EXHIBIT 10.6
METHYLPHENIDATE HYDROCHLORIDE, U.S.P.
AGREEMENT NO. 245
CUSTOM MANUFACTURING AGREEMENT................................... 1
1. DEFINITIONS.................................................. 1
2. TERM......................................................... 2
3. PRODUCTION................................................... 2
4. LIMITED WARRANTY AND LIABILITY............................... 3
5. FORECAST OF BUYER's REQUIREMENTS............................. 4
6. GUARANTEED SUPPLY............................................ 5
7. FORCE MAJEURE................................................ 5
8. GROSS INEQUITIES............................................. 6
9. PRICING...................................................... 6
10. SHIPMENT AND DELIVERY SCHEDULES.............................. 8
11. EARLY TERMINATION............................................ 8
12. ENTIRE AGREEMENT.............................................10
13. GOVERNING LAW................................................10
14. ASSIGNMENT...................................................10
15. NOTICES......................................................10
16. CONFIDENTIALITY..............................................11
17. MISCELLANEOUS................................................11
AGREEMENT NO: 245
CUSTOM MANUFACTURING AGREEMENT
------------------------------
This Agreement is entered into between Xxxxxxx Xxxxxxx Inc. ("Company") of 0000
Xxxx Xxxx, Xxxx Xxxxxxx, XX 00000 and Schein Pharmaceutical, Inc. for itself and
for its Subordinated Affiliates, defined hereinafter (collectively referred to
as "Buyer"), a New York corporation having place of business at 000 Xxxxxx
Xxxxx, Xxxxx 000, Xxxxxxx Xxxx, Xxx Xxxxxx 00000 to establish terms and
conditions upon which Company will sell Methylphenidate Hydrochloride, U.S.P.
(Material), as defined in section 1.2 below, to Buyer. This Agreement may be
referenced in orders and other correspondence related hereto as Agreement No.
245.
1. DEFINITIONS
-----------
1.1. The Effective Date of the Agreement is as of July 1, 1995.
1.2. Material shall mean bulk active Methylphenidate Hydrochloride,
U.S.P., which is to be formulated pursuant to Section 1.3 hereof. Material
shall not include bulk active Methylphenidate Hydrochloride, USP which is
to be formulated in dosage forms other than those described in Section 1.3
hereto.
1.3. Final Dosage Form Product(s) shall mean Material formulated by Buyer
into tablets, which are bioequivalent to 5 mg, 10 mg, and 20 mg immediate
release and 20 mg extended release products marketed by Ciba Geigy
Corporation under the brand name Ritalin/R/, to be sold, swapped or bartered
to third parties.
1.4. Net Sales shall mean total invoiced sales by Buyer and its affiliates
of Buyer's Final Dosage Form Product(s) to unrelated third party customers
using Material supplied by Company, minus all usual and customary rebates,
discounts, returns, allowances, credits and chargebacks to such customer
actually incurred.
1.5. Specifications shall have the meaning ascribed thereto in Section 4. 1
hereof.
1.6 "Subordinated Affiliates" shall mean any corporation, firm,
partnership or other entity of whatsoever nature, which is directly or
indirectly owned by, or is under common ownership with, Buyer to the
extent of at least fifty percent (50%) of the equity, having the power to
vote on or direct the affairs
1
of the entity, and any firm, partnership, corporation or other entity
actually controlled by or under common control with Buyer.
2. TERM
----
2.1. Subject to Section 11 hereof, this Agreement shall commence on the
Effective Date and shall expire on December 31, 2005, and shall thereafter
automatically renew for additional successive terms of three (3) years
unless either party gives the other notice of termination in writing at
least twenty-four (24) months prior to the expiration of the term or any
renewal term hereof.
3. PRODUCTION
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3.1. During the original term of this Agreement and any extensions
thereof, Buyer agrees to buy from Company and Company agrees to produce and
supply to Buyer on an exclusive basis 100% of Buyer's U.S. requirements for
the Material subject to sections 5.2 and 11 hereof. Notwithstanding the
foregoing, it is specifically understood that Company shall be permitted to
supply methylphenidate hydrochloride to Ciba Geigy Corporation using
manufacturing processes supplied to Company by Ciba Geigy Corporation.
Company agrees to process and deliver quantities ordered by Buyer within
three (3) months of the date of receipt of Buyer's written purchase order,
provided that such written purchase order does not order a quantity greater
than Buyer's DEA procurement quota for Material or greater than one hundred
ten percent (110%) of the most recent force, for the applicable month. If
such quantity ordered should exceed one-hundred ten percent (110%) of the
most recent forecast, the parties will negotiate a mutually agreeable
further delivery date for the quantity in excess of one-hundred ten percent
(110%) of the forecast. Buyer shall not order and Company shall have no
obligation to supply any quantity of Material in excess of Buyers DEA
procurement quota. Company certifies and warrants that it will not violate
any process patents or other process patent rights of any third party in its
manufacture of the Material supplied to Buyer under this Agreement.
3.2. Company shall provide Buyer with a reference letter with respect to
its Drug Master File for Material (DMF) as soon as possible after execution
of this Agreement. Company shall provide Buyer, at no cost to Buyer, such
quantities of purified characterized reference standard samples of Material
and degradants and impurities related to Material as Buyer may from time to
time request for its use in obtaining regulatory approvals. Company shall
provide such technical assistance as may be
2
reasonably requested from time to time by Buyer for the purpose of aiding
Buyer in its efforts to obtain in any such approvals, all at no cost to
Buyer.
4. LIMITED WARRANTY AND LIABILITY
------------------------------
4.1. Company warrants that Material shall conform to Company's Drug Master
File (DMF), the applicable bulk product monograph and the specifications as
described in Exhibit A, attached hereto, as such specifications may from
time-to-time be amended by mutual written agreement or by requirement of the
Federal Food and Drug Administration (FDA), other governmental body or the
then current edition of the U.S. Pharmacopoeia (collectively,
"Specifications"); and Company's production of Material shall conform to all
applicable laws and regulations of the FDA, the Drug Enforcement
Administration (DEA) and other cognizant governmental bodies as required.
4.2. Company warrants and guarantees that, as of the date of each shipment
hereunder of any articles subject to the provisions of the Federal Food,
Drug and Cosmetic Act (the "Act"), such article is not, when shipped,
adulterated or misbranded within the meaning of the Act or of any applicable
state law in which the definitions of adulteration and misbranding are
substantially the same as those contained in the Act, or an article which
may not, under the provisions of Sections 404, 505, or 512 of the Act, be
introduced into interstate commerce. COMPANY MAKES NO OTHER REPRESENTATION
OR WARRANTY OF ANY KIND, EXPRESSED OR IMPLIED, AS TO MERCHANTABILITY,
FITNESS FOR PARTICULAR PURPOSE, OR ANY OTHER MATTER WITH RESPECT TO THE
MATERIAL WHETHER USED ALONE OR IN COMBINATION WITH OTHER SUBSTANCES.
4.3. Buyer shall have the right to inspect from time to time and upon
reasonable prior notice to Company, Company's manufacturing facilities.
4.4. Company will provide Buyer with a Certificate of Analysis containing
the results of all assays required to be run in the Specifications as well
as a preshipment sample from the Material batch. Buyer reserves the right to
expressly waive from time to time the preshipment sample. The preshipment
sample will be deemed accepted by Buyer upon final release by Buyer's
Quality Control Department, but in no event later than sixty (60) days after
receipt of the preshipment sample. During such period, Buyer as it deems
necessary in accordance with its customary practices and procedures, may run
the tests set forth in Exhibit A, no later than sixty (60) days after
receipt of the preshipment sample. Buyer shall notify Company in writing
that the material does or does not meet Specifications. In the event the
preshipment sample does not meet Specifications, the sample shall be
returned by Buyer to Company at Company's expense.
3
4.4.1. In the event that the preshipment sample does meet Specifications,
or is waived by Buyer, Company will ship Material with a Certificate of
Analysis in accordance with Sections 5 and 10 to Buyer, subject to Section 6
hereof. Material will be deemed accepted by Buyer upon final release by
Buyer's Quality Control Department, but in no event later than sixty (60)
days after receipt of the Material sold hereunder. During such period, Buyer
as it deems necessary in accordance with its customary practices and
procedures, may run tests set forth in Exhibit A hereto as well as any other
applicable tests, and shall examine the Material for any damage, defect or
shortage. Buyer shall promptly notify Company in writing if the Material
does not meet the specifications or is subject to any claim of damage,
defect or shortage. In the event the Material does not meet Specifications,
or is subject to any claim of damage, defect or shortage, the rejected
Material shall not be used by Buyer and shall promptly be returned by Buyer
to Company at Company's expense, or such other mutually agreed upon, written
response shall be undertaken.
4.4.2. Upon return of any rejected Material and/or rejected preshipment
sample, Company will replace the Material at Company's cost and will
resubmit to Buyer within ninety (90) days of receipt of additional raw
materials from Company's suppliers. BUYER'S EXCLUSIVE REMEDY FOR BREACH OF
WARRANTY SHALL BE DAMAGES AND COMPANY'S LIABILITY FOR ANY AND ALL LOSSES OR
DAMAGE FROM ANY CAUSE WHATSOEVER, INCLUDING ALLEGED NEGLIGENCE, SHALL IN NO
EVENT EXCEED THIS OBLIGATION TO REPLACE THE MATERIAL AND RESUBMIT IT TO
BUYER WITHIN THE TIME PERIOD STATED, SUBJECT TO SECTION 4.5 HEREOF. Company
shall not be liable for, and Buyer assumes responsibility for, all personal
injury and property damage resulting from the handling, possession, or use
of the Material following Buyer's receipt of the Material.
4.5. In no event shall Company be liable for special, incidental or
consequential damages, whether Buyer's claim for breach of warranty is in
contract, negligence, strict liability or otherwise. Buyer agrees to
indemnify and hold harmless Company from all losses, liability, damages,
and/or expenses which may be sustained or claimed against Company arising out
of the handling, possession, or use of the Material, following Buyer's
receipt of the Material.
5. FORECAST OF BUYER's REQUIREMENTS
--------------------------------
5.1. Buyer shall, promptly after the effective date of this Agreement and
thereafter at least three (3) months before the beginning of each calendar
year, provide Company with a written forecast of its requirements for that
year. Such forecasts shall be made to assist Company in planning its
production, and shall not be binding. Forecasts shall be revised in writing
by Buyer should a forecasted volume
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change exceed seventeen percent (17%) of Buyer's initial projections.
Company shall process and deliver quantities as called forth revised
forecasts subject to Sections 3.1, 6 and 10 hereof.
5.2. If for any reason Company is unable or unwilling to supply such
quantity and/or quality of Material to Buyer as contemplated hereunder
provided that such quantities are not in excess of Buyer's DEA procurement
quota for Material, Company shall so notify Buyer in writing within ten (10)
days of receipt of Buyer's written purchase order. Upon such written notice,
Buyer shall have the right to use an alternate source of Material and
purchase such quantity of Material from such source, without further
obligation to Company hereunder with respect to such Material that Company
does not supply. Within sixty (60) days after written notice by Company to
Buyer that Company is able and willing to supply such quantity of Material
to Buyer, Buyer shall discontinue purchasing such quantity from its second
source, and shall resume purchasing all its requirements for Material from
Company, pursuant to the terms of this Agreement, subject to Buyer's
commitments then outstanding to such second source but in no event to exceed
six (6) months from the date of receipt of Company's notice of ability to
supply.
6. GUARANTEED SUPPLY
-----------------
6.1. The Material is scheduled under the Federal Controlled Substances
Act. Company is required to obtain a quota from the DEA before producing
Material; such quotas are limited therefore, in order to assure Buyer of the
supplies agreed to hereunder, Company agrees to use its best efforts to
obtain a DEA quota sufficient to process Buyer's orders for Material.
6.2. Each party's obligation hereunder is subject to obtaining the
necessary DEA quota. Neither party shall be liable to the other for that
quantity of Material which Company is unable to supply or take as a result
of failure to obtain the necessary DEA quota, provided that Company shall be
relieved of any obligations hereunder for failure to obtain a DEA quota only
so long as it has adhered to the requirements of Section 6.1 hereof, and
provided that Buyer can obtain such quantity of Material from another
source, without further obligation to Company hereunder with respect to such
Material, if Company does not obtain the necessary DEA quota.
7. FORCE MAJEURE
-------------
7.1. Company's obligations to process and Buyer's obligation to take
Material shall be subject to any delays caused by acts of God, fires,
floods, explosion, sabotage, riot, accidents; orders of, or
5
subject to Section 6.2 failure to issue or continue in effect all necessary
permits by, civil or military authorities whether relating to manufacture
and sale of the Material, or discharge of materials into the environment or
otherwise if beyond such party's reasonable control; delays by suppliers of
fuel, power, raw materials, containers or transportation; breakage or
failure of machines, strikes, lockouts or labor trouble if beyond such
party's reasonable control; perils of the sea; or any other cause beyond
such party's reasonable control.
7.2. The party invoking this Section 7 shall give the other party prompt
written notice of any event that is likely to delay shipment or acceptance.
No such delay shall result in cancellation of quantities required hereunder,
or of this Agreement, provided that either party may cancel or amend the
quantities delayed without penalty if any delay lasts longer than one
hundred and eighty (180) days.
7.3. During any period in which Company is unable to supply Material to
Buyer as Buyer orders hereunder, Buyer shall have the right to purchase such
shortfall from an alternate source, without any obligation to Company with
respect to such Material Company does not supply, as provided under Section
5.2.
8. GROSS INEQUITIES
----------------
8.1. It is the further intent of the parties hereto that they shall
mutually benefit from the terms, conditions and provisions of this
Agreement, and in the event that either party shall suffer a gross inequity
resulting from such terms, conditions or provisions, or from a substantial
change in circumstances or conditions, the parties shall negotiate in good
faith to resolve or remove such inequity. It is mutually understood and
agreed, however, that nothing herein shall be construed to relieve either
party of any of its obligations under this Agreement, unless and until such
resolution or removal has been agreed to in writing by both parties.
9. PRICING
-------
The price for Material sold to Buyer by Company hereunder shall be the
Base Fabrication Price plus the Fabrication Price Adjustment.
6
9.1 Base Fabrication Price
The Base Fabrication Price for quantities of Material greater than or
equal to one hundred (100) kilograms per order will be ****** per kilogram.
The Base Fabrication Price for quantities of Material less than one hundred
(100) kilograms per order will be negotiated in good faith by the parties.
Terms are thirty (30) days net after receipt of each shipment of Material.
9.2 Fabrication Price Adjustment
The Fabrication Price Adjustment (FPA) will be calculated quarterly as
follows:
FPA = **** * *** ******** ********* * ********* ******* ***** ******
Where "Kg Material purchased" shall mean the total Kilograms of Material
purchased by Buyer from Company during such quarter, and the Weighted
Average Price (WAP) shall be defined as Buyer's Net Sales of Final Dosage
Form Products containing Material during such quarter and the following
calendar quarter divided by the grams of Material contained in such Final
Dosage Form Products. If the WAP as defined herein is less than *****, the
FPA shall be zero.
Buyer shall keep accurate books and records of sales of Final Dosage Form
Product(s) and of all payments due Company hereunder. After the first
commercial sale of any Final Dosage Form Product(s), Buyer shall deliver to
Company written reports of sales of Final Dosage Form Product(s) during the
preceding calendar quarter on or before the 30th day after the end of
following calendar quarter. Such report shall include a calculation of the
FPA due in accordance with the preceding paragraph and be accompanied by
payment of the monies due. For example, the FPA due for the first calendar
quarter of any given year (January 1 through March 31) will be calculated
using the WAP for the period of January 1 through June 30 of that year and
is payable net 30 days from June 30 of the given year.
Company shall have the right, at its own expense, for the period during
which the FPA is due to Company and for one (1) year thereafter, to have an
independent public accountant, to whom Buyer has no reasonable objection,
examine the relevant books and records of account of Buyer upon reasonable
notice during reasonable business hours and not more than once during each
calendar year, to confirm that appropriate FPA payments have been made by
Buyer hereunder for the preceding calendar year. If in any audit a
discrepancy of greater than ten percent (10%) is found by the independent
public accountants, Company reserves the right to audit the prior two years'
FPA payments.
* redacted pursuant to confidential treatment request
7
9.3 Price Changes
Subject to Section 8 hereof, the Base Fabrication Price for Material shall
be automatically subject to price adjustment on the first day of each
calendar year beginning with January 1, 1997 by a quantity equal to the
increase in the total cost of raw materials utilized in the manufacture of
Material. Along with notification of such adjustment, Company shall provide
Buyer with a detailed analyses of raw material costs, including an itemized
list of raw materials and quantities used, as well as invoices for such raw
materials. Within thirty (30) days of the fifth anniversary of the Effective
Date of this Agreement, Company may request that Buyer and Company amend the
Base Fabrication Price for Material and/or the annual price adjustment
described above. Such amendment, if necessary, will be made by mutual
written agreement between the parties.
9.4 Interest
Buyer agrees to pay an interest charge equal to the prime rate on the
unpaid balance on any invoice not paid within the specified terms. In the
event that Material shipped to Buyer does not meet Specifications pursuant
to Section 4.4.1, any interest charge will not be applicable until thirty
(30) days after replacement of material pursuant to Section 4.4.2.
10. SHIPMENT AND DELIVERY SCHEDULES
-------------------------------
10.1. Material shall be shipped FOB Company's plant in such containers as
may be agreed upon by the parties, packed in accordance with Department of
Transportation (DOT) requirements for interstate shipment of poisonous
materials, in accordance with the established security procedures of DOT,
DEA and any other regulatory agency applicable thereto. Shipments in any
year shall be made in accordance with a delivery schedule provided by Buyer
in Buyer's purchase order to Company at least three (3) months prior to the
desired delivery date. Invoices shall accompany or follow the applicable
shipment of Material.
11. EARLY TERMINATION
-----------------
11.1. In addition to termination as provided for in Section 2, this
Agreement can be terminated by Company for nonpayment of any sums due
hereunder (remaining unpaid for more than thirty (30) days after notice to
Buyer), or by either party at any time with 90 days' advance written notice:
8
(i) on account of a material violation of the Agreement by the other
party, provided, however, that such notice shall be null and void if the
offending party removes the reason for the notice before expiration of the
ninety (90) days notice period referred to above in this Section 11.1; or
(ii) when the other party makes a general assignment for the benefit of
its creditors, has a custodian, receiver or any trustee appointed for it or a
substantial part of its assets, commences any voluntary proceeding under any
bankruptcy law; or
(iii) when a court having jurisdiction over the other party shall enter
a decree or order for relief in any involuntary case under applicable
bankruptcy law and such decree or order shall continue unstayed and in effect
for a period of sixty (60) days or more.
11.2. Company has the sole right to terminate the Agreement upon sixty
(60) days advance written notice:
(i) if for any calendar half, the WAP is less than ***** per gram of
Material; or
(ii) if Buyer fails to submit an Abbreviated New Drug Application
(ANDA) for at least one Final Dosage Form Product containing Material to the
FDA within seven (7) months from the date of Buyer's receipt of at least
twelve (12) kilograms of Material from company subsequent to the Effective
Date of this Agreement, except in the event of delays in bioavailability
studies which could not have been reasonably avoided by Buyer.
(iii) if in any complete calendar year after approval of Buyer's first
ANDA with respect to Material, Buyer fails to purchase *** ******* ***** ****
kilograms of Material from Company.
(iv) if at any time after a period of one (1) year following approval
of Buyer's ANDA with respect to a Final Dosage Form Product containing
Material, Buyer markets any Final Dosage Form Product described in such ANDA
containing Material not purchased from Company (other than Material purchased
from any alternate source as provided in Sections 5.2 and 7.3).
11.3. Buyer has the sole right to terminate the Agreement upon one (1)
years prior written notice if the WAP is less than ***** per gram of Material.
In the event Buyer elects to so terminate, Company's obligation to exclusively
supply Buyer pursuant to Section 3.1 shall cease upon Company's receipt of
Buyer's written notice.
11.4. Termination for any reason by either party under this Section II
shall not prejudice that party's remaining contractual rights, including without
limitation rights to damages, nor terminate obligations set forth in Sections 4
and 16 hereof.
* redacted pursuant to confidential treatment request
9
11.5. If Company chooses to invoke its termination rights under Section
11.2(i) or (iii), and, in the event that Buyer has not secured a new supplier
for Material prior to such termination, Buyer way delay said termination date
for a period of one (1) year. During this period all terms and conditions of the
Agreement shall apply except exclusive supply from Company to Buyer as contained
in Section 3.1
12. ENTIRE AGREEMENT
----------------
12.1. This Agreement constitutes the entire agreement between the parties.
No modifications to or supplementation of this Agreement, whether contained in
any purchase order, confirmation or otherwise, shall be effective unless made in
writing and signed by the party to be charged with modification.
13. GOVERNING LAW
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13.1. This Agreement shall be interpreted in accordance with the laws of
the state of Delaware.
14. ASSIGNMENT
----------
14.1. No right or obligation of either party hereunder shall be assignable
without the prior written agreement of the other party; otherwise this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective permitted successors and assigns.
15. NOTICES
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15.1. All notices, requests, and other communications hereunder shall be
deposited in the United States mail, registered or certified, postage prepaid,
addressed as follows:
15.2. If to Schein: With a Copy to:
Schein Pharmaceutical, Inc. Schein Pharmaceutical, Inc.
000 Xxxxxx Xxxxx, Xxxxx 000 000 Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxx, XX 00000 Xxxxxxx Xxxx, XX 00000
Attn.:Chairman Attn.:General Counsel
10
15.3. If to JMI: With a Copy to:
Xxxxxxx Xxxxxxx Inc. Xxxxxxx Matthey Inc.
Materials Technology Div. Materials Technology Div.
0000 Xxxx Xxxx Biomedical Materials Group
Xxxx Xxxxxxx, XX 00000 0000 Xxxxx Xxxxx
XXXX: Division General Counsel Xxxx Xxxxxxxx, XX 00000
ATTN: General Manager
16. CONFIDENTIALITY
---------------
16.1. Neither party shall disclose to any third party, except as may be
required by law, or provided for herein, the substance of this Agreement. Each
of Company and Buyer hereby agrees to be and confirms that it is bound by the
terms of a Confidentiality Agreement dated June 12, 1992, and made between
Danbury Pharmacal, Inc. and Company attached as Exhibit B hereof and
incorporated herein as if fully rewritten. All written information provided by
either party to the other hereunder including, but not limited to products
containing Material under development by Buyer, volume requirements, pricing,
and sales information disclosed under Section 9.2, delivery schedules, and
process data, is the disclosing party's confidential proprietary information, as
the same is defined in such Confidentiality Agreement. The receiving party
agrees not to disclose any such information or use such information except for
purposes of performance hereunder, for a period of five (5) years after the
termination of this Agreement, provided that the receiving party may use or
disclose any such information that (1) is already known to it at the time of
disclosure to the receiving party; (2) becomes publicly known through no fault
of the receiving party; or (3) is disclosed to receiving party by a third party
who is free to make such disclosure.
17. MISCELLANEOUS
-------------
17.1. This Agreement may be executed in two (2) separate counterparts, each
of which shall be deemed to be an original, but which together shall constitute
one and the same instrument.
17.2. This Agreement is on a principal to principal basis. Neither party is
authorized nor shall it incur any liability whatsoever for which the other party
may become directly, indirectly or contingently liable.
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17.3. The section headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized representatives.
BUYER: COMPANY:
SCHEIN PHARMACEUTICAL, INC. XXXXXXX XXXXXXX INC.
[SIGNATURE ILLEGIBLE] /s/ Xxxxxxx X. Xxxxxx
------------------------ -----------------------
TYPED NAME: ________________________ TYPED NAME: Xxxxxxx X. Xxxxxx
-----------------------
TITLE: [SIGNATURE ILLEGIBLE] TITLE: General Manager
------------------------ -----------------------
[SIGNATURE ILLEGIBLE] DATE: 7/18/95
------------------------ -----------------------
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EXHIBIT A
---------
XXXXXXX MATTHEY INC.
Biomedical Products
FINISHED PRODUCT SPECIFICATION SHEET
Name: Methylphenidate Hydrochloride . USP C\\14\\H\\l9\\N\\02.\\ HC1 CII
--------------------------------------------------------------------------
FP Material Code No.: FPC-93 Sample Size: Sgr #of Samples 2,
------------- --- ---
Testing Procedure No.: FP-093-002
----------------------
--------------------------------------------------------------------------------
Test SPECIFICATION
---- -------------
********** ***** *********** ******
**************
* *** ** ******** ******** **
********* ********
* ******** *** ********
**** ** ****** *** ****
******* ** ********* *** ****
***** ****** *** ******
**************** ***** **** ****** *** **
***** ** **************************
**** ************* *** ****
***** ***** * ******
******** ******* *** **** ***
--------------------------------------------------------------------------------
Prepared by: [SIGNATURE ILLEGIBLE] Date: 9/18/92
------------------------- -------------------
Approved by: [SIGNATURE ILLEGIBLE] Date: 9/18/92
------------------------- -------------------
* redacted pursuant to confidential treatment request
EXHIBIT B
[LETTERHEAD OF XXXXXXX XXXXXXX]
=========================
CONFIDENTIALITY AGREEMENT
=========================
This CONFIDENTIALITY AGREEMENT ("Agreement") is entered into, effective
this 12th day of June 1992, by and between Xxxxxxx Matthey Inc. ("JMI") and
Danbury Pharmacal, Inc. ("DPI") for the purpose of holding technical discussions
with JMI relating to the transmission of information regarding the development
of methylphenidate (the foregoing referred to as "Program"). It will be
necessary for each party to disclose to the other certain valuable technical and
trade secret information relating to said Program and to furnish samples of
related materials ("Samples") to the other party. Such valuable technical and
trade secret information and Samples shall be referred to herein as
"Confidential Information". Such Confidential Information, other than Samples,
is defined to be all written information disclosed hereunder that is marked on
its face as confidential and all oral information which is confirmed in writing
as confidential within thirty (30) days from the date of disclosure hereunder.
Such Confidential Information is a commercial asset of considerable value to the
disclosing party and the disclosing party is willing to disclose such
Confidential Information only under the conditions set forth below:
1. The receiving party agrees to maintain in confidence for a period of
five (5) years from the date of this Agreement all Confidential Information
disclosed by the other and not to divulge said Confidential Information, in
whole or in part, to any third party, other than affiliated companies, or
subsidiaries owned 51% or more by the receiving party, and not to make use of
said Confidential Information other than in relation to the Program without the
written permission of the disclosing party. This obligation shall not apply to:
(A) Confidential Information which at the time of disclosure by the
disclosing party is in the public domain; or
(B) Confidential Information which, after disclosure by the
disclosing party, becomes part of the public domain by publication or
otherwise, other than by an unauthorized act or omission by the receiving
party; or
(C) Confidential Information which the receiving party can show by
written records was in its possession at the time of the disclosure and
which was not acquired, directly or indirectly, from the disclosing party,
provided the receiving party promptly so notifies the disclosing party; or
(D) Confidential Information which the receiving party rightfully
receives from a third party and which was not acquired, directly or
indirectly, from the disclosing party.
Even in the event that any one or more of the foregoing exceptions
are applicable, the receiving party agrees that it will not disclose to any
other party the correlation existing between information acquired from any
other source, including public domain, and the information acquired from
the disclosing party; nor will the receiving party reveal to any other
party that such information is utilized in any way by the disclosing party.
2. Samples furnished by either party shall remain the property of the
disclosing party. The receiving party shall not perform or have performed
any tests to determine the physical or chemical composition of Samples
furnished by the other; nor will the receiving party allow the Samples to
be examined or tested by a third party without the express written
permission of disclosing party. Within a reasonable time after completion
of testing, all Samples shall be returned to the disclosing party
irrespective of the condition of said Samples.
3. The receiving party shall not publish or otherwise divulge to any
third party, the results of its evaluations of Samples without the express
written permission of the disclosing party, except as provided in Section 4
below.
4. In the event that test results are legally required to be disclosed to
the United States Environmental Protection Agency or the Food and Drug
Administration or any similar body having the legal authority to require
such disclosure by one or both parties, such disclosure shall be in a
manner which maintains confidentiality to the extent permitted by law.
5. This Agreement shall be construed and interpreted in accordance with
the laws of the Commonwealth of Pennsylvania.
6. The receiving party agrees further that it shall restrict disclosure
of the Confidential Information within its own organization to those
persons having a need to know it for the purposes of this Agreement, and
that such
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persons shall be advised of the obligations set forth in this Agreement
and shall be obligated in like fashion.
7. Nothing contained in this Agreement shall be construed as granting
or conferring any rights by license or otherwise, expressly, impliedly or
otherwise for any invention, discovery or improvement made, conceived or
acquired prior to or after the date of this Agreement with respect to the
subject matter hereof.
8. Upon completion of activities hereunder, the receiving party shall
return all Samples or written Confidential Information and shall retain no
copies.
9. The parties hereby acknowledge and agree that in the event of any
violation hereof by the receiving party, the disclosing party shall be
authorized and entitled to obtain from any court of competent jurisdiction,
preliminary and permanent injunctive relief, as well as an equitable
accounting of all profits or benefits arising out of such violation, which
rights and remedies shall be cumulative and in addition to any other rights
or remedies to which the disclosing party may be entitled.
10. Any notices required under this Agreement shall be sent by registered
mail, return receipt requested, to the parties at the addresses specified
below, unless notice of a different address is given to the other party:
Xxxxxxx Xxxxxxx Inc.
Materials Technology Division
0000 Xxxx Xxxx
Xxxx Xxxxxxx, XX 00000
Attn: Division General Counsel
Danbury Pharmacal, Inc.
00 Xxxxxxxxxx Xxx
Xxxxxx XX 00000
Attn: Dr. Xxxxxx Xxxxx
11. If any provisions of this Agreement should be deemed to violate time
or geographical limitations, or any other limitations, permitted by
applicable law in any jurisdiction, such provisions shall be deemed
reformed ln such jurisdiction so as to continue to apply to the maximum
permitted by applicable law, and this Agreement shall continue in full
force and effect with regard to all other provisions.
12. No waiver of any provision, breach or default under this Agreement
shall be deemed a waiver of any subsequent provision, breach or default,
nor shall any such waiver constitute a continuing waiver.
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13. This Agreement constitutes the entire understanding of the parties
with regard to the subject matter hereof and may not be modified, supplemented
or rescinded except by an agreement in writing signed by the parties hereto.
This Agreement shall not be assignable (by operation of law or otherwise) by
either party without the prior written consent of the other party;.provided,
however, that JMI shall have the right to assign this Agreement to its parent,
subsidiary or affiliated corporations.
IN WITNESS WHEREOF, intending to be bound hereby, the parties hereto have
caused their authorized representatives to subscribe their names hereunder.
XXXXXXX MATTHEY INC. DANBURY PHARMACAL, INC.
By: /s/ Xxxxxxx X. Xxxxxx By: [SIGNATURE ILLEGIBLE]
---------------------- ----------------------
Name: Xxxxxxx Xxxxxx Name: [SIGNATURE ILLEGIBLE]
----------------------
Title: General Manager
Title: [TITLE ILLEGIBLE]
Date Signed: 6/23/92 ------------------
------------------
Date Signed: 6/26/92
-----------------
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