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EXHIBIT 10.57
[Confidential treatment has been requested for portions of this exhibit. The
confidential portions have been redacted and are denoted by [**]. The
confidential portions have been separately filed with the commission.]
EXCLUSIVE LICENSE AGREEMENT
(DHAC)
THIS AGREEMENT is made as of November 27, 1996, by and between MGI
PHARMA, INC. ("MGI"), 300E Opus Center, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ and ILEX ONCOLOGY, INC. ("ILEX"), ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
Recitals
A. MGI acquires, develops and markets pharmaceuticals that it
believes address currently unmet medical needs or significantly improve upon
current therapies.
B. ILEX has certain rights and know-how relating to a compound
called 5,6-dihydro-5 azacytidine ("DHAC") and has filed a U.S. patent
application covering the use of such compound for treatment of prostate cancer.
C. MGI and ILEX have previously entered into that certain Non-
Disclosure Confidentiality Agreement dated June 17, 1996 (the "Non-Disclosure
Agreement").
D. MGI desires to develop, make or have made, sell and distribute
products containing DHAC on a worldwide basis, and ILEX desires to grant to MGI
rights to develop, make, have made, import, offer for sale, sell, promote and
distribute such products, all upon the terms and conditions set forth in this
Agreement.
E. ILEX and MGI wish to transfer its only orphan drug designation
for DHAC from ILEX to MGI.
F. ILEX wishes to use its best efforts to cause the National Cancer
Institute of the Department of Health and Human Services, Public Health
Service, National Institutes of Health ("NCI") to transfer and assign to MGI
its existing investigational new drug application for DHAC products as well as
its existing supplies of DHAC bulk drug substance.
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the Parties hereto have agreed as follows:
ARTICLE 1 INTRODUCTORY PROVISIONS
1.1 Defined Terms. The following terms, when used in capitalized for
in this Agreement, shall have the meanings set forth below:
(a) "Affiliate" when used with reference to either party shall mean
any entity controlling, controlled by or under common control
with the said party. For
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purposes hereof, "control" shall mean ownership, directly or
indirectly, of more than [**] percent ([**]%) of the
securities having the right to vote for the election of
directors, in the case of a corporation, and more than [**]
percent ([**]%) of the beneficial interest in the capital, in the
case of a business entity other than a corporation.
(b) "Best Efforts" shall mean those efforts that would be made by a
reasonably prudent business person acting in good faith, in the
exercise of reasonable commercial judgment and in a manner
consistent with those efforts the applicable party devotes to its
own business and pharmaceutical products resulting from its own
research efforts and having a similar market potential, profit
potential or strategic value.
(c) "Confidential Information" shall mean all proprietary
information, including ILEX Know-How, Proprietary Product
Information of a party, including any information on the markets,
customers, suppliers, patents or patent applications, inventions,
products, procedures, designs, formulas, business plans,
financial projections, organizations, employees or consultants or
any other similar aspects of a party's present or future
business, the secrecy of which confers a competitive advantage
upon that party.
(d) "Drug Master File" shall mean a Type II Drug Master File for any
Product created by ILEX, NCI or their respective agents and on
file with the FDA, any supplementary or successor drug master
file in respect of DHAC that is submitted by ILEX, NCI or their
respective agents to the FDA, or any corresponding drug master
file or similar file in respect of any Product that may be
submitted to the FDA or other applicable governmental agency; in
each case, by ILEX or its agents as of the Effective Date or by
NCI or its agents at any time (provided that ILEX has rights from
NCI with respect thereto).
(e) "Effective Date" shall mean the date first above written.
(f) "FDA" shall mean the United States Food and Drug Administration
or any successor entity.
(g) "Health Registration Dossier" shall mean all documentation which
is now or shall hereafter be on file with the FDA or other
applicable governmental agency, which comprises the information
and data submitted to such agency in support of an application
made by ILEX, MGI, or a sublicensee of MGI or ILEX, to such
agency for Marketing Authorization for a Product to treat any
Indication.
(h) "ILEX Know-how" shall mean all information and data, regardless
of form, which is necessary or useful to the development
(including, without limitation, clinical or preclinical testing
or results, and any other information necessary or supportive of
a request for Marketing Authorization) or manufacture of a
Product or to the development or manufacture of dose forms or
means of delivery of a
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Product, including, without limitation, the Proprietary Product
Information, (i) which (A) may have been developed by ILEX, NCI
or other third parties or (B) which is owned, developed, acquired
or otherwise licensable by ILEX to MGI; and (ii) which is in
ILEX's possession or control as of the Effective Date, or with
respect to any of the foregoing received by ILEX from NCI or its
agents, as of the Effective Date or thereafter.
(i) "ILEX Patents" shall mean all patents or patent applications
under the laws of any country or countries, (i) which are
necessary or useful to (A) the development or manufacture of dose
forms or means of delivery of the Products, or (B) to the use of
the Products alone or in conjunction with other products; and
(ii) which are owned or controlled by ILEX which ILEX has a right
to license to MGI or its sublicensees as of the Effective Date,
or with respect to any of the foregoing licensed or assigned to
ILEX by NCI or its agents, as of the Effective Date or
thereafter.
(j) "IND" shall mean an Investigational New Drug Application, or a
successor application.
(k) "Indication" shall mean any medical condition or set of symptoms
for the treatment of which a Product may be determined to be safe
and efficacious.
(l) "Marketing Authorization" shall mean any governmental approval by
the FDA or other applicable governmental agency which is legally
required under applicable laws, regulations or administrative
decisions to put a pharmaceutical product on the market in such
country for use in the treatment of any Indication (including
pricing and reimbursement approvals, if applicable).
(m) "Net Sales" shall mean the total of the gross invoice prices of
Products sold or transferred by MGI, its Affiliates, and its
sublicensees less rebates and allowances given by MGI, its
Affiliates or sublicensees and the sum of the following actual
and customary deductions included on the invoice as part of the
gross invoice price and actually paid: cash, trade, or quantity
discounts; dales, use, tariff or other excise taxes imposed upon
particular sales; import/export duties; and transportation
charges. Sales among MGI, its Affiliates and its sublicensees
for ultimate third party use shall be disregarded for the
purposes of computing Net Sales. Products provided by MGI, its
Affiliates or sublicensees to third parties as samples or for
research purposes or clinical studies shall not be deemed to be
sold or transferred of the purposes of computing Net Sales.
(n) "Orphan Drug Designation" shall mean designation under the U.S.
Orphan Drug Act, as amended, or any successor statute, of a
Product for treatment of mesothelioma.
(o) "Party" shall mean either of the two parties to this Agreement
and, to the extent appropriate when required by the context, to
any sublicensees of a Party.
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(p) "Products" shall mean any pharmaceutical products having as an
active ingredient DHAC, either alone or in combination with other
substances, whether or not such products are known or in
existence on the Effective Date.
(q) "Proprietary Product Information" shall mean (i) all information
and data now or hereafter contained in any Drug Master File or
Health Registration Dossier to which either Party, or any
sublicensee of either Party, shall have the right under
applicable law, regulations and administrative decisions to
refer, to authorize third parties to refer and to prohibit third
parties from referring, for purposes of any application for
Marketing Authorization for any Product; (ii) all data concerning
any serious or unexpected adverse effects, side effects and
contraindications of any Product which may come to the attention
of either Party or of any sublicensee; (iii) all data and
information in the possession of either Party or any permitted
sublicensee of a Party relating to (A) the pharmacological or
toxicological properties of a Product, (B) pre-clinical or
clinical testing and experience in relation to a Product which is
not included in any Health Registration Dossier and (C) to the
extent reasonably required for purposes of any application for
Marketing Authorization, the chemical composition, manufacturing
processes and quality control testing of a Product and (iv) all
other information and data now or hereafter in existence and in
the possession of either Party which relates to the development,
testing, manufacture, marketing or use of any Product which is
not in the public domain. Notwithstanding the foregoing, as used
herein, Proprietary Product Information of ILEX shall be limited
to (1) any of the foregoing in ILEX's possession or control as of
the Effective Date and (2) any of the foregoing received by ILEX
from NCI or its agents as of the Effective Date or thereafter.
1.2 Other Rules of Interpretation. Unless the context clearly indicates
otherwise, the following rules shall govern the interpretation of this
Agreement:
(a) The definitions of all terms defined herein shall apply equally
to the singular, plural, and possessive forms of such terms;
(b) All references herein to "days" shall mean calendar days;
(c) All references herein to "quarters" shall mean calendar quarters;
and
(d) All references herein to "Sections" shall mean the corresponding
Sections of this Agreement and all references to "Articles" shall
mean the corresponding Articles of this Agreement.
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ARTICLE 2 WARRANTIES, REPRESENTATIONS AND COVENANT; LIMITATIONS
2.1 ILEX Warranties. ILEX represents and warrants to MGI that:
(a) it has the legal right and power to enter into this Agreement;
(b) it has taken all necessary corporate action to authorize and
perform this Agreement;
(c) it has not entered into any inconsistent prior obligations that
would impair the rights being licensed to MGI hereunder;
(d) it owns or has the right to license or sublicense all the rights
granted to MGI herein with respect to the ILEX Patents, ILEX
Know-how and such information and data in any applicable Drug
Master Files which ILEX owns, possesses or controls as of the
Effective Date;
(e) it will own or have the right to license or sublicense all the
remaining rights granted to MGI herein with respect to the ILEX
Patents, ILEX Know-how and such information and data in any
applicable Drug Master Files that ILEX is receiving hereunder
from NCI or its agents after the Effective Date, such that as of
the last date of such transfers, ILEX will own or have the right
to license or sublicense all of the rights granted to MGI herein;
(f) to the best of its knowledge, there are no third party claims
that would challenge or impair the license of the rights granted
to MGI herein, including, without limitation, any claims based
upon patents, copyrights or trade secret laws in the United
States; and
(g) to the best of its knowledge, the manufacture, use or sale of the
Products under the license granted herein under the ILEX Patents
and ILEX Know-how will not infringe any patents, copyrights,
trade secrets or any other intellectual property rights of any
third parties.
2.2 MGI Warranties. MGI represents and warrants to ILEX that:
(a) it has the legal right and power to enter into this Agreement;
and
(b) it has taken all necessary corporate action to authorize and
perform this Agreement.
2.3 ILEX Covenant. During the term of this Agreement (and if this
Agreement is terminated by MGI pursuant to Section 11.2, then for an
additional period of five (5) years thereafter), ILEX covenants and
agrees that it shall not market, promote, supply or sell Products,
directly or indirectly through any affiliate or third party, unless MGI
consents in writing, such consent not to be unreasonably withheld. For
the purposes of
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this Section 2.3, MGI's refusal to consent shall not be deemed to be
unreasonable if MGI determines, in its sole discretion, that the Product
in question would be competitive to any current or future Product of MGI
or its sublicensees. Notwithstanding the foregoing, ILEX shall be
entitled to manufacture any Product for any third party provided that it
can do so without using or disclosing any ILEX Patent or ILEX Know-how
licensed hereunder.
2.4 DISCLAIMER OF WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN SECTIONS 2.1
AND 2.2, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY WITH RESPECT TO THE
ILEX PATENTS, ILEX KNOW-HOW OR THE PRODUCTS AND EACH PARTY HEREBY EXPRESSLY
DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR PATENT ABILITY.
2.5 LIMITATION OF LIABILITY. EXCEPT AS PROVIDED IN SECTIONS 2.1, 2.2,
ARTICLE 9 OR IN THE EVENT OF A MATERIAL BREACH BY EITHER PARTY OF THE
LIMITATIONS SET FORTH IN ARTICLE 10 BELOW, NEITHER PARTY SHALL BE LIABLE
TO THE OTHER FOR ANY LOSS, EXPENSE OR DAMAGE ARISING OUT OF OR RESULTING
FROM THIS AGREEMENT. IN ANY EVENT, NEITHER PARTY SHALL BE LIABLE FOR
ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL LOSS OR DAMAGES. IN
THE EVENT OF ANY CLAIM FOR SUCH LOSS OR DAMAGES, THE SOLE AND EXCLUSIVE
REMEDY FOR ANY LIABILITY UNDER THIS AGREEMENT SHALL BE LIMITED TO A
REFUND OF ANY SUMS PAID AND/OR THE TERMINATION OF ANY RIGHTS GRANTED
UNDER THIS AGREEMENT.
ARTICLE 3 RIGHTS IN INTELLECTUAL PROPERTY
3.1 License Grant to MGI. Subject to the terms and conditions of this
Agreement, ILEX hereby grants to MGI, and MGI hereby accepts from ILEX, an
exclusive, worldwide right and license (with right of sublicense) under the
ILEX Patents and ILEX Know-how and all other intellectual property rights
covering or relating to the Products, which are owned or controlled by ILEX as
of the Effective Date or licensed, assigned or transferred to ILEX by NCI or
its agents at any time, to develop, make, have made, import, use, offer to
sell, sell and distribute the Products.
ARTICLE 4 TRANSFERS TO MGI
4.1 Orphan Drug Designation. ILEX shall transfer and assign to MGI its
Orphan Drug Designation for the Products. The parties acknowledge and agree
that MGI's obligations under this Agreement are dependent upon such transfer
and assignment by ILEX.
4.2 Technology Transfer. ILEX shall (a) provide MGI all DHAC bulk drug
substance then in its possession and ILEX Know-How then in its possession or
control and necessary or useful in development or commercialization of the
Products, including chemistry, manufacturing and controls, preclinical and
clinical data, published literature and the like, for MGI's use and (b)
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transfer to MGI any Drug Master Files of ILEX or its agents or otherwise then
in its possession or control and relating to the Products.
4.3 Transfer from NCI. The parties acknowledge that MGI's obligations under
this Agreement are dependent upon NCI's agreement to assign and transfer to MGI
the IND for the Products and any DHAC bulk drug substance in possession or
control of NCI or its agents. MGI shall cooperate reasonably in such transfers
including providing NCI with a copy of its protocol for clinical study of the
Products.
4.4 Schedules for Transfers. ILEX's obligations under Sections 4.1 and 4.2
shall be completed not later than December 15, 1996. ILEX shall use its Best
Efforts to cause the assignment and transfers from NCI, as contemplated under
Section 4.3, to be completed by December 20, 1996 and not later than March 15,
1997. If the assignment and transfers from NCI contemplated in Section 4.3 are
not completed prior to March 15, 1997, either party may terminate this
Agreement as provided in Section 11.5.
4.5 Surviving Provisions. MGI shall comply with Sections 4.7, 5.2 and 9.1
of that certain License Agreement dated August 4, 1993, by and between ILEX and
the National Technical Information Services, as if MGI were a "LICENSEE"
thereunder.
ARTICLE 5 PRODUCT DEVELOPMENT; PATENT PROSECUTION
5.1 Product Development. MGI shall develop the Products, at MGI's expense,
for use in treatment of an initial Indication (which is currently intended to
me myelodisplastic syndrome) (the "Initial Indication") in accordance with a
development plan prepared by MGI and acceptable to ILEX, and thereafter for use
for such Indications and in such countries as MGI deems appropriate.
5.2 ILEX Development Work. ILEX shall be entitled to perform contract
research and development work for MGI, as agreed by the parties from time to
time, at ILEX's then standard contract rates, for an aggregate amount equal to
[**] percent ([**]%) of MGI's total clinical development budget for the
Initial Indication for the Products (excluding any preclinical work for the
Products). If MGI terminates the development of the Products for any reason,
such aggregate amount shall equal [**] percent ([**]%) of what MGI
actually spent for development of the Products (unless the parties have already
agreed to a greater amount pursuant to a written agreement as contemplated
below). Such development work may be related to the Products or to other MGI
products, in MGI's sole discretion and will be subject to the terms of a
separate written agreement, including, without limitation, provisions (i)
restricting ILEX's use of any data resulting f rom the work, (ii) assigning to
MGI all ownership and other rights with respect to any resulting data and
inventions and (iii) indemnifying MGI, its Affiliates and sublicensees and
their respective officers, directors, employees and agents from any claims
arising from negligence, gross negligence or willful misconduct of ILEX with
respect to such development work. MGI and ILEX shall use their Best Efforts to
enter into such a separate written agreement prior to but not later than the
date on which an NDA for a Product is submitted or within sixty (60) days of
the date on which MGI decides, in its sole discretion, to
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terminate development of the Products, whichever occurs first, with the
development work to be completed within one year after signing such agreement.
5.3 Patent Prosecution. MGI shall have the right to prosecute and maintain
any ILEX Patents, by attorneys of MGI's choice and at MGI's expense. MGI shall
also reimburse ILEX for up to $[**] of ILEX's out-of-pocket patent expenses
incurred prior to the Effective Date. If MGI decides, for any reason, not to
prosecute or maintain any of the ILEX Patents in the United States, it shall so
notify ILEX in writing. Upon such notification, ILEX shall have the right to
prosecute and maintain such ILEX Patent, at its own expense, and MGI shall no
further rights under Section 3.1 in the United States with respect to such ILEX
Patent.
ARTICLE 6 PRODUCT REGULATORY APPROVALS
6.1 Regulatory Approvals. MGI shall submit appropriate applications for
Marketing Authorization in the United States for use of the Products in the
Initial Indication and shall use its Best Efforts, in consultation with ILEX,
to obtain such Marketing Authorization. Thereafter, MGI may submit
applications for Marketing Authorizations for such Indications and in such
countries as MGI deems appropriate. Such responsibility shall include the
conduct and documentation of such testing and preclinical and clinical trials
as are required in connection with the submission of applications for Marketing
Authorization within such countries.
6.2 Co-Development. MGI shall have the right to engage third parties to
develop the Products jointly with MGI. The Parties acknowledge that any
sublicensee that is developing the Products jointly with MGI shall be entitled
to file separate applications to obtain Marketing Authorizations for the
Products.
ARTICLE 7 PROMOTION AND MARKETING
7.1 General Best Efforts Obligation. MGI shall commit adequate funding and
use its Best Efforts to fund and support the commercial launch and ongoing
promotion, marketing and sale of Products in the Initial Indication.
Thereafter, MGI shall commit such funding and use such efforts as it deems
appropriate to fund and support the commercial launch and on-going promotion,
marketing and sale of Products in other Indications.
7.2 Co-Promotion and Co-Marketing. MGI shall have the right to engage third
parties to assist in its promotion and marketing of the Products. Such third
party arrangements may include co-promotion or co-marketing of the Products.
7.3 Compliance with Law. MGI shall market, promote and sell the Products in
compliance with the conditions and requirements of all applicable Marketing
Authorizations and with all other applicable legal and regulatory requirements.
ARTICLE 8 LICENSE FEE AND ROYALTIES
8.1 Up-front License Fee. MGI shall pay to ILEX Seven Hundred Fifty
Thousand Dollars ($750,000), as an up-front license fee. This fee shall be
payable by wire transfer five (5)
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days after the earlier of (a) the date on which MGI receives written notice
from NCI, in a form reasonably acceptable to MGI, that it shall so transfer and
assign to MGI (or to ILEX as an intermediary) any NCI IND for the Product and
DHAC bulk drug substance in its possession or control, or (b) the date on which
NCI transfers and assigns to MGI (directly or through ILEX) any such IND for
the Products and transfers to MGI any such DHAC bulk d rug substance. If MGI
pays such fee as provided in (a) above, and if NCI thereafter fails, within six
(6) months of such payments, to transfer and assign to MGI (directly or through
ILEX) such IND and to transfer such DHAC bulk drug substance, then (i) ILEX
shall refund such up-front license fee to MGI within five (5) days of such six
(6) month anniversary, and such up-front license fee shall thereafter be
payable to ILEX only upon actual transfer and assignment by NCI of the
foregoing and (ii) the parties shall have the right to terminate this Agreement
as provided under Section 11.5.
8.2 Royalties.
(a) MGI shall pay to ILEX, a royalty of [**] percent ([**]%) of
Net Sales of Products. For any such country in which a third
party introduces a competitive product containing DHAC, MGI's
royalty payments to ILEX will be reduced to [**] percent
([**]%).
(b) Royalties shall continue on a Product-by-Product and country-by-
country basis for (i) the life of the last ILEX Patent covering
the manufacture, use or sale of such Product, or (ii) ten (10)
years from first commercial sale of such Product, whichever is
longer. Upon expiration of such royalty obligations, the license
granted under Section 3.1 shall be deemed to be fully paid up,
irrevocable and perpetual.
8.3 Reports. MGI shall pay to ILEX any amounts owing under Section 8.2, on
a quarterly basis on or before the forty-fifty (45th) day after the end of each
calendar quarter during the term of this Agreement. Each royalty payment shall
be accompanied by a report which shows the Net Sales of Products by MGI and its
sublicensees for such quarter, by Product.
8.4 Books and Records. MGI shall keep adequate and complete books and
records showing all Products sold by MGI and its sublicensees for a period of
no less than five (5) years following completion of the fiscal year in which
the sale of Products occurred. Such books and records shall include all
information necessary to verify the total amount and computation of the Net
Sales hereunder, and shall be open to inspection, audit and copying by ILEX or
its agents during reasonable business hours and upon reasonable notice to the
extent necessary to verify the amount of such Net Sales. Such inspection,
audit and copying may be conducted at the expense of ILEX by an independent
Certified Public Accountant or other agent appointed by ILEX and reasonably
acceptable to MGI, provided, however, MGI shall reimburse ILEX for ILEX's
reasonable expenses incurred in such inspection and audit if such audit reveals
any underpayment of amounts owing hereunder of more than [**] Dollars
($ [**] ) or [**] percent ([**]%), whichever is greater, for any quarter
covered by such inspection and audit.
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8.5 Withholding. If any payment to ILEX hereunder is subject to any income
taxes in a particular country:
(a) ILEX shall pay such income taxes and hereby authorizes MGI to
withhold such taxes from the applicable payments due to ILEX
under this Agreement and to pay such withheld amounts to the
relevant tax authorities within such country; and
(b) whenever MGI withholds and pays such income taxes from any
payments due to ILEX under this Agreement, it shall furnish ILEX
with a certificate of the relevant tax authorities and reasonably
acceptable to the U.S. Internal Revenue Service, documenting
payment of such taxes.
8.6 Net Payments. Except as expressly provided in Section 8.5, all payments
by MGI to ILEX under this Agreement represent the net amounts that ILEX is
entitled to receive and shall not be subject to any other withholding or
deduction for any reason whatsoever.
8.7 Currency Controls. If MGI is precluded at any time from making any
payments due to ILEX under the provisions of this Agreement because MGI has
failed to obtain any governmental approvals that may be required under the laws
and regulations in a particular country for such transfers of funds, then MGI
shall:
(a) deposit, or cause its agent to deposit, such sums to an account
designated by ILEX at a bank or other entity in such country;
(b) provide, or cause its agent to provide, to ILEX documentary
evidence of such deposits; and
(c) remit such deposits to ILEX immediately upon the subsequent
receipt of any required governmental approvals for such
transfers.
Subject to any applicable regulatory requirements, MGI further agrees, and
shall cause any agent of MGI to agree, that the form of such depository account
shall permit ILEX to withdraw the deposited amounts at will, but neither MGI
nor any agent of MGI shall withdraw the deposited amounts otherwise than for
the purpose of remitting such amounts to ILEX pursuant to the provisions of
this Section.
ARTICLE 9 INDEMNIFICATION; PATENT INFRINGEMENT
9.1 INDEMNIFICATION BY MGI.
(a) MGI hereby indemnifies and holds harmless ILEX and its affiliates
and their respective officers, directors, employees and agents
(an ILEX Indemnified Party") from and against all liabilities,
damages, losses, costs and expenses (including reasonable
attorney's fees) arising out of" (i) breach of any warranty,
covenant or agreement of MGI contained in this Agreement; (ii)
claims, suits or proceedings (a "Legal Action") brought by a
third party alleging actual
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negligence, gross negligence or willful misconduct of MGI or its
sublicensees resulting in personal injury or death related to the
use of any Product developed or marketed by MGI or its
sublicensees.
(b) Whenever an ILEX Indemnified Party becomes aware of a Legal
Action as to which it believes it entitled to indemnification
under this Article 9, such ILEX Indemnified Party shall give
notice in writing to MGI in sufficient time so as not to
materially and adversely prejudice MGI's fights with respect to
such Legal Action, shall permit MGI to assume exclusive control
of the defense or settlement of the matter, and shall provide, at
the expense of MGI, all authority, information and assistance
which MGI may reasonably request for purposes of such defense.
If a single law firm engaged by MGI would be subject to any
material conflict of interest in representing one or more of such
Parties, MGI shall not be required to waive such conflict and
may, instead, request separate representation by an independent
law firm of the ILEX Indemnified Party at the expense of MGI. An
ILEX Indemnified Party may engage its own counsel, at its own
expense, to monitor the defense of any such matter. MGI will
maintain general and products liability insurance with
contractual liability coverage and limits of at least [**]
Dollars ($ [**] ).
9.2 Indemnification by ILEX.
(a) ILEX hereby indemnified and holds harmless MGI, its Affiliates
and any parties to which it sublicenses rights to manufacture,
market, or distribute Products and their respective officers,
directors, employees and agents (a "MGI Indemnified Party") from
and against all liabilities, damages, losses, costs and expenses
(including reasonably attorney's fees) arising out of breach of
any warranty, covenant or agreement of ILEX contained in this
Agreement.
(b) Except as provided in Section 9.3, whenever a MGI Indemnified
Party becomes aware of a Legal Action as to which it believes it
is entitled to indemnification under this Article 9, it shall
give notice in writing to ILEX in sufficient time so as not to
materially and adversely prejudice ILEX's rights with respect to
such Legal Action, shall permit ILEX to assume exclusive control
of the defense or settlement of the matter, and shall provide, at
the expense of ILEX, all authority, information and assistance
which ILEX may reasonably request for purposes of such defense.
If a single law firm engaged by ILEX would be subject to any
material conflict of interest in representing one or more of such
parties, ILEX shall not be required to waive such representation
by an independent law firm of the MGI Indemnified Party at the
expense of ILEX. An MGI Indemnified Party may engage its own
counsel, at its own expense, to monitor the defense of any such
matter.
9.3 Patent Infringement. MGI shall have the right, but shall not be
obligated, to commence Legal Action or any alleged infringement of the ILEX
Patents and to defend any Legal Action alleging that the ILEX Patents violate
any patents, know-how, trade secret or any other
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intellectual property rights. MGI shall not enter into any settlement or
consent judgment or other voluntary final disposition of such Legal Action
without the approval of ILEX, such approval to not be unreasonably withheld.
If MGI notifies ILEX at any time of its intention not to commence or continue
prosecution or defense of a Legal Action alleging patent infringement, ILEX
shall have the right to commence or continue prosecution or defense of the
Legal Action. In any Legal Action either Party may prosecute or defend under
this Section 9.3, the other party shall cooperate with and at the request of
the party prosecuting or defending the suit. In addition to its obligation to
indemnify MGI, as set forth in Section 9.2, ILEX shall be solely responsible
for the costs of any Legal Action brought by ILEX under this Section 9.3.
9.4 Survival. The parties' obligations under this Article 9 shall survive
the termination of this Agreement for any reason.
ARTICLE 10 CONFIDENTIALITY
10.1 Non-Use and Non-Disclosure. Each party acknowledges and agrees that all
the other party's Confidential Information is confidential and proprietary to
the disclosing party. Each party shall not use or disclose to any third party
the other party's Confidential Information without the other party's prior
written consent for any purpose other than as permitted or required hereunder.
Each party shall take the same reasonable measures necessary to prevent any
unauthorized use or disclosure by its employees, agents, contractors,
sublicensees, or consultants of the other party's Confidential Information as
it applies to the protection of its own Confidential Information.
10.2 Marking. To be entitled to protection as Confidential Information, all
ILEX or MGI documents containing that party's Confidential Information shall be
appropriately and clearly marked as "Proprietary," "Secret," "Confidential," or
other words to similar effect. If a disclosure of Confidential Information is
made orally, as in a meeting, the disclosing party shall indicate the nature of
that information at the time of its disclosure and shall confirm such
designation in writing within ten (10) days of the date of such disclosure to
the receiving party.
10.3 Exclusions. Information shall not be considered Confidential
Information hereunder if it:
(a) was already in the possession of the receiving party prior to its
receipt from the disclosing party, as shown by the receiving
party's books and records;
(b) is, or becomes, part of the public knowledge or literature
through no fault, act or omission of the receiving party,
provided, however, that Proprietary Product Information shall not
be deemed to have entered the public domain by reason of its
having been filed with the FDA or any other applicable
governmental agency;
(c) is, or becomes, available to the receiving party from a source
other than the disclosing party, which source has rightfully
obtained the same information and has no obligation of
confidentiality to the disclosing party with respect to it;
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(d) is made available on an unrestricted basis by the disclosing
party to a third party unaffiliated with the disclosing party; or
(e) is required to be revealed pursuant to law, provided, however,
the receiving party which is under any such requirement of law
shall give reasonable notice (pursuant to the provisions of
Section 13.5) to the disclosing party of such requirement and
shall cooperate with the disclosing party in reasonable legal
efforts to limit or mitigate any such revelation so as to
preserve the proprietary nature of any Confidential Information
contained therein.
10.4 Duration; Surviving Obligation. Each party's obligations of non-use and
non-disclosure of the other party's Confidential Information shall apply during
the term of this Agreement and shall also survive for a period of five (5)
years after its termination or expiration for any reason.
10.5 Prior Agreements. The non-disclosure and non-use provisions of this
Agreement hereby supersede the provisions of the Non-Disclosure Agreement,
provided, however, that this Article 10 shall be deemed retroactive to the
effective date of the Non-Disclosure Agreement.
ARTICLE 11 TERM AND TERMINATION
11.1 Term. Unless earlier terminated in accordance with Section 11.2, 11.3,
11.4 or 11.5, this Agreement shall be in effect, on a Product-by-Product and
country-by-country basis, for the longer of (i) the life of the last ILEX
Patent covering the manufacture, use or sale of such Product in such country or
(ii) ten (10) years from the first commercial sale of such Product.
11.2 Termination for Cause. Either party may terminate this Agreement at any
time by giving notice in writing to the other party, which shall be effective
ninety (90) days after its date, in accordance with the following provisions:
(a) if the other party files a petition of any type as to its
bankruptcy, is declared bankrupt, becomes insolvent, makes an
assignment for the benefit of creditors, or goes into liquidation
or receivership; or
(b) if the other party is in material breach of this Agreement and
has failed to cure such breach within sixty (60) days of the
receipt of written notice of breach from the non-breaching party.
11.3 Termination by Mutual Agreement. The parties may agree in writing to
terminate this Agreement for their mutual convenience at any time and for any
reason, subject to such terms and conditions as they may adopt.
11.4 Termination by MGI. This Agreement may be terminated by MGI:
(a) for any reason upon sixty (60) days notice; or
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(b) immediately upon a decision by MGI to stop all clinical research
on the Products due to safety issues with respect to
administration of a Product to humans.
11.5 Termination due to NCI. If NCI (a) refuses in writing to transfer and
assign to MGI its IND for the Products and the DHAC bulk drug substance, as
required under Section 4.3, (b) fails to do so on or before March 15, 1997 or
(c) fails to transfer and assign to MGI such IND and such bulk drug substance
within six months of MGI's payment of the up-front license fee as provided in
Section 8.1, either party may terminate this Agreement effective immediately
upon written notice to the other party.
11.6 Rights and Obligations on Termination or Expiration. If this Agreement
is terminated or expires for any reason, the parties shall have the following
rights and obligations:
(a) Termination of this Agreement shall not release either party from
the obligation to make payment of all amounts then due and
payable;
(b) If this Agreement expires as provided in Section 11.1 or if it is
terminated by MGI pursuant to Section 11.2, the license granted
under Section 3.1 shall continue on a fully paid-up, irrevocable
and perpetual basis. If this Agreement is otherwise terminated,
the license granted under Section 3.1 shall terminate and MGI
shall return to ILEX any ILEX Know-How relating to the Products
that MGI initially received from ILEX, and if ILEX terminates
this Agreement pursuant to Section 11.2 or MGI terminates this
Agreement pursuant to Section 11.4, ILEX shall have a right of
first negotiation to obtain a license to any patent rights and
know-how developed by MGI during the term of this Agreement and
relating directly to the Products, on such terms as the parties
may the agree; and
(c) Each party's respective obligations of indemnification under
Article 9 (as provided in Section 9.3), of non-use and non-
disclosure under Article 10 (as provided in Section 10.4) and to
settle all disputes, controversies or claims under Article 12 (as
provided in Section 12.6) shall survive such termination or
expiration of this Agreement.
11.7 Rights under U.S. Bankruptcy Laws. The parties acknowledge and agree
that all rights and licenses granted to MGI by ILEX pursuant to this Agreement
are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the
Bankruptcy Code, licenses of rights to "intellectual property" as defined under
Section 101(52) of the Bankruptcy Code, and that MGI, as the licensee
hereunder, shall retain and may fully exercise all of its rights and elections
under the Bankruptcy Code.
11.8 No Compensation. The parties agree that, subject to the above
provisions of Section 11.6, and without prejudice to any other remedies at law
or in equity that either party may have in respect of any breach of this
Agreement, neither party shall be entitled to or claim that it is entitled to
any compensation or like payment as a result of or arising out of any
termination in accordance with this Article 11, whether claimed as loss of good
will, foregone profits, lost investments, or otherwise.
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ARTICLE 12 DISPUTE RESOLUTION
12.1 Negotiation. 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 or obligations hereunder or thereunder. 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. The parties agree to consult and
negotiate in good faith to try to resolve any dispute, controversy or claim
that arises out of or relates to this Agreement.
12.2 Reservation for Litigation. Notwithstanding Sections 12.1 and 12.3,
each party expressly reserves the right to seek judicial relief from a court of
competent jurisdiction if the other party is or appears to be in violation of
such other party's obligations of non-use and non-disclosure under Article 10
above, including, without limitation, any injunction or other preliminary
relief. Nothing in this Section 12.2 shall preclude a party from seeking such
interim relief with respect to any disputes or claims arising under this
Agreement as may be available under the commercial arbitration rules as
provided in Section 12.3.
12.3 Arbitration. Subject to the reservation of the parties under Section
12.2, all disputes, claims or controversies arising out of or in connection
with this Agreement shall be finally settled under the commercial arbitration
rules of the American Arbitration Association ("AAA"), as modified by Section
12.4 below. Judgment upon the award rendered by the arbitrators may be entered
in any court of competent jurisdiction. The place of arbitration shall be
Chicago, Illinois. The arbitration shall be conducted by three (3) neutral
arbitrators selected by mutual agreement of the parties, or, if that is not
possible within thirty (30) days of the initial demand for such arbitration, by
the AAA. At least one (1) arbitrator shall have knowledge of and experience in
the ethical pharmaceutical industry, and at least one (1) arbitrator shall have
knowledge of and experience in technology licensing.
12.4 Special Rules. Notwithstanding any provision to the contrary in the
commercial arbitration rules, the parties hereby stipulate that any arbitration
hereunder shall be subject to the following special rules:
(a) Each party shall have the right to request from the arbitrators,
and the arbitrators shall order upon good cause shown, reasonable
and limited pre-hearing discovery, including (i) exchange of
witness lists, (ii) depositions under oath of named witnesses,
(iii) written interrogatories, and (iv) document requests;
(b) Upon conclusion of the pre-hearing discovery, the arbitrators
shall promptly hold a hearing upon the evidence to be presented
by the parties and shall promptly render a written opinion and
award;
(c) The arbitrators may not award or assess punitive damages against
either party; and
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(d) Each party shall bear its own costs and expenses of the
arbitration and one-half ( 1/2) of the fees and costs of the
arbitrators, subject to the power of the arbitrators, in their
sole discretion, to award all such reasonable costs, expenses and
fees to the prevailing party.
12.5 Survival. The duty of the parties to arbitrate any dispute, controversy
or claim under this Article 12 shall survive the termination of this Agreement
for any reason.
Article 13 GENERAL PROVISIONS
13.1 Entire Agreement. This Agreement constitutes the entire agreement of
the parties with respect to the subject matter hereof and thereof and supersede
all the parties' previous correspondence, term sheets, understandings,
agreements and representations, oral or written, including the Non-Disclosure
Agreement.
13.2 Assignment. Neither party shall assign or otherwise transfer its rights
or obligations under this Agreement except with the prior written consent of
the other party; provided that no such consent for a transfer to an entity
shall be required and all rights and obligations arising hereunder shall inure
to the benefit of that entity if it is (a) an Affiliate of either party, (b)
the successor in interest of one party by reason of sale, merger or operation
of law, or (c) has acquired all or substantially all of the assets and business
of a party.
13.3 Amendment. This Agreement may not be modified or amended, in whole or
in part, except by a written agreement signed by both parties.
13.4 Severability. If one or more of the provisions of this Agreement is
subsequently declared invalid or enforceable, this Agreement shall be treated
as though that provision were not i n this Agreement, and this shall not affect
the validity or enforceability of the remaining provisions of this Agreement
(unless those provisions that are invalidated or unenforceable are clearly
material and inseparable from the other provisions). The Agreement as modified
shall be applied and construed to reflect substantially the good faith intent
of the parties and to achieve the economic effects originally intended by the
terms hereof.
13.5 Notices. Except as may be otherwise provided in this Agreement, any
notice, demand or request given, made or required to be made shall be in
writing and shall be effective, unless otherwise provided herein, when received
after delivery by (a) registered air mail, postage prepaid; (b) facsimile with
electronic confirmation of receipt; or (c) by express mail or a reputable
courier at the addresses set forth below or to any other address that a party
specifies in writing:
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If to MGI: MGI PHARMA, INC,
300E Opus Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇, Vice
President,
General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With copy to: ▇▇▇▇▇▇ & Whitney LLP
Pillsbury Center South
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to ILEX: ILEX Oncology, Inc.
Suite 101
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With Copy to: Fulbright & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
13.6 Waiver. Either party's failure or delay in exercising any remedy for
default shall not be deemed a waiver of that or any subsequent default of that
provision or of any other provision hereof.
13.7 Counterparts. This Agreement shall be executed in two (2) or more
counterparts, each of which shall be deemed an original.
13.8 Governing Law. This Agreement shall be governed by, and interpreted and
construed in accordance with, the laws of the State of New York, excluding its
choice of law rules and provided, however, that the operation of the
arbitration agreement contained in Section 12.3 hereof, and the enforcement of
any award rendered pursuant thereto, shall be governed by United Stated federal
law to the exclusion of any state law.
13.9 Relationship. The parties are independent contractors and have only a
licensor-licensee relationship hereunder and shall not be deemed to have formed
any partnership, joint venture or other relationship. Neither party shall
make, or represent to any other person that it has the power or authority to
make, any financial or other commitment on behalf of the other party.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written.
MGI PHARMA, INC. ILEX ONCOLOLGY, INC.
By: By: /s/ ▇▇▇▇▇▇▇ ▇. Love
-------------------------------- --------------------------------
Its: Its: President and CEO