
Licensing Party has been instructed by the JSC, pursuant to
Section 8.8.1, to attempt to enter into a license agreement with
respect to Blocking Third Party Intellectual Property or
Enhancing Third Party Intellectual Property, as the case may be,
it is determined by the JSC that no license is obtainable on
commercially reasonably terms despite a good faith attempt by
such Licensing Party to obtain such license, then (a) neither
Party shall practice Blocking Third Party Intellectual Property
that was the subject of the proposed license agreement and (b) in
the case of Blocking Third Party Intellectual Property only,
neither Party shall proceed with the Research to be conducted
under this Agreement, and/or the Development, Manufacture and/or
Commercialization of an R&D Candidate or Collaboration Product,
as
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the case may be, to the extent doing so would infringe such
Blocking Third Party Intellectual Property.
8.8.3 Resolution of Disputes. If the JPC is unable to reach a
determination under Section 8.8.1 with respect to whether Third
Party intellectual property constitutes either Blocking Third
Party Intellectual Property or Enhancing Third Party
Intellectual Property, as the case may be, then such issue shall
be presented to Vice President, Intellectual Property ELAN for
determination and resolution. In the event CAT does not agree
with the determination made by that person, [***]. In the case
of Blocking Third Party Intellectual Property only: (a) neither
Party shall proceed with the Research to be conducted under this
Agreement, and/or the Development of an R&D Candidate, the
Manufacture of Clinical Supplies or Commercialization Supplies
or the Commercialization of a Collaboration Product, as the case
may be, to the extent the Parties believes such activities would
infringe such Blocking Third Party Intellectual Property or (b)
a Party may suspend its performance under this Agreement in the
event it provides an opinion of a nationally recognized patent
counsel that such performance constitutes infringement, direct
or otherwise, of one or more claims of the applicable Blocking
Intellectual Property.
8.9 Patent Marking{TC "8.9 Patent Marking" \f C \1 "2"}. Each Party agrees
to ▇▇▇▇ and have its Affiliates and all Sublicensees ▇▇▇▇ all
Collaboration Products (or their containers or labels) sold pursuant to
this Agreement in accordance with the applicable statutes or
regulations in the country or countries of manufacture and sale
thereof.
8.10 Patent Certifications{TC "8.10 Patent Certifications" \f C \1 "2"}.
Each Party shall immediately give written notice to the other of any
certification of which it becomes aware filed pursuant to 21 U.S.C.
(S)355(b)(2)(A), or (S)355(j)(2)(A)(vii) (or any amendment or successor
statute thereto) claiming that the CAT Patent Rights, CAT Collaboration
Patent Rights, ELAN Collaboration Patent Rights, ELAN Patent Rights or
Joint Collaboration Patent Rights covering any Collaboration Product
are invalid or that infringement will not arise from the manufacture,
use or sale of such Collaboration Product by a Third Party.
8.11 Limitation{TC "8.11 ▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ any
other provision in this Article 8, the Parties acknowledge and
understand that neither ELAN nor CAT shall not be obligated to prepare,
file, prosecute, and maintain patents and patent applications, or to
bring or pursue enforcement proceedings or defend declaratory judgment
actions regarding the ELAN Patent Rights or CAT Patent Rights, as the
case may
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be, if, and to the extent that, ELAN or CAT is not entitled to do so
under applicable agreements with Third Parties.
8.12 Patent Attorneys{TC "8.12 Patent Attorneys" \f C \1 "2"}. The Parties
shall cause their patent attorneys to liaise so far as is necessary and
reasonably practicable on all issues relating to the filing,
prosecution, maintenance and enforcement of the Joint Collaboration
Patent Rights. The patent attorneys may be invited to JPC meetings and
each party shall be responsible for the costs of its own patent
attorney incurred hereunder.
9. CONFIDENTIALITY.
9.1 Confidentiality{TC "9.1 ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇▇▇ the
term of this Agreement and for a period of [***] following the
expiration or earlier termination thereof, each Party shall maintain in
confidence the Confidential Information of the other Party, and shall
not disclose, use or grant to a Third Party the right to use any of the
Confidential Information of the other Party except on a need-to-know
basis to such Party's directors, officers and employees, and to such
Party's consultants working on such Party's premises, to the extent
such disclosure is reasonably necessary in connection with such Party's
activities as expressly authorized by this Agreement. To the extent
that disclosure to any person is authorized by this Agreement, prior to
disclosure, a Party shall obtain written agreement of such person to
hold in confidence and not disclose, use or grant the use of the
Confidential Information of the other Party except as expressly
permitted under this Agreement. Each Party shall notify the other Party
promptly upon discovery of any unauthorized use or disclosure of the
other Party's Confidential Information.
9.2 Terms of Agreement{TC "9.2 Terms of ▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇▇▇▇
Party shall disclose any terms or conditions of this Agreement to any
Third Party without the prior written consent of the other Party;
provided, however, that a Party may disclose the terms or conditions of
this Agreement, (a) on a need-to-know basis to its legal and financial
advisors, who are obligated to maintain such information in confidence,
and (b) to a Third Party (who is obligated to maintain such information
in confidence) in connection with (i) an equity investment in ELAN or
CAT by such Third Party, which investment is in excess of [***] of
ELAN's or CAT's market capitalization at such time, (ii) a merger,
consolidation or similar transaction by such Party, or (iii) the sale
of all or substantially all of the assets of such Party relating to the
subject matter of this Agreement. Notwithstanding the foregoing, prior
to execution of this Agreement, the Parties have agreed upon the
substance of information (including a form of press release) that can
be used to describe the terms and conditions of this
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transaction, and each Party may disclose such information, as modified
by mutual written agreement the Parties, without the consent of the
other Party.
9.3 Permitted Disclosures{TC "9.3 Permitted Disclosures" \f C \1 "2"}.
The confidentiality obligations under this Article 9 shall not apply
(a) to the extent that a Party is required to disclose information by
applicable law, regulation or order of a governmental agency or a court
of competent jurisdiction, or (b) to the extent necessary or desirable
to allow either Party (where possible, with adequate safeguards for
confidentiality) to defend against litigation or to file and prosecute
Patent Rights; provided, however, in either such case that such Party
shall provide written notice thereof to the other Party, consult with
the other Party with respect to such disclosure and provide the other
Party sufficient opportunity to object to any such disclosure or to
request that the disclosing Party seek confidential treatment thereof,
in which event, the disclosing Party shall use all reasonable efforts
to accommodate the other Party's requests.
9.4 Publications{TC "9.4 ▇▇▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇▇▇ the term of
this Agreement, each Party will submit to the other Party for review
and approval all proposed academic, scientific and medical publications
and public presentations relating to Joint Collaboration Patent Rights,
Joint Collaboration Know How, ELAN Collaboration Patent Rights, CAT
Collaboration Patent Rights, ELAN Collaboration Know How, CAT
Collaboration Know How, the Research Program, Development Program, R&D
Candidates, and/or Collaboration Products for review in connection with
preservation of exclusive Patent Rights and/or to determine whether
Confidential Information should be modified or deleted; provided,
however, that after the approval of an academic, scientific or medical
publication and/or public presentation has been given, then such Party
shall not have to resubmit any such information for re-approval should
it be republished or publicly disclosed in another form. Written copies
of such proposed publications and presentations shall be submitted to
the other Party no later than [***] before submission for publication
or presentation and such other Party shall provide its comments with
respect to such publications and presentations within [***] following
its receipt of such written copy. Notwithstanding the foregoing, no
such publication or presentation shall be made until such publication
or presentation has been approved by each Party's respective patent
counsel. ELAN and CAT will each comply with standard academic practice
regarding authorship of scientific publications and recognition of
contribution of other parties in any publications relating to the Joint
Collaboration Patent Rights, Joint Collaboration Know How, ELAN
Collaboration Patent Rights, CAT Collaboration Patent Rights, ELAN
Collaboration Know How, CAT Collaboration Know How, Research Program,
the Development Program, R&D Candidates, and/or Collaboration Products.
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10. REPRESENTATIONS AND WARRANTIES.
10.1 Representations and Warranties of Each Party{TC "10.1 Representations
and Warranties of Each Party" \f C \1 "2"}. As of the Effective Date,
each of ELAN and CAT hereby represents and warrants to the other Party
hereto as follows:
10.1.1 it is a corporation or entity duly organized and validly
existing under the laws of the state or other jurisdiction of
its incorporation or formation;
10.1.2 the execution, delivery and performance of this Agreement by
such Party has been duly authorized by all requisite corporate
action and does not require any shareholder action or
approval;
10.1.3 it has the power and authority to execute and deliver this
Agreement and to perform its obligations hereunder;
10.1.4 the execution, delivery and performance by such Party of this
Agreement and its compliance with the terms and provisions
does not and will not conflict with or result in a breach of
any of the terms and provisions of or constitute a default
under (i) a loan agreement, guaranty, financing agreement,
agreement affecting a product or other agreement or instrument
binding or affecting it or its property; (ii) the provisions
of its charter or operative documents or bylaws; or (iii) any
order, writ, injunction or decree of any court or governmental
authority entered against it or by which any of its property
is bound;
10.1.5 its Patent Rights and Know How are existing and, to its
knowledge, are not invalid or unenforceable, in whole or in
part; and
10.1.6 it has the full right, power and authority to grant all of the
right, title and interest in the licenses granted to the other
Party under this Agreement.
10.2 Additional Representations and Warranties of CAT{TC "10.2 Additional
Representations and Warranties of CAT" \f C \1 "2"}. CAT hereby
represents and warrants to ELAN that as of the Effective Date:
10.2.1 Other than as provided for on Exhibit 1.15, CAT has the sole
------------
right, title and interest in and to the CAT Patents Rights
listed on such Exhibit 1.15;
------------
10.2.2 no CAT Patent Rights are subject to, or were developed
pursuant to, any funding agreement with any government or
government agency, except as provided on Exhibit 1.15;
------------
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10.2.3 CAT has disclosed to ELAN all patents owned or controlled by
Third Parties (except as licensed to CAT by such Third Parties
and except any such patents relating to antigens which are
screened as part of the Operation of the CAT Antibody Library)
of which CAT is aware and for which it may be necessary to
obtain Third Party Licenses for the Operation of the CAT
Antibody Library in accordance with Section 8.8. For the
purposes of this Section 10.2.3 "Operation of the CAT Antibody
Library" shall mean the screening of antigens against the CAT
Antibody Library and the isolation of single-chain Fv
fragments from the CAT Antibody Libary;
10.2.4 CAT is not in breach of any material provisions of any
agreements with Third Parties (including without limitation
the CAT In-Licenses) relating to the CAT Patent Rights;
10.2.5 to CAT's knowledge, as of the Effective Date, the total fees
due under the CAT In-Licenses for the activities currently
contemplated to be conducted by the Parties under this
Agreement is no more than [***] of the Net Sales of any
Collaboration Products;
10.2.6 Except as scheduled on Exhibit 10.2.6, there is no claim,
--------------
investigation, suit or proceeding pending or to the CAT's
knowledge there is no claim, investigation, suit, action or
proceeding pending or, to CAT's knowledge, expressly
threatened, against CAT or any Third Party before or by any
governmental entity, court or arbitrator that, individually or
in the aggregate, could reasonably be expected to (i)
materially impair the ability of CAT to perform any obligation
under this Agreement; (ii) prevent or materially delay or
alter the consummation of any or all of transactions
contemplated hereby or (iii) result in the payment of a
material sum by either CAT or ELAN as a result of any of the
activities contemplated under this Agreement;
10.2.7 [***];
10.2.8 Operation of the CAT Antibody Library is and shall be [***].
10.3 Additional Representations and Warranties of ELAN{TC "10.3 Additional
Representations and Warranties of ▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇ hereby
represents and warrants to CAT that as of the Effective Date:
10.3.1 ELAN has the sole right, title and interest in and to the ELAN
Patent Rights listed in Exhibit 1.41 to this Agreement;
------------
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10.3.2 No ELAN Patent Rights are subject to, or were developed
pursuant to any funding agreement with any government or
government agency, except as provided in Exhibit 1.41, to this
------------
Agreement;
10.3.3 ELAN is not in breach of any material provisions of any
agreements with Third Parties relating to the ELAN Patent
Rights; and
10.3.4 Except as scheduled on Exhibit 10.3.4, there is no claim,
--------------
investigation, suit or proceeding pending or to ELAN's
knowledge there is no claim, investigation, suit, action or
proceeding pending before or by any governmental entity, court
or arbitrator that, individually or in the aggregate, could
reasonably be expected to (i) materially impair the ability of
ELAN to perform any obligation under this Agreement; (ii)
prevent or materially delay or alter the consummation of any
or all of transactions contemplated hereby or (iii) result in
the payment of a material sum by either CAT or ELAN as a
result of any of the activities contemplated under this
Agreement.
10.3.5 to ELAN's knowledge, the use of the ELAN Technology in the
Field does not infringe any patents owned or controlled by any
Third Party (except as licensed to ELAN by such Third Party);.
10.4 Representation by Legal Counsel{TC "10.4 Representation by Legal
Counsel" \f C \1 "2"}. Each Party hereto represents that it has been
represented by legal counsel in connection with this Agreement and
acknowledges that it has participated in the drafting. In interpreting
and applying the terms and provisions of this Agreement, the Parties
agree that no presumption shall exist or be implied against the Party
which drafted such terms and provisions.
10.5 No Inconsistent Agreements{TC "10.5 No Inconsistent Agreements" \f C \1
"2"}. Neither Party has in effect and after the Effective Date neither
Party shall enter into any oral or written agreement or arrangement
that would be inconsistent with its obligations under this Agreement.
10.6 Disclaimer{TC "10.6 Disclaimer" \f C \1 "2"}. THE FOREGOING WARRANTIES
OF EACH PARTY ARE IN LIEU OF ANY OTHER WARRANTIES, EXPRESS OR IMPLIED,
INCLUDING, WITHOUT LIMITATION, ANY IMPLIED WARRANTIES OF
NON-INFRINGEMENT, ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR ANY
IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR PURPOSE ALL OF WHICH ARE
HEREBY SPECIFICALLY EXCLUDED AND DISCLAIMED.
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11. GOVERNMENT APPROVALS.
11.1 ELAN's and CAT's Obligations{TC "11.1 ELAN's and CAT's Obligations" \f
C \1 "2"}. Each of ELAN and CAT shall use its good faith efforts to
eliminate any concern on the part of any court or government authority
regarding the legality of the proposed transaction, including, if
required by federal or state antitrust authorities, promptly taking all
steps to secure government antitrust clearance, including, without
limitation, cooperating in good faith with any government investigation
including the prompt production of documents and information demanded
by a second request for documents and of witnesses if requested.
11.2 Additional Approvals{TC "11.2 Additional Approvals" \f C \1 "2"}. ELAN
and CAT will cooperate and use respectively all reasonable efforts to
make all other registrations, filings and applications, to give all
notices and to obtain as soon as practicable all governmental or other
consents, transfers, approvals, orders, qualifications, authorizations,
permits and waivers, if any, and to do all other things necessary or
desirable for the consummation of the transactions as contemplated
hereby. Neither Party shall be required, however, to divest or
out-license products or assets or materially change its business if
doing so is a condition of obtaining governmental approvals of the
transactions contemplated by this Agreement.
12. TERM AND TERMINATION.
12.1 Term{TC "12.1 Term" \f C \1 "2"}. The term of this Agreement will
commence on the Effective Date and, unless earlier terminated as
provided in Article 13 or this Article 12, shall continue in full force
and effect on a Collaboration Product-by-Collaboration Product and
country-by-country basis for so long as any R&D Candidate is being
Developed or any Collaboration Product is being sold under this
Agreement. Notwithstanding the foregoing, the Research Term shall be as
set forth in Section 5.1.2, unless this Agreement is properly
terminated as provided for herein.
12.2 Termination for Cause{TC "12.2 Termination for Cause" \f C \1 "2"}.
This Agreement may be terminated effective immediately by written
notice by either Party at any time during the term of this Agreement
for a continuing material breach or recurring material breaches by the
other Party, which breach or breaches remain uncured for [***] in the
case of nonpayment of any amount due (unless there exists a bona fide
dispute as to whether such payment is owing, in which case the [***]
period shall be tolled pending resolution of such dispute) and [***]
for all other breaches, each measured from the date written notice of
such breach is given to the breaching Party; pro-
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vided, however, that if such breach is not susceptible of cure within
the stated period and the breaching Party uses diligent good faith
efforts to cure such breach, the stated period will be extended by an
additional [***]; provided, however, that there shall be no such
extension in the case of any nonpayment of material amounts due except
in the case of bona fide dispute as set out above. It is expressly
understood and agreed that the failure by a Third Party Sublicensee to
materially perform its obligations to a Party or the Parties, as the
case may be, shall not relieve either Party from any obligations
sublicensed to such Third Party. Either Party may exercise its rights
pursuant to this Section 12.2 upon the failure of any permitted Third
Party Sublicensee to perform any material duty subcontracted to it in
accordance with the terms of Section 3.3. No failure by a Party to pay
any sums due under Sections [***] shall constitute a basis for
termination of this Agreement; provided, however, that such breach
shall remain actionable as a breach of this Agreement or the applicable
common law and the breaching Party shall be liable for the costs and
expenses, including attorney's fees, of the non-breaching Party if a
successful recovery or settlement is obtained for any breach.
12.3 Effect of a Termination for Cause on Licenses. {TC "12.3 Effect of a
Termination for Cause on Licenses" \f C\1 "2"} If a Party (the
"Terminating Party") terminates this Agreement pursuant to Section 12.2
(for cause):
12.3.1 all licenses granted by the Terminating Party to the other
Party hereunder, other than those with respect to any
Non-Antibody, Non-Antibody Product, CAT Exclusive Antibody
and/or Party Exclusive Product, will automatically terminate;
and
12.3.2 all licenses granted by the other Party to the Terminating
Party will become fully paid up, irrevocable, perpetual,
royalty-free (other than royalties which may be due to Third
Parties in respect thereof which shall be borne by the
Terminating Party or such royalties as may be due with respect
to any Non-Antibody Product and/or Party Exclusive Product)
licenses; and
12.3.3 the other Party will:
(a) deliver up to the Terminating Party any Know How and/or
materials covering or directly related to the R&D
Candidates and Collaboration Products; and
(b) deliver up to the Terminating Party any and all
quantities of Collaboration Product in its possession,
power, custody or control subject always to ELAN's right
to dispose of Collaboration Product which is the subject
of pre-termination date orders; and
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(c) ensure that its patent attorneys transfer to the Terminating
Party the patent files relating to the Joint Collaboration
Patent Rights in respect of R&D Candidates and Collaboration
Products; and
(d) commensurate with legislative and regulatory requirements,
transfer to the Terminating Party or its nominee all Regulatory
Approvals and other regulatory filings for any Collaboration
Product. In the event that in any country such a transfer is
not possible, the other Party shall use reasonable endeavours
to ensure that the Terminating Party has the benefit of the
relevant regulatory filings and Regulatory Approvals and, to
this end, consents to any Regulatory Authority
cross-referencing to the data and information on file with any
Regulatory Authority as may be necessary to facilitate the
granting of second Regulatory Approvals or other filings and
approvals to the Terminating Party, and the other agrees to
complete whatever other procedures are reasonably necessary in
relation to the same to enable the Terminating Party (either
itself or in conjunction with a Third Party) freely to develop
and sell the Collaboration Product in substitution for the
other Party; and
(e) use its reasonable endeavors to assign to the Terminating Party
the benefit and burden of any agreement made between the other
Party and a Sublicensee in relation to Collaboration Product;
and
(f) assign all of the other Party's interest in any Trademarks
including the goodwill symbolized by such Trademark used for
Collaboration Product; and
(g) after the date of termination, cease to Develop, Manufacture,
have Manufactured, use, market, Distribute or sell R&D
Candidates or Collaboration Products during the life of the
Joint Collaboration Patent Rights except that where ELAN is the
other Party ELAN shall have the right to dispose of that part
of its inventory of Collaboration Product on hand as of the
effective date of termination which is the subject of orders
for Collaboration Product accepted prior to the effective date
of termination for a period of [***] after the effective date
of termination, and, within [***] after disposition of such
inventory pursuant to the fulfilment of such orders, ELAN will
forward to CAT a final report and pay CAT's share of Pro-Forma
Net Profits due to CAT for such period; and
(h) provide the Terminating Party with all reasonable assistance in
relation
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to the appointment of a Third Party Manufacturer of
Collaboration Product; and
(i) assign all of the other Party's interest in any
Copyrights necessary or useful for Commercializing
Collaboration Products; and
(j) except as otherwise provided in Section 12.3.2, the
other Party will grant to the Terminating Party a
worldwide, non-exclusive license to those Patent
Rights within the Control of such other Party
necessary to Research, Develop, Manufacture or
Commercialize an R&D Candidate or Collaboration
Product; and
(k) agree that, and, at the Terminating Party's option,
execute a release confirming such agreement, the
other Party will have no right to receive a share of
Pro-Forma Profits or any other payments which may
result from the sale of any Collaboration Product,
the occurrence of any event or the conduct of any
activity after the effective date of such
termination; provided, however, that the other Party
shall remain entitled to receive any payments that
accrued before the effective date of such
termination.
Nothing in this Section 12.3, but subject to the other provisions of
this Agreement, shall impact ELAN's exclusive ownership or, or
exclusive right to, research, develop, manufacture, or commercialize
any composition of matter other than an Antibody in the Field,
including, without limitation, a Non-Antibody or CAT's exclusive
ownership or, or exclusive right to, research, develop, manufacture,
or commercialize CAT Exclusive Antibodies.
12.4 Termination Pursuant to Section 12.2. {TC "12.4 Termination
Pursuant to Section 12.2" \f C \1 "2"}. In the event of a
termination under Section 12.2, then, notwithstanding any provision
of this Agreement to the contrary, neither Party shall have any
further obligation to the other Party with respect to the subject
matter of this Agreement except for the obligations set forth in
Articles 9, 14, 12 and 15 which obligations shall survive any
termination of this Agreement. Notwithstanding the foregoing, if CAT
shall be the Terminating Party, (i) the [***] sentence of Section
[***] shall not be operative, (ii) ELAN shall not be obligated under
[***] (iii) all of the provisions of Section 5.6.3 shall be stricken
and replaced with the following provision: "For a period of ten (10)
years after the first Commercial Sale of any CAT Exclusive Antibody,
CAT shall be obligated to pay to ELAN a royalty of [***] of any
Party Exclusive Product containing such a CAT Exclusive Antibody;
provided, however, that ELAN shall have no rights pursuant to this
Section 5.6.3 unless the applicable Anti
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body was previously identified upon the list required pursuant to Section
5.6.1 and the other conditions of this Section are met." If ELAN is the
Terminating Party, then ELAN shall not be obligated to offer to CAT the
right to enter into a mutually exclusive collaboration arrangement under
Section 5.6.2 and the royalty due to CAT under that provision shall be
increased to [***].
12.5 Provisions For Change Of Control{TC "12.5 Provisions For Change Of
Control" \f C \1 "2"}.
12.5.1 Change Of Control Notice. A Party subject to a Change of Control
(the "Acquired Party") shall provide written notice to the other
Party (the "Non-Acquired Party") as soon as the impending Change
of Control can be disclosed to the Non-Acquired Party. For the
purposes of this Section 12.5, CAT shall mean only Cambridge
Antibody Technology Group plc or Cambridge Antibody Technology
Limited and ELAN shall mean Elan Corporation plc.
12.5.2 Certain Rights Upon Change Of Control of CAT. Upon the receipt of
the written notice required pursuant to Section 12.5.1 by ELAN,
this Agreement may be terminated, effective immediately, upon the
provision of written notice to CAT by ELAN; provided, however,
that such written notice must be made within [***] of the receipt
of notice of the Change of Control; and provided, further that
termination for a Change of Control shall not apply to any [***]
at the effective date of such termination unless the [***]. If
ELAN elects to terminate this Agreement pursuant to this Section
12.5.2, then ELAN shall have no further obligations to CAT and
its obligations under this Agreement will discontinue (except in
respect of any [***].
12.5.3 Certain Rights Upon Change Of Control of ELAN. Upon the receipt
of the written notice required pursuant to Section 12.5.1 by ELAN
this Agreement may be terminated, effective immediately if within
[***] of the receipt of notice of the Change of Control by CAT,
ELAN and its Third Party successor in title does not provide a
written confirmation reasonably satisfactory to CAT to the effect
that: [***]. If CAT makes a proper election to terminate this
Agreement pursuant to this Section 12.5.3 then this Agreement
shall terminate (except in respect of any [***] at the effective
date of such termination which shall continue unless [***], CAT
shall have no further obligations to ELAN under this Agreement
(except in respect of any R&D Candidates[***].
12.5.4 [***]
12.6 Provision for Insolvency {TC "12.6 Provisions for ▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇
"▇"}. .
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12.6.1 Termination. This Agreement may be terminated by notice by either
Party at any time during the term of this Agreement upon the
filing or institution of bankruptcy, reorganization, liquidation
or receivership proceedings, or upon an assignment of a
substantial portion of the assets for the benefit of creditors by
the other Party, or in the event a receiver or custodian is
appointed for such Party's business, or if a substantial portion
of such Party's business is subject to attachment or similar
process; provided, however, that in the case of any involuntary
bankruptcy proceeding such right to terminate shall only become
effective if the proceeding is not dismissed within [***] after
the filing thereof.
12.6.2 Effect of Termination for Insolvency. In the event either Party
terminates this Agreement under Section 12.6.1 (the "Terminating
Party") the Parties agree that the Terminating Party, as a
licensee of rights to intellectual property under this Agreement,
shall retain and may fully exercise all of its rights and
obligations under this Agreement, including as set forth in
Section 12.6.3
(a) Effect on Licenses. In the event of an insolvency of either
Party (the "Insolvent Party") under any applicable
insolvency statute (the "Insolvency Statute"), the Insolvent
Party agrees that the Terminating Party, as licensee of
intellectual property rights under this Agreement, shall
retain and may fully exercise all of its rights and
elections under this Section 12.6.2. The Insolvent Party
agrees that all rights and licenses granted under or
pursuant to this Agreement by the Insolvent Party to the
Terminating Party are licenses of rights to patents, patent
applications, copyrights, trade secrets and other
"intellectual property" within the meaning of such term or
its equivalent under any Insolvency Statute. The Insolvent
Party agrees during the term of this Agreement to create and
maintain current copies or, if not amenable to copying,
detailed descriptions or other appropriate embodiments, to
the extent feasible, of all such intellectual property. If a
case is commenced by or against the Insolvent Party under
the Insolvency Statute, unless and until this Agreement is
rejected by the Insolvency Statute trustee, the Insolvent
Party (in any capacity, including debtor-in-possession) and
its successors and assigns (including without limitation, a
trustee or examiner appointed pursuant to the Insolvency
Statutes) shall, as the Terminating Party may elect in a
written request, immediately upon such request:
(i) perform all of the obligations provided in this
Agreement to be performed by the Insolvent Party
including, where applicable
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and without limitation, providing the Terminating Party
portions of such intellectual property (including
embodiments thereof) held by the Insolvent Party and
such successors and assigns or otherwise available to
them; or
(ii) provide to the Terminating Party all such intellectual
property (including all embodiments thereof) held by
the Insolvent Party and such successors and assigns or
otherwise available to them.
12.6.3 Rights to Intellectual Property.
(a) The Insolvent Party agrees that it will not (a) terminate or
reject this Agreement or (b) assign or sell the intellectual
property licensed hereunder without the Terminating Party's
written consent.
(b) If this Agreement is rejected or breached by the Insolvent
Party or any successor, and the Terminating Party elects to
retain its rights hereunder, then the Insolvent Party (in
any capacity, including debtor-in-possession) and its
successors and assigns (including, without limitation, an
Insolvency Statute trustee) shall provide to the Terminating
Party all such intellectual property (including all
embodiments thereof) held by the Terminating Party and such
successors and assigns, or otherwise available to them,
immediately upon the Terminating Party's written request.
Whenever the Insolvent Party or any of its successors or
assigns provides to the Terminating Party any of the
intellectual property licensed hereunder (or any embodiment
thereof) pursuant to this Section, the Terminating Party
shall have the right to perform the obligations of the
Insolvent Party hereunder with respect to such intellectual
property, but neither such provision nor such performance by
the Terminating Party shall release the Insolvent Party from
any such obligation or liability for failing to perform it.
12.6.4 The Terminating Party's Rights. All rights, powers and remedies
of the Terminating Party provided herein are in addition to and
not in substitution for any and all other rights, powers and
remedies now or hereafter existing at law or in equity
(including, without limitation, the Insolvency Statute) in the
event of the commencement of an Insolvency Statute case by or
against the Insolvent Party. The Terminating Party, in addition
to the rights, power and remedies expressly provided herein,
shall be entitled to exercise all other such rights and powers
and resort to all other such remedies as may now or hereafter
exist at law or in equity (including, without limitation, the
Insolvency Statute) in such
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event. The Parties agree that they intend the foregoing
Terminating Party rights to extend to the maximum extent
permitted by law, including, without limitation, for purposes of
the Insolvency Statute:
(a) the right of access to any intellectual property (including
all embodiments thereof) of the Insolvent Party, or any
Third Party with whom the Insolvent Party contracts to
perform an obligation of the Insolvent Party under this
Agreement, and, in the case of the Third Party, which is
necessary for the Research, Development, Manufacture and
commercialization of Collaboration Products; and
(b) the right to contract directly with any Third Party
described in (a) to complete the contracted work.
12.6.5 Deemed Grant of Rights. In the event of any insolvency of the
Insolvent Party and if any statute and/or regulation in any
country in the Territory requires that there be a specific grant
or specific clause(s) in order for the Terminating Party to
obtain the rights and benefits as licensee under this Agreement,
then this Agreement shall be deemed to include any and all such
required grant(s), clause(s) and/or requirements.
12.7 Survival of Certain Obligations. Expiration or termination of this
Agreement shall not relieve the Parties of any obligation accruing
before such expiration or termination, and the provisions of Articles 9,
14, 12 and 15 shall survive the expiration of the Agreement. Any
expiration or early termination of this Agreement shall be without
prejudice to the rights of either Party against the other accrued or
accruing under this Agreement before termination, including, without
limitation, the obligation to distribute Pro-Forma Net Profits for
Collaboration Product(s) sold before such termination.
13. WITHDRAWAL TO A ROYALTY POSITION
13.1 Right to Terminate{TC "13.1 Right to Terminate" \f C\1 "2"}.
13.1.1 ELAN may terminate this Agreement on sixty (60) days written
notice to CAT at any time after the second anniversary of the
commencement of the Research Term; or
13.1.2 CAT may terminate this Agreement during the Research Term on
sixty (60) days written notice to ELAN, such notice to be
effective on the third anniversary of the commencement of the
Research Term; or
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13.1.3 Notwithstanding Sections 13.1.1 and 13.1.2, either Party may
terminate this Agreement on an R&D Candidate-by-R&D Candidate or
a Collaboration Product-by-Collaboration Product basis (as the
case may be) upon thirty (30) days prior written notice to the
other Party;
13.1.4 any termination under Sections 13.1.1, 13.1.2 or 13.1.3 shall be
a "Termination for Convenience" and the provisions of Sections
13.2 or 13.3, as applicable, and Section 13.4 shall apply.
13.2 Effect of Termination for Convenience by ELAN{TC "13.2" Effect of
Termination for Convenience by ElAN"\f C\1 "2"}. If ELAN elects to
effect a Termination for Convenience:
13.2.1 A license under the ELAN Intellectual Property and the ELAN
Technology, limited in scope so as to solely permit CAT to, as
applicable, continue to Research, Develop, Manufacture and
Commercialize the R&D Candidate and/or Collaboration Product
subject to the ELAN Termination for Convenience shall be granted,
and, as so limited, will become fully paid up, irrevocable,
perpetual and royalty-free (other than royalties which may be due
to Third Parties or under Section 13.4);
13.2.2 all licenses, except as provided for in Section 13.6, with
respect to the applicable R&D Candidate which have or are to be
granted to ELAN will automatically terminate;
13.2.3 ELAN will:
(a) deliver up to CAT any Know How and/or materials covering or
directly related to any R&D Candidate and Collaboration
Product which is the subject to the Termination for
Convenience; and
(b) deliver up to CAT any and all quantities of applicable
Collaboration Product in its possession, power, custody or
control, subject always to ELAN's right to dispose of
Collaboration Product which is the subject of
pre-termination date orders pursuant to Section 13.2.3(g);
and
(c) ensure that its patent attorneys transfer to the patent
files relating to the Joint Collaborating Patent Rights in
respect of any applicable R&D Candidates and Collaboration
Products; and
(d) commensurate with legislative and regulatory requirements,
transfer to
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CAT or its nominee all Regulatory Approvals and other
regulatory filings for any Collaboration Product for which
an ELAN termination has been made. In the event that in any
country such a transfer is not possible, ELAN shall use
reasonable endeavours to ensure that CAT has the benefit of
the relevant regulatory filings and Regulatory Approvals
and, to this end, consents to any Regulatory Authority
cross-referencing to the data and information on file with
any Regulatory Authority as may be necessary to facilitate
the granting of second Regulatory Approvals or other filings
and approvals to CAT, and the other agrees to complete
whatever other procedures are reasonably necessary in
relation to the same to enable CAT (either itself or in
conjunction with a Third Party) freely to develop and sell
the applicable Collaboration Product in substitution for
ELAN; and
(e) use its reasonable endeavours to assign to CAT the benefit
and burden of any agreement made between ELAN and a
Sub-Licensee in relation to the applicable Collaboration
Product; and
(f) assign all of ELAN's interest in any Trademarks including
the goodwill symbolized by such Trademark used for any
applicable Collaboration Product; and
(g) after the date of termination, not Develop, Manufacture,
have manufactured, use, market, distribute or sell any R&D
Candidate or Collaboration Product subject to an ELAN
Termination for Convenience during the life of the Joint
Collaboration Patent Rights except that ELAN shall have the
right to dispose of that part of its inventory of any
applicable Collaboration Product on hand as of the effective
date of termination which is the subject of orders for such
Collaboration Product accepted prior to the effective date
of termination for a period of [***] after the effective
date of termination, and, within [***] after disposition of
such inventory pursuant to the fulfilment of such orders,
ELAN will forward to CAT a final report and pay CAT's share
of Pro Forma Net Profits due to CAT for such period; and
(h) provide CAT with all reasonable assistance in relation to
the appointment of a Third Party Manufacturer of applicable
Collaboration Product; and
(i) assign all of ELAN's interest in any Copyrights necessary or
useful or Commercializing such Collaboration Products; and
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(j) execute such releases and waivers as may be required to
discharge CAT from its obligations to ELAN, other than as
otherwise provided for in this Section and Sections 13.4,
13.5 and 13.6, under this Agreement with respect to an R&D
Candidate or Collaboration Product subject to a Termination
for Convenience.
13.2.4 ELAN will have no right to receive a share of Pro-Forma Net
Profit which may result from the sale of any Collaboration
Product as to which an ELAN Termination for Convenience has been
made, the occurrence of any event or the conduct of any activity
after the effective date of such termination; provided, however,
that (i) ELAN shall remain entitled to receive any payments that
accrued before the effective date of such termination, and (ii)
CAT shall pay ELAN the sums set out in Section 13.4.
13.2.5 For the avoidance of doubt, ELAN shall not be obligated to, and
none of the licenses granted pursuant to this Section 13.2 shall
include, a license to practice the ELAN Intellectual Property
with respect to any composition of matter, including without
limitation, a Non-Antibody, other than an Antibody inside or
outside the Field.
13.3 Effect of Termination for Convenience by CAT{TC "13.3 Effect of
Termination for Convenience by CAT"\f C\1 "2"}. If CAT elects to effect
a Termination for Convenience:
13.3.1 A license under the CAT Intellectual Property and to the CAT
Technology, limited in scope so as to solely permit ELAN to, as
applicable, continue to Research, Develop, Manufacture and
Commercialize the R&D Candidate and/or Collaboration Product
subject to the CAT Termination for Convenience shall be granted,
and, as so limited, will become fully paid up, irrevocable,
perpetual and royalty-free (other than royalties which may be due
to Third Parties or under Section 13.4);
13.3.2 all licenses, except as provided for in Section 13.6, with
respect to the applicable R&D Candidate which have or are to be
granted to CAT will automatically terminate;
13.3.3 CAT will:
(a) deliver up to ELAN any Know How and/or materials covering or
directly related to the R&D Candidate and Collaboration
Product which is the subject of this Article 13; and
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(b) deliver up to ELAN any and all quantities of applicable
Collaboration Product in its possession, power, custody or
control subject always to CAT's right to dispose of Collaboration
Product which is the subject of pre-termination date orders
pursuant to Section 13.3.3(g); and
(c) ensure that its patent attorneys transfer to the patent files
relating to the Joint Collaborating Patent Rights in respect of
any applicable R&D Candidates and Collaboration Products; and
(d) commensurate with legislative and regulatory requirements,
transfer to ELAN or its nominee all Regulatory Approvals and
other regulatory filings for any Collaboration Product for which
a CAT termination has been made. In the event that in any country
such a transfer is not possible, CAT shall use reasonable
endeavours to ensure that ELAN has the benefit of the relevant
regulatory filings and Regulatory Approvals and, to this end,
consents to any Regulatory Authority cross-referencing to the
data and information on file with any Regulatory Authority as may
be necessary to facilitate the granting of second Regulatory
Approvals or other filings and approvals to ELAN, and the other
agrees to complete whatever other procedures are reasonably
necessary in relation to the same to enable ELAN (either itself
or in conjunction with a Third Party) freely to develop and sell
the applicable Collaboration Product in substitution for CAT; and
(e) use its reasonable endeavours to assign to ELAN the benefit and
burden of any agreement made between CAT and a Sub-Licensee in
relation to the applicable Collaboration Product; and
(f) assign all of CAT's interest in any Trademarks including the
goodwill symbolized by such Trademark used for any applicable
Collaboration Product; and
(g) after the date of termination not Develop, Manufacture, have
manufactured, use, market, distribute or sell any R&D Candidate
or Collaboration Product subject to a CAT Termination for
Convenience during the life of the Joint Collaboration Patent
Rights except that CAT shall have the right to dispose of that
part of its inventory of any applicable Collaboration Product on
hand as of the effective date of termination which is the subject
of orders for such Collaboration Product accepted prior to the
effective date of termination for a period of [***] after the
effective date of termination, and, within [***] after
disposition of such inven-
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tory pursuant to the fulfilment of such orders, CAT will
forward to ELAN a final report and pay ELAN's share of Pro
Forma Net Profits due to ELAN for such period; and
(h) provide ELAN with all reasonable assistance in relation to
the appointment of a Third Party Manufacturer of applicable
Collaboration Product; and
(i) assign all of CAT's interest in any Copyrights necessary or
useful or Commercializing such Collaboration Products; and
(j) execute such releases and waivers as may be required to
discharge CAT from its obligations to ELAN, other than as
otherwise provided for in this Section and Sections 13.4,
13.5 and 13.6, under this Agreement with respect to an R&D
Candidate or Collaboration Product subject to a Termination
for Convenience.
13.3.4 CAT will have no right to receive a share of Pro-Forma Net
Profit which may result from the sale of any Collaboration
Product as to which a CAT Termination for Convenience has been
made, the occurrence of any event or the conduct of any activity
after the effective date of such termination; provided, however,
that (i) CAT shall remain entitled to receive any payments that
accrued before the effective date of such termination, and (ii)
ELAN shall pay CAT the sums set out in Section 13.4.
13.3.5 For the avoidance of doubt, CAT shall not be obligated to, and
none of the licenses granted pursuant to this Section 13.3 shall
include, a license to practice the CAT Intellectual Property with
respect to any composition of matter, including without
limitation, a Non-Antibody, other than an Antibody inside or
outside the Field.
13.4 Payments{TC "13.4 Payments"\f C\1 "2"}. In the event that a Party elects
to effect a Termination for Convenience pursuant to Section under
Section 13.1 then Section 13.2 or Section 13.2, as applicable shall
apply and the non-terminating Party shall thereafter pay the terminating
Party the following sums (on a R&D Candidate-by-R&D Candidate or
Collaboration Product-by-Collaboration Product basis) dependent upon the
point of Research and/or Development and/or Commercialization of the R&D
Candidate and/or Collaboration Product at the time of such termination,
as follows:
13.4.1 If such Termination for Convenience occurs during the Research
Term or prior to the filing of an IND for the applicable R&D
Candidate, then the non-
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terminating Party shall pay to the terminating Party a royalty of
[***] of the Net Sales of any Collaboration Product containing
such R&D Candidate until the tenth anniversary of the First
Commercial Sale in the Field of such Collaboration Product in any
Major Market Country.
13.4.2 If such termination occurs after the filing of an IND for the
relevant R&D Candidate but [***] the non-terminating Party shall
pay the terminating Party (on an R&D Candidate-by-R&D Candidate
basis):
(a) subject to the provisions of Section 13.5, a royalty of
[***] of the Net Sales of any Collaboration Product
containing such R&D Candidate until the tenth anniversary of
the First Commercial Sale in the Field of such Collaboration
Product in any Major Market Country; and
(b) [***] upon receipt of Regulatory Approval for any
Collaboration Product containing such R&D Candidate;
provided, however, that [***] of such milestone payments
shall be creditable by the non-terminating Party against the
royalty on Net Sales payable pursuant to Section 13.4.1 (a)
above.
13.4.3 If such termination occurs at any time between [***] the
non-terminating Party shall pay the terminating Party (on an R&D
Candidate-by-R&D Candidate basis):
(a) subject to the provisions of Section 13.5, a royalty of
[***] of the Net Sales of any Collaboration Product
containing such R&D Candidate until the tenth anniversary of
the First Commercial Sale in the Field of such Collaboration
Product in any Major Market Country: and
(b) [***] upon receipt of Regulatory Approval for any
Collaboration Product containing such R&D Candidate;
provided, however, that [***] of the milestone payment
payable hereunder shall be creditable by the non-terminating
Party against the royalty on Net Sales payable pursuant to
the Section 13.4.3 (a) above.
13.4.4 After [***] a Termination for Convenience may only be effected
within sixty (60) days from the date on which:
(i) the JSC approves any increase to the budget for [***] in
excess of [***]; or
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(ii) final data obtained from [***] becomes available to the
Parties following completion of [***]; or
(iii) any increase to the post [***] budget in excess of [***] is
approved by the JSC following receipt of the data in
respect of such [***] as set out in (ii) above,
and the non-terminating Party shall pay the terminating Party (on
an R&D Candidate-by-R&D Candidate basis):
(a) until the [***] the point on which Net Profit (as defined
in Section 13.7) is attributable to the first Collaboration
Product containing such R&D Candidate (the "Profitability
Point") and subject to Section 13.5, a royalty of [***] of
the Net Sales of such Collaboration Product until the tenth
anniversary of the First Commercial Sale in the Field of
such Collaboration Product in any Major Market Country; and
(b) after the Profitability Point the repayment, in [***]
equal, annual tranches, of the sums expended by the
terminating Party on the [***] on the relevant R&D
Candidate in accordance with the applicable budget; and
(c) after the [***] of the Profitability Point (notwithstanding
the fact that Net Profit attributable to such Collaboration
Product may become negative thereafter in which case any
payments due hereunder shall be accrued) and subject to the
provisions of Section 13.5, a royalty of [***] of the Net
Sales of any Collaboration Product until the tenth
anniversary of the First Commercial Sale in the Field of
such Collaboration Product in any Major Market Country; and
(d) [***] upon receipt of Regulatory Approval for a
Collaboration Product containing such R&D Candidate;
provided, however, that such amount shall be reduced by any
amounts due under Section 13.4.4 (b) above and [***] of the
milestone payment payable hereunder shall be creditable by
the non-terminating Party against any royalty payable with
respect to Net Sales pursuant to Section 13.4.4 (a) or (c),
as the case may be; and
13.4.5 A Termination for Convenience may only be effected after the
first BLA filing for the relevant R&D Candidate within [***] of
the JSC approving the first Post BLA Filing Plan containing a
Post BLA Filing Budget for that R&D Can-
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didate and the non-terminating Party shall pay the terminating
Party (on an R&D Candidate-by-R&D Candidate basis):
(a) until the first anniversary of the Profitability Point of
the Collaboration Product containing such R&D Candidate and
subject to the provisions of Section 13.5, a royalty of
[***] of the Net Sales of such Collaboration Product until
the tenth anniversary of the First Commercial Sale in the
Field of such Collaboration Product in any Major Market
Country; and
(b) after the Profitability Point the repayment, in [***] equal,
annual tranches, of the sums expended by the terminating
Party on the [***] on such R&D Candidate in accordance with
the applicable budget; and
(c) after the first anniversary of the Profitability Point
(notwithstanding the fact that Net Profit attributable to
such Collaboration Product may become negative thereafter in
which case any payments due hereunder shall be accrued) and
subject to the provisions of Section 13.5, a royalty of
[***] of the Net Sales of such Collaboration Product until
the tenth anniversary of the First Commercial Sale in the
Field of such Collaboration Product in any Major Market
Country.
13.5 Royalty Cost Adjustment{TC "13.5 Royalty Cost Adjustment" {f C\1 "2"}.
For the purposes of Section 13.4, all payments due Third Parties in
respect of Collaboration Products sold by the non-terminating Party
shall be the responsibility of the non-terminating Party and shall be in
addition to any payments made to the Terminating Party hereunder.
13.6 Survival of Obligations{TC "13.6 Survival of Obligations" \f C\1 "2"}.
Upon a Termination for Convenience by either Party, except as provided
for with respect to each specific R&D Candidate subject to such a
termination, all of the other Party's obligations shall survive and
shall not be modified in any manner. For the avoidance of doubt, all
licenses, rights, grants and obligations granted to and among the
Parties relating to R&D Candidates and Collaboration Products not
subject to a Termination for Convenience, Non-Antibodies, Non-Antibody
Products, CAT Exclusive Antibodies, Party Exclusive Products and Hybrid
R&D Candidates shall remain in full force and effect. In addition, upon
a Termination for Convenience by either Party as provided herein the
Terminating Party shall be responsible for its share of the Third Party
Development Costs contained in the then applicable Annual Research
Budget, Annual Development Budget or Post BLA Filing Annual Budget and
actually incurred by the non-terminating Party at any time following
such termination.
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13.7 Net Profit{TC "13.7 Net Profit" f C\1"2"}. For the purposes of Section
13.4, Net Profit shall be calculated in the same way as Pro-Forma Net
Profit (as set out in Section 1.82) except that Reimbursable Commercial
Costs shall not include any Development Costs, Ongoing Development Costs
or Research Expenses incurred by the non-terminating Party in respect of
the relevant R&D Candidate prior to a Termination for Convenience.
13.8 Withdrawal Royalty Stacking Provision{TC "13.8 Withdrawal Royalty
Stacking Provision" f C\1 "2"}. If the amount of Third Party License
Fees or other obligations required to paid to a Third Party to
Commercialize any Product subject to the provisions of Section 13.4 and
13.5 and the amounts to be paid pursuant to Section 13.4 exceed an
amount equal to [***] of the Net Sales of such Product, then the
royalties payable under Section 13.4 shall be reduced by the dollar
amount of the Third Party License Fees or other consideration paid to
such a Third Party; provided, however, that the maximum amount of any
such reduction shall not result in a reduction of any royalty due to the
other Party to an amount below [***] of the Net Sales of any Product as
to which such a royalty is due pursuant to Section 13.4. The provisions
of this Section 13.8 shall not apply to the first [***] of the royalty
payable under Section 13.4.4(c) or the first [***] of the royalty
payable under Section 13.4.5(c) and such [***] shall always be payable,
where applicable, in addition to the [***] royalty floor referred to
herein.
14. PRODUCT LIABILITY, INDEMNIFICATION AND INSURANCE.
14.1 Sharing of Collaboration Product Liability Expenses{TC "14.1 Sharing of
Collaboration Product Liability Expenses" f C\1 "2"}. Except where
proximately caused by the gross negligence or wilful misconduct of a
Party seeking reimbursement, the Parties shall share, on an equal basis,
all losses, damages, liabilities, settlements, penalties, fines and
expenses (including, without limitation, reasonable attorneys' fees and
expenses) arising out of or caused by (a) the Manufacture of a
Collaboration Product; (b) the death or bodily injury of any person on
account of the use of a Collaboration Product; and/or (c) any recall or
withdrawal of a Collaboration Product (collectively, "Collaboration
Product Liability Claims").
14.2 Indemnification by CAT{TC "14.2 Indemnification by CAT" f C\1 "2"}. CAT
will indemnify, defend and hold harmless ELAN, its Affiliates,
sublicensees, distributors, and each of its and their respective
employees, officers, directors and agents (each, an "ELAN Indemnified
Party") from and against any and all liability, loss, damage, expense
(including reasonable attorneys' fees and expenses) and cost (collec-
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tively, a "Liability") that the ELAN Indemnified Party may be required
to pay to one or more Third Parties resulting from or arising out of:
(a) any claims of any nature, other than Collaboration Product
Liability Claims or claims by Third Parties asserting patent
infringement unrelated to the CAT Technology and/or the CAT
Intellectual Property, arising out of the conduct of the
Research Program, the Development Program, or the
Commercialization of Collaboration Products and/or Party
Exclusive Products by, on behalf of, or under the authority of
CAT (other than by ELAN);
(b) any CAT representation or warranty set forth herein being untrue
in any material respect when made; and/or
(c) any Collaboration Product Liability Claims proximately caused
[***];
except in each case, to the extent caused by the gross negligence or
wilful misconduct of ELAN or any ELAN Indemnified Party.
Notwithstanding the foregoing, CAT shall have no obligation to defend,
indemnify or hold harmless any ELAN Indemnified Party from and against
any Liability arising out of or resulting from the infringement of a
Third Party patent.
14.3 Indemnification by ELAN{TC "14.3 Indemnification by ELAN" \f C \1 "2"}.
ELAN will indemnify, defend and hold harmless CAT, its Affiliates, and
each of its and their respective employees, officers, directors and
agents (each, a "CAT Indemnified Party") from and against any and all
Liabilities that the CAT Indemnified Party may be required to pay to
one or more Third Parties arising out of:
(a) any claims of any nature, other than Collaboration Product
Liability Claims or claims by Third Parties asserting patent
infringement unrelated to the ELAN Technology and/or the ELAN
Intellectual Property, arising out of the conduct of the
Research Program , the Development Program, or the
Commercialization of Collaboration Products, Party Exclusive
Products or a Non-Antibody Product by, on behalf of, or under
the authority of ELAN (other than by CAT);
(b) any ELAN representation or warranty set forth herein being
untrue in any material respect when made; and/or
(c) any Collaboration Product Liability Claims proximately caused by
[***];
except in each case, to the extent caused by the gross negligence or
wilful misconduct of CAT or any CAT Indemnified Party. Notwithstanding
the foregoing, ELAN shall
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have no obligation to defend, indemnify or hold harmless any CAT
Indemnified Party from and against any Liability arising out of or
resulting from the infringement of a Third Party patent.
14.4 Procedure{TC "14.4 Procedure" \f C \1 "2"}. Each Party will notify the
other in the event it becomes aware of a claim for which
indemnification may be sought hereunder. In case any proceeding
(including any governmental investigation) shall be instituted
involving any Party in respect of which indemnity may be sought
pursuant to this Article 14, such Party (the "Indemnified Party") shall
promptly notify the other Party (the "Indemnifying Party") in writing
and the Indemnifying Party and Indemnified Party shall meet to discuss
how to respond to any claims that are the subject matter of such
proceeding. The Indemnifying Party, upon request of the Indemnified
Party, shall retain counsel reasonably satisfactory to the Indemnified
Party to represent the Indemnified Party and shall pay the fees and
expenses of such counsel related to such proceeding. In any such
proceeding, the Indemnified Party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the
expense of the Indemnified Party unless (i) the Indemnifying Party and
the Indemnified Party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the Indemnifying Party
and the Indemnified Party and representation of both Parties by the
same counsel would be inappropriate due to actual or potential
differing interests between them. All such fees and expenses shall be
reimbursed as they are incurred. The Indemnifying Party shall not be
liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a
final judgment for the plaintiff, the Indemnifying Party agrees to
indemnify the Indemnified Party from and against any loss or liability
by reason of such settlement or judgment. The Indemnifying Party shall
not, without the written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of which
the Indemnified Party is, or arising out of the same set of facts could
have been, a party and indemnity could have been sought hereunder by
the Indemnified Party, unless such settlement includes an unconditional
release of the Indemnified Party from all liability on claims to which
the indemnity relates that are the subject matter of such proceeding.
14.5 Insurance{TC "14.5 Procedure" \f C \1 "2"}. Each Party further agrees
to use its reasonable efforts to obtain and maintain, during the term
of this Agreement, Commercial General Liability Insurance, including
Collaboration Products Liability Insurance, with reputable and
financially secure insurance carriers to cover its indemnification
obligations under Sections 14.2 or 14.3, as applicable, or
self-insurance, with limits of not less than [***] per occurrence and
in the aggregate.
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15. DISPUTE RESOLUTION.
15.1 Disputes{TC "15.1 Disputes" \f C \1 "2"}. The Parties recognize that
disputes as to certain matters may from time to time arise during the
term of this Agreement which relate to either Party's rights and/or
obligations hereunder. Each Party shall continue to perform its
obligations under this Agreement pending final resolution of any
dispute arising out or relating to this Agreement. It is the objective
of the Parties to establish procedures to facilitate the resolution of
disputes arising under this Agreement in an expedient manner by mutual
cooperation and without resort to litigation. To accomplish this
objective, the Parties agree to follow the procedures set forth in this
Article 15 if and when a dispute arises under this Agreement. Unless
otherwise specifically recited in this Agreement, disputes among
members of the Joint Project Team will be submitted [***]. Such
submission shall occur within twenty (20) days of the date of the last
meeting at which the Joint Project Team was unable to resolve the
issue. [***]. Each Party shall be responsible for the expenses incurred
by its decision-making individual in attending or otherwise
participating in such meetings. If within [***] of any meeting between
[***] a resolution of the deferred matter has not been reached, then
the applicable provisions of Article 15.2 may be invoked.
15.2 Discretionary Dispute Resolution{TC "15.2 Discretionary Dispute
Resolution" \f C \1 "2"}. For all disputed matters referred to the
senior level decision-makers specified in Article 15.1 which are not
resolved thereunder, [***]. A Party seeking to exercise its rights
under this Article 15.2 shall provide written notice to the other Party
within [***] of the date specified in the next to last sentence of
Article 15.1, with the written resolution of such matter being provided
to the other Party five (5) days thereafter
15.3 Discretionary Dispute Resolution{TC "15.3 Discretionary Dispute
Resolution" \f C \1 "2"}. Jurisdiction. For the purposes of this
Article 15, the Parties agree to accept the non-exclusive jurisdiction
of the federal courts located in the Southern District of New York for
the purposes of enforcing the agreements or resolutions of disputes
reflected in this Article.
15.4 Determination of Patent Disputes{TC "15.4 Determination of Patent
Disputes" \f C \1 "2"}. Where so indicated, a dispute between the
Parties or arising out of operation of the JPC shall first be referred
to the JSC who shall retain independent patent counsel with appropriate
national specific expertise who shall render a binding determination of
the dispute. All other disputes regarding matters arising out or
relating to either Party's Patent Rights shall be subject solely to the
jurisdiction of the applicable national court respecting the Patent
Right as to which such a dispute exists.
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16. ASSIGNMENTS; CHANGES OF CONTROL.
16.1 Assignments{TC "16.1 ▇▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. ▇▇▇▇▇▇▇ this
Agreement nor any right or obligation hereunder may be assigned or
delegated, in whole or part, by either Party without the prior express
written consent of the other, except as expressly set forth below in
this Section 15.1. Notwithstanding the foregoing, either Party may,
without the written consent of the other Party, assign this Agreement
and its rights and delegate its obligations hereunder to any of its
Affiliates or to a Third Party in connection with the transfer or sale
of all or substantially all of its business relating to the subject
matter of this Agreement (provided that any such assignment to a Third
Party shall be deemed a Change in Control of the assigning Party for
purposes of Section 12.5).
17. MISCELLANEOUS.
17.1 Further Actions{TC "17.1 Further Actions" \f C \1 "2"}. Each Party
agrees to execute, acknowledge and deliver such further instruments,
and to do all such other acts, as may be necessary or appropriate in
order to carry out the purposes and intent of this Agreement.
17.2 Force Majeure{TC "17.2 Force Majeure" \f C \1 "2"}. Nonperformance of
a Party (other than for the payment of money) shall be excused to the
extent that performance is rendered impossible by strike, fire,
earthquake, flood, governmental acts or orders or restrictions, failure
of suppliers, or any other reason where failure to perform, is beyond
the reasonable control and not caused by the negligence, intentional
conduct or misconduct of the nonperforming Party. The nonperforming
Party shall notify the other Party promptly should such circumstances
arise, giving an indication of the likely extent and duration thereof,
and shall use all reasonable efforts to resume performance of its
obligations as soon as practicable; provided, however, that neither
Party shall be required to settle any labor dispute or disturbance.
17.3 Notices{TC "17.3 Notices" \f C \1 "2"}. All requests and notices
required or permitted to be given to the Parties hereto shall be given
in writing, shall expressly reference the section(s) of this Agreement
to which they pertain, and shall be delivered to the other Party, and
shall be deemed given if delivered personally or by facsimile
transmission (receipt verified), mailed by registered or certified mail
(return receipt requested), postage prepaid, or sent by nationally
recognized express courier service, to the Parties, at the appropriate
address as set forth below or to such other addresses as may be
designated in writing by the Parties from time to time during the term
of this Agreement:
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All correspondence to CAT shall be addressed as follows:
Cambridge Antibody Technology Limited
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention: Company Secretary
Fax: ▇▇-▇▇▇▇-▇▇▇▇▇▇
All correspondence to ELAN shall be addressed as follows:
Elan Corporation, plc
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇, ▇▇▇▇▇▇▇
Attn: Chief Executive Officer
Fax: ▇▇▇-▇▇-▇▇-▇▇▇-▇▇▇▇
with a copy to:
Elan Pharmaceuticals, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
17.4 Amendment{TC "17.4 Amendment" \f C \1 "2"}. No amendment, modification
or supplement of any provision of this Agreement shall be valid or
effective unless made in writing and signed by a duly authorized
officer of each Party.
17.5 Waiver{TC "17.5 Waiver" \f C \1 "2"}. No provision of this Agreement
shall be waived by any act, omission or knowledge of a Party or its
agents or employees except by an instrument in writing expressly
waiving such provision and signed by a duly authorized officer of the
waiving Party.
17.6 Severability{TC "17.6 Severability" \f C \1 "2"}. If any clause or
portion thereof in this Agreement is for any reason held to be invalid,
illegal or unenforceable, the same shall not affect any other portion
of this Agreement, as it is the intent of the Parties that this
Agreement shall be construed in such fashion as to maintain its
existence, validity and enforceability to the greatest extent possible.
In any such event, this Agreement shall be construed as if such clause
or portion thereof had never been
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contained in this Agreement, and there shall be deemed substituted
therefor such provision as will most nearly carry out the intent of the
Parties as expressed in this Agreement to the fullest extent permitted
by applicable law unless doing so would have the effect of materially
altering the rights and obligations of the Parties in which event this
Agreement shall terminate and all the rights and obligations granted to
the Parties hereunder shall cease and be of no further force and
effect.
17.7 Descriptive Headings{TC "17.7 Descriptive Headings" \f C \1 "2"}. The
descriptive headings of this Agreement are for convenience only, and
shall be of no force or effect in construing or interpreting any of the
provisions of this Agreement.
17.8 Governing Law; Venue and Jurisdiction{TC "17.8 Governing Law; Venue and
Jurisdiction" \f C \1 "2"}. This Agreement shall be governed by and
interpreted in accordance with the substantive laws of the State of New
York, except matters of intellectual property law, which shall be
governed by and interpreted in accordance with the national
intellectual property laws relevant to the intellectual property in
question, without regard to conflict of law principles thereof. Venue
and jurisdiction for any action brought under this Agreement by ELAN
shall lie exclusively in England and Wales and for any action brought
under this Agreement by CAT shall lie exclusively in New York and both
Parties hereby consent to such venues.
17.9 Entire Agreement of the Parties{TC "17.9 Entire Agreement of the
Parties" \f C \1 "2"}. This Agreement constitutes and contains the
complete, final and exclusive understanding and agreement of the
Parties and cancels and supersedes any and all prior negotiations,
correspondence, understandings and agreements, whether oral or written,
among the Parties respecting the subject matter hereof.
17.10 Independent Contractors{TC "17.10 Independent ▇▇▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇
"▇"}. ▇▇▇▇ Parties are independent contractors under this Agreement.
Nothing herein contained shall be deemed to create an employment,
agency, joint venture or partnership relationship between the Parties
or any of their agents or employees, or any other legal arrangement
that would impose liability upon one Party for the act or failure to
act of the other Party. Neither Party shall have any express or implied
power to enter into any contracts or commitments or to incur any
liabilities in the name of, or on behalf of, the other Party, or to
bind the other Party in any respect whatsoever.
17.11 Debarment{TC "17.11 ▇▇▇▇▇▇▇▇▇" \▇ ▇ \▇ "▇"}. Each Party agrees that it
will not use, in any capacity, in connection with any of its
obligations to be performed under the Research Program or the
Development Program any individual who has been debarred under the FD&C
Act or the Generic Drug Enforcement Act.
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17.12 Counterparts{TC "17.12 Counterparts" \f C \1 "2"}. This Agreement may
be executed in any number of counterparts, each of which need not
contain the signature of more than one Party but all such counterparts
taken together shall constitute one and the same agreement.
17.13 NO CONSEQUENTIAL DAMAGES{TC "17.12 NO CONSEQUENTIAL DAMAGES" \f C \1
"2"}. IN NO EVENT SHALL A PARTY HERETO BE LIABLE FOR SPECIAL,
INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THIS AGREEMENT OR
THE EXERCISE OF ITS RIGHTS HEREUNDER, INCLUDING WITHOUT LIMITATION LOST
PROFITS ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT,
REGARDLESS OF ANY NOTICE OF SUCH DAMAGES. NOTHING IN THIS SECTION 17.13
IS INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR
OBLIGATIONS OF EITHER PARTY.
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IN WITNESS WHEREOF, duly authorized representatives of the Parties have
duly executed this Agreement to be effective as of the Effective Date.
ELAN PHARMA INTERNATIONAL CAMBRIDGE ANTIBODY TECHNOLOGY
LIMITED LIMITED (on its own behalf and on
behalf of its Affiliates)
By:________________________________ By:_________________________________
Name: Name:
Title: Title:
EXHIBIT 1.10
CAT GATEKEEPING PROCEDURE
[***]
EXHIBIT 1.11
CAT IN-LICENSES
1. License Agreement dated January 7, 1997 between CAT and MRC, with
certain royalty rates, as may be amended from time to time, which shall
include all royalty payments due to The Scripps Research Institute and
Stratagene pursuant to an agreement dated June 25, 1999.
2. Therapeutic Antibodies Agreement, dated December 31, 1997 between CAT
and Dyax Corp., as such agreement may be amended from time to time.
3. Diagnostic Antibodies Agreement dated December 31, 1997 between CAT and
Dyax Corp., as such agreement may be amended from time to time.
EXHIBIT 1.15
CAT PATENT RIGHTS
[***]
EXHIBIT 1.17
CAT TECHNOLOGY
[***]
EXHIBIT 1.41
ELAN PATENT RIGHTS
[***]
EXHIBIT 1.43
ELAN TECHNOLOGY
[***]
EXHIBIT 1.95
SPECIFIC TARGETS
[***]
EXHIBIT 2.2(d)(iii)
CAT PREEXISTING OBLIGATIONS
[***]
EXHIBIT 5.2.1
ELEMENTS OF ANNUAL RESEARCH PLAN
[***]
EXHIBIT 10.2.6
CAT THIRD PARTY CLAIMS
[***]
EXHIBIT 10.3.4
ELAN THIRD PARTY CLAIMS
[NONE]