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EXHIBIT 10.22
[Confidential treatment has been requested for portions of this exhibit. The
confidential portions have been redacted and are denoted by [**]. The
confidential portions have been separately filed with the commission.]
LICENSE AND DEVELOPMENT AGREEMENT
THIS AGREEMENT, effective as of the 1st day of October, 1992 (the "Effective
Date"), is by and between Sterling Winthrop Inc. of 00 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx, 00000, X.X.X., (hereinafter call "Sterling," which expression
includes its subsidiaries, successors and assignees) and the CTRC Research
Foundation of 0000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxx, 00000,
X.X.X. (hereinafter called "CTRC," which expression includes its subsidiaries,
successors and assignees).
WITNESSETH:
WHEREAS, Sterling is engaged in pharmaceutical research and development
activities directed to the discovery, development and commercialization of
cancer therapy agents; and
WHEREAS, CTRC's mission includes acceleration of the discovery, development and
clinical use of therapeutic agents for the treatment of human cancers; and
WHEREAS, CTRC has Commercial Rights to a Product for the treatment of human
cancers, which Product and Commercial Rights are more fully described on
Exhibit A and incorporated herein ("The Product"); and
WHEREAS, Sterling has exercised its option to obtain a license to develop and
market the Product;
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
Sterling and CTRC agree as follows:
ARTICLE I. DEFINITIONS
1.1 Unless plainly stated otherwise, all defined terms in the Research
Collaboration Agreement and Option Agreement, dated October 1, 1992, shall have
the same meaning in this Agreement.
a. "ACQUISITION COSTS" shall mean those necessary out-of-pocket
costs (applicable to the Field of Use) incurred or paid by CTRC to Third
Parties from whom Commercial Rights are acquired, to obtain Commercial Rights
to any Licensed Product or Licensed Technology including any licensing fees,
future royalty, milestone or other payment obligations.
b. "ANNIVERSARY DATE" shall mean January 1, 1994, and every
January 1st thereafter throughout the term of this Agreement, including any
extensions thereof.
c. "BUSINESS DAY" shall mean a day on which banks are open for
business in New York, USA.
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d. COMMERCIAL RIGHTS" shall mean CTRC's legal right by patent,
contract, agreement, copyright, trademark, or other means to make, have made,
use, sell or have sold in any country any compound, material technology or
know-how within the Field of Use for commercial purposes, including Inventions,
Know-How or Products.
e. "CTRC AFFILIATE" shall mean any present or future firm,
company, joint venture or other entity which directly or indirectly is
controlled by or is under the common control of CTRC. "Control" shall mean the
legal power to direct or cause the direction of the general management and
policies of such entity whether through ownership of at least [**] percent
[**] of voting securities, by contract or otherwise.
f. 'CTRC INFORMATION" shall mean information developed or
otherwise acquired by or for CTRC, including all animal and human laboratory
and clinical data, technical information, Know-How, inventions, techniques,
processes, technology, systems, formulae, results of experimentation, designs,
statistics and records pertaining to products and technology subject to
Sterling's option set forth in the Option Agreement, and all information
relating to the contents of the Research Collaboration Agreement, including
Data Information Packages, necessary to effectuate the grant of license to
Sterling, including CTRC's exclusive property as provided in Article 3.7 of the
Research Collaboration Agreement.
g. "DATA/INFORMATION PACKAGES" shall mean those documents which
CTRC shall submit to Sterling in accordance with Article 2.4 of the Option
Agreement, and generally will be in the following product/technology
categories:
(i) Products which have been tested in human clinical
trials. Data/Information packages will include summaries of and
access to all regulatory filings, clinical studies to date and a
description of all Commercial Rights.
(ii) Products which are, in CTRC's opinion, suitable for
human clinical evaluation. The Data/Information Package is intended
to be of such content and quality as to be suitable for filing of an
Investigational New Drug Application (IND) with the Food and Drug
Administration (FDA) with the reasonable expectation of initiating
Phase I clinical trials in human volunteers, and will also include a
description of all Commercial Rights.
(iii) Technology which may be applied in the research and
development of products within the Field of Use. For a technology to
be offered for license, there should exist one or more Patent
Applications and scientific data to indicate that the technology can
immediately be applied to the discovery and development of Products
within the Filed of Use. Notwithstanding the above, non-patented
technology, including know-how, may make up, in whole or in part, a
Data/Information Package.
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h. "FIELD OF USE" shall mean all applications of a Licensed
Product of Licensed Technology in the treatment and/or mitigation of cancer
i. "FIST COMMERCIAL SALE" shall mean the first commercial sale
in any country after the date the New Drug Application (NDA), Product License
Agreement (PLA) or equivalent application for a Licensed Product is approved.
j. "FUNDING PERIOD" shall mean each twelve (12) month calendar
period during which Sterling makes payments under Article III of the Research
Collaboration Agreement. The first such funding period shall actually
encompass fifteen (15) months, from October 1, 1992 to December 31, 1993.
k. "INVENTION" shall mean any invention or discovery (whether or
not patented or patentable) in the Field of Use which is originated or
conceived or first reduced to practice, arising out of the performance of the
Research collaboration Agreement.
l. "KNOW-HOW" shall mean all technical and other information
arising from the Research Program, including, but not limited to, all data,
results of experiments, formulae, specifications, procedures, tests, compounds,
cell lines, cultures, constructs, vectors, development strains,
micro-organisms, assay systems, assay protocol and assay supporting material,
fermentation and purification material and techniques.
m. "LICENSE" shall mean a license to a Licensed Product or
Licensed Technology under Research Collaboration Agreement.
n. "LICENSE AND DEVELOPMENT AGREEMENT" shall mean an agreement
executed between the parties providing the terms under which a Licensed Product
or Licensed Technology shall be licensed and developed, and which shall comply
with the provisions of Articles 4.2 and 4.3 of the Option Agreement.
o. "LICENSED PRODUCT" shall mean a Product upon which Sterling
has exercised its option under the Option Agreement.
p. "LICENSED TECHNOLOGY" shall mean a technology or Know-How
upon which Sterling has exercised its option under the Option Agreement.
q. "NET SALES" shall mean the total of all charges invoiced to
customers by Sterling, any Sterling Affiliate, and/or its sub-licensees for
Licensed Product less: (a) normal trade and cash discounts actually allowed;
(b) credits or refunds actually allowed for spoiled, damaged, out-dated, or
returned goods; (c) sales and other excise taxes imposed and paid directly with
respect to the sales; (d) transportation costs paid on behalf of the customer;
and (e) commissions and rebates; provided, however, that sales between Sterling
and any Affiliate shall not be included in such computations. No sales of
Licensed Product to any person(s) shall be counted more than once i the
calculation of Net Sales.
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r. "OPTION AGREEMENT" shall mean the agreement between CTRC and
Sterling dated October 1, 1992, a copy of which is attached as Exhibit I, as
amended April 1, 1994, a copy of which is attached as Exhibit II.
s. "PARTIES" shall mean CTRC and Sterling.
t. "PATENT APPLICATIONS" shall mean any patent applications with
respect to an Invention.
u. "PATENTS" shall mean any patents containing a Valid Claim,
granted on or pursuant to Patent Applications, including any continuations,
renewals, extensions or re-issues or any divisions thereof.
v. "PRODUCT(S)" shall mean all products which embody, in part or
whole, the Inventions, Patents, Patent Applications or Know-How.
w. "PROGRAM COUNCIL" shall mean the committee composed of members
designated by Sterling and CTRC, whose duties are set forth in Article II of
the Research Collaboration Agreement.
x. "RESEARCH COLLABORATION AGREEMENT" shall mean the Agreement
between CTRC and Sterling, dated October, 1, 1992, a copy of which is attached
as Exhibit III, as amended April 1, 1994, a copy of which is attached as
Exhibit IV.
y. "RESEARCH PROGRAM" shall mean the research and preclinical
development program being or to be carried out by CTRC and Sterling as agreed
to between the Parties. Any clinical development to be carried out by CTRC and
Sterling shall be subject to a separate License and Development Agreement.
z. "STERLING AFFILIATE" shall mean any present or future firm,
company or joint venture or other entity which directly or indirectly controls,
is controlled by or is under the common control of Sterling. "Control" shall
mean the legal power to direct or cause the direction of at least [**] percent
[**] of voting securities, by contract or otherwise. For the purposes of this
Agreement, "Sterling Affiliate" shall also include Elf-Sanofi S.A. and all
companies formed by the Joint Venture of Sterling and Elf-Sanofi S.A.
aa) "STERLING INFORMATION" shall mean any and all information and
technology which is applied to or derived from activities conducted by or on
behalf of Sterling with respect to ny compounds, materials, technologies, or
Know-How, the rights to which are owned by Sterling. Excluded from this
definition is that information which is incorporated in any Joint Invention or
CTRC Invention.
bb) "STERLING PROJECTS" shall men any work under the Research
Program on compounds, materials, technologies, or Know-How, the rights to which
are owned by Sterling, and to which Sterling controls the decisions on funding
and program protocols.
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cc) "THIRD PARTY" shall mean a person or entity which is not a
Party or a CTRC Affiliate or Sterling Affiliate.
dd) "VALID CLAIM" shall mean a claim of an issued Patent relating
to a Licensed Product or CTRC Information held by CTRC during the existence of
the Patent together with any renewals or extensions thereof or a claim of a
Patent Application, which claim has not been declared or rendered invalid by
reexamination, re-issue, disclaimer or unappealable final judgment of a court
of competent jurisdiction. If no Patent has issued within fifteen (15) years
after the earliest filing date of an application, then the claims of such
application will not be considered valid.
1.2 Additionally, the following words and phrases shall have the following
meanings:
a. "DEVELOPMENT PLAN" shall mean the plan described in Schedule
B to this Agreement and incorporated herein.
b. "EFFECTIVE DATE", as used in this Agreement, the Research
Collaboration Agreement, the Option Agreement, or any other License and
Development Agreement shall refer to the Agreement in which the term is used,
unless plainly stated otherwise.
c. "FULLY ALLOCATED COSTS" shall mean the total direct and
indirect costs attributable to a given project. Indirect costs shall mean
those general and administrative costs of CTRC, both internal and external,
which are not specifically attributable to a given project, but which are
accounted to each project using a formula derived from CTRC's standard
allocating method. Such costs shall be calculated and invoiced to Sterling on
a monthly basis.
d. "LICENSE YEAR" shall mean the twelve (12) month period
following the effective date of any License and Development Agreement, and each
succeeding twelve (12) month period during the pendency of the License, until
the date of First Commercial Sale of Product.
e. "PHS AGREEMENT" means the license agreement between CTRC and
the United States Public Health Service, dated September 8, 1991, a copy of
which is attached hereto as Exhibit V.
f. "THE PRODUCT," for purposes of this Agreement, shall mean the
Licensed Product know as MGBG, with its attendant Commercial Rights, as more
fully described in Schedule A to this Agreement. With respect to any other
License and Development Agreement, it shall mean the Licensed Product described
in a similar attachment to that particular agreement.
ARTICLE 2 - WARRANTY
CTRC represents and warrants that as the owner of the Commercial
Rights in and to The Product, as more specifically set forth in Exhibit A
attached hereto, that it
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has the sole right to grant licenses for such Commercial Rights, and that it
has not granted licenses thereunder to any other person or entity. CTRC
represents and warrants that, to its knowledge, no rights of a Third Party are
infringed or breached by the grant of this License to Sterling.
ARTICLE 3 - GRANT
3.1 Subject to their terms and conditions of this Agreement and the PHS
Agreement, CTRC hereby grants to Sterling, and Sterling accepts, an exclusive
worldwide license to make, have made, use or sell The Product, together with
its related CTRC Information, in the Filed of Use. CTRC agrees to transfer to
Sterling ownership of all regulatory documents, product inventory or other
tangible materials which CTRC has in its possession and which are required for
Sterling to effectuate this grant.
3.2 Sterling agrees to abide by the terms of the PHS Agreement.
3.3 Sterling shall have the right to grant sub-licenses in accordance with
Section 2.3 of the Option Agreement. In addition, Sterling shall be
responsible for the operations of its sub-licensee, as if the operations were
carried out by Sterling, including the payment of applicable licensing fees,
milestone payments, and royalties, whether or not paid to Sterling by the
sub-licensee. In no event shall CTRC be entitled to receive duplicative
licensing fees, milestone payments or royalties from sub-licensee and Sterling.
ARTICLE 4 - LICENSING FEES, MILESTONE PAYMENTS AND ROYALTIES
4.1 LICENSING FEE: Sterling has paid to CTRC a Licensing Fee of
five hundred thousand dollars ($ 500,000), which amount has been determined
pursuant to Article 4.4 of the Option Agreement. The intended use of The
Product is for treatment of patients with non-Hodgkin's lymphoma, prostrate
cancer and head and neck cancers.
4.2 MILESTONE PAYMENTS: Upon achievement of any development or
commercialization milestone as described in this Article 4.2, Sterling will pay
to CTRC a Milestone Payment as specified below:
a. Upon the filing of the first Investigational New Drug
Application ("IND") by Sterling or CTRC for The Product in each of the U.S.,
the first major country (France, Germany or the United Kingdom) of the European
Economic Community (EC), or Japan, Sterling will pay to CTRC a Milestone
Payment of one hundred thousand dollars ($ 100,000), ($ 300,000 maximum);
b. Upon the filing of the first New Drug Application ("NDA"),
Product License Application ("PLA"), or equivalent by Sterling or CTRC for The
Product in each of the U.S., the first major country of the EC, or Japan,
Sterling will pay to CTRC a Milestone Payment of two hundred fifty thousand
dollars ($ 250,000), ($ 750,000 maximum); and
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c. Upon receipt by Sterling or CTRC of an approval to sell The
Product in the U.S., the first major country of the EC, or Japan, for each new
approved indication (new tumor type), for a maximum of two such indications,
Sterling will pay to CTRC a milestone payment of [**] dollars
($ [**] ) for each such indication ($ [**] maximum).
x. Xxxxxxxx will pay to CTRC a bonus payment (in addition to any
other payments under this or any other Agreement) upon receipt of an approval
to sell The Product in the U.S. The amount of such bonus payment will be based
on the date of receipt of such approval as follows:
(i) [**] dollars ($ [**] ) if The Product
is approved for sale within three (3) years of Sterling's written
exercise of its Option to license The Product; or
(ii) If The Product is approved more than three (3) years
after Sterling's written exercise of its Option to license, a payment
of [**] dollars ($ [**] ) per month for each month ahead of
the anticipated approval date set forth in the Development Plan, up to
a maximum of [**] dollars ($ [**] ).
4.3 Certain payments made to CTRC under Articles 4.1 and 4.2 above shall
be credited to Sterling's funding commitment of the Research Program, as
provided in Article III of the Research Collaboration Agreement, or any
amendments thereto.
4.4 ROYALTIES: Whether sold by Sterling, a Sterling Affiliate, an
assignee, or sub-licensee, Sterling will pay to CTRC a royalty on Net Sales of
The Product as follows:
(a) For sales of The Product in countries covered by a
Valid Claim or for which market exclusivity has been obtained de facto
and by statutory or regulatory grant or decree, such as the drug Price
competition and Patent Term Restoration Xxxx xx 0000, 00 Xxxxxx Xxxxxx
Code Section 505(j) (or foreign counterpart), CTRC will be paid a
royalty as follows:
ROYALTY IN PERCENT
ANNUAL NET SALES OF ANNUAL NET SALES
---------------- -------------------
[S] [C]
$[**] to [**] [**]%
$[**] to [**] [**]%
in excess of $[**] [**]%
such royalties will be paid until the last to expire of all Valid
Claims or market exclusivity determinations for The Product.
or
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(b) For sales of The Product in countries not covered by
a Valid Claim or de facto and legal market exclusivity obtained by
statutory or regulatory grant or decree, CTRC will be paid a royalty
not to exceed [**] ([**]%) percent. Such royalties will be
paid until ten (10) years after the date of First Commercial Sale in
that country for The Product.
4.5 COMPETITION: The parties understand that a competitive version of
The Product may be presently available for sale in certain EC countries.
Consequently, at the time an NDA or equivalent application for The Product is
first filed in the U.S., Japan, or the EC as set forh in Section 4.2(b), the
Parties will review the competitive situation to determine in good faith if the
remaining milestone payments and royalties set forth in this Article 4 are
still appropriate and would provide a fair return to Sterling in view of
economic conditions existing at that time in each particular market. In the
event that the Parties in good faith agree that such payments and rates are no
longer appropriate, the parties will negotiate a reasonable reduction of the
remaining payments and rates set forth therein, taking into account the
particular market where sale of The Product is contemplated.
4.6 MINIMUM ROYALTIES: Minimum annual royalties of [**]
dollars ($ [**] ) shall be payable on a quarterly basis beginning at the end
of the second full calendar quarter following the date of the First Commercial
Sale in the United States of The Product. Quarterly minimum royalty payments
shall be made at the end of each calendar quarter thereafter, and shall be in
amounts equal to the difference between the royalty actually accrued as
determined by this Agreement, and the minimum quarterly royalty of
[**] dollars ($ [**] ).
4.7 Starting with the firs calendar quarter ending at least sixty (60)
days after the First Commercial Sale of Product, Sterling shall make written
financial reports and royalty payments to CTRC within thirty (30) days after
the end of each calendar quarter. Such reports shall state the number,
description and aggregate Net Sales of The Product during such completed
calendar quarter, and the resulting calculation pursuant to Article 4.3 above
of earned royalty payments due to CTRC for such completed calendar quarter.
With each such report, Sterling shall include payment due to CTRC of all
royalties for the calendar quarter covered by such report. The remittance of
royalties payable on Net Sales of The Product shall be made to CTRC at the
official rate of exchange of the currency of the country from which the
royalties are payable, as quoted by the Wall Street Journal (or in the event
there is no Wall Street Journal quote for such currency, the rate of exchange
shall be established by the issuer of such currently) for the last Business Day
of the calendar quarter in which the royalties are payable, less any
withholding or transfer taxes which are applicable. Sterling shall supply CTRC
with proof of payment of such taxes paid on CTRC's behalf and shall cooperate
with CTRC in obtaining credit or refund of any such taxes. The parties shall
cooperate with each other in making lawful arrangements in the event royalties
payable by Sterling are earned in a country whose currency is blocked on
exchange into U.S. dollars. Whenever any payment hereunder shall be stated to
be due on a day that is not a Business Day, such payment shall be made on the
immediately succeeding Business Day.
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4.8 Sterling shall promptly notify CTRC in writing of all submissions to
appropriate regulatory authorities for approvals to sell The Product in any
country (other than those submitted by CTRC), of the date such approvals are
granted, and the date of First Commercial Sale of The Product under this
Agreement. Upon request, Sterling shall provide to CTRC copies of such
approvals, and reasonable access to such submission.
4.9 Sterling shall keep true and accurate records and books of accounts
containing all data necessary for the calculation of the royalties payable to
CTRC under this Agreement. Such records and books of account for the prior
three (3) year period shall be made available at Sterling's principal office in
the United States on reasonable notice at all reasonable times during
Sterling's normal business hours for inspection by an independent auditor on
behalf of CTRC or by an authorized officer of CTRC.
ARTICLE V - DEVELOPMENT RESPONSIBILITIES AND COSTS
5.1 Sterling hereby assigns to CTRC, and CTRC accepts, subject to the
terms and conditions of this Agreement, the responsibility for implementing the
Development Plan for The Product, up to and including obtaining FDA marketing
approval for The Product. Upon receipt of such approval, but not sooner
(unless otherwise agreed by the Parties), CTRC shall transfer and assign to
Sterling all pre-approval regulatory documents necessary for marketing the
product, including the IND and NDA for The Product. Upon request, CTRC will
provide Sterling with a right of cross reference to all such regulatory
documents in order to further Sterling's development efforts for The Product.
5.2 CTRC will use its best efforts to perform the work outlined in the
Development Plan, in accordance with the terms of this Agreement, and shall
provide Sterling with reasonable access to and copies of all data and documents
reflecting work performed under the Development Plan.
5.3 CTRC shall have the right to subcontract certain duties under the
Development Plan. In the event CTRC does subcontract any such duties, it shall
be responsible for the subcontractor with the applicable terms of this
Agreement, including but not limited to Article VI and Article 11.4.
5.4 CTRC shall notify the Program Council prior to entering into any
subcontracts requiring an expenditure of [**] dollars ($ [**] ) or
more in any License Year.
5.5 Sterling shall reimburse CTRC for its Fully Allocated Costs incurred
in implementing the Development Plan, in accordance with Exhibit B, within
thirty (30) days of receipt of an invoice, which shall be issued by CTRC on a
monthly basis.
5.6 CTRC shall report on its progress in implementing the Development
Plan, including its performance against budget, at quarterly meetings during
the period in
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which The Product is being developed. Such development activities will be
supervised by the Program Council, which shall among other things, coordinate
development activities between the parties, including the exchange of
information and documents, establish project teams, and coordinate
responsibilities for regulatory filings and communications with regulatory
agencies.
5.7 The Program council, on an annual basis, will review and modify the
Development Plan and adjust the budget as appropriate. If the parties fail to
each mutual agreement on a change to the Development Plan, Sterling will make
the final decision on such change; provided that prospective modifications to
the Development Plan which may cause the Development Plan budget to increase or
decrease by more than [**] percent ([**]%) of CTRC's external costs or
contractual obligations from then current levels shall only be made with the
prior written consent of CTRC. Both parties will exercise their discretion
under this paragraph in good faith. Notwithstanding the foregoing, Sterling
shall have the right, based upon its good faith determination, to unilaterally
terminate or suspend the Development Plan in view of safety considerations
relating to Product testing or use, without further obligation to CTRC under
this Agreement.
5.8 Sterling shall reimburse CTRC for its Acquisition Costs for The
Product, as listed in Exhibit D, within thirty (30) days after receiving an
invoice from CTRC. Such payments will be in addition to any payments required
under Articles 4.1, 4.2, 4.4 and 4.6.
5.9 In the event that Sterling exercises its right to terminate, suspend
or discontinue the Development Plan, in accordance with Section 5.7 or 8.3,
then Sterling agrees to reimburse CTRC for its reasonable and necessary costs
incurred during the winding down period, which period will in no event extend
longer than twelve (12) months from the date of suspension. Such costs shall
include, but no be limited to, those non-cancelable contracts and commitments
which CTRC has entered into in contemplation of this agreement. CTRC shall use
its best efforts to minimize any such costs incurred by virtue of cancellation.
ARTICLE VI - CONFIDENTIALITY AND SECURITY
In addition to the provisions of Article IV and Article V of the
Research Collaboration Agreement, which are incorporated herein by reference,
the parties agree as follows:
6.1 It is understood that CTRC Information is proprietary and
confidential. Sterling hereby agrees to maintain the confidentiality of all
such CTRC Information.
6.2 It is understood that Sterling Information is proprietary and
confidential. CTRC hereby agrees to maintain the confidentiality of all such
Sterling Information.
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6.3 The Parties' obligations of confidentiality with respect to CTRC
Information and Sterling Information shall expire ten (10) years from the date
of receipt of the information.
6.4 The parties agree that they shall each use their best efforts to
ensure that Third Parties with whom they may contract to perform duties, as
permitted by this Agreement, shall abide by the provisions of this Article VI.
6.5 The parties acknowledge the right of CTRC to publication or oral
presentation of the results of any research, work or development done pursuant
to this Agreement. CTRC agrees that it will give Sterling an opportunity to
review any publication or presentation at least thirty (30) days prior to the
expected publication or presentation date, and consult with CTC with respect to
such publication or presentation date, and consult with CTRC with respect to
such publication or presentation. Nothing in this Agreement shall be construed
to prevent CTRC from publishing substantially all of the results of the
research conducted under this License which would be useful or beneficial to
the interested public.
ARTICLE VII - PATENT PROSECUTION
7.1 Upon execution of this Agreement, Sterling shall reimburse CTRC for
its reasonable out-of-pocket costs incurred (prior to the Effective Date) for
preparation, filing, prosecution and maintenance of any Patent Application(s)
pertaining to The Product. All such cost reimbursements shall be fully
creditable against future earned royalties from The Product.
7.2 Sterling will be responsible for all preparation, filing, prosecution
and maintenance of Patents or Patent Applications covering The Product, at its
expense, after the Effective Date. CTRC shall cooperate with Sterling in all
such activities and agrees to have executed by its employees appropriate
documents submitted by Sterling to obtain, perfect or maintain title, and to
cause such employees to furnish information and date in their possession
reasonably necessary to maintain such Patents in accordance with the provisions
of this Agreement.
7.3 CTRC shall have the right to consult with Sterling regarding the
content of said Patent Applications, prior art searches and correspondence, and
to comment thereon. Sterling shall consider all such comments offered by CTRC,
it being agreed, however, that all final decisions respecting conduct of the
prosecution of said Patent Applications shall reset solely in the discretion of
Sterling.
ARTICLE VII - DILIGENCE
8.1 Sterling shall use reasonable diligence according to usual business
practices to develop, manufacture and commercialize The Product in the U.S.,
major countries of the EC, and Japan, subject to all then existing regulatory
and economic conditions. Sterling shall earnestly and in good faith endeavor
to develop and market the product
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within a reasonable time after the Effective ate, in amounts sufficient to meet
the anticipated market demand therefor. In this regard, Sterling shall provide
CTRC with semi-annual written reports demonstrating Sterling's good faith
efforts (other than efforts by CTRC) to meet the diligence requirement, the
first such report to be provided twelve (12) months after the Effective Date.
8.2 With respect to The Product, Sterling shall be deemed to have met its
diligence obligations under this Article VIII if it has met its funding
obligations under Exhibit B, or agreed modifications thereof.
8.3 Sterling shall promptly give written notice to CTRC in the event that
funding falls below the agreed minimum level for any License Year, as set forth
in Exhibit B, and Sterling has not paid to CTRC such shortfall within thirty
(30) days after the end of the License Year. Sterling shall also give written
notice if a decision is made to discontinue the development and/or
commercialization of a Licensed Product in either of the U. S., major countries
of the EC, ( as defined in Section 4.20), or Japan (individually the
"Territory" or collectively the "Territories"). Upon either such notice, CTRC
shall have the first option, or if the parties are unable to reach agreement on
such buy-back provisions, Sterling shall have a period not to exceed 180 days
from that point of refusal or disagreement to sub- license The product to a
Third Party, provided that CTRC shall have a right to match any bona fide
offers from such Third Party. If Sterling does not sub-license The Product
within 180 days, and if CTRC does not buy back such rights, the license will
terminate and all Commercial Rights for The Product in such discontinued
territory will revert to CTRC.
8.4 If The Product has been approved for commercial sale in any country
and all required milestone payments have been made to CTRC, Sterling shall have
no obligation to make The Product available to CTRC for license or re-purchase
should Sterling seek to out-license or sell The Product for any reason.
ARTICLE IX - INFRINGEMENT
9.1 ENFORCEMENT. In the event that CTRC or Sterling determines that a
Third Party is making, using or selling The Product in any country, and within
the scope of a Valid Claim in that country, the parties shall have a period of
sixty (60) days from the date of such notice of alleged infringement to agree
between themselves whether and under what conditions and procedures to enforce
the infringed-upon Patent. If the parties do not agree, Sterling shall have
the first right to bring, at its own expense, an infringement action against
any Third Party. If Sterling does not proceed with a particular patent
infringement action within sixty (60) days thereafter, CTRC, after notifying
Sterling in writing, shall be entitled to institute proceedings against such
infringer at its own expense.
9.2 DEFENSE. In the event that Sterling or a Sterling affiliate or a
sub-licensee is sued by a Third Party charging infringement of a Patent because
of the manufacture, use, or sale by Sterling or a Sterling Affiliate or sub-
licensee of The Product, or in the
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event a Third Party brings an action to obtain a declaration of Patent
invalidity against CTRC and/or Sterling, each party will promptly notify the
other; and
(i) The named defendant(s) shall have the first right to
defend said action(s) at its or their own cost and expense and to
control ensuing litigation; or
(ii) If the named defendant(s) elect not to defend the
action(s), the other party may elect to defend the action(s) at its
own cost and expense and to control the ensuing litigation.
9.3 MUTUAL PROVISIONS. In both enforcement and defense actions the
following shall apply:
(i) The party conducting the suit shall have full control
over its conduct, but the other party will reasonably assist and
cooperate in such litigation upon request and be reimbursed for
reasonable out-of- pocket expenses incurred while providing any
requested assistance to the requesting party.
(ii) Any recovery as a result of litigation and settlement
thereof and any damages awarded shall be the property of the party
bearing the financial responsibility for such litigation.
(iii) Any royalties required to be paid by Sterling to a
Third Party as a result of such litigation or settlement thereof shall
be subtracted from the total of all charges in the determination of
Net Sales in the country of such action in the calculation of
royalties payable to CTRC.
ARTICLE X - TERM AND TERMINATION
10.1 This Agreement shall commence on the Effective Date and shall remain
in full force and effect on a country by country basis until the last to expire
of Valid Claims for The Product or, in the event of no Valid Claims, for a
period of ten (10) years from First Commercial Sale of The Product on a country
by country basis, whichever is later. Upon such expiration, Sterling will have
a fully paid-up license to make, use and sell The Product; provided however,
either party may terminate this Agreement prior to the end of the ten (10) year
period on three (3) months notice, but only in the event that any of the
following circumstances arise:
(i) The other party is in material breach or default with
respect to any material term or provision hereof and fails to cure
same within sixty (60) days after written notification thereof;
(ii) The other party is adjudicated bankrupt, has filed
against it any petition under bankruptcy, insolvency or similar law,
which is not dismissed
14
within sixty (60) days, has a receiver appointed for its business or
property, or makes a general assignment for the benefit of creditors;
or
10.2 Subsequent to regulatory approval to market The Product in a given
country, but prior to the end of the period described in Article 10.1, if
Sterling, a Sterling Affiliate, sub-licensee or assignee, at its discretion
elects to terminate the commercialization or sale of The Product in that
country, then CTRC may terminate this Agreement solely as to that county, on
three (3) months notice.
10.3 Termination of this Agreement shall not affect Sterling's obligations
under Articles IV or VI hereof, nor any other rights of either party accrued
prior to such termination.
ARTICLE XI - WARRANTIES AND INDEMNIFICATIONS
11.1 Sterling hereby represents that as of the date of this Agreement, it
has the full right and authority to enter into and perform this Agreement, and
that Sterling is free of any duties or obligations to Third Parties which may
conflict with the terms of this Agreement.
11.2 CTRC hereby represents that as of the date of this Agreement, it has
the full right and authority to enter into and perform this Agreement, and that
CTRC is free of any duties or obligations to Third Parties which may conflict
with the terms of this Agreement.
11.3 Except as set forth in Article 11.4, each Party to this Agreement
shall be responsible for its own acts relating to the performance of its duties
and obligations hereunder. Neither Party shall be liable to the other for
costs, expenses, liability, damages and claims for any injury or death to
persons or damage to or destruction of property or other loss arising out of or
in connection with use of The Product by either Party, but his provision shall
not relieve either Party of the consequences of its own negligence.
11.4 Sterling hereby indemnifies and holds harmless CTRC, its subsidiaries
and CTRC Affiliates from any claim by Third Parties arising out of the use of
The Product in clinical trials, provided that such use was conducted in
accordance with applicable laws and regulations, the applicable Study Protocol
and in the absence of gross negligence or willful misconduct by CTRC. Where
CTRC is the sponsor of such clinical trials, Sterling shall have final approval
of all Protocols and informed Consents for such trials. CTRC shall give
written notice to Sterling of any claims as soon as reasonably possible, and
provide assistance to Sterling in its handling of the claim. Sterling, and/or
its insurers, shall take over such claim and may defend or settle it in its
discretion.
11.5 Neither CTRC nor any of its subsidiaries or CTRC Affiliats assume any
responsibility for the manufacture or product specifications or end-use of The
Product if manufactured by or for or sold by Sterling or by any sub-licensee or
Sterling Affiliate,
15
with the exception of any of The Product manufactured by CTRC. All warranties
in connection with Teh Product made by Sterling (or its sub-licensee or
Sterling Affiliate involved) as manufacturer and/or seller shall not directly
or impliedly obligate CTRC or any of its subsidiaries or other CTRC Affiliates,
with the exception of any of The Product manufactured by CTRC. Sterling hereby
indemnifies and holds harmless CTRC, its subsidiaries and CTRC Affiliate,
except for gross negligence or willful misconduct of another party, from any
claim by Third Parties alleging that The Product or its manufacture,
recommended use, delivery or operating performance has failed to comply with
any warranty or contract between Sterling (or the sub-licensee, or Sterling
Affiliate) and such Third Party, with the exception of any of The Product
manufactured by CTRC. Sterling warrants and represents that under its
self-insurance program it has sufficient funds to honor the indemnities in this
Article XI.
11.6 In no event shall CTRC or Sterling be liable to the other for any
incidental or consequential damages including, but not limited to, loss of
profit or revenues or other indirect damages, whether a claim for such
liability or damages is premised upon breach of contract, breach or warranty,
fulfillment of warranty, negligence, strict liability, misrepresentation, fraud
indemnity or any other theories of liability.
11.7 CTRC and Sterling each warrants that it will comply with all
applicable laws and regulations in connection with its performance of this
Agreement, including the Food, Drug and Cosmetic Act and the Animal Health
Welfare Act.
ARTICLE XII - INDEPENDENT CONTRACTOR
In the performance of this Agreement, the status of CTRC, including
its employees and agents, shall be that of independent contractors and not as
employees, agents, or fiduciaries of Sterling and as such have no right to make
commitments for or on behalf of Sterling.
ARTICLE XIII - GOVERNING LAW AND ARBITRATION
13.1 This Agreement is to be read and construed in accordance with and be
governed by laws of the State of New York.
13.2 The parties agree that all disputes, controversies or claims that may
arise between them (including their agents and employees) arising out of the
operation of this agreement, shall be settled by binding arbitration in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association. The arbitration award shall be final and binding on all parties,
and may include attorney's fees and costs to the prevailing party. The
arbitration shall be held in San Antonio, Texas, U.S.A.
16
ARTICLE XIV - NOTICE
Any notice or other document required to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if left at or
sent by First class, registered, express or ail mail to a party at the address
set out below for such party or such other address as the party may from time
to time designate by written notice to the other:
Address of Sterling
Sterling Winthrop Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 X.X.X.
Attention: President
Sterling Winthrop Pharmaceuticals
Research Division
Facsimile Number: 215/889-8867
and
General Counsel, Sterling Winthrop Inc.
Facsimile Number: 212/907-3084
Address of CTRC
CTRC Research Foundation
0000 Xxxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000 X.X.x.
Attention: Chief Operating Officer, CTRC
Facsimile Number: 210/692-9823
ARTICLE XV - ASSIGNMENT
15.1 Subject to the provisions of Articles 15.2 and 15.3, no Party to this
Agreement shall assign to any Third Party the benefit and/or burden of this
Agreement without the prior written consent of the other, which consent shall
not be unreasonably withheld.
15.2 CTRC shall be entitled, with the consent of Sterling which shall not
be unreasonably withheld, to assign, transfer, or in any manner provide, in
whole or part, the benefit and/or burden of this Agreement to a subsidiary or
CTRC Affiliate or the University of Texas Health Science Center at San Antonio
("UTHSCSA"); provided that such CTRC Affiliate, subsidiary or UTHSCSA
undertakes and agrees in writing to assume, observe and perform the rights and
powers and/or duties and obligations of CTRC under the provisions of this
Agreement being assigned, transferred or otherwise provided.
17
15.3 Sterling shall be entitled, without consent, to assign, transfer, or
in any manner provide, in whole or part, the benefit and/or burden of this
Agreement to a subsidiary or Sterling Affiliate. In addition, Sterling may
without consent assign, transfer, or in any manner provide, in whole or part,
the benefit and/or burden of this Agreement to any Sterling Affiliate or
company with which it may merge or form a joint venture with respect to its
pharmaceutical oncology assets; provided that such Sterling affiliate or other
company undertakes and agrees in wiritng to assume, observe and perform the
rights and powers and/or duties and obligations of Sterling under the
provisions of this Agreement being assigned, transferred or otherwise provided.
ARTICLE XVI - MISCELLANEOUS
16.1 ENTIRE AGREEMENT AND INTEGRATION. This Agreement, the Research
Collaboration Agreement, and the Option Agreement constitute the full and
complete agreement and understanding between the Parties and supersede any and
all prior written and oral agreements with respect to The Product. The terms
and conditions of the Research Collaboration Agreement and Option Agreement, to
the extent applicable, shall be incorporated into the provisions of this
Agreement; provided however that in the event of any conflict or inconsistency,
the terms and conditions of this Agreement shall govern. This Agreement may
not be modified or amended without a written instrument executed by CTRC and
Sterling.
16.2 FORCE MAJEURE. Neither party shall be liable for any delay or
default in performance hereunder due to any cause beyond its reasonable
control, including but not limited to acts of God or the public enemy; laws,
regulations, acts or requests of any government or any government officer or
agent purporting to act under duly constituted authority; wars, floods, fires,
storms, strikes, lockouts, interruptions of transportation, freight embargoes,
or failures, exhaustion or unavailability on the open market or delays in
delivery of material, equipment or services necessary to the performance of any
provision hereof; or happening of any unforeseen act, misfortune or casualty by
which performance hereunder is delayed or prevented. The provisions of the
Article 16.2 shall not relieve either party of the obligation to make promptly
when due any monetary payment hereunder and shall not be applicable to
financial difficulties of either party or to the inability of either party to
obtain financing.
16.3 WAIVER. Sterling or CTRC may, by an instrument in writing, extend the
time for or waive the performance of any of the obligations of the other or
waive compliance by the other with any of the convenats or conditions contained
in this Agreement. Any such waiver of a condition or a covenant shall not be
deemed as a waiver of any subsequent breach or default.
16.4 SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any party, person or circumstance shall, to any extent,
be invalid or unenforceable, the remainder of this Agreement, or the
application of such term or provision to any party, person or circumstance
other than those as to which it is held
18
invalid or unenforceable, shall not be affected thereby, and each term and
provision of this Agreement shall be valid and enforced to the fullest extent
permitted by law.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS whereof the parties have entered into this Agreement by their duly
authorized officers the day and year first written above.
CTRC RESEARCH FOUNDATION
NAME:_____________________________
TITLE:____________________________
DATE:_____________________________
STERLING WINTHROP INC.
NAME:_____________________________
TITLE:____________________________
DATE:_____________________________
