EXHIBIT 10.5.1
AMENDMENT NO. 1 RESEARCH, DEVELOPMENT AND COLLABORATION AGREEMENT
This Amendment No. 1 to Research, Development and Collaboration Agreement (the
"Amendment No. 1") effective as of January 1, 1999, is entered into by and
between GenVec, Inc. ("GenVec") and Xxxxxx-Xxxxxxx Company ("Warner"), and
amends that certain Research, Development and Collaboration Agreement entered
into by Warner and GenVec effective as of July 21, 1997 (the "Agreement").
1. All capitalized terms not defined in this Amendment No. 1 shall have
the meanings given to them in the Agreement.
2. The Agreement is hereby amended to revise Section 1.5 as follows:
1.5 "COLLABORATION PRODUCT" shall mean a Product Configuration for
which Development has commenced pursuant to this Agreement. On a
country-by-country basis, a Product Configuration which has commenced
sales shall continue to be a Collaboration Product unless Warner or its
Affiliates or Sublicensees discontinue sales of such Collaboration
Product in the applicable country and have no intent to resume such
sales.
3. The Agreement is hereby amended to revise Section 2.2.3(a) as follows:
2.2.3 ASIAN COMPANY.
(a) GenVec may enter into an agreement(s) with one or more
companies for the research, development and/or commercialization of one or more
Product Configurations in Japan or other countries outside the Territory and the
Co-Promotion Countries, any such company (an "Asian Partner" and collectively,
the "Asian Partners") shall have the right to obtain access to and the right to
use the Data Package for the purpose of seeking Regulatory Approval for any
Product Configurations for any indication to which the Asian Partner has
commercialization rights in Japan and/or any other country, subject to Section
15.2. Notwithstanding the foregoing, Warner shall only be obligated to provide
each component of the Data Package a single time and GenVec shall designate
which of GenVec or the Asian Partners shall be the party to whom Warner shall
provide the Data Package components; provided, however, that the party receiving
the Data Package may provide the Data Package to GenVec and one or more other
Asian Partners, and GenVec (or its Asian Partner designee) shall reasonably seek
to minimize the number and frequency of requests for the components of the Data
Package. In exchange for receiving such access and rights, the Asian Partner(s)
must agree to pay to Warner amounts to be agreed by Warner and the Asian
Partner(s), which shall not, in the aggregate, exceed one-fourth of all costs
incurred in connection with those aspects of the Research Program or the
Development in which data contained in the Data Package was generated or
obtained. In addition to the payment to Warner described above, each Asian
Partner shall be obligated to pay all expenses it incurs in conducting research
and development activities with respect to any Product Configuration
specifically and solely for obtaining Regulatory Approvals in Japan and/or any
other country for which it has commercialization rights.
[*] = CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH
RESPECT TO THE OMITTED PORTIONS. OMITTED TEXT IS INDICATED BY A "*".
4. The Agreement is hereby amended to revise Section 1.27 by amending
the formula therein to read as follows:
Average percentage
discount on a = (1-A/B) x 100
particular "bundle"
5. The Agreement is hereby amended by adding the following clause to
the beginning of the first sentence of Section 4.5.1: "Subject to the terms
of Section 6.3.5, and . . ."
6. The Agreement is hereby amended to add the following to the end of
Section 6.1:
On or before March 20, 1999, Warner shall pay to GenVec the amount of
three million seven hundred fifty thousand dollars ($3,750,000).
7. The Agreement is hereby amended to revise Section 6.3 by the addition
of new Section 6.3.5:
6.3.5 REIMBURSEMENT. On or before March 20, 1999, Warner shall pay to
GenVec one million two hundred fifty thousand dollars ($1,250,000) as
reimbursement of certain Development Costs described on Exhibit A
hereto incurred by GenVec in the period July 1, 1997 through December
31, 1998 with respect to Collaboration Products. No further Development
Costs shall be owed to GenVec by Warner for the period July 1, 1997
through December 31, 1998. Each year the Executive Committee shall
approve a twelve (12) month budget for all Development Costs
anticipated to be incurred by GenVec and reimbursed by Warner (the
"Budget"). The Executive Committee shall review such Budget every six
(6) months. Except as specifically approved in the Budget, after
December 31, 1998, GenVec shall not receive funding for any Development
Costs in excess of the funds paid by Warner pursuant to Sections 6.3 or
11.7, without the prior written consent of the Executive Committee or a
Warner designee and only such pre-approved Development Costs shall be
reimbursed to GenVec by Warner. For any of the above approved
Development Costs in excess of the funds paid by Warner pursuant to
Sections 6.3 or 11.7, GenVec shall be reimbursed by Warner for
Development Costs, if any, incurred by GenVec up to a maximum of 110%
of the approved amount. GenVec shall further not expend any of the
funds received by it under Sections 6.3.1, 6.3.2 and 11.7 for
Development Costs except pursuant to the Budget. In the event that
GenVec believes that additional Development funding in excess of 110%
of that approved by the Executive Committee is required or desirable
for the conduct of activities to be conducted by GenVec in connection
with the Development, it may notify the Executive Committee; provided,
Warner shall have no obligation to reimburse GenVec for any such excess
without the prior written approval of the Executive Committee or a
Warner designee.
8. Section 6.4.1 of the Agreement is hereby revised to restate the
third and fourth milestone payments due to GenVec for the "Filing of a PLA"
with respect to Collaboration Products for the first occurrence for each of
CAD and PVD as follows:
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Filing of a PLA *
Filing of a PLA *
All other milestones set forth in Section 6.4.1 shall remain unchanged.
9. Section 6.5.1 of the Agreement is hereby revised to replace the
following :
"Annual Net Sales up to *
Annual Net Sales over *
with the following new description of royalties:
"Annual Net Sales up to *
Annual Net Sales over *
and less than or equal *
Annual Net Sales above *
10. Section 6.5.4 of the Agreement is hereby amended to replace the
words "*" with the words "*".
11. The Agreement is hereby amended to revise Section 6.6.2 to provide
in its entirety as follows:
Except as expressly provided in Sections 6.6.1 or 6.6.3, Warner shall
be responsible for the payment of all royalties, license fees and
milestone and other payments due from GenVec or Warner to any Third
Party(ies) under licenses or similar agreements (including license or
similar agreement entered into by GenVec only if approved by the
Executive Committee) for the manufacture, use, import, or sale of
Collaboration Products in the Territory; provided, if the Executive
Committee fails to approve a particular license or other agreement(s)
with a Third Party, Warner shall have no rights to any intellectual
property or other subject matter within the scope of such agreements,
and GenVec shall have no liability under this Agreement for not
providing such rights to Warner.
12. The Agreement is hereby amended to revise Section 6.6.3 to provide
in its entirety as follows:
6.6.3 SHARED RESPONSIBILITIES. Subject to Section 6.5.4, in the event
that (y) the aggregate amount paid or otherwise due or owing by Warner
for royalties with respect to a particular Collaboration Product (i) to
GenVec for royalties pursuant to Section 6.5.1, and (ii) for royalty
payments to Third Parties pursuant to Section 6.6.2, and (z) the Cost
of Manufacture of such Collaboration Product, in the aggregate, exceed
thirty percent (30%) of the Net Sales of such Collaboration Product,
then Warner and GenVec shall equally share the portion of the aggregate
of the payments for (y) and (z) by Warner which are in excess of thirty
percent (30%) of Net Sales of the applicable Collaboration Product, to
the extent such payments in excess of thirty percent (30%) of Net Sales
are attributable to (y) (ii) above. It is understood and agreed that
Warner shall be solely responsible for any such payment obligations for
(y) and (z) which in the aggregate are less than or equal to thirty
percent (30%) of the Net Sales
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of the applicable Collaboration Product. In each such case, such
determination shall be made on a country-by-country basis and Warner
shall provide to GenVec documentation establishing the royalty due to
the Third Party(ies) and the Cost of Manufacture, in each case, with
respect to the applicable Collaboration Product and the payment due
from GenVec with respect thereto at least thirty (30) days before such
amount is due.
13. The Agreement is hereby amended to revise Section 11.1 by deleting
Section 11.1.
14. Section 11.2.1 is amended to provide in its entirety as follows:
11.2.1 Warner shall control all issues relating to, and shall have
the sole right to, at its expense, manufacture or have
manufactured Bulk Product and Finished Product for clinical
use and for commercial sale in the Territory and in any or
all Co-Promotion Countries. All costs associated with the
qualification or validation of Warner or a Third Party
manufacturer for the production of such Bulk Product and
Finished Product for sale in the Territory and in the
Co-Promotion Countries, pursuant to this Section 11.2 shall
be borne by Warner, subject to the terms of Section 9 and
Exhibit B as they relate to reimbursement of Warner's
Development Costs. If Warner provides GenVec notice that
Warner wishes to assume the performance of those activities
being conducted by GenVec as of March 12, 1999 with respect
to the manufacture of Collaboration Products, GenVec and
Warner agree to cooperate in good faith to transfer such
activities to Warner. With respect to any agreements entered
by GenVec on or before March 12, 1999 which relate solely to
Collaboration Products for the manufacture of clinical or
commercial supplies of Bulk Product or Finished Product with
Third Parties, GenVec shall promptly provide Warner with a
list of, and where it legally may do so, copies of all such
agreements, and at Warner's request, shall (i) assign such
agreements to Warner, if it has the right to do so without
incurring a penalty, or (ii) otherwise terminate such
agreements as soon as practicable, provided GenVec shall
have no obligation to terminate any such agreement if it
would incur a penalty for doing so. At Warner's written
request and expense for out-of-pocket costs, GenVec shall
promptly supply to Warner substantially all written and
electronic records in its control or possession relating to
the manufacture of Bulk Product or Finished Product for
clinical trials and shall provide reasonable assistance to
Warner in interpreting such information; provided, GenVec
shall not be in breach of this Agreement if after GenVec
makes a good faith effort to comply with the foregoing
obligation to supply records, GenVec supplies substantially
all, but not all such records.
15. The Agreement is hereby amended to revise Sections 11.3, 11.4 and
11.5 by deleting the existing Sections and replacing them with the following:
11.3 WARNER'S RIGHT TO IDENTIFY AND QUALIFY SECOND SOURCE FOR BULK
PRODUCT. [deleted]
11.4 USE OF SECOND SOURCE FOR BULK PRODUCT. [deleted]
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11.5 Terms of Manufacture and Supply. [deleted]
16. The Agreement is hereby amended to revise Article 11 by the addition
of the following new Sections:
11.7 PROCESS DEVELOPMENT. GenVec shall be responsible for the conduct
of activities for the development of a manufacturing process for Bulk
Products according to the activity schedule attached as Exhibit B
hereto, as may be amended by the written agreement of the Executive
Committee. At Warner's expense for out-of-pocket costs, GenVec shall
supply Warner with both electronic and hard copies of substantially all
information and data arising out of such activities, Warner and GenVec
shall meet promptly after March 15, 1999 to discuss the frequency of
such information and data transfers and Warner shall indicate what
information and/or data, if any, it does not desire to receive. GenVec
shall provide Warner with reasonable assistance in interpreting such
information and data. In consideration for such activities, Warner
shall pay GenVec * , in accordance with
the payment schedule, and subject to the achievement of the milestone
set forth on Exhibit C, a total of *.
GenVec shall not be obligated to expend amounts or incur costs on such
activities in excess of the * received from Warner, unless
otherwise agreed in writing by the Executive Committee. Warner shall
have the right to visit GenVec's facilities during reasonable business
hours and upon reasonable advance notice, to inspect GenVec's
facilities and applicable records to confirm that the amounts being
paid under this Section 11.7 are being expended by GenVec and are
intended for the development of a manufacturing process for the Bulk
Product.
11.8 COOPERATION. At GenVec's written request, Warner shall provide
GenVec with reasonable cooperation and assistance to establish, qualify
and validate, at GenVec's election, GenVec and/or a Third Party
manufacturer to manufacture requirements of Collaboration Products for
clinical and commercial use outside the Territory and the Co-Promotion
Countries. GenVec shall reimburse Warner for Warner's reasonable
out-of-pocket costs incurred in providing such cooperation and
assistance. In addition, if Warner wishes to have a Third Party
manufacture Bulk Product within the United States for use within the
Territory, it shall consider, but shall have no obligation to enter
into any agreement to utilize GenVec to supply any such Bulk Product,
for compensation to be reasonably agreed by Warner and GenVec.
11.9 WARNER MANUFACTURING TECHNOLOGY. All manufacturing and related
technology developed by Warner or its Affiliates or a Third Party on
behalf of Warner with respect to any one or more Collaboration
Products, to the extent applicable to the manufacture of gene therapy
products and directly developed as a result of such activities
("Manufacturing Technology"), shall be treated as follows: With respect
to any such Manufacturing Technology solely developed by Warner in the
period from January 1, 1999 until December 31, 2000, GenVec shall have
a non-exclusive, fully paid-up, royalty-free, worldwide license (with
the right to sublicense, but only to the extent required to permit a
Third Party or an Affiliate of GenVec to manufacture products,
including without limitation, Collaboration Products pursuant to the
license granted in this sentence), to make, have made, use, import,
offer for sale and sell Collaboration Products outside the Territory
and products
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other than Collaboration Products, subject to Article 15. With
respect to such Manufacturing Technology solely developed by Warner
in the period from January 1, 2001 to December 31, 2001, GenVec
shall have a non-exclusive, worldwide license thereto (with the
right to sublicense, but only to the extent required to permit a
Third Party or an Affiliate of GenVec to manufacture products,
including without limitation, Collaboration Products pursuant to the
license granted in this sentence), to make, have made, use, import,
offer for sale and sell Collaboration Products outside the Territory
and products other than Collaboration Products, subject to Article
15; provided GenVec's payment obligations under such a license shall
be * of the applicable product. Net sales for such purpose shall be
based on the definition in Section 1.27 and calculated in accordance
with Section 1.27 (with appropriate contextual adjustments). GenVec
shall have no rights in any Manufacturing Technology developed by
Warner after December 31, 2001, but any licenses granted prior to
such date shall remain in effect after December 31, 2001; provided,
that if process development with respect to a Collaboration Product
continues after December 31, 2001 the foregoing dates in this
Section 11.9 shall be extended until the date determined by the
Executive Committee to have been the date on which such process
development ceased. Notwithstanding the foregoing and any other
provision of this Agreement, it is understood and agreed that GenVec
may make, have made and use (but not sell or permit to be sold or
used in any human clinical trials) Collaboration Products in the
Territory to facilitate its ability to enter into an agreement with
the Asian Partner and to develop and commercialize Collaboration
Products with the Asian Partner.
17. The Agreement is hereby amended to revise Article 12 by the addition of
the following new Section 12.6:
12.6 ACCESS.
(a) Until the first commercial sale of a Collaboration
Product, Warner shall provide GenVec and its sublicensees with
such data, documents and information as GenVec may reasonably
believe is required to be submitted to a regulatory agency in
connection with regulatory filings or audits or inspections by
an Agency, including, without limitation, a right of reference
or authorization to any Collaboration Product approvals,
and/or modifications made by Warner to the manufacturing
process developed by GenVec as described in Section 11.7,
subject to Section 2.2.3 and Section 15.2. GenVec shall pay
Warner reasonable costs necessary to provide such access and
use.
(b) After the first commercial sale of a Collaboration
Product, Warner shall provide GenVec and its sublicensees with
such data, documents and information as GenVec or its designee
is required to be submitted to a regulatory agency in
connection with regulatory filings or audits or inspections by
an Agency.
(c) It is understood and agreed that GenVec may only use the
data, information and documents made available pursuant to
Sections 12.5(a) and (b) above for the development and
commercialization of (i) Collaboration Products outside the
Territory and (ii) for products other than Collaboration
Products.
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18. The Agreement is hereby amended to revise Section 14.1.1 to provide
in its entirety as follows:
14.1.1 BACKGROUND TECHNOLOGY.
(a) Except as otherwise set forth herein, each Party shall
retain ownership or Control, as the case may be, over its
Background Technology. The owner of any patentable Background
Technology shall have the right, at its option and expense, to
prepare, file and prosecute in its own name any patent
applications with respect to such Background Technology and to
maintain any patents issued thereon.
(b) Notwithstanding Section 14.1.1(a) above, GenVec agrees to
keep Warner reasonably informed of the countries in which
GenVec intends to seek and maintain patent protection with
respect to Background Technology owned or Controlled by
GenVec. Warner shall have the right to request GenVec to seek
or maintain patent protection with respect to Background
Technology in countries in which GenVec does not intend to
seek or continue to maintain patent protection (each an
"Additional Country"). In such event, GenVec may elect to seek
or maintain patent protection in the Additional Countries in
GenVec's name and at Warner's expense. Warner shall pay GenVec
the amount due for any such activities within * days
of receipt of an invoice therefor. All amounts paid by Warner
in connection with such activities in the Additional Countries
shall be credited, on an Additional Country-by-Additional
Country and Collaboration Product-by-Collaboration Product
basis, against royalties owed by Warner to GenVec with respect
to the applicable Collaboration Product(s) in the applicable
Additional Country. With respect to activities for which
Warner is paying expenses pursuant to this Section, GenVec
shall use patent counsel reasonably acceptable to Warner, and
shall keep Warner fully informed and provide the opportunity
for Warner to review and comment with respect to such patent
matters, including, without limitation, (a) providing Warner
with copies of all communications, including, without
limitation, all applications and other filings, with all
patent offices in sufficient advance of filing to permit
Warner and its patent counsel to review and comment on such
communications, (b) providing sufficient advance notice to
Warner of all meetings at all patent offices where such
patents and patent applications may be discussed to permit
Warner to attend all meetings at such patent offices, and (c)
providing to Warner, at Warner's request, copies of all
documentation (except documents subject to GenVec's
attorney-client privilege) relating to the filing, prosecution
and maintenance of all such patents and patent applications.
19. Revise Article 17 by addition of new Section 17.5:
17.5 OTHER DISCLOSURES. Clinical data relating to Collaboration
Products shall be published in a timely manner upon the prior written
consent of Warner. The publications committee under the Drug
Development Committee shall consider all publications initially,
provided if the publication committee does not approve the timely
publication of any disclosure of clinical data regarding a
Collaboration Product, GenVec may submit such matter to the
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Executive Committee for final determination and the publication
shall only go forward upon approval of the Executive Committee. At
GenVec's request, and with Warner's prior written consent, which
consent shall not be unreasonably withheld, GenVec shall be
permitted to make reasonable disclosures in a timely manner
regarding the status of the Development of Collaboration Products
and related information to prospective lenders, investment bankers
and other financial institutions of its choice for the sole purpose
of seeking financing for its business operations.
20. Except as specifically modified or amended hereby, the Agreement shall
remain in full force and effect and, as modified or amended, is hereby ratified,
confirmed and approved. No provision of this Amendment No. 1 may be modified or
amended except expressly in a writing signed by both parties nor shall any terms
be waived except expressly in a writing signed by the party charged therewith.
This Amendment No. 1 shall be governed in accordance with the laws of the State
of Maryland, without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, each of the parties has executed this Amendment No.
1 as of the Effective Date of this Amendment No. 1.
GENVEC, INC. XXXXXX-XXXXXXX COMPANY
By: By:
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Name: Name:
---------------------------- ----------------------------
Title: Title:
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Exhibit A
SCHEDULE FOR REIMBURSABLE 1998 EXPENSES
*
Exhibit B
*
Exhibit C
Process Development Payment Schedule
*
Total $10.0 million
