EXHIBIT 10.11
Dated 23rd September, 1994
GLYCYX PHARMACEUTICALS, LTD (1)
- and -
MENARINI INTERNATIONAL OPERATIONS LUXEMBOURG SA (2)
______________________________________________________
DISTRIBUTION AGREEMENT
_______________________________________________________
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ + ▇▇▇▇
▇/▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-1-
THIS AGREEMENT is made 23rd day of September 1994
BETWEEN:
-------
(1) GLYCYX PHARMACEUTICALS, LTD a company incorporated under the laws of
Bermuda and whose registered office is at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇,
▇▇▇▇▇▇▇ ("Glycyx"); and
(2) MENARINI INTERNATIONAL OPERATIONS LUXEMBOURG SA a company incorporated
under the Law of Luxembourg whose principal place of business is at ▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ("Menarini")
WHEREAS:
A. Biorex Laboratories Limited ("Biorex") has developed and owns patent and
other intellectual property rights in' a therapeutic pharmaceutical product
for treatment and maintenance of colitis based upon the compound
Balsalazide and Biorex has granted to Glycyx the exclusive right and
licence to manufacture, or have manufactured, use, sell or have sold
products incorporating Balsalazide.
B. Glycyx wishes to grant to Menarini (who in turn wishes to accept) the
exclusive right to promote market distribute and sell the Product in the
Territory and to effect or have effected on its behalf final manufacture of
a finished Product within the Territory on the terms and subject to the
conditions of this Agreement.
NOW IT IS HEREBY AGREED as follows:-
1. DEFINITIONS
-----------
1.1 In this Agreement the following words shall have the following
meanings:
"the Applications" means the treatment of Diseases of Digestive
System according to the international
Classification of Diseases (Edition 9) under
categories 555 and 556 "Ulcerative Colitis
and Crohn's disease"
"Balsalazide" means (E)-5- [[4[[ (2-carboxyethyl) amino]
carbonyl] phenyl] azo] -2 hydroxybenzoic acid
disodium salt dihydrate (USAN)
"Biorex" means Biorex Laboratories Limited a company
incorporated in England under Company
Registration Number 390233 whose registered
office in at 2 Crossfield ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇,
-▇-
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
"Clinical Trials" shall mean clinical trials effected by or on
behalf of Glycyx and/or Menarini to effect a
comparative study between the Product and the
Asacol brand of 5.ASA currently marketed in
the Territory and elsewhere whether conducted
in the United States, United Kingdom, the
Territory or elsewhere and to be conducted
substantially in accordance with the protocol
previously agreed between Menarini and Glycyx
and contained in a document dated October 5th
1992
"Dossier" means the master regulatory dossier relating
to the Product prepared by Glycyx in
accordance with the terms of this Agreement
"Dossier Date" means the date upon which the Dossier shall
be delivered by Glycyx to Menarini in
accordance with the terms of this Agreement
"Excluded Territory" means all countries in the World except the
Territory and Japan Taiwan and Korea
"Force Majeure" means in relation to either party any
circumstances beyond the reasonable control
of that party (including but not limited to
strike, look out or other form of industrial
action, act of God, war, riot, accident,
breakdown in plant or machinery, fire, flood,
explosion or government action)
"Launch" means a commercial launch by Menarini (or any
Menarini Associate) of the Product in a
country Of the Territory supported by such
marketing expense and support and launched in
such quantities as may reasonably be
appropriate for the Product to have a
significant effect on total
-3-
sales of any similar or competitive product
in such country of the Territory
"the Manufacturing means the agreement relating to the
Agreement" manufacture and supply of the Menarini.
Product referred to in clause 9.10.
"Menarini Associate" means Menarini and such other companies owned
by or associated with Menarini as are
notified in writing to Glycyx by Menarini
from time to time
"the Menarini Product" means Bulk Balsalazide or the Bulk Active
Ingredient (4ABA) and in the event of the
development of any other pharmaceutical
preparations, Bulk Balsalazide or the Bulk
Active Ingredient in the form required for
such other pharmaceutical preparation for the
Applications.
"the Patents" means the patents and applications therefor
relating to Balsalazide listed in Schedule 1
to this Agreement and Any continuations,
continuations in part, divisions,
substitutions, reissues and extensions
thereof and any applications for patents and
patents granted in any part of the World
derived from any such patents and
applications and any and all other patent
rights now existing or hereafter acquired
(including applications therefor) pertaining
to the subject matter of any of such patents
and applications listed in Schedule 1 or that
are otherwise related to Balsalazide or to
pro drugs analogs or isomers thereof or
improvements of any of the foregoing obtained
in any country within the Territory.
"Product" means a pharmaceutical preparation in capsule
form containing Balsalazide for the
-4-
Applications and such other pharmaceutical
preparations containing Balsalazide for the
Applications as may be developed by Glycyx
during the term of this Agreement
"the Territory" means Italy, Spain, Portugal and Greece
"the Trade Name" means such trade name (other than the Trade
▇▇▇▇) as may be agreed between Glycyx and
Menarini and designated for use in connection
with the Product in any part of the Territory
"the Trade ▇▇▇▇" means the trade name "Colazide" registered as
a trademark for use on pharmaceutical
preparations in the United Kingdom and
elsewhere
1.2 The headings in this Agreement are for convenience only and shall not
affect its Interpretation.
1.3 References to documents in the approved form shall be references to
documents in the form agreed between the parties and initialled by
both parties for the purposes of identification.
2. APPOINTMENT OF MENARINI
-----------------------
2.l In accordance with the terms and conditions contained in this
Agreement Glycyx hereby grants to Menarini the exclusive right to
promote market and sell the Product within and throughout the
Territory and pursuant to the terms of Clause 9.2 only to effect (or
have affected on its behalf) final manufacture of a finished Product.
2.2 The rights granted hereunder to Menarini shall be in respect of the
Product only but for the avoidance of doubt shall include such dosages
and forms thereof as may be appropriate within the Applications. In
the event that either party shall become aware of any indications or
applications for Balsalazide other than the Applications it shall
forthwith notify the other party and shall supply the other party with
such details of the other indications and applications as may be
available to it Provided Always That:-
2.2.1 Menarini shall have the right of first refusal (exercisable
within 30 days of receipt by Menarini of such details from
Glycyx or supply by Menarini of such details to Glycyx (as
the case may be)) to enter into good faith negotiations with
Glycyx in respect of an agreement concerning the development
-5-
of such other Indications and applications and the grant to
Menarini of the right to exploit the same in the Territory;
and
2.2.2 Menarini shall have no right whatsoever to use and exploit
Balsalazide in any such other indications and/or
applications unless and until completion of such good faith
negotiations and the execution of a written agreement in
respect thereof; and
2.2.3 during the period in which Menarini shall continue to
negotiate in good faith (which shall not (unless expressly
agreed in writing by Glycyx and Menarini) exceed six
calendar months) Glycyx shall not disclose details of such
other indications and/or applications to any third party or
grant any third party any rights therein provided that
Glycyx shall not be prevented or precluded from disclosing
the same to any third party which shall have entered good
faith negotiations for the acquisition of the right to
exploit such other indications and/or applications outside
the Territory; and
2.2.4 In the event that Menarini shall not exercise its right of
first refusal under Clause 2.2.1 or (after exercise of such
right of first refusal) shall not enter into an agreement
for the grant of rights to Menarini in respect of the
Territory in respect of such other indications and
applications within such period of six calendar months (or
such extended period as may be agreed between the parties)
Glycyx shall be entitled to offer such rights in respect of
the Territory to a third party provided that (unless
otherwise agreed by Menarini) such rights shall be offered
to such third party upon terms and conditions no more
favourable than those offered to Menarini. For the avoidance
of doubt no such proviso shall apply to the offer or grant
of rights in respect of such other indications and
applications for areas outside the Territory; and
2.2.5 in respect of any such other applications and Indications
disclosed by Menarini to Glycyx, Glycyx shall not use or
exploit the same (either itself or through any third party)
whether in the Territory or elsewhere without the prior
consent of Menarini (such consent not to be unreasonably
withheld or delayed).
3. EARLY TERMINATION BY MENARINI
-----------------------------
3.l This agreement shall become effective in all respects as at the date
of execution and shall continue thereafter in accordance with its
terms, subject to termination under the provisions of Clause 18
Provided Always that this agreement may at the sole option of Menarini
be terminated by notice
-6-
in writing served by Menarini on Glycyx in the event that the results
of the Clinical Trials shall not have established the clinical
superiority of the Product in comparison with the Asacol brand of 5-
ASA (as currently marketed within the Territory and elsewhere) upon
the criteria and basis set out in Appendix 1 to this agreement: such
notice to be served by Menarini within 30 days of receipt by Menarini
of the results of the Clinical Trials.
3.2 Forthwith upon service of any notice of termination under Clause 3.1
Menarini shall:-
3.2.1 return to Glycyx and deliver up all tangible copies of all
confidential information belonging to Glycyx or Biorex and
supplied to or obtained by Menarini in connection with this
Agreement; and
3.3.2 forthwith cease all and any actions concerning or in respect
of the exercise by it of any rights granted under this
Agreement; and
3.2.3 deliver to Glycyx all information and data of whatsoever
nature relating to the Product together with all copies
thereof (other than correspondence between Glycyx and
Menarini) which Menarini may have in its possession or under
its control including (but without limitation) all
scientific, medical and safety data relating to the Product;
and
3.2.4 at its sole cost take all such actions as may be necessary
and appropriate fully and effectively to transfer absolutely
to Glycyx (or as it may direct) all applications made or
pending and all approvals and rights granted to or by all
regulatory and approval authorities (including without
limitation all technical and pricing approvals) within each
part of the Territory and all information, documentation and
rights within the possession or control of Menarini or any
Menarini Associate or any agent or representative thereof in
respect of all or any of such applications, approvals and
rights.
3.3 Menarini undertakes after the date of service of any notice under
Clause 3.1:-
3.3.1 and for a period of two years thereafter to execute such
further documents and/or provide to Glycyx such further
Information and assurance as Glycyx may reasonably require
fully to give effect to the provisions of Clause 3.2;
3.3.2 and for a period of tan years thereafter (without prejudice
to the provisions of Clause 3.4) to keep and maintain as
confidential the existence of and the contents of this
Agreement and all matters relating to the negotiation and/or
termination of
-7-
this Agreement and not to disclose any information
concerning any of the same to any third party.
3.4 Menarini hereby confirms and acknowledges that notwithstanding the
termination of this Agreement under Clause 3.l the provisions of
Clauses 14, 15.1 and 23 shall continue thereafter in accordance with
their terms.
3.5 In the event of termination under Clause 3.1 forthwith upon the proper
and full performance in all material respects by Menarini of its
obligations under Clause 3.2 Glycyx shall reimburse to Menarini:-
3.5.1 [*]
3.5.2 [*]
3.5.3 [*]
3.6 Menarini hereby undertakes that it shall not effect any Launch of the
Product in any part of the Territory unless and until either:-
3.6.l 30 days after the date of receipt by Menarini of the results
of the Clinical Trials, in the event that no notice shall
have been served under Clause 3.1; or
3.6.2 Menarini shall have expressly and irrevocably by notice in
writing to Glycyx waived its right to terminate under Clause
3.1
3.7 In the event that either no notice under Clause 3.1 shall have been
------
servedby Menarini within 30 days of receipt by Menarini of the results
of the Clinical Trials or that Glycyx shall receive from Menarini
--
notice in writing expressly and irrevocably waiving in all respects
its right to terminate under Clause 3.1 Menarini shall forthwith upon
the expiry of such 30 day period or upon service of such notice of
waiver (as the case may be) pay to Glycyx the sum of [*] due under
Clause 7.1.1.
4. REGULATORY APPROVALS
--------------------
4.1 Glycyx shall use all reasonable endeavours to prepare (or procure the
preparation of) the Dossier in accordance with published standards
required for master regulatory dossiers by the European Commission as
at the date of completion of the Dossier and in a form suitable for
submission to and suitable for approval by the relevant regulatory
authorities in connection with obtaining health registration in each
Part of the Territory.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-8-
4.2 Menarini undertakes to use its best endeavours to file the Dossier in
each part of the Territory as soon as reasonably practicable after the
Dossier Date and in any event within 26 weeks of the Dossier Date.
4.3 Menarini undertakes to use its best endeavours to apply for and obtain
all relevant regulatory health and price approvals for the marketing
and use of the Product in each part of the Territory as soon as
reasonably practicable after the Dossier Date and in any event shall
apply for such approvals within two years from the Dossier Date
Provided Always that Menarini shall not be liable in respect of any
delay experienced in obtaining any such approvals where such delay is
caused by circumstances outside its reasonable control or influence.
Menarini shall supply to Glycyx quarterly reports setting out in
reasonable detail its activities and progress in developing and
securing such approvals for the Products in each part of the
Territory.
4.4 Subject to proper performance by Glycyx of its obligations under
Clause 4.1 Menarini shall be solely responsible for effecting (at its
sole cost and expense) such amendments and translations to the Dossier
as may be required to procure that the Dossier complies with and
satisfies the requirements of any regulatory or approval authority
within any particular part of the Territory and Glycyx shall not be
obliged to incur any cost or conduct any further test or development
work or otherwise amend or translate the Dossier whether before or
after the Dossier Date Provided always that in the event that Menarini
reasonably requires any additional work to be carried out by Glycyx in
such connection, Glycyx shall use its reasonable endeavours to assist
Menarini subject to reimbursement by Menarini of reasonable costs
incurred by Glycyx in providing such assistance.
4.5 In the event that Menarini shall fail to effect Launch in any country
of the Territory within a period of 180 days after the grant of all
necessary registrations, approvals, price approvals, and
reimbursements, then Glycyx may in its absolute discretion serve
written notice on Menarini (within 30 days of the expiry of such
period of 180 days) amending the rights of Menarini granted hereunder
to be non-exclusive in respect of any such country of the Territory
only. Thereafter Glycyx for the avoidance of doubt shall also be
entitled to exploit such rights and to market and exploit the Product
in such part of the Territory (whether directly or indirectly through
any agent, contractor or licenses) in such manner as it may In its
sole discretion think fit.
4.6 In the event that Menarini's failure to effect Launch in any country
in the Territory as stated in Clause 4.5 exceeds a period of twelve
months from the grant of all necessary registrations, approvals, final
price approvals and reimbursements for such country Glycyx may at its
sole discretion serve written notice on Menarini (within 30 days of
the expiry of such period of twelve months) terminating all rights
granted to Menarini under the terms of this
-9-
Agreement in respect of such part of the Territory only and thereafter
Glycyx for the avoidance of doubt shall be entitled to exploit such
rights and to market and exploit the Product in such part of the
Territory (whether directly or indirectly through any agent,
contractor or licensee) in such manner as it may in its sole
discretion think fit free of any obligation to Menarini.
5. MENARINI'S UNDERTAKINGS
-----------------------
5.l Menarini shall use its best endeavours to promote, market and sell the
Product and to achieve such penetration of the relevant market as may
be commensurate with the qualities of the Product throughout the
Territory. Menarini undertakes to use at least such procedures and
standards to seek to obtain such penetration as it may use for other
products of Menarini.
5.2 Without prejudice to the generality of Clause 5.1 Menarini undertakes
to allocate such promotional and sales resources and such technical
support for the promotion, marketing and sales of the Product as may
reasonably be required to achieve such penetration of the relevant
market an may be commensurate with the qualities of the Product in all
parts of the Territory. Menarini undertakes to use at least such
procedures and standards to seek to obtain such penetration as it may
use for other products of Menarini.
5.3 Menarini shall promote market and sell the Product in the Territory
entirely in accordance with the terms of any product licence, price
approval (where applicable), and other restrictions and regulations
for the Product as may be relevant and applicable in each country
within the Territory.
5.4 Menarini further undertakes:-
5.4.1 to promote, market and sell the Product in the Territory
under the Trade ▇▇▇▇ or Trade Name only and not to use any
other trade name, trademark or logo for or on the Product
Provided Always That the name "Balsalazide" may be used but
only as a generic name for the Product in accordance with
and as required by applicable laws and regulations; and
5.4.2 to enter into such trademark user agreements as may
reasonably be required by Glycyx in connection with the
exploitation by Menarini of the Trade ▇▇▇▇ or the Trade
Name; and
5.4.3 to enter into such other agreements (whether relating to
technical standards or otherwise) as may reasonably be
required by Glycyx in connection with the exploitation by
Menarini of the Product provided always that such other
agreements shall evidence and clarify the obligations of
Menarini as agreed between the parties as at the date
-10-
hereof and shall not seek to amend any such obligations; and
5.4.4 to notify Glycyx immediately of any improper or wrongful use
of the Trade ▇▇▇▇ or the Trade Name, Patents or otherwise
any proprietary or confidential information of Glycyx or
Biorex relating to the Product coming to Menarini's
knowledge; and
5.4.5 forthwith to refer to Glycyx all enquiries received for the
supply of the Product outside the Territory; and
5.4.6 not actively to seek customers for the Product outside the
Territory and not to establish any branch or sales force
outside the Territory for the marketing and sale of the
Product; and
5.4.7 to develop and design packaging labelling instructions and
promotional materials for the Product in each part of the
Territory at its sole cost and expense Provided Always That
the general quality design and content of such packaging and
other materials supplied with the Product by Menarini shall
be subject to prior approval by Glycyx (such approval not to
be unreasonably withheld or delayed); and
5.4.8 not to use any misleading statements or misrepresentations
on the Product packaging labelling instructions and
promotional materials or use any defective packaging or
other materials and to comply in all respects with all
regulations and laws applicable in each part of the
Territory in connection with the Product packaging and other
materials provided in connection therewith; and
5.4.9 in the promotion marketing and/or sale of the Product in
each part of the Territory to comply with all relevant
regulatory health and pricing regulations and approvals in
such part of the Territory. For the avoidance of doubt
Glycyx shall not be responsible or liable In any manner
whatsoever for compliance with any such regulations and
approvals (whether or not it shall have assisted Menarini in
or approved the promotion marketing and/or sale of the
Product in such part of the Territory); and
5.4.10 not to use any packaging which may adversely affect the
Product in any way whatsoever including but without
limitation the Product's approved shelf-life; and
5.4.11 not to incur any liability on behalf of Glycyx or in any
manner pledge or purport to pledge Glycyx's credit or accept
any order or make any contract
-11-
binding on Glycyx or give or make any representation,
warranties or conditions or quantities with reference to the
Product on behalf of Glycyx. Menarini is not and shall not
be deemed to be the agent of Glycyx and in all
correspondence and dealings with third parties shall clearly
indicate that it is acting as principal or otherwise as
Licenses under the terms of this Agreement; and
5.4.12 to be solely responsible for the acts and omissions of its
employees and representatives in connection with the
performance of its rights and obligations hereunder; and
5.4.13 not to obtain or seek to obtain the Menarini Product from
any third party or otherwise (save as expressly permitted by
this Agreement) itself to manufacture or attempt to
manufacture all or any part of the Menarini Product.
5.4.14 During the period from the date of this Agreement to the
date of expiry of a period of three years after Launch in
each country of the Territory not to market (and to procure
that no Menarini Associate involved in the distribution or
marketing of the Product within any country of the Territory
shall market) whether directly or indirectly or through any
licenses or distributor within each such country of the
Territory any product for the treatment of inflammatory
bowel disease in which the anti inflammatory component may
compete in any material respect with Balsalazide.
6. PRODUCT DATABASE AND ADVERSE REACTIONS REPORTING
------------------------------------------------
6.1 Glycyx shall maintain a database of all adverse and other reactions or
events occurring in connection with the Product in any part of the
Territory or the Excluded Territory and shall use reasonable
endeavours to procure that any such adverse and other reactions are
notified to it in a timely manner by any sub-licensee and/or
distributor of the Product in the Territory and the Excluded
Territory.
6.2 Menarini undertakes to notify Glycyx:-
6.2.1 by telephone or telefax within 24 hours of becoming aware of
any serious or unexpected adverse reaction or
contraindication to the Product; written documentation of
such events must be received by Glycyx within five working
days of verbal notification using the CIOMS form;
6.2.2 within 3 months, on a quarterly basis, of other adverse
reactions or contraindications to the Product other than
stated under 6.2.1, in accordance with the definitions
listed in Schedule
-12-
4; and
6.2.3 regarding sales volumes, by providing in writing quarterly
unit sales figures by reference to each part of the
Territory. This information will be used by Glycyx to
generate "increased frequency" data for periodic safety
reporting to FDA.
6.3 Glycyx undertakes to notify Menarini:-
6.3.1 forthwith in the event that it becomes aware of any serious
or previously unknown adverse reaction or contra indications
to the Product in any part of the Territory and the Excluded
Territory; and
6.3.2 within three months, on a quarterly basis of other adverse
reactions or contraindications to the Product other than
stated under 6.3.1 in any part of the Territory and the
Excluded Territory.
6.4 In the event that Glycyx or any third party shall conduct clinical
studies in support of any promotional or marketing activities of
Glycyx or such third party within the Territory or the Excluded
Territory, Glycyx shall grant or procure the grant to Menarini of full
unrestricted access to the results of such trials and Menarini shall
be entitled to use such results in connection with the marketing, sale
and use of the Product in the Territory.
6.5 Glycyx undertakes to organise regular meetings between Menarini and
any other licenses and/or distributor of the Product within Europe at
which information concerning the marketing usage and performance of
the Product may be exchanged in order to co-ordinate the marketing
image of the Product as sold by licensees and/or distributors
throughout Europe and Menarini undertakes to procure attendance at
such meetings by a suitably qualified and experienced employee of
Menarini.
7. DEVELOPMENT PAYMENT
-------------------
7.1 In consideration of the obligations of Glycyx contained in this
Agreement Menarini shall pay to Glycyx as a contribution to the costs
incurred in the research and development of the Product (both before
and after the date hereof):-
7.1.1 [*]
7.1.2 [*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-13-
[*]
7.1.3 [*]
7.2.1 Glycyx acknowledges receipt prior to the date hereof to the
sum of [*] from Menarini as partial reimbursement of the
costs of conduct of the Clinical Trials.
7.2.2 In the event that the Clinical Trials are conducted at the
cost of Glycyx within the United Kingdom and/or the United
States of America Menarini shall pay to Glycyx (within seven
days of receipt of a request therefore from Glycyx such
request to be made upon agreement of the parties as to the
conduct of the Clinical Trials) a
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-14-
further sum of [*] as partial reimbursement of the costs of
the conduct of the Clinical Trials.
7.2.3 In the event that the clinical trials are not conducted at
the cost Of Glycyx within the United Kingdom and/or the
United States of America and at Menarini's option the
Clinical Trials will be conducted at the cost of Menarini
within the Territory Menarini shall be under no obligation
to pay any further sum under clause 7.2.2 above and Glycyx
shall repay to Menarini (within seven days of receipt of the
request therefore from Menarini such request to be made upon
agreement between the parties as to the conduct of the
Clinical Trials) the sum previously paid under clause 7.2.1.
8. CLINICAL TRIALS AND DEVELOPMENTS
--------------------------------
8.1 Menarini is authorised by Glycyx to undertake clinical studies after
the date hereof in support of Menarini's regulatory, promotional and
marketing activities and to enhance the Product's approval and/or use
within the Applications Provided Always That:-
8.1.l such trials are conducted solely for such purposes and not
for any other purpose whatsoever;. and
8.1.2 prior to the conduct of such trials the trial objectives and
protocols are approved by Glycyx (such approval not to be
unreasonably withheld or delayed); and
8.1.3 Menarini shall keep Glycyx fully informed as to the conduct
progress and results of such trials; and
8.1.4 Glycyx shall have full unrestricted access to the results of
such trials and shall be entitled to disclose the same to
third parties for use in connection with the registration
marketing sale and use of the Product in the Excluded
Territory only; and
8.l.5 Menarini shall bear all the costs and expenses associated
with such trials (including but without limitation the costs
of documentation and administrative payments to trialists);
and
8.1.6 such trials shall be conducted only in accordance with any
regulatory permissions and/or approvals granted for the
Product in such part of the Territory in which the trials
are conducted; and
8.1.7 Menarini, agrees that, prior to submission of a manuscript
describing the results for publication, Menarini, shall
forward to Glycyx a copy of the manuscript to be submitted
and shall allow Glycyx 30 days to determine whether a patent
application
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-15-
or other Intellectual property protection should be sought
prior to publication in order to protect Glycyx's
proprietary interest in any product or invention developed
in connection with this project. Upon request by Glycyx and
with reasonable justification, Menarini agrees to withhold
such publication for an additional 90 days, if required to
obtain subject protection. Glycyx will have the right to
request deletion from a manuscript of any trade secret,
proprietary, or confidential information supplied by Glycyx
to Menarini, but shall not otherwise have the right to
interfere with publication; and
8.1.8 all Information relating to and all results of such trials
shall be supplied to Glycyx forthwith in the event of
termination of this agreement by Menarini under Clause 3.1.
8.2 Menarini undertakes to use reasonable endeavours to support those
scientific International symposia organised, arranged or sponsored by
Glycyx and/or Biorex involving areas of medicine relating to diseases
of the gastro-intestinal tract and similar conditions.
9. SUPPLY OF PRODUCT
-----------------
9.1 The Menarini Product shall be supplied by Glycyx to Menarini (or any
specified sub-licensee or designated third party) upon such terms as
may be agreed in writing between Glycyx and Menarini.
9.2 Menarini shall be granted a limited licence for the term of this
Agreement only to undertake such further manufacturing as may
reasonably be required to produce from the Menarini Product the
Product in and for use in the Territory only Provided Always that;
9.2.1 Menarini shall carry out such manufacturing fully in
accordance with the Drug Master File and the specification
for the Product and otherwise in accordance with good
manufacturing practice and shall comply with such
instructions of Glycyx as may reasonably be required to
ensure conformity with other Product on the market within
Europe; and
9.2.2 Glycyx shall notify Menarini forthwith of any changes in the
Drug Master File and/or the specification for the Product;
9.2.3 Representatives of Glycyx and/or its licensor may upon
reasonable notice and at times reasonably acceptable to
Menarini visit and inspect the premises and facilities at
which such further manufacturing takes place from time to
time and consult informally (during such visits and by
telephone) with personnel of Menarini carrying out work on
such manufacture.
-16-
9.3 Without prejudice to the generality of Clause 9.1 Menarini shall
notify Glycyx in writing of its forecast requirements for quantities
of Menarini Product and details of its proposals for Launch in each
country of the Territory:-
9.3.l In respect of initial quantities of Menarini Product
required for Launch of Product In the Territory and details
of its proposals for Launch In each country of the Territory
Menarini shall deliver to Glycyx in writing on or before the
date of filing within any country (under clause 4.2) a
forecast of its requirements for each of the twelve months
immediately following the anticipated date for Launch. Such
forecast shall be updated in writing quarterly thereafter
but shall not be binding upon Menarini unless and until
delivered in connection with Launch under the provisions of
Clause 9.3.2.
9.3.2 Menarini shall deliver to Glycyx firm written orders for
quantities of Menarini Product required for Launch and
thereafter not less than sixteen weeks before the required
date of delivery. Firm written orders for the first two
months after Launch shall be delivered (permitting not less
than 16 weeks lead time) no later than fifteen days
following the grant of all relevant approvals for marketing
and sale of the Product within such Territory together with
forecasts for the seven months subsequent to the first two
months after Launch. Upon delivering such firm written
orders in connection with Launch, and thereafter on or
before the first day of each calendar month throughout the
term of this agreement, Menarini shall deliver to Glycyx
revised forecasts in writing of its requirements for
Menarini Product for the subsequent nine month period
(commencing on the first day of the month being sixteen
weeks after the month in which the forecast is delivered)
and with such forecasts shall deliver firm written orders
for the first two calendar months of such nine month
forecast period, In accordance with clause 9.5. Provided
Always that during the first year of supply under the terms
of this Agreement the parties will work closely together and
agree on such terms as to enable Glycyx to have such firm
orders and lead times as may reasonably be appropriate to
enable it to use all reasonable endeavours to meet in full
Menarini's requirements for Menarini Produt under the terms
of this Agreement.
9.4 Glycyx shall use reasonable endeavours to fulfil all written orders
placed on it by Menarini for the Menarini Product.
9.5 Whilst the forecasts delivered by Menarini to Glycyx under Clause 9.3
shall be non-binding and will not place any obligation on either
Menarini to order such quantities or
-17-
Glycyx to deliver such quantities:-
9.5.1 Menarini shall use all reasonable endeavours to estimate
accurately in such forecasts its requirements for the
Menarini Product; and
9.5.2 Menarini shall ensure that all written orders are placed
providing a period of 16 weeks between the date of order and
the required date of delivery.
9.6 Glycyx hereby warrants and undertakes that all quantities of the
Menarini Product supplied by it to Menarini under the terms of this
Agreement shall as at the date of delivery be supplied fully in
accordance with the Bulk Product Specification and the Finished
Product Specification contained in Schedule 2 and shall have been
manufactured in accordance with European Community Current Good
Manufacturing Practice and the Drug Master File for the Product.
9.7 Upon the receipt of any delivery of the Menarini Product from Glycyx
Menarini shall test such Menarini Product (in accordance with the
Quality Test Procedures agreed in the Manufacturing Agreement) and in
the event that the proper performance of such Quality Test Procedures
reveals any breach of the warranty given in Clause 9.6 Menarini shall
be entitled to reject the full shipment of the Menarini Product within
45 days of receipt of such shipment by notice in writing to Glycyx. In
the event that such shipment is not rejected within 45 days of receipt
Menarini shall be deemed to have accepted the same as fully in
compliance with the warranty given in Clause 9.6.
9.8 In the event of any dispute between the parties concerning any
allegation of breach of the warranty contained in clause 9.6 or
concerning any rejection or purported rejection of any shipment of the
Menarini. Product a sample quantity of the Menarini Product in
question shall be delivered to an independent laboratory (nominated by
the agreement of the parties or in the absence of agreement on the
application of either party by the President for the time being of the
Swiss Pharmaceutical Society) which shall be supplied with copies of
the Bulk Product Specification, the Finished Product Specification or
otherwise, the relevant agreed specification and the Drug Master File
and shall carry out testing in accordance with the Quality Test
Procedures and whose decision as to the quality of such Menarini
Product and as to any breach of warranty by such Menarini Product and
as to the apportionment between the parties of the costs of
arbitration shall in the absence of manifest error be final and
binding on the parties.
9.9 The terms and conditions relating to the supply of the Menarini
Product by Glycyx to Menarini as set out in this Agreement or as
otherwise agreed in writing from time to time by the parties shall
prevail over any terms and conditions of sale or purchase specified by
either party from time to time.
-18-
9.10 The parties undertake to execute an agreement relating to the
manufacture and supply of Menarini Product for the purpose of
disclosure to the relevant regulatory authorities in the Territory
substantially in the form contained in Schedule 3. In the event that
such agreement is entered into by any Menarini Associate in place of
Menarini, Menarini undertakes to guarantee and procure the proper
performance by such Menarini Associate of all its obligations under
such agreement.
10. PRICE
-----
10.1 The price charged for the Menarini Product by Glycyx to Menarini shall
be such prices as may be agreed in writing between Glycyx and
Menarini (or any Menarini Associate, on behalf of Menarini).
11. DELIVERY
--------
11.1 Delivery of the Menarini Product shall be made to such address
designated by Menarini and Glycyx shall be responsible for effecting
delivery to such designated address Provided Always that all such
costs incurred by Glycyx in effecting such delivery shall be
reimbursed in full by Menarini.
11.2 Risk in the Menarini Product shall pass to Menarini upon delivery and
Glycyx shall be responsible for insuring the Menarini Product in
transit to the designated Menarini destination Provided Always that
all such costs of insurance shall be reimbursed in full by Menarini.
12. TRADEMARK LICENCE
-----------------
12.l Glycyx hereby grants to Menarini (at Merarini's sole option) a sole
and exclusive licence to use either the Trade ▇▇▇▇ or the Trade Name
------ --
on the Product and in connection with the marketing and exploitation
of the Product in the Territory only.
12.2 In the event that Menarini wishes to use the Trade ▇▇▇▇ Glycyx
undertakes to procure the grant of such rights and licence as may
reasonably be required to give effect to Clause 12.1 from the Trade
▇▇▇▇ owner, Biorex.
12.3 In the event that Menarini wishes to use the Trade Name Menarini
hereby confirms and undertakes that all right title and interest
therein shall vest in and remain in Glycyx and that Menarini shall
have the right to use the same only as set out in this Clause 12.
12.4 Menarini hereby confirms and acknowledges that it is licensed to use
either the Trade ▇▇▇▇ or the Trade Name only as set out in this
Agreement and Menarini further acknowledges:-
-19-
l2.4.1 that all goodwill in the Trade ▇▇▇▇ and the Trade Name in
any part of the Territory (whether or not generated by the
activities of Menarini under this Agreement) shall vest in
Biorex or Glycyx as the case may be; and
l2.4.2 that any application for registration of the Trade ▇▇▇▇
shall be made in the name of Biorex only; and
12.4.3 that any application for registration of the Trade Name
shall be made in the name of Glycyx only; and
12.4.4 undertakes to transfer and assign to Glycyx (or as it may
direct) any right, title or interest required by Glycyx or
Biorex for registration of the Trade Name or the Trade ▇▇▇▇
in any part of the Territory in the name of Biorex or Glycyx
and for all goodwill relating to the Trade ▇▇▇▇ or the Trade
Name in the Territory to vest in Biorex or Glycyx as the
case may be.
l2.5 In consideration of the rights and licence granted to Menarini in
respect of the Trade ▇▇▇▇ or Trade Name Menarini shall pay to Glycyx a
licence fee at the rate of [*] [*] of all Product bearing the Trade
▇▇▇▇ or Trade Name (as the case may be) supplied by Menarini to any
third party Provided Always that:-
12.5.l such licence fee shall not become payable upon any Product
until after the date of expiry of this Agreement pursuant to
Clause 18.1; and
12.5.2 thereafter shall continue to be payable for the period only
in which the Trade ▇▇▇▇ or Trade Name (as the case may be)
is used by Menarini
and for the purposes of this Clause 12.5:
"Net Sales Price" shall mean the invoiced ex-works sales price of a
Product as sold by Menarini or any Menarini Associate in an arms
length transaction after deduction of normal trade discounts actually
granted and any credits actually given by Menarini or any Menarini
Associate for returned or defective goods and after deducting any
costs included in the invoice for packing, insurance, carriage and
freight and Value Added Tax or other sales tax and in the case of
export orders any import duties or similar applicable government
levies. In any sale or other disposal of any Product otherwise than in
any arms length transaction the Net Sales Price shall be whichever is
the higher of the price actually charged to the customer for the
Product or the fair market value of the Product in the relevant part
of the Territory.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-20-
13. LIABILITY
---------
13.1 Glycyx hereby agrees to indemnify Menarini against any action, claim, loss
and damage suffered by or awarded against Menarini in connection with any
claim against Menarini from a third party arising from any breach by Glycyx
(or its subcontractors or nominees) of the warranty and undertaking
contained in clause 9.6 Provided Always That such indemnity shall not
extend to any liability, cost, expense or damage suffered or incurred by
reason of any defect in any Menarini Product which was detected or should
have been detected by Menarini by means of the Quality Test Procedures
applied (or which should have been applied) by Menarini within 45 days of
the date of delivery of the Menarini Product under the provisions of Clause
9.7.
13.2 Menarini undertakes to indemnify and hold Glycyx harmless against all and
any loss, damage, claim or liability suffered or incurred by Glycyx in any
circumstances whatsoever save only where Glycyx is liable under Clause
13.l.
13.3 Save as expressly provided in this Agreement in no circumstances whatsoever
shall either Glycyx or Menarini be liable for any special indirect
incidental or consequential damages (including without limitation damages
for lose of profits production, use or sales) whether arising in contract,
tort or any other legal basis whatsoever.
14. CONFIDENTIAL INFORMATION
------------------------
14.1 Menarini hereby agrees and undertakes that during the term of the Agreement
and for a period of ten years thereafter (howsoever termination may be
caused or arise and including termination by reason of expiry under Clause
18.l) it shall keep confidential and shall not without the prior written
consent of Glycyx disclose to any third party or (save as expressly
provided in this Agreement) use any information of a confidential nature
belonging to Glycyx or Biorex (including trade secrets and information of
commercial value) which may become known to Menarini from Glycyx or its
representatives in connection with this Agreement Provided Always That such
obligation of confidentiality shall not extend to any part of such
confidential information which:
14.1.1 shall otherwise than by reason of any default by Menarini become
freely available to the general public; or
14.l.2 Menarini can show by documentary evidence was in its possession
or control prior to disclosure free of any obligation of
confidentiality; or
14.l.3 Menarini can show by documentary evidence shall have come into
the possession or control of Menarini from a third party free of
any obligation of confidentiality subsequent to disclosure
hereunder; or
-21-
14.l.4 Menarini is obliged by law or regulation to disclose to a third
party provided that such disclosure shall only be to the extent
required by such law or regulation.
14.2 Menarini shall ensure that any employee of, or consultant to Menarini who
shall obtain any confidential information in connection with the
performance of this Agreement shall be bound by obligations of
confidentiality substantially similar to the provisions of Clause 14.1.
14.3 Glycyx acknowledges the importance of keeping all material information
relating to the Product confidential and Glycyx will use all reasonable
endeavours to ensure that no such information is made public or otherwise
made available to third parties in any manner which would jeopardize the
exclusivity in the Territory granted to Menarini hereunder.
15. INTELLECTUAL PROPERTY
---------------------
15.1 Menarini acknowledges that save as expressly provided herein Menarini shall
have no right, title, interest or licence in or to the Patents or otherwise
any intellectual property rights of Biorex or Glycyx in Balsalazide or the
Product or any Menarini Product.
15.2 In the event that either party becomes aware of any infringement by any
third party within the Territory of any intellectual property rights of
Glycyx and/or Biorex in the Patents, Balsalazide, the Product or any
Menarini Product or the Trade ▇▇▇▇ it shall forthwith notify the other
party. Glycyx shall be entitled to take such action (or procure such
action by Biorex) as it may in its sole discretion consider appropriate
against any such third party infringer Provided Always That:-
15.2.1 Menarini shall give such assistance as Glycyx may reasonably
require in connection with any such action (subject to
reimbursement by Glycyx of all costs reasonably incurred by
Menarini); and
15.2.2 Glycyx shall keep Menarini informed of the conduct and progress
of such action but shall be entitled to conduct, pursue and
settle such action in such manner as it shall reasonably consider
appropriate and to retain any damages awarded against any such
infringer;
and in the event that such infringement shall continue and Glycyx shall
fail to take or procure any action to prevent any continued infringement
within the period of ninety days from the date upon which Glycyx shall
become aware of any such infringement Menarini may (in its sole discretion)
at its sole expense initiate and pursue such action as it considers
appropriate to prevent any continued infringement Provided Further That:-
-22-
15.2.3 Glycyx shall give (and shall use reasonable endeavours to procure from
Biorex) such assistance as Menarini may reasonably require in
connection with any such action (subject to reimbursement by Menarini
of all costs reasonably incurred by Glycyx and/or Biorex); and
15.2.4 Menarini shall keep Glycyx informed of the conduct and progress of
such action but shall be entitled to conduct, pursue and settle such
action in such manner as it shall reasonably consider appropriate
(having regard to the continuing value of any such intellectual
property rights to Glycyx and/or Biorex and the effect which any such
infringement shall have had or will have on the exploitation in the
Territory by Menarini of the Product) and to retain any damages
awarded against any such infringer.
15.3 In the event that any claim is made against Menarini by any third party
alleging infringement of any rights of any third party by the use and
exploitation of the Product by Menarini Menarini shall forthwith notify
Glycyx and Glycyx may at its sole option take such action (or procure such
action by Biorex) as it may in its sole discretion consider appropriate to
defend any such claim and in such circumstances;
15.3.l Menarini shall give such assistance as Glycyx may reasonably
require in connection with any such defence (subject to
reimbursement by Glycyx of all costs reasonably incurred by
Menarini); and
15.3.2 Glycyx shall keep Menarini informed of the conduct and progress
of any such claim but shall be entitled to conduct pursue and
settle such action in such manner as it reasonably considers
appropriate;
In the event that Glycyx (and/or Biorex) shall notify Menarini that it does
not intend taking any action to defend any such claim or shall otherwise
not take any action to defend any such claim Menarini shall be entitled at
its sole cost and expense to defend any such claim in such manner as it may
in its sole discretion consider appropriate Provided Always That
15.3.3 Glycyx shall give (and shall use, reasonable endeavours to
procure from Biorex) such assistance as Menarini may reasonably
require in such action (subject to reimbursement by Menarini of
all costs reasonably incurred by Glycyx and/or Biorex); and
15.3.4 Menarini shall keep Glycyx informed of the conduct and progress
of such action but shall be entitled to conduct, pursue and
settle such action in such manner as it shall reasonably consider
appropriate (having regard to the continuing value of any such
intellectual property rights to Glycyx and/or
-23-
Biorex and the effect which any such infringement shall have had
or will have on the exploitation in the Territory by Menarini of
the Product) and to retain any damages awarded against any such
infringer; and
15.3.5 In the event of any such claim as aforesaid (subject always to
any breach of the warranty contained in Clause 15.4) Glycyx shall
not be liable in any manner whatsoever to Menarini for any loss
or damages suffered incurred or awarded against Menarini in
connection with any such claim.
15.4 Glycyx hereby represents and warrants to Menarini as at the date of this
Agreement that so far as it is aware such of the Patents as are listed in
Schedule 1 are valid and subsisting.
15.5 In the event that in the exercise of its rights and obligations under this
Agreement Menarini shall develop any improvements to the Product or its use
in the Applications or otherwise any invention of direct application to the
Product and/or its use in the Applications Menarini shall:-
15.5.1 notify Glycyx in writing of any such improvements or inventions;
and
15.5.2 forthwith upon such notification grant to Glycyx an exclusive
royalty free licence (without limit in time) to use and exploit
any such inventions or improvements in connection with the use
and exploitation of the Products by Glycyx or any sub-licensee in
all parts of the world outside the Territory; and
15.5.3 (for the avoidance of doubt) have the right to use and exploit
the same within the Territory in such manner as it considers
appropriate and to use and exploit the same in connection with
the Product in the exercise of its rights and obligations under
the terms of this Agreement.
16. SUB-DISTRIBUTION AND SUB-LICENSEES
----------------------------------
16.1 Menarini is hereby granted the right to appoint sub-distributors and/or
sub-licensees for the exercise of its rights hereunder in connection with
the Product In countries within the Territory Provided Always That:-
16.1.1 Menarini shall remain solely liable to Glycyx for the performance
of its obligations hereunder in each part of the Territory; and
16.1.2 Menarini shall prior to granting any such rights notify Glycyx in
writing of the identity of any such sub-distributor and/or sub
licensee and of the terms upon which it proposes to appoint such
-24-
sub-distributor/sub-licensee; and
16.1.3 No such sub-distributor and/or sub-licensee shall be appointed
without the prior approval in writing of Glycyx such approval not
to be unreasonably withheld or delayed; and
16.1.4 Menarini shall supply Glycyx with a copy of each such sub-licence
and/or sub-contract entered into by it within fourteen days of
the effective date thereof.
17. BREACH BY GLYCYX
----------------
17.1 In the event of any breach of the terms of this Agreement by Glycyx,
Menarini shall be entitled to refer any such breach to arbitration
(pursuant to the provisions of Clauses 24.5 and 24.6) and to request from
the arbitrator such remedies as Menarini may reasonably require:-
17.1.1 to compensate Menarini for any lose or damage suffered or
incurred by reason of any such breach; and
17.1.2 to ensure the continued supply to Menarini of the Menarini
Product under the terms of this Agreement; and
17.1.3 to enable Menarini to exploit the Product fully in accordance
with the rights granted to Menarini under the terms of this
Agreement
and Glycyx and Menarini each confirm and acknowledge that such arbitrator
shall have the power, upon hearing all the evidence and representations of
both parties in a full arbitration hearing, to make such order as he
considers reasonable and appropriate in the light of all the circumstances
concerning and surrounding such breach including (but without limitation):
17.1.4 the award of damages; and/or
17.1.5 the grant of a licence to manufacture the Menarini Product to a
third party upon the basis that such third party shall fulfil the
obligations of Glycyx under the terms of this Agreement for such
period as the arbitrator may consider reasonable and appropriate
as Glycyx's agent and/or licensee; and/or
17.1.6 the grant of a licence to manufacture the Menarini Product to
Menarini to enable Menarini to manufacture the Menarini Product
for such period as the arbitrator may consider reasonable and
appropriate, such licence to be granted upon such terms as the
arbitrator may consider reasonable and appropriate including,
(without limitation) terms relating to the payment of such
royalty (if
-25-
any) as the arbitrator may consider appropriate to compensate
Glycyx and/or any licensor of Glycyx for the use by Menarini of
the Patents and otherwise any confidential information supplied
or required in connection with the Product under the terms of
this Agreement.
18. TERMINATION
-----------
18.1 Subject always to earlier termination under Clauses 3.1 or 18.2 the rights
and obligations of the parties contained in this agreement shall cease
forthwith upon the expiry of whichever shall be the earlier of:-
18.1.1 that date upon which such of the Patents as are listed as patents
in Schedule 1 (together with any extensions (deriving from a
supplementary protection certificate or similar instrument or
provision of such Patents) reasonably available to the Patent
owner in any part of the Territory) shall expire or otherwise
cease to be subsisting; or
18.l.2 a period of fifteen years from the date hereof
Provided Always that
18.l.3 notwithstanding the provisions of Clause 18.1.1 no such cessation
shall occur and this agreement shall continue fully in accordance
with its terms for a period of 10 years from the first date of
Launch; and
18.1.4 for the avoidance of doubt any licence or interest granted under
this agreement in all or any part of the Patents Balsalazide
and/or the Product and any confidential information shall
continue indefinitely after such cessation.
18.2 Either party to this Agreement shall be entitled to terminate this
Agreement forthwith by notice in writing to the other in the event that:-
18.2.1 the other party shall fail to pay any sum due hereunder on the
due date and shall fail to remedy such breach within (30) thirty
days of being required in writing by the other party so to do; or
18.2.2 the other party shall commit a material breach of any of the
terms and conditions of this Agreement and shall fail to remedy
the same (if capable of remedy) within ninety (90) days of being
required in writing by the other party so to do; or
18.2.3 the other party shall enter into liquidation (either voluntary or
compulsory) or shall be the subject of any petition for winding
up; or
-26-
18.2.4 the other party shall make any assignment or arrangement for the
benefit of its creditors or cease or threaten to cease to carry
on its business in the ordinary course; or
18.2.5 a receiver, administrative receiver, or receiver and manager, or
judicial manager or administrator is appointed over the whole or
any part of the assets of either party or if any court
proceedings are commenced for the appointment of an administrator
or receiver to either party; or
18.2.6 the other party shall become unable to pay its debts as they
become due in the ordinary course of business or shall otherwise
become subject or seek relief under any law relating to
insolvency in any jurisdiction relevant to such other party
18.3 Any waiver by either party of a breach of any provision of this Agreement
shall not be considered as a waiver of any subsequent breach of the same or
any provisions of this Agreement.
18.4 Any termination of this Agreement shall be without prejudice to the right
of either party to recover any monies due to it under this Agreement or the
rights or remedies of either party in respect of any breach prior to the
effective date of termination of this Agreement.
19. CONSEQUENCES OF TERMINATION
---------------------------
19.1 In the event of termination of this Agreement under Clause 18.2 by Glycyx
or by Menarini (prior to the expiry of this Agreement in respect of any
part of the Territory pursuant to Clause 18.1) Menarini shall:
19.1.1 forthwith, cease all manufacturing, marketing, sale and promotion
of the Product; and
19.1.2 immediately pay all monies due and payable to Glycyx as at the
date of termination; and
19.1.3 immediately return to Glycyx all information and data of
whatsoever nature relating to the Product together with all
copies thereof (other than correspondence between Glycyx and
Menarini) which Menarini may have in its possession or under its
control including but without limitation all scientific, medical
and safety data relating to the Product; and
19.l.4 immediately cease use of all or any confidential information of
Glycyx delivered in connection with this Agreement; and
19.1.5 immediately cease use of the Trade ▇▇▇▇; and
-27-
19.1.6 take all such steps as may reasonably be required by Glycyx to
transfer or procure the transfer to Glycyx (or its nominee) of
all such product licences and approvals as may have been obtained
for the manufacturing marketing and sale of the Product in any
part of the Territory subject always (save only in the event of
termination by Glycyx under the provisions of Clauses 18.2.1 or
18.2.2) to payment by Glycyx of a sum representing the
reimbursement to Menarini of the unamortised amount of its
reasonable costs directly incurred in obtaining and successfully
exploiting such product licences and approvals, amortised over a
ten year period from the date of approval, such costs to be
agreed and determined in good faith negotiations between the
parties or, in the event of any failure to be agreed by an
arbitrator appointed and operating in accordance with the
provisions of Clause 24.6; and
19.1.7 immediately deliver to Glycyx a full and detailed inventory of
all Products and Menarini Products in the course of manufacture
and/or in stock as at the date of termination; and
19.1.8 Glycyx may at its sole discretion purchase such stocks of the
Product (inclusive of packaging) as Menarini shall still have in
its possession once it has fulfilled all orders outstanding as at
the date of termination at a price calculated as cost price to
Menarini Provided Always that such stocks:-
(i) are of merchantable quality; and
(ii) have remaining (as at the date of any such purchase) not
less than two thirds of their approved shelf life.
20. ASSIGNMENT AND SUB-CONTRACTING
------------------------------
20.1 The benefit of this Agreement is personal to Menarini and to Glycyx and
shall not be capable of assignment (whether in whole or in part) by either
of them without the prior consent in writing of the other party (such
consent not to be unreasonably withheld or delayed) Provided Always that:-
20.1.1 Glycyx shall be entitled to assign the whole (but not part) of
this Agreement without the prior consent of Menarini to any
company to which the entire trade and business of Glycyx may be
transferred as part of any internal corporate restructuring of
Glycyx;
20.1.2 Menarini shall be entitled to assign the whole (but not part) of
this Agreement to any Menarini Associate without the prior
consent of Glycyx
Provided further that in the event of any assignment by Menarini to any
Menarini Associate or third party Menarini
-28-
undertakes to remain liable as guarantor of the obligations of such
Menarini Associate or third party under this Agreement.
20.2 Menarini hereby confirms and undertakes that in the event that any
obligation of Menarini contained herein is sub-contracted or sub-licensed
or otherwise performed by any Menarini Associate Menarini shall remain
solely liable for the proper performance of such obligation.
21. FORCE MAJEURE
-------------
21.1 If the performance of any obligations under this Agreement by either party
Is affected by Force Majeure it shall forthwith notify the other party of
the nature and extent thereof.
21.2 Neither party shall be deemed to be in breach of this Agreement or
otherwise be liable to the other by reason of any delay in performance or
non-performance of any of its obligations hereunder to the extent that such
delay or non-performance is due to any Force Majeure which has been
notified to the other party in writing.
22. COSTS
-----
Each party hereto shall bear its own costs in relation to the negotiation,
drafting, preparation, and execution of this Agreement.
23. CONFIDENTIALITY OF THIS AGREEMENT
---------------------------------
23.1 The contents of this Agreement shall remain confidential as between the
parties. Neither party shall, without the prior written consent of the
other (such consent not to be unreasonably withheld without justification),
disclose any of the financial terms of this Agreement to any other person,
firm or company save for
23.1.1 disclosure by Glycyx to Biorex (or otherwise the owner for the
time being of the Patents) and/or Salix Pharmaceuticals Inc. (for
as long as it shall remain a company in common ownership with
Glycyx) in circumstances where such third party shall have
accepted obligations of confidentiality in respect of the
information disclosed; and
23.1.2 such disclosure as may be required by any relevant law or
regulatory authority; and
23.1.3 such disclosure as may reasonably be required to its professional
advisers and/or any potential or actual investor in such party
(subject always to such party obtaining appropriate obligations
of confidentiality from any such person(s)).
-29-
24. NATURE OF THE AGREEMENT
-----------------------
24.1 Nothing in this Agreement shall create or be deemed to create any
partnership, joint venture or the relationship of principal and agent
between the parties.
24.2 Each party acknowledges that, in entering into this Agreement, it does not
do so on the basis of, and does not rely on, any representation, warranty
or other provision (save only as expressly provided herein) and all
conditions, warranties or other terms implied by Statute or common law are
hereby excluded to the fullest extent permitted by law.
24.3 This Agreement (including all the Schedules) and any agreements entered
into pursuant to this Agreement constitutes the entire understanding and
agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements, negotiations and discussions
between the parties relating to this Agreement.
24.4 This Agreement may not be released, discharged, abandoned, charged or
modified, in any manner, except by an instrument in writing signed by a
duly authorised officer or representative from each of the parties hereto.
24.5 This Agreement shall be governed by and construed in all respects in
accordance with the laws of England.
24.6 Any dispute arising out of or in connection with this Agreement shall be
referred to arbitration in Geneva, Switzerland before an arbitrator (with
suitable technical knowledge) appointed by the agreement of the parties or
in the absence of agreement by the President for the time being of the
Swiss Pharmaceutical Society and such arbitration shall be conducted in the
English language under the arbitration rules of the International Chamber
of Commerce.
25. NOTICES
-------
25.l All notices to be served by the parties to this Agreement shall be served
only in the English language.
25.2 Notices shall be sufficiently served if dispatched by international courier
to the address of the receiving party set out below
Glycyx ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇▇ ▇.▇.▇.
F.A.O. The President
Menarini ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇
F.A.0. for the President of the Board
-30-
with a copy to:
A. Menarini Industrie Farmaccutiche
Riunite s.r.l.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇
F.A.O. The Legal Department
Any modification to this address must in itself be notified in writing to
the other party in accordance with the terms of this sub-clause.
25.3 In the absence of proof to the contrary notices properly sent hereunder
shall be deemed to have been duly served 10 days after the date of
dispatch.
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first above written.
-31-
SCHEDULE 1
----------
THE PATENTS
-----------
PATENT NUMBER FILING DATE GRANT DATE DUE TO EXPIRE
UK 2,080,796 Complete 07.07.2001
Specification
07.07.1981
France 1,493,313 21.07.1981 21.07.2001
Italy 1,138,450 10.07.1981 10.07.2001
Japan 1,433,303 16.07.1981 07.04.2001
U.S.A. 4,4l2,992 08.07.1981 01.11.2000
F.R.G. 3,120,0l9 21.07.1981 15.02.90 21.07.2001
-32-
SCHEDULE 2
----------
"Bulk Product Specifications"
and
"Finished Product Specifications"
-33-
PENN PHARMACEUTICALS LTD
DEVELOPMENT DEPARTMENT
INTERIM
ANALYTICAL PROCEDURES AND SPECIFICATIONS
BALSALAZIDE SODIUM
Written by: Date:
Approved by: Date:
▇▇▇.▇▇. 20.DEC.93 Supersedes: 19 AUG 1993
Page 1 of 4
--------------------------------------------------------------------------------
Chemical Name
-------------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-34-
SPECIFICATIONS
--------------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-35-
PENN PHARMACEUTICALS LTD
DEVELOPMENT DEPARTMENT
ANALYTICAL PROCEDURES AND SPECIFICATIONS
COLAZIDE CAPSULES
Written by: Date:
Approved by: Date:
Ref. No. 18.FEB.93 Supersedes: First
Page 1 of 3
--------------------------------------------------------------------------------
Appearance:
----------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-36-
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-37-
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
-38-
SCHEDULE 3
----------
MANUFACTURING AGREEMENT
-----------------------
TECHNICAL ARRANGEMENTS
between
A. MENARINI INDUSTRIE FARMACEUTICHE RIUNITE SRL a company incorporated under the
laws of Italy whose principal Place of business is at ▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ hereinafter called MENARINI
and
GLYCYX PHARMACEUTICALS LTD a Company incorporated under the laws of Bermuda
whose registered office is at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ hereinafter
called GLYCYX
WHEREBY it is agreed as follows:-
Supply of Product
-----------------
1. GLYCYX will supply the Product specified in the Schedule to this agreement
("the Product") to MENARINI upon the terms and conditions of this agreement
and otherwise as agreed between the parties.
2. GLYCYX will use its site(s) at [
] for
manufacturing and control activities of the Product.
Quality of manufacturing materials used by GLYCYX
-------------------------------------------------
3. GLYCYX shall obtain the manufacturing materials specified in Schedule A.
4. GLYCYX is solely responsible for ensuring that each batch of manufacturing
material used by GLYCYX has been examined and complies with the
specifications In Schedule A.
GMP standard
------------
5. All manufacture and quality control operations of GLYCYX shall be carried
out according to the current Basic Standard of Good Manufacturing Practice
for Pharmaceutical Products - including supplementary recommendations as
issued by the European Commission.
-39-
Changes in quality standards, formula, manufacturing and quality control
------------------------------------------------------------------------
procedures
----------
6. The procedures of manufacture and quality control shall be as agreed by the
parties and any change in such procedures shall be agreed upon by both
parties in writing.
7. GLYCYX may not sub-contract any manufacturing or quality control operations
to any Glycyx site other than that specified in Clause 2 or sub-contractor
without prior notice in writing to MENARINI and providing such period of
notice is reasonably required by MENARINI for MENARINI to meet Drug
Regulatory requirements.
Responsibility for release of product manufactured by GLYCYX
------------------------------------------------------------
8. GLYCYX shall only release batches of Product for shipment to MENARINI which
have been examined and comply with the specifications in Schedule A
Provided Always that MENARINI shall be solely responsible for the final
approval of batches of Product manufactured by GLYCYX.
Storage
-------
9. GLYCYX shall store all manufacturing materials and Products in accordance
with GMP recommendations and the storage conditions prescribed therein [and
agreed between the parties].
Documentation
-------------
10. GLYCYX shall keep:-
10.1 reference samples (solvents excluded) and quality control records for
each batch of manufacturing material used by GLYCYX; and
10.2 manufacturing and quality control records for each batch of the
Product manufactured for MENARINI by GLYCYX
for a period of six years from the date of manufacture or such longer
period as may be agreed upon in writing between MENARINI and GLYCYX.
l1. Each shipment of the Products from GLYCYX to MENARINI shall be accompanied
by a certificate of analysis with the following information:-
11.1 the results of such tests as may by agreement of the parties be
carried out by GLYCYX; and
11.2 a statement by GLYCYX that the batch of Products has been released for
shipment to MENARINI in accordance
- 40 -
with the following criteria:-
11.2.1 all manufacturing materials used in the manufacture of the
Products have complied with the specification in Schedule 2;
and
11.2.2 all manufacture and quality control operations by GLYCYX
have been carried out according to current GMP,
manufacturing, in process control and testing procedures, as
well as Standard Operating Procedures in the form agreed
between the parties.
11.3 the manufacturing date.
12. GLYCYX agrees to submit to MENARINI upon receipt of any request therefor
from Menarini:-
12.1 copies of all manufacturing and quality control records of any batch
of the Products manufactured by GLYCYX; and
12.2 copies of the quality control records of any batch of manufacturing
materials used by GLYCYX.
13. Menarini shall keep reference samples and quality control records for each
batch of Product delivered to Menarini by Glycyx for a period of six years
from the date of delivery or such longer period as may be agreed upon in
writing between Menarini and Glycyx.
14. Menarini agrees to submit to Glycyx upon receipt of any request therefor
copies of all quality control records for each batch of Product delivered
to it by Glycyx.
Quality test procedures
-----------------------
15. Upon receipt of each batch of Products from Glycyx, Menarini shall test
each such batch fully in accordance with Quality Test Procedures agreed
from time to time by Glycyx and Menarini.
Quality Audit
-------------
16. During normal working hours and upon reasonable notice MENARINI shall be
entitled to inspect the manufacturing and quality control areas at GLYCYX's
site.
17. During quality audits by MENARINI and upon request, GLYCYX shall inform
MENARINI of the outcome of inspections by the National Drug Inspectorate of
GLYCYX's site.
18. GLYCYX shall supply MENARINI with all relevant information reasonably
required for the investigation of any complaints concerning the quality of
the Products.
- 41 -
Post production product inspection
----------------------------------
19. MENARINI is solely responsible for all post production Inspection of the
Product.
Contact persons
---------------
20. Contact persons in matters relating to manufacture and quality control
under the terms of this Agreement are:-
- on behalf of MENARINI
- on behalf of GLYCYX
- 42 -
SCHEDULE A
----------
Manufacturing materials to be supplied by GLYCYX
------------------------------------------------
NAME SPECIFICATION NO.
---- -----------------
Detailed specifications
-----------------------
Date:
A. MENARINI INDUSTRIE FARMACEUTICHE RIUNITE SRL
____________________________________
Date:
GLYCYX
____________________________________
- 43 -
SCHEDULE 4
----------
ADVERSE EVENT REPORTING
-----------------------
1. Serious Event: In the US, a serious event includes death, a life-
threatening event, hospitalisation (initial or prolonged), disability,
congenital anomaly, and any event requiring intervention to prevent
permanent impairment or damage.
2. Unexpected: Event is not listed in the current FDA-approved labelling for
the drug. This includes events that may differ from a labelled reaction
because of greater severity or specificity.
3. Quarter: Non-serious and expected events occurring prior to NDA approval
will be reported to Glycyx on a quarterly basis, where the first quarter of
each year begins an 22 June.
Non-serious and expected events occurring post-NDA approval will be reported to
Glycyx every quarter, where the first quarter begins on the date of approval of
the NDA.
- 44 -
SIGNED by ) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
for and on behalf of GLYCYX ) PRESIDENT
PHARMACEUTICALS, LTD in the presence) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
of:- ) VICE PRESIDENT
SIGNED by ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇ ) ▇▇▇▇▇ ▇▇▇▇▇▇▇
for and on behalf of MENARINI )
INTERNATIONAL OPERATIONS LUXEMBOURG ) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
S.A. in the presence of:- )
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
GENERAL COUNSEL
APPENDIX 1
▇▇▇:eae/1.3/24
ADDRESS FOR CORRESPONDENCE:
--------------------------
Beech House,
Melbourn Science Park,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇.
TEL: ▇▇▇▇-▇▇▇▇▇▇ [IMAGE OMITTED]
FAX: ▇▇▇▇-▇▇▇▇▇▇
CAMAS PARTNERS
________________________________
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
FAX: ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇ E N G L A N D
TEL(0767)40373
FAX(0767)40941
▇▇ ▇▇▇▇▇▇
Direttore Della Ricerca Clinica
A. MENARINI Industrie Farmaceutiche Riunite srl
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ cc: Mr R ▇▇▇▇▇▇▇▇
Mr J ▇▇▇▇▇▇▇▇
Dear ▇▇ ▇▇▇▇▇▇
Since our meeting on March 10th, we have been diligently analysing data in order
to arrive at a fair and accurate measure of the superiority of 'Colazide' when
compared to 'Asacol'. I must apologise for the delay in responding to these
matters, but we have felt it important to give due consideration to the
parameters that are used to adjudge these comparative factors.
In regard to clinical superiority, our hypothesis is that the reproducible and
site-specific delivery aspects of 'Colazide' will result in superior rates of
symptomatic improvement vs. 'Asacol'. This hypothesis has largely been based
on the improvement we have seen in our relapse-treatment trials at the two week
interval.
To date, there have been no direct comparative studies of the two drugs, so we
must rely on analogy to establish a foundation of understanding. Nevertheless,
two published studies can shed light on the anticipated performance of
'Colazide' and 'Asacol' in the treatment of relapse in mild to moderate
ulcerative colitis:
* Sninsky CA, et al, Oral Mesalamine ('Asacol') for mildly to moderately
active ulcerative colitis. Annals of Int Med 1991; 115(5): 350-355
* ▇▇▇▇▇▇▇▇▇ ▇▇ et al. Is high dose balsalazide better than sulphasalazine in
initial management of ulcerative colitis? Gut (1991) In Press.
/Contd...
- 2 -
▇▇ ▇▇▇▇▇▇
A. MENARINI Industrie Farmaceutiche Riunite srl
The 'Asacol' study compared 1.6g/d and 2.4g/d to placebo, measuring improvement
and remission at 3 and 6 weeks. The balsalazide study compared 6.75g/d
balsalazide to 3g/d of sulphasalazine, and measured improvement and remission at
2, 4 and 8 weeks. End-point measures were similar and the patient populations
were not dramatically different. The daily balsalazide dose of 6.75g equates to
2.36g of 5-ASA, almost exactly the 2.4g/d dose of 'Asacol'.
Though it is not scientifically valid to directly compare these two studies, we
believe the 2/3 week scores reveal a trend in the favour of balsalazide. The
Sninsky trial defined improvement as a reduction of physician's global
assessment score and in at least one other component score, with no score
increase in severity. At 3 weeks, 32% of patients on 2.4g/d 'Asacol' were scored
as improved. Using a similar scoring of improvement in the balsalazide study,
at 2 weeks of treatment, 68% of patients were scored as improved. Had this been
a direct comparative study, these results would represent a 112% superiority of
balsalazide over 'Asacol', measured as early (2 week) patient improvement.
We therefore propose to conduct a direct, comparative clinical trial of
'Colazide' and 'Asacol' in the treatment of acute relapse in mild to moderate
ulcerative colitis. The trial would compare the most widely accepted acute
dosage of 'Asacol', 2.4g per day, to 6.75 g of 'Colazide' per day. The trial
would run for 8 weeks, with symtomatic scores being taken at 1, 2 and 4 weeks,
and assessment of remission at the 8 week treatment point. The scoring system
is shown on the attached sheet. Patient improvement would be defined as per the
Sninsky study, noted above.
Clinical superiority of 'Colazide' will be determined by the following formulae:
Proportion of 'Colazide' patients Improved
------------------------------------------ = 1.20
Proportion of 'Asacol' patients Improved
This represents the 20% "superiority" target set out for us by Dott. Aleotti.
We think that the superiority of 'Colazide' at any of the time points is a
significant finding, consistent with our postulate that 'Colazide' treatment
will result in faster improvement, even if at later time points the two drugs
are closer to equivalent (c.f. omeprazole vs ranitidine vs cimetidine).
/Contd ...
- 3 -
▇▇ ▇▇▇▇▇▇
A. MENARINI Industrie Farmaceutiche Riunite srl
Of course, more rapid clinical improvement is only a part of 'Colazide's
advantage. In regard to safety, our hypothesis is that the unpredictable
release of 5-ASA from Asacol can result in greater systemic exposure and
possible nephrotoxicity. This concern gave rise to a CSM warning regarding
'Asacol' in the UK.
To put 'Colazide into perspective, we refer to: ▇▇▇▇▇▇▇ et al. Disposition of
5-aminosalicylic acid by olsalazine and three mesalazine preparations (including
'Asacol') in patients with ulcerative colitis: comparison of intraluminal
colonic concentrations, serum values and urinary excretion. Gut (1990) 31:1271-
1276. This study showed a significantly higher urinary output of 5-ASA from
'Asacol' as compared to olsalazine. The authors note:
"The potential toxicity of 5-ASA should be considered, in particular during
long-term treatment with 5-ASA delivering compounds in doses above 1g/day.
Most interest has been focused on the potential renal abnormalities due to
5-ASA. The drug has structural similarities to phenacetin, and has caused
papillary necrosis when given intravenously in high doses to rats. A
putative nephrotic syndrome and an interstitial nephritis after treatment
with 'Asacol' and 'Salofalk' respectively, have been reported. Finally, a
two year follow up of patients on 'Asacol' has shown an incidence of pyuria
of more than 50%. Hence; the lowest possible systemic load of 5-ASA should
be sought in the choice of a system for effective delivery of 5-ASA to the
inflamed colon."
We also know from direct clinical input from UK gastroenterologists that
patients transferred onto 'Asacol' are in practice exposed to a higher level of
side effects than is widely perceived. Our intent is to monitor systemic 5-ASA
levels and other marker enzymes predictive of renal tubule damage in volunteers
and patients. We consider that such evaluation is a critical adjunct to the
assessment of this type of product, where the site and mechanism of delivery of
5-ASA is such a key adjunct to efficacy.
/Contd ...
- 4 -
▇▇ ▇▇▇▇▇▇
A. MENARINI Industrie Farmaceutiche Riunite srl
Since 'Colazide' uses the same azo-reductase delivery mechanism as olsalazine,
we postulate that urinary excretion of 5-ASA from 'colazide' will be
significantly less than that from 'Asacol'. Furthermore, we believe this
contrast will be even greater when comparing unmetabolized urinary 5-ASA output
(N-acetyl-5-ASA is considered therapeutically inert).
Clearly, superiority in efficacy is a much stronger argument from reimbursement
and marketing perspectives. However, it might be appropriate to factor urinary
5-ASA output as an additional score in the definition. For any drug,
superiority should be measured by both efficacy and safety parameters. Each
must be considered together in a benefit/risk assessment.
SYMPTOM SCORING SYSTEM
----------------------
Stool frequency
---------------
0 = Normal number of stools for this patient
1 = 1 to 2 stools more than normal
2 = 3 to 4 stools more than normal
3 = 5 or more stools more than normal
Rectal bleeding
---------------
0 = No blood seen
1 = Streaks of blood with stool less than half the time
2 = Obvious blood with stool most of the time
3 = Blood alone passed
Abdominal pain
--------------
0 = None
1 = Mild, with bowel action
2.= Moderate, with bowel action
3 = Severe, with bowel action or continuous abdominal pain
PATIENT'S FUNCTIONAL ASSESSMENT
-------------------------------
0 = Generally well
1 = Fair
2.= Poor
3 = Terrible
HAEMATOLOGICAL SCORING SYSTEM
-----------------------------
0 = ESR within Normal Range
1 = ESR more than 20 less than 50 mm/hr
2.= ESR more than 50 less than 100 mm/hr
3 = ESR more than 100 mm/hr
/Contd...
- 5 -
▇▇ ▇▇▇▇▇▇
A. MENARINI Industrie Farmaceutiche Riunite srl
--------------------------------------------------------------------------------
SIGMOIDOSCOPIC AND HISTOLOGICAL GRADING SYSTEMS
--------------------------------------------------------------------------------
Sigmoidoscopic grading Histological grading
--------------------------------------------------------------------------------
Grade macroscopic appearance Grade Microscopic appearance
--------------------------------------------------------------------------------
0 Normal, vascular pattern 0 Normal
clearly visible
--------------------------------------------------------------------------------
1 Erythema with loss of 1 Mild increase in chronic
vascular pattern inflammatory cell infiltrate
no tissue destruction
--------------------------------------------------------------------------------
2 As above plus contact 2 Moderate increase in chronic
bleeding inflammatory cell infiltrate
no tissue destruction
--------------------------------------------------------------------------------
3 As above plus 3 Marked increase in
spontaneous bleeding inflammatory cell infiltrate
mild tissue destruction
--------------------------------------------------------------------------------
4 As above plus 3 Marked increase in chronic,
obvious ulceration inflammatory cell infiltrate
obvious tissue destruction
--------------------------------------------------------------------------------
We are in the process of developing a complete clinical trial protocol, but in
the meantime we should come to a basic understanding as to the means of
determining and definition of superiority. I look forward to your comments and
a chance to discuss the definition proposed herein.
This letter has been forwarded to you by Fax as the preliminary communication.
The references quoted in the letter are being sent with a hard copy of the
letter by Express Post.
Best regards
Yours sincerely
/s/ ▇.▇. ▇▇▇▇▇▇
▇ ▇ ▇▇▇▇▇▇
----------
Glycyx Pharmaceuticals, Ltd
▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
▇▇▇▇
▇▇▇▇▇▇▇
Menarini International
Operations Luxembourg S.A.
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ 23rd September 1994
Dear Sirs
I write in connection with an Agreement entered into between Glycyx
Pharmaceuticals, Ltd ("Glycyx") and Menarini International Operations Luxembourg
SA ("Menarini") in the form of the agreement attached hereto dated 23rd
September ("the Agreement").
In this letter words and phrases defined in the Agreement shall bear the same
meaning.
I write to confirm the agreement between Menarini and Glycyx of the prices to be
paid for the Menarini Product in accordance with clause 10.1. I confirm our
agreement as follows:.
1. It is intended that the prices charged by Glycyx will be calculated by
reference to Glycyx's [*] Provided Always that Glycyx's costs shall not be
materially different to the costs that might be incurred by Menarini if it
was itself to manufacture the Menarini Product.
2. For this purpose, the [*] of Glycyx shall be volume related and shall be
calculated as a percentage of the [*] achieved by Menarini (or any Menarini
Associate, marketing and selling the Product under the terms of the
Agreement) on any sale within each part of the Territory in any year
("Menarini's Price") and:-
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
Continued/... Page 2
for that portion of Menarini Glycyx's reasonable profit
aggregate sales in any will be calculated as
calendar year between
[*]
3. Annual quantities of Product (ie finished capsules) shall be calculated as
the number sold during each twelve month period starting from the date of
first commercial launch of the Product in the first market. Once the
Product has been launched in all parts of the Territory a definitive
adjustment to the anniversary date will be made substituting 31st December
in each year as the expiry date of each twelve month period and such
calendar year shall apply to all quantities of products sold In the
Territory.
4. "Menarini's Price" shall be calculated as the price obtained by Menarini
(or any Menarini Associate, exercising rights granted to Menarini under the
terms of the Agreement) on the sale and supply of each unit of Product to
third parties in each calendar year. In any six month period from the date
of first commercial launch of the Product in the Territory account shall be
taken of actual volumes of sales and prices in such period. The overall
accounting periods will be adjusted to conform with a calendar year basis
through one definitive adjustment (as specified above) once the Product has
been launched in all parts of the Territory.
5. Not later than one month prior to the commencement of any six month period
Glycyx and Menarini will determine the "Interim Price" to apply during such
six month period and to be based on historical figures, forecasts and
estimates. Menarini's Price shall be determined finally for each six month
period at the end of the third month after the expiry of each six month
period and any difference arising from the calculation of the Menarini
Price as due and the Interim Price previously paid shall be settled between
Glycyx and this Company within fourteen days of such date of determination.
6. To assist in the calculation of the Menarini Price (and the Interim Price)
Menarini shall
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
Continued/... Page 3
(i) keep Glycyx fully informed of its best available estimates of total
sales and prices for the Product in each part of the Territory and
of any material deviation from such estimates; and
(ii) keep full records of all such prices actually achieved; and
(iii) grant Glycyx access to all such records in order to verify such
prices for the purposes of calculating the "reasonable profit" and
the prices to be charged by Glycyx to Menarini for the Product under
the terms of this letter agreement.
7. Menarini's Price shall be determined and settled in United Kingdom pounds
sterling at the exchange rate applicable as at the date of determination.
8. The price payable to Glycyx for all quantities of Menarini Product
delivered pursuant to the Agreement shall be payable in Pounds Sterling and
shall be payable by means of interbank telegraphic transfer.
9. All matters information and discussions relating to the calculation of the
Interim Price and Menarini's Price shall be treated as strictly
confidential and this shall be maintained as confidential.
It is confirmed that this letter is intended to reflect a binding agreement
between Glycyx and Menarini in respect of all the matters covered by this letter
as if these terms were expressly incorporated into the Agreement.
It is the intention of Menarini that all detailed matters concerning the trading
relationship between Menarini and Glycyx (including, in particular, the supply
of Menarini Product and details concerning the forecasting, ordering, delivery
and payment of and for the Menarini Products) shall be effected by a Menarini
Associate appointed by Menarini as its agent with authority to act in all such
matters under the terms of the Agreement and to bind Menarini in all such
matters as if it was a signatory to any such arrangements. Menarini would
intend appointing any such agent by a letter of authority forwarded to Glycyx
and Menarini confirms that notwithstanding any such appointment or the exercise
of any such rights by any Menarini Associate, Menarini shall remain solely
liable for the proper performance of all obligations under the Agreement.
Continued/... Page 4
Kindly countersign and return the enclosed copy letter to evidence your
agreement to these terms.
Yours faithfully
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
FOR AND ON BEHALF OF
GLYCYX PHARMACEUTICALS, LTD
Confirmed, acknowledge and agreed for and on behalf of Menarini International
Operations Luxembourg SA.
[SIGNATURE ILLEGIBLE]
.................................
Duly authorised signatory
DATED 23rd September 1994
A. MENARINI INDUSTRIE FARMACCUTICHE RIUNITE s.r.l.
-and-
GLYCYX PHARMACEUTICALS, LTD
------------------------------
AGREEMENT
------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ + ▇▇▇▇
▇/▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
THIS AGREEMENT is made the 23rd day of September 1994
BETWEEN
(1) A. Menarini Industrie Farmaccutiche Riunite s.r.l of ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Menarini"); and
(2) Glycyx Pharmaceuticals, Ltd of Cedar House 41 Cedar Avenue ▇▇▇▇▇▇▇▇ EM12
Bermuda ("Glycyx")
WHEREAS
(A) At the request of Menarini Glycyx has today entered into an Agreement
between Glycyx and Menarini International Operations Luxembourg SA
("Menarini Luxembourg"); and
(B) Menarini has agreed to guarantee to Glycyx the performance of all the
obligations and liabilities of Menarini Luxembourg under the terms of the
said Agreement in accordance with the terms of this Agreement.
NOW IT IS HEREBY AGREED as follows:-
1. In consideration of Glycyx at the request of Menarini entering into an
agreement with Menarini Luxembourg dated 23rd September 1994 ("the
Agreement");
1.1 Menarini hereby guarantees to Glycyx the due and punctual performance
by Menarini Luxembourg (notwithstanding any legal limitation and/or
incapacity or other circumstances (including without limitation,
insolvency) relating to Menarini Luxembourg or any irregularity
unenforceability or invalidity of any obligation of Menarini under
this agreement) of all obligations which Menarini Luxembourg may incur
or assume under the Agreement and the due compliance by Menarini
Luxembourg of all provisions under the Agreement ("Menarini
Luxembourg's Obligations"); and
1.2 Menarini hereby covenants with Glycyx that if and whenever Menarini
Luxembourg shall make any default in any of Menarini Luxembourg's
Obligations Menarini will indemnify Glycyx against all losses, damages
costs and expenses which may be incurred by Glycyx by reason of any
such default.
2. The liability of Menarini hereunder shall be as primary obligor and not
merely as a surety and Menarini waives any rights which it may have to
require Glycyx to proceed first against or claim payment first from
Menarini Luxembourg and furthermore, the liability of Menarini shall not be
affected impaired or discharged by reason of any act omission matter or
thing which but for this provision might operate to release or otherwise
exonerate Menarini Luxembourg from the Menarini Luxembourg Obligations
including but without limitation;
2.1 any granting of time or other indulgence or (without limitation) any
extension renewals acceptance forbearance or release in respect of any
of Menarini Luxembourg's Obligations; or
2.2 Any waiver or release of any right under the terms of the Agreement;
or
2.3 Any modification of or variation to the terms of the Agreement; or
2.4 Any transfer or assignment of rights or obligations under the
Agreement; or
2.5 Any corporate reorganisation reconstruction amalgamation dissolution
merger acquisition of or by other alteration in the corporate
existence or structure of Menarini Luxembourg; or
2.6 Any composition or arrangement made by Glycyx with Menarini Luxembourg
or any other person; or
2.7 Any dealing with exchange modification or abstention from perfecting
or enforcing any right; or
2.8 The invalidity or enforceability of any provision of the Agreement.
It being the intention of Menarini that the guarantee and indemnity set out
herein shall be irrevocable and unconditional and that the same may be
enforced as often as the need may arise.
3. This Agreement shall be construed in accordance with the laws of England
and Wales and Menarini hereby undertakes to submit to the jurisdiction of
the English Courts.
IN WITNESS whereof the parties hereto have executed this Agreement as a Deed on
the date set out above.
Signed sealed and )
delivered by A. Menarini )
Industrie Farmaceutiche )
Riunite s.r.l )
[SIGNATURE ILLEGIBLE]
Signed sealed and ) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
delivered by Glycyx ) PRESIDENT
Pharmaceuticals, Ltd ) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
VICE PRESIDENT
-2-
Menarini International Operations
Luxembourg SA
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ 23rd September 1994
Dear Sirs:
Re: AGREEMENT BETWEEN MENARINI INTERNATIONAL OPERATIONS LUXEMBOURG SA and
---------------------------------------------------------------------
GLYCYX PHARMACEUTICALS, LIMITED DATED 23rd Sept. 1994 ("the Agreement")
-----------------------------------------------------------------------
I write for and on behalf of Glycyx Pharmaceuticals, Limited ("Glycyx") in
connection with the Agreement and in particular, in connection with agreements
and arrangements entered into between Glycyx and third parties for the
exploitation of the Product (as defined in the Agreement) within Europe and
Scandinavia.
I confirm that such agreements contain a clear obligation on Glycyx's licensee
for such Territory to, within each country of its Territory, "use all reasonable
endeavours to obtain the most favourable Factory Sales Price, which is
consistent with competitive market characteristics and the demonstrated
advantages of the Product and presenting the Product as a new chemical entity
within such country."
In such agreements "Factory Sales Price" is defined as the ex-factory sales
price of each Product actually charged by the licensee (or any associate) for
each shipment of Product on an arms length open market basis to any third party
net only of sales and purchase taxes, customs or import duties, delivery charges
and returns and allowances actually charged on each shipment.
I hope this confirms the position for your purposes.
Yours faithfully,
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
President
SIGNED FOR AND ON BEHALF OF
GLYCYX PHARMACEUTICALS, LIMITED
[A. MENARINI LETTERHEAD]
Legal Department
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇
▇/▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Florence, September 9, 1994
Dear Fiona
Re: Glycyx Pharmaceuticals Limited - Distribution Agreement
-------------------------------------------------------
Further to your letter dated 26th August 1994 and to our recent phone
conversation, I would like to confirm that under Italian law the "guarantee
agreement" signed by Menarini Florence in connection with the captioned
Distribution Agreement is valid and enforceable even though there is no seal of
the company and one signatory only appears. As a matter of fact, the Italian
Civil code allows a limited liability company to be validly represented by one
person ("Amministratore Unico") whose signature on any document creates a legal
obligation on the conpany itself.
For certain acts or documents the law prescribes the written form as a condition
of their validity (for example, sale of a piece of land) and legalization by a
Notary Public is required to give publicity to the act and gain protection
against third parties. However, a unilateral warranty or a guarantee agreement
does not need to be executed before a Notary Public or by another director. In
other words, we are not bound to execute a document of that kind as a deed.
I can also confirm that ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ is "Amministratore Unico" of
"A.MENARINI INDUSTRIE FARMACEUTICHE RIUNITE s.r.l." and his signature on any
document released by the company (including, inter alia, the "guarantee
agreement" pertaining to Balsalazide Distribution Agreement) creates a legal
obligation on the company to abide by the terms of the signed document.
I hope that the above clarifies the situation. Please do not hesitate to call
me if you have any further question on the content of this letter.
Kindest regards.
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
TRIBUNALE CIVILE E PENALE DI FIRENZE
CANCELLERIA COMMERCIALE
Il ▇▇▇▇▇▇▇▇▇▇▇ sottoscritto
c e r t i f i c a
risulatre dagli atti depositati in questa Cancelleria, omologati, iscritti e
pubblicati nelle forme ▇▇ ▇▇▇▇▇: - che la societa "A.MENARINI - Industrie
Farmaceutiche Riunite s.r.l."e regolarmente iscritta al n 2206 del Registro
Societa con il capitale di 1 3,000,000,000 - interamente versato durata fino al
31 dicembre 2050 avente sede legale in Firenze Via Sette Santi n.3, avente per
oggetto la ricerca scientifica, l'industria e la fabbricazione di specialita
medicinali, Prodotti farmaceutici, prodotti ottenuti attraverso la biologia
molecare, parafarmaceutici, diagnostici (e relative apparecchiature),
elettromedicali, cosmetici, dietetici, sanitari e similari in genere, nonche il
commercio degli stessi in Italia e all'estero - Cod. Fisc. e Partita IVA
00395270481; - che detta societa e stata trasformata da "societa in accomandita
semplice" a "societa a responsabilita limitata" con atto a rogito Notaio
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ di Firenze del 22 dicembre 1988 reg. to a Firenze - Atti
Civili - il 10 gennaio 1989 al n. 252, omologato dal Tribunale di Firenze con
decreto 16 gennaio 1989, trascritto nel Registro Societa in data 1 febbraio
1989 al n. 2210 reg. Gen. d'Ord.- La predetta so-
cieta e stata costituita con Atto Costitutivo in data 24 febbraio 1915 atto
Notaio ▇. ▇▇▇▇▇▇▇▇▇ registrato a Firenze il 4 marzo 1915 da ultimo modificato
con ▇▇▇▇▇ Sociali sottoscritti in data 22 dicembre 1988;
- che detta societa e amministrata da un Amministratore Unico nominato per tutta
la durata della societa nella persona del Cav. del. Lav. ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
nato a Quattro Castella (RE) il 4 marzo 1923 il ▇▇▇▇▇ ▇▇ accettato la carica;
- che il predetto Amministratore Unico fino ad oggi non risulta sostituito e
quindi ▇▇▇▇'ora in carica;
- che in base all'art. 14 del vigente statuto sociale all'Amministratore Unico
sono attribuiti tutti i piu ampi poteri per la gestione della societa e per il
compimento di tutti gli atti di ordinaria e straordinaria amministrazione
rientranti ▇▇▇▇'oggetto sociale essendo di sua competenza tutto cio che per
▇▇▇▇▇ o per statuto non sia espressamente ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ competenza
dell'assemblea dei soci;
- che la rappresentanza legale della societa di fronte a ▇▇▇▇▇ ▇▇ in giudizio e
devoluta al predetto Amministratore Unico Cav. del Lavoro ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇;
- ▇▇▇ ▇▇▇▇'ultimo quinquennio la predetta societa non e stata dichiarata fallita
ne ammessa a procedura di concordato preventivo, di amministrazione controllata,
o di liquidazione e quindi si trova nel pieno e libero esercizio dei
suoi diritti. -
Si rilascia per gli usi consenti dalla ▇▇▇▇▇ -
Firenze.
TERMS OF AMENDMENT
In light of new developments affecting the Distribution Agreement between Glycyx
Pharmaceuticals ("Glycyx"); and Menarini International Operations Luxembourg SA
("Menarini") dated 23rd September 1994 ("the Agreement"), Glycyx and Menarini,
with intent to be legally bound, agree to the following amendment to the
Agreement.
I. Menarini will provisionally accept the interim results of the U.S.
comparative trial versus Asacol delivered on 6 December 1994 as very
promising with regard to the requirements of Clause 3.1 of the Agreement.
Payment of [*] per Clause 7.1.1 is due and payable immediately following
acceptance by both parties of this Letter of Amendment, but it will be
refundable pursuant to section III herebelow and clause 3.1 of the
Agreement.
II. The parties having agreed that Glycyx will file the dossier in Europe
under the E.U. Decentralized Procedure, the term "Dossier Date" for
purposes of the Agreement is now understood as "the date upon which the
master regulatory dossier relating to the Product shall be delivered by
Glycyx to Menarini following filing of Glycyx's Product licence
application for the Product in the UK" it being understood that UK has
been selected as the rapporteur country for the EU Decentralized
Procedure. Payment of [*] to Glycyx will be due no later than three
months from the Dossier Date per Clause 7.1.2.2 of the Agreement.
III. The above payments shall not be refunded by Glycyx, Provided Always That:
A. Glycyx shall complete the scheduled Clinical Trials as convened at due
time and shall submit to Menarini the final results; and
B. the results of the Clinical Trials are satisfactory pursuant to Clause
3.1 of the Agreement.
IV. Except as specifically provided herein, the terms of the Distribution
Agreement shall remain in full force and effect.
Accepted and agreed this 13th day of February, 1995
Company: GLYCYX PHARMACEUTICALS, LTD
By: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President
Signature: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Company: MENARINI INTERNATIONAL OPERATIONS LUXEMBOURG SA
By: Dr. asa ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President of the Board of Directors
Signature: /s/ ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
