RESEARCH, COLLABORATION & LICENSE AGREEMENT DATED AS OF July 31, 2024 BY AND BETWEEN GEMMA BIOTHERAPEUTICS, INC. AND PASSAGE BIO, INC.
CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [*], HAS BEEN OMITTED BECAUSE IT IS NOT MATERIAL AND IS THE TYPE THAT PASSAGE BIO, INC. TREATS AS PRIVATE OR CONFIDENTIAL.
RESEARCH, COLLABORATION & LICENSE AGREEMENT
DATED AS OF July 31, 2024
BY AND BETWEEN
▇▇▇▇▇ BIOTHERAPEUTICS, INC.
AND
TABLE OF CONTENTS
RESEARCH, COLLABORATION & LICENSE AGREEMENT
This Research, Collaboration & License Agreement (this “Agreement”) is effective as of July 31, 2024 (“Effective Date”) by and between Gemma Biotherapeutics, Inc., a corporation organized under the laws of the state of Delaware (“Gemma”), and Passage Bio, Inc., a corporation organized under the laws of the state of Delaware (“Passage”). ▇▇▇▇▇ and Passage may be referred to herein as a “Party” or, collectively, as “Parties”.
RECITALS:
WHEREAS, Passage and The Trustees of the University of Pennsylvania (“Penn”) are parties to a Research, Collaboration & License Agreement, entered into on September 18, 2018, which was restated on May 5, 2020, and which was subsequently amended on August 13, 2020, November 2, 2020, December 9, 2020, June 2, 2021, August 3, 2021, November 12, 2021, December 3, 2021, May 11, 2022, and November 15, 2023 (collectively, as amended and restated, the “First ARCA”), pursuant to which Penn granted to Passage certain rights, licenses and options under certain Patent Rights (as defined below) and Know-How (as defined below) with respect to the research, development, manufacturing, and commercialization of certain products in certain indications;
WHEREAS, concurrently with the execution of this Agreement, ▇▇▇▇ and ▇▇▇▇▇ are entering into a business transaction under which the majority of the ▇▇▇▇▇▇ Laboratory (as defined below) resources will transition from Penn and into ▇▇▇▇▇, and pursuant to which the ▇▇▇▇▇▇ Laboratory will no longer exist at Penn (such transaction, the “Spin-Out Transaction”);
WHEREAS, concurrently with the execution of this Agreement, Passage and Penn are also entering into that certain Second Amended and Restated Research, Collaboration & License Agreement, effective as of the Effective Date (the “Second ARCA”), pursuant to which Penn and Passage are amending and restating the First ARCA, including to account for the Spin-Out Transaction;
WHEREAS, in connection with the Spin-Out Transaction and concurrently with the execution of this Agreement, Penn and ▇▇▇▇▇ are entering into that certain License Agreement (the “Upstream License Agreement”), pursuant to which Penn is granting to Gemma an exclusive license under certain Patent Rights and a non-exclusive license under certain manufacturing Patent Rights and Know-How;
WHEREAS, Passage is a biopharmaceutical company with expertise in the development, manufacture and commercialization of human therapeutic products for the treatment of genetic disorders;
WHEREAS, ▇▇▇▇▇, through the Spin-Out Transaction, has technology and expertise in the research and development of gene therapy products; and
WHEREAS, the programs contemplated by this Agreement are of mutual interest to Passage and ▇▇▇▇▇ and may benefit Passage and Gemma through the creation or discovery of new inventions and the development and commercialization of Licensed Products (as defined herein) for the Indications (as defined herein);
NOW, THEREFORE, in consideration of the various promises and undertakings set forth herein, the Parties agree as follows:
Unless otherwise specifically provided herein, the following terms shall have the following meanings:
| 1.1. | “AAV” means adeno-associated virus. |
| 1.2. | “Achievement Date” means with respect to a Diligence Event, the corresponding date such Diligence Event is to be achieved as provided in Section 5.7 below. |
| 1.4. | “BLA” means (a) a biologics license application as that term is defined in the PHS Act and the regulations promulgated thereunder, (b) a marketing authorization application in the European Union, or (c) any equivalent or comparable application, registration or certification in any other country or region. |
| 1.5. | “Calendar Quarter” mean the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30, and December 31 of each Calendar Year. |
| 1.6. | “Calendar Year” means each successive period of twelve (12) months commencing on January 1 and ending on December 31. |
| 1.7. | “cGLP” means the current good laboratory practice regulations promulgated by the FDA, published at 21 U.S. C.F.R. §58, and equivalent non-United States regulations and standards in any other country or region, as applicable, as such current laboratory practices, regulations and standards may be amended from time to time. |
| 1.8. | “cGMP” means those current practices, as amended from time to time, related to the manufacture of pharmaceutical products and any precursors thereto promulgated in guidelines and regulations of standard compilations including the GMP Rules of the World Health Organization, the United States Code of Federal Regulations, the Guide to Inspection of Bulk Pharmaceutical Chemicals (established by the United States Department of Health and Human Services), the Pharmaceutical Inspection Convention, and the European Community Guide to Good Manufacturing Practice in the production of pharmaceutical products, and equivalent guidelines, regulations and standards in any other country or region, as such guidelines, regulations and standards may be amended from time to time. |
| 1.9. | “Challenge” means that Passage or a Sublicensee (including sub-Sublicensees) will be deemed to have made a “Challenge” of the Licensed Patent Rights, Discovery Patent Rights, or a DRG Patent Right if Passage or such Sublicensee (including sub-Sublicensees), respectively: (a) institutes or voluntarily joins as a party to, or causes its counsel to institute on Passage’s or such Sublicensee’s (including sub-Sublicensees) behalf, any interference, opposition, re-examination, post-grant review or similar proceeding with respect to any Licensed Patent Right, Discovery Patent Right, or a DRG Patent Right with the U.S. Patent and Trademark Office or any foreign patent office; or (b) |
| makes any filing or institutes or voluntarily joins as a party to any legal proceeding, or causes its counsel to make any filing or institute or voluntarily join as a party to any legal proceeding on Passage’s or such Sublicensee’s (including sub-Sublicensees) behalf, with a court or other Governmental Body (including, without limitation, the U.S. Patent and Trademark Office or any foreign patent office) having authority to determine the validity, enforceability or scope of the Licensed Patent Rights, Discovery Patent Rights, or a DRG Patent Right, in which one or more claims or allegations challenges the validity or enforceability of any Licensed Patent Right, Discovery Patent Right, or a DRG Patent Right. |
| 1.10. | “Clinical Study” means a Phase 1 Study, Phase 1/2 Study, Phase 2 Study, or Phase 3 Study, or such other study in humans that is conducted in accordance with good clinical practices and is designed to generate data in support or maintenance of an application for Regulatory Approval. |
| 1.11. | “CNS Field” means a disease or condition with significant morbidity in the central nervous system (“CNS”) or peripheral nervous system (“PNS”) [*]. For further clarity, [*]. |
| 1.12. | “CNS Indication” means an indication in the CNS Field. |
| 1.13. | “Combination Product” means a Licensed Product that is delivered with one or more additional active ingredients and/or other items or services incident to the administration of any such Licensed Product (with or without one or more such other active ingredients), [*], in each such case when any of the foregoing are co-formulated, co-packaged or sold under one pricing scheme (whether payment of such price is paid to the same or to more than one seller). |
| 1.14. | “Commercially Reasonable Efforts” means the efforts and resources that a similarly situated biotechnology company would use for its own internally discovered technology of similar commercial potential and similar stage of development, taking into account the likely timing of the technology’s entry into the market and any patent and other proprietary position, safety and efficacy, product profile, and the then-current competitive and regulatory environments for the product. Without limiting the foregoing, Commercially Reasonable Efforts requires, with respect to such obligations, that the Party (a) promptly assign responsibility for such obligation to specific employee(s) who are accountable for progress and monitor such progress on an on-going basis, (b) set annual objectives for carrying out such obligations, and (c) allocate resources designed to advance progress with respect to such objectives. |
| 1.15. | “Compulsory License” means a compulsory license under Licensed Patent Rights obtained by a Third Party through the order, decree, or grant of a competent Governmental Body or court, authorizing such Third Party to develop, make, have made, use, sell, offer to sell or import a Licensed Product in any country. For clarity, [*]. |
| 1.16. | “Controlled” means, with respect to intellectual property rights, that a Party or one of its Affiliates owns or has a license or sublicense to such intellectual property rights and has the ability to provide, grant a license or sublicense to, or assign its right, title and interest in and to, such intellectual property rights as provided for in this Agreement without (a) violating the terms of any other agreement or other arrangement with any Third Party from whom the Party or its Affiliate acquired such intellectual property rights, (b) requiring additional obligations, liabilities or financial consideration to such Third Party in connection with the grant of such license or sublicense (other than consideration for which Passage agrees to bear the entire cost), or (c) violating the terms of, or requiring additional obligations, liabilities or financial consideration to a Third Party under, [*]. |
| 1.17. | “Designated Product” means a Specified Licensed Product arising from a Research Program [*]. |
| 1.18. | “Development Transition Point” or “DTP” means on a Licensed Product-by-Licensed Product basis, the date on which the IND-enabling studies for such Licensed Product under the applicable Research Program have been completed and immediately prior to filing of the IND, unless otherwise agreed by the Parties. |
| 1.19. | “Diligence Event” means each of the events that Passage, itself or through any of its Affiliates or Sublicensees, is expected to accomplish in the development of each Licensed Product in each Indication set forth in Section 5.7. |
| 1.20. | “Discovery Patent Rights” means [*]. |
| 1.21. | “Discovery Program” means the discovery research program conducted at Penn solely by the ▇▇▇▇▇▇ Laboratory during the period between January 1, 2016 and July 31, 2024 (inclusive), in the conduct of the discovery research program conducted at Penn prior to the Effective Date, which consisted of (a) [*], (b) [*], (c) [*], (d) [*]; (e) [*], and (f) [*]. |
| 1.22. | “DRG Excluded Indications” means [*]. |
| 1.23. | “DRG Know-How” means all Know-How related to DRG Technology that is Controlled by ▇▇▇▇▇ and [*]. |
| 1.24. | “DRG Patent Rights” means (a) the Patent Rights [*], (b) [*], and (c) [*]. |
| 1.25. | “DRG Technology” means [*]. |
| 1.26. | “EMA” means the European Medicines Agency and any successor entity thereto. |
| 1.27. | “FD&C Act” means the United States Federal Food, Drug and Cosmetic Act, as amended. |
| 1.28. | “FDA” means the United States Food and Drug Administration and any successor entity thereto. |
| 1.29. | “Field of Use” means prophylactic, diagnostic and therapeutic uses in humans. For clarity, [*]. |
| 1.30. | “FIH” means on a Licensed Product-by-Licensed Product basis, a first in human Clinical Study for a Licensed Product. |
| 1.31. | “First Commercial Sale” means, on a country-by-country basis, the first commercial transfer or disposition for value of Licensed Product in such country to a Third Party by Passage, or any of its Affiliates or Sublicensees, in each case, after Regulatory Approval has been obtained in and for such country. |
| 1.32. | “FPFD” means, on a Licensed Product-by-Licensed Product basis with respect to each Clinical Study, the first dosing of the first patient in such Clinical Study. |
| 1.33. | “GAAP” means United States generally accepted accounting principles applied on a consistent basis. |
| 1.34. | “Gene Therapy Product” means a pharmaceutical product (or proposed or prospective pharmaceutical product) that inserts one or more functional genes or proteins into a patient’s CNS or PNS cells using a parvovirus vector, including but not limited to an AAV. For clarity, Gene Therapy Products [*]. For clarity, [*]. |
| 1.35. | “Generic Product” means, with respect to a particular Licensed Product in a country, a generic or biosimilar pharmaceutical product, that is not produced, licensed or owned by Passage, any of its Affiliates or Sublicensees, that: (a) is bioequivalent or biosimilar to such Licensed Product; and (b) is approved for use in such country by a Regulatory Authority by referencing the prior approval, in whole or part, or safety and efficacy data submitted in support of the prior approval, of the Licensed Product. Generic Product includes, but is not limited to, any pharmaceutical products for which Regulatory Approval is obtained via: (i) a bioequivalence or bioavailability showing such as those covered by section 505(j) of the FD&C Act or an equivalent outside the United States; or (ii) a biosimilarity or interchangeability determination such as those covered by section 351(k) of the PHS Act or an equivalent outside the United States. |
| 1.36. | “Governmental Body” means any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) federal, provincial, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or entity and any court or other tribunal); (d) multi-national or supranational organization or body; or (e) individual, entity, or body exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature. |
| 1.37. | “HD Research Program” means the Transferred Research Program for HD. |
| 1.41. | “Know-How” means intellectual property, data, results, pre-clinical and clinical protocols and study data, chemical structures, chemical sequences, information, inventions, formulas, techniques, methods, processes, procedures, and developments. For clarity, “Know-How” does not include Licensed Patent Rights, Discovery Patent Rights, or DRG Patent Rights claiming any of the foregoing. “Know- How” also does not include Licensed Materials. |
| 1.42. | “Law” or “Laws” means all applicable laws, statutes, rules, regulations, ordinances and other pronouncements having the binding effect of law of any Governmental Body. |
| 1.43. | “Licensed Know-How” means all Know-How that is Controlled by ▇▇▇▇▇ that is necessary or reasonably useful to develop, make, use, sell, offer for sale or import a Licensed Product in the Field of Use, including, but not limited to, any such Know-How (a) licensed to Gemma pursuant |
| to the Upstream License Agreement, or (b) developed or discovered under any of the Research Programs on behalf of ▇▇▇▇▇ (including but not limited to all Research Results generated by or on behalf of Gemma). |
| 1.44. | “Licensed Material” means biological or chemical materials that are Controlled by ▇▇▇▇▇ and necessary or useful to exploit the licenses granted to Passage under this Agreement, to the extent that ▇▇▇▇▇ is (as of the Effective Date or at any relevant time during the Term thereafter) able to grant rights to such materials to Passage. Such biological and chemical materials include cell lines, viral seed stocks, product- specific reference materials, platform or product specific assay controls and reagents that are not available as standard commercial items. |
| 1.45. | “Licensed Patent Rights” means Licensed Patent Rights A and Licensed Patent Rights B, collectively. |
| 1.46. | “Licensed Patent Rights A” means (a) the Patent Rights listed in Exhibit A, (b) [*], (c) any continuations, provisionals, continued prosecution applications, substitutions, extensions and term restorations, registrations, confirmations, reexaminations, renewals or reissues thereof, including divisions, and further including continuations-in-part (to the extent related directly to the subject matter of the parent application or containing new information developed pursuant to the Research Program), (d) ▇▇▇▇▇’s interest in and to any jointly owned Patent Rights of the kind described in Section 2.2.4, and (e) any corresponding foreign Patent Rights to the foregoing. |
| 1.47. | “Licensed Patent Rights B” means: (a) [*]; (b) any continuations, provisionals, continued prosecution applications, substitutions, extensions and term restorations, registrations, confirmations, reexaminations, renewals or reissues thereof, including divisions, and further including continuations-in-part (to the extent related directly to the subject matter of the parent application or containing new information developed pursuant to the Research Program); and (c) any corresponding foreign Patent Rights to the foregoing. For clarity, [*]. |
| 1.49. | “Major Markets” means the United States, Japan, France, Germany, Spain, Italy and the United Kingdom. |
| 1.50. | “MHLW” means the Ministry of Health, Labor and Welfare of Japan. |
| (a) | trade discounts, including trade, cash and quantity discounts or rebates, credits or refunds; |
| (b) | allowances or credits actually granted upon claims, returns or rejections of products; |
| (c) | charges included in the gross sales price for freight, insurance, transportation, postage, handling and any other charges relating to the Sale, transportation, delivery or return of such Licensed Product; |
| (d) | customs duties, sales, excise and use taxes actually paid in connection with the transportation, distribution, use or Sale of such Licensed Product (but excluding what is commonly known as income taxes); |
| (e) | bad debt expense and amounts actually written off by reason of uncollectible debt not to exceed [*] of the Net Sales of Licensed Product. |
Even if there is overlap between any of the deductions described above, each individual item shall only be deducted once in the overall Net Sales calculation.
In the case of a Combination Product, the Parties shall negotiate in good faith, at the latest [*] before the expected launch of such Combination Product, an allocation of Net Sales of such Combination Product to the respective Licensed Product components and other component(s) thereof, as the case may be, based on the fair market value of such components for the purposes of determining a product-specific allocation of such Net Sales. Payments related to such Combination Product under this Agreement, including Royalties and Milestone Payments, will be calculated, due and payable based only on the portion of such Net Sales so allocated to the Licensed Product components.
In case of disagreement and failure by the Parties to agree upon an allocation of Net Sales of such Combination Product to the respective Licensed Product components and other component(s) thereof, [*].
| 1.52. | “Next Generation Capsid” means a specific parvovirus vector identified by sequence that is discovered, developed or engineered in the Discovery Program or by ▇▇▇▇▇ during the Term. |
| 1.53. | “Option” means a New Indication Option and/or a Next Generation Indication Option, in each case as the context may require. |
| 1.54. | “Option Period” means the period commencing on the Effective Date and expiring on the [*] anniversary thereof. |
| 1.55. | “Patent Rights” means (a) patents and patent applications, together with any unlisted patents and patent applications claiming priority thereto, and any continuations, continuations-in-part, reissues, reexamination certificates, substitutions, divisionals, supplementary protection certificates, renewals, registrations, extensions, including all confirmations, revalidations, patents of addition, PCTs, and pediatric exclusivity periods and all foreign counterparts thereof, and any patents issued or issuing with respect to any of the foregoing, and (b) all official correspondence relating to the foregoing. |
| 1.56. | “Person” means any natural person, corporation, firm, business trust, joint venture, association, organization, company, partnership or other business entity, or any government or agency or political subdivision thereof. |
| 1.57. | “Phase 1 Study” means a clinical study of a drug candidate in human patients with the primary objective of characterizing its safety, tolerability, and pharmacokinetics and identifying a recommended dose and regimen for future studies as described in 21 C.F.R. §312.21(a), or a comparable clinical study prescribed by the relevant Regulatory Authority in a country other than the United States. The drug candidate can be administered to patients as a single agent or in combination with other investigational or marketed agents. |
| 1.58. | “Phase 1/2 Study” means a clinical study of a drug candidate in diseased human patients that satisfies the requirements of a Phase 1 Study and a Phase 2 Study. |
| 1.59. | “Phase 2 Study” means a clinical study of a drug candidate in human patients with the primary objective of characterizing its activity in a specific disease state as well as generating more detailed safety, tolerability, and pharmacokinetics information as described in 21 C.F.R. §312.21(b), or a comparable clinical study prescribed by the relevant Regulatory Authority in a country other than the United States including a human clinical trial that is also designed to satisfy the requirements of 21 C.F.R. §312.21(a) or corresponding foreign regulations and is subsequently optimized or expanded to satisfy the requirements of 21 C.F.R. §312.21(b) (or corresponding foreign regulations) or otherwise to enable a Phase 3 Clinical Study (e.g., a phase 1/2 trial). The relevant drug candidate may be administered to patients as a single agent or in combination with other investigational or marketed agents. |
| 1.60. | “Phase 3 Study” means a clinical study of a drug candidate in human patients that incorporates accepted endpoints for confirmation of statistical significance of efficacy and safety with the aim to obtain Regulatory Approval in any country as described in 21 C.F.R. 312.21(c), or a comparable clinical study prescribed by the relevant Regulatory Authority in a country other than the United States. The relevant drug candidate may be administered to patients as a single agent or in combination with other investigational or marketed agents. |
| 1.61. | “PHS Act” means the United States Public Health Service Act, as amended. |
| 1.62. | “Program Budget” means a New Program Budget and/or a Next Generation Indication Program Budget, in each case as the context may require. |
| 1.63. | “Program Extension Research Term” means, for any Indication for which the Research Plan agreed upon by the Parties for a Research Program remains in effect at the expiration of the Option Period, the period beginning upon the expiration of the Option Period until completion of such outstanding Research Plan for such Indication. |
| 1.64. | “Regulatory Approval” means, with respect to a product in any regulatory jurisdiction, approval from the applicable Regulatory Authority sufficient for the manufacture, distribution, use, marketing and sale of such pharmaceutical product in such jurisdiction in accordance with Laws. “Regulatory Approval” does not include authorization by a Regulatory Authority to conduct named patient, compassionate use or other similar activities. |
| 1.65. | “Regulatory Authority” means any Governmental Body, including the FDA, EMA or MHLW, or any successor agency thereto, that has responsibility for granting any licenses or approvals or granting pricing or reimbursement approvals necessary for the marketing and sale of a pharmaceutical product in any country. |
| 1.66. | “Research Plan” means the research plan setting forth the Parties’ roles and responsibilities for each Research Program as set forth in Exhibit B hereto, respectively, and as may be amended from |
| time to time with written approval of the JSC or (to the extent provided herein) both Parties (collectively, all such Research Plans, the “Research Plans”). |
| 1.67. | “Research Program” means the pre-clinical discovery, research, and/or development program of Licensed Products in the Field of Use for each of the Indications funded by Passage and to be conducted or continued to be conducted by the Parties hereunder (collectively, all such Research Programs, the “Research Programs”). For clarity, [*]. |
| 1.68. | “Research Results” means all any and all ideas, information, inventions, developments, animate and inanimate materials, including live animals, discoveries, software, Know-How, methods, techniques, formulae, data, software, processes, methodologies, techniques, biological materials, software and works of authorship, whether patentable or copyrightable, that are first conceived, discovered, developed, reduced to practice, or generated in the performance of (a) the [*] or (b) prior to the Effective Date, by ▇▇▇▇ through the ▇▇▇▇▇▇ Laboratory in performance of the [*], in each case (a) and (b), including any unpatentable inventions discovered, developed or conceived in the conduct of any of the Research Programs or Discovery Program. Research Results expressly excludes Licensed Patent Rights, Discovery Patent Rights, and DRG Patent Rights. |
| 1.69. | “Sale” means any transaction for which consideration is received or invoiced by Passage, its Affiliates or Sublicensees for sale, use, lease, transfer or other disposition of a Licensed Product to or for the benefit of a Third Party. For clarity, sale, use, lease, transfer or other disposition of a Licensed Product by Passage or any of its Affiliates or Sublicensees to another of these entities for resale (or other disposition) by such entity to a Third Party shall not be deemed a Sale. |
| 1.70. | “Service Center Cores” means the following core laboratories at Penn that reported directly to ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ prior to the Effective Date: [*]. |
| 1.71. | “Specified Licensed Product” means a Licensed Product containing [*]. |
| 1.72. | “Specified Obligations” means the licenses, options, and obligations that Gemma owes to a Third Party that are identified in Exhibit E, [*]. |
| 1.73. | “Sublicense Documents” means any and all agreements, amendments or written understandings entered into with a Sublicensee (including any of its Affiliates) that are directly or indirectly related to a Sublicense, Licensed Patent Rights or Licensed Product. For clarity, a development agreement or distribution agreement for a Licensed Product is a Sublicense Document. |
| 1.74. | “Sublicensee” means a Person (including any Affiliate) to which a Sublicense is granted pursuant to the terms of Section 3.4. |
| 1.75. | “Sublicense Income” means income received by Passage or its Affiliates in consideration for a Sublicense or for a grant of the right to negotiate or obtain a Sublicense, subject to the exclusions below. Sublicense Income includes such income received from a Sublicensee in the form of license issue fees, milestone payments and the like but specifically excludes (a) [*], (b) [*], (c) [*], (d) [*], or (e) [*]. |
| 1.76. | “Tax” means all taxes, duties, fees, premiums, assessments, imposts, levies, rates, withholdings, dues, government contributions and other charges of any kind whatsoever, whether direct or indirect, together with all interest, penalties, fines, additions to tax or other additional amounts, imposed by any Governmental Body. |
| 1.77. | “Third Party” means any Person other than ▇▇▇▇▇, Passage or any of their respective Affiliates. |
| 1.78. | “TLE Research Plan” means [*]. |
| 1.79. | “TLE Research Program” means [*]. |
| 1.80. | “Transferred Research Program” means [*]. |
| 1.81. | “United States” or “US” means the United States of America, its territories and possessions. |
| 1.82. | “USD” or “$” means US dollars. |
| 1.83. | “Valid Claim” means a claim of (a) an issued and unexpired patent in Licensed Patent Rights which claim has not been revoked or held unenforceable or invalid by a decision of a court or governmental agency of competent jurisdiction from which no further appeal can be taken or has been taken within the time allowed for appeal, and has not been abandoned, disclaimed, denied or admitted to be invalid or unenforceable through reissue or disclaimer; or (b) a pending patent application (that has been pending for no more than [*] from the filing date of such application) that is included in Licensed Patent Rights which was filed and is being prosecuted in good faith, and has not been abandoned or finally disallowed without the possibility of appeal or re-filing of the application. |
| 1.84. | “▇▇▇▇▇▇ Laboratory” means ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and all individuals [*]. |
| 1.85. | Other Terms. The definition of each of the following terms is set forth in the section of this Agreement indicated below: |
Defined Term | Section |
|---|---|
Advance Payment | 6.2.2 |
Agreement | Introductory Clause |
Alliance Manager | 2.11.2 |
Approved Subcontractor | 2.2.6 |
Clinical Candidate Designation | 2.6.2(a) |
CNS | 1.11 |
Commercial Milestone | 4.2.2(a) |
Commercial Milestone Payment | 4.2.2(a) |
Confidential Information | 7.1 |
CTA | 1.38 |
Default | 8.4.4 |
Development Milestone | 4.2.1(a) |
Development Milestone Payment | 4.2.1(a) |
Disclosing Party | 7.1 |
DP Review Period | 2.5.1(a) |
DRG | 1.25 |
DRG Election Notice | 6.2.4 |
DRG License | 3.1.2 |
Effective Date | Introductory Clause |
Exclusive Licensed Patent Rights | 6.3.2 |
Existing Research Plan | 2.5.1(a) |
Failed Indication | 2.10 |
Defined Term | Section |
|---|---|
Financial Report | 4.6 |
First ARCA | Recitals |
Gemma | Introductory Clause |
Gemma Indemnitees | 9.1.1 |
Gemma Sublicense Income | 4.4.1 |
HD | 1.40 |
Indemnified Party | 9.3.1 |
Indemnified Party | 9.3.1 |
Infringement Notice | 6.3.1 |
Joint Steering Committee or JSC | 2.11.1(a) |
License | 3.1.1 |
Passage | Introductory Clause |
Licensing Exclusivity Period | 2.7 |
Limited Collaboration Exclusivity Covenant | 2.8 |
Losses | 9.1.1 |
Maximum Anti-Stacking Reduction | 4.3.4(b)(iv) |
Method | 1.48 |
New Indication | 2.5.2(a) |
New Indication Option | 2.5.2(a) |
New Indication Option Fee | 4.1.1 |
New Program | 2.5.2(a) |
New Program Budget | 2.5.2(a) |
Next Generation Data Package | 2.5.1(a) |
Next Generation Indication Option | 2.5.1(a) |
Next Generation Indication Program | 2.5.1(a) |
Next Generation Indication Program Budget | 2.5.1(a) |
Next Generation Technology | 2.5.1(a) |
non-Publishing Party | 7.4 |
Party or Parties | Introductory Clause |
Passage | Introductory Clause |
Passage Indemnitees | 9.2.1 |
Patent Costs | 6.2.1 |
Patent Counsel | 6.1.1 |
Penn | Recitals |
PNS | 1.11 |
Product Specific Patent Rights | 6.1.1 |
Progress Report | 5.8.1 |
Prosecution Request | 6.1.2 |
Publishing Party | 7.4 |
Receiving Party | 7.1 |
Research Support Amount | 2.2.1 |
Royalty | 4.3.1(a) |
Royalty Period | 4.3.2 |
SDR Report | 3.4.4 |
Second ARCA | Recitals |
Spin-Out Transaction | Recitals |
Sublicense | 3.4.1 |
Term | 10.1 |
Defined Term | Section |
|---|---|
Third Party Claim | 9.1.1 |
TLE | 1.27 |
Upstream License Agreement | Recitals |
The Parties desire to collaborate with respect to the pre-clinical development of Licensed Products, as set forth in more detail in this Article 2, in each Indication within the Field of Use, with the goal of identifying one or more Licensed Products for clinical development and commercialization in each Indication. As more specifically outlined herein, ▇▇▇▇▇ will be responsible, in consultation with Passage through the JSC, for certain preclinical development activities, including certain IND-enabling non-clinical studies and research grade manufacturing, and all activities set forth in the Research Plans (as applicable) that are not identified therein as Passage’s responsibilities. Passage will be responsible for regulatory strategy and operations, clinical development, GMP manufacture, and commercialization of all Licensed Products.
| 2.2.2 | Gemma will use commercially reasonable efforts to conduct the Research Programs in accordance with the respective Research Plans and the other terms and conditions of this Agreement. |
| (a) | Without limiting the foregoing, within each Indication, ▇▇▇▇▇ will be responsible, in consultation with Passage through the JSC, for the completion of the applicable Research Plan (subject to Section 2.2.2(b), with respect to the TLE Research Plan) for the agreed upon research and development work up to completion of IND-enabling studies, [*]. ▇▇▇▇▇ shall be responsible through the completion of the [*]. Passage shall be responsible for the clinical and commercial manufacture of the Designated Product in accordance with relevant cGMP. |
| (b) | The Parties acknowledge and agree that the TLE Research Program is paused as of the Effective Date until March 31, 2025, when the JSC will evaluate the TLE |
| Research Program and determine whether to resume or terminate the TLE Research Program. If the JSC determines to resume the TLE Research Program, the Parties will enter into an amendment to restart such TLE Research Program, and if the JSC determines to terminate the TLE Research Program, the Parties shall formally terminate such TLE Research Program. |
| 2.2.3 | The JSC shall review the Research Plans at least once per Calendar Year. The JSC may amend the Research Plans at any time, including amendments to include further activities, including corresponding revisions to the budget. |
| 2.2.5 | The Parties hereby acknowledge that there are inherent uncertainties involved in the research and development of products and such uncertainties form part of the business risk involved in undertaking the Research Programs. Accordingly, in the event that upon completion of the Research Plan for a specific Indication (other than with respect to the TLE Research Plan prior to the amendment thereof, in accordance with Section 2.2.2(b)), the Parties do not develop or identify a suitable candidate to propose as a development candidate for that Indication, [*]. |
| agreement shall be as least as protective as the nondisclosure obligations set forth herein. Any Party engaging a subcontractor hereunder will remain responsible and obligated for such activities and will not grant rights to such subcontractor that interfere with the rights of the other Party under this Agreement. Furthermore, if ▇▇▇▇▇ engages any subcontractor to perform any activities that would otherwise be performed by ▇▇▇▇▇, [*]. |
| 2.2.8 | With respect to the TLE Research Program and/or any future Research Program for which a Research Plan and budget therefor has already been agreed, including pursuant to the New Indication Option procedure set forth Section 2.5.2(a), Passage shall be required to obtain ▇▇▇▇▇’s written consent prior to Passage commencing performance, at is sole expense, of any pre-IND activities (including IND-enabling studies) outside of Gemma for research activities that are part of such Research Program. |
| 2.2.9 | With respect to any other work (i.e., work that is not within the scope of work to be performed under Sections 2.2.7 or 2.2.8) that is proposed by Passage to be performed outside of Gemma, Passage shall be permitted to perform, at its sole expense, such work, provided such work and any data resulting therefrom is reviewed and discussed by the Parties at the JSC. |
| 2.3 | Funding of the Research Programs. |
Calendar Quarter | Percentage of Research Support Amount payable by Passage in a particular Calendar Year |
|---|---|
First Calendar Quarter | [*] |
Second Calendar Quarter | [*] |
Third Calendar Quarter | [*] |
Fourth Calendar Quarter | ▇▇▇▇▇ will perform a full year-end reconciliation, and the Parties shall update the payment schedule for the budget for the following |
Calendar Quarter | Percentage of Research Support Amount payable by Passage in a particular Calendar Year |
|---|---|
Calendar Year of the Program Extension Research Term to account for any overpayment or underpayment in the then-current Calendar Year. |
| 2.3.3 | Unless otherwise indicated in the applicable Research Plan(s) or agreed-upon budget, title to any equipment, laboratory animals, or any other tangible materials made or acquired with funds provided under this Agreement will vest in Gemma, and such equipment, animals, or tangible materials will remain the property of ▇▇▇▇▇ following termination or expiration of this Agreement (but subject to any license grants to Passage hereunder). |
| 2.3.4 | Gemma shall maintain records of the use of the funds provided by Passage for performance of the Research Programs by ▇▇▇▇▇ and shall provide Passage with monthly financial reports, including copies of all invoices and any other supporting documentation related to any third-party contracted costs incurred during the applicable month, within [*] business days after the end of each [*]. |
| 2.3.5 | Reconciliation of Research Programs Funding. |
| incurrence thereof. If no further quarterly payments are owed with respect to a particular Research Program, (i) any underpayment shall be paid to Gemma within [*] after receipt by Passage of the final reconciliation report for such Research Program, or (ii) any overpayment shall be returned to Passage within [*] after receipt by Passage of such final reconciliation report; provided however that, on a month-by-month and research or development activity-by-research or development activity basis, Passage shall not be required to pay any amount that exceeds [*] of the amount budgeted for such research or development activity, without Passage’s express written approval of such amount prior to the incurrence thereof. |
| 2.4 | Unavailability of ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ |
If, at any time during the Term, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, MD, PhD ceases to be affiliated with ▇▇▇▇▇, then Passage shall have the right, exercisable in Passage’s sole discretion by written notice to ▇▇▇▇▇, to assume all of ▇▇▇▇▇’s activities under the Research Programs in effect at such time. For clarity, [*].
| 2.5 | Next Generation Indication Programs; New Programs. |
| 2.5.1 | Gemma Initiated Next Generation Indication Programs. |
| receipt of such Next Generation Data Package from Gemma (such period, the “DP Review Period”) of its interest in such Next Generation Indication Program and ▇▇▇▇▇ will develop and propose within [*] days a work plan and budget for [*] subject to the reasonable review and approval by Passage (“Next Generation Indication Program Budget”). Within [*] of Passage’s receipt of the Next Generation Indication Program Budget and work plan, Passage shall decide whether to exercise its option to such Next Generation Indication Program (the “Next Generation Indication Option”). The Parties acknowledge and agree that this Section 2.5.1(a) is intended to apply to research programs for [*] (“Next Generation Technology”). For further clarity, [*]. |
| 2.5.2 | Passage Initiated Programs. |
| 2.5.3 | Exercise and Termination of New Indication Options. The Parties acknowledge and agree that, beginning on the Effective Date, Passage shall have a total of four (4) New Indication Options under Section 2.5.2, which Passage may elect to exercise at any time until the expiration or termination of the Option Period. Upon the earlier of (i) exercise by |
| Passage of four (4) New Indication Options pursuant to Section 2.5.2, and (ii) expiration or termination of the Option Period, Gemma shall have no obligation under Section 2.5.2 to perform any additional New Program, or grant a license to any additional New Indication to Passage after such period. For clarity, [*]. Notwithstanding the foregoing, Passage may exercise a Next Generation Indication Option for a Next Generation Indication Program under Sections 2.5.1(a) or 2.5.2(b) [*]. |
| 2.6 | Rights to Technologies arising from Discovery Program. |
| 2.6.1 | Generally. It is anticipated that Licensed Product development under the Research Programs will include the use of the most scientifically appropriate and available Next Generation Capsids and other technologies Controlled by ▇▇▇▇▇ (including, any such technologies arising from the Discovery Program prior to the Effective Date). As used throughout this Section 2.6, “available” means that the Specified Obligations do not prevent the Next Generation Capsid from being offered or licensed to Passage as contemplated herein. For clarity, [*]. |
| 2.6.2 | Ongoing Research Programs and Clinical Candidate Designation. |
Subject to ▇▇▇▇▇’s retained rights in Section 3.2, Gemma shall not license, or grant any other rights in or to, any Licensed Patent Rights conceived and reduced to practice in the conduct of any Research Program [*] or any Discovery Patent Rights to another Third Party for an Indication that is the subject of a Research Program for a period of the greater of (a) [*] after ▇▇▇▇▇’s initiation of work under the Research Program for such Indication and (b) [*] after IND Clearance for such Indication, (“Licensing Exclusivity Period”) provided that ▇▇▇▇▇ conducts the Research Plan [*] for such product candidate for such Indication under this Agreement (further provided that the Licensing Exclusivity Period will apply if ▇▇▇▇▇ is unwilling or unable to perform [*], including through the use of a subcontractor, or has agreed to allow Passage to perform such studies as set forth in Section 2.2.7). At the conclusion of the Licensing Exclusivity Period, or earlier if the
Research Plan for such Indication has been terminated, ▇▇▇▇▇ shall have the right to license any [*] for the Indication [*]. For clarity, [*]. Notwithstanding the foregoing, the restriction and Licensing Exclusivity Period set forth in Section 2.7 shall not apply to a Next Generation Indication Program that is not included in the License as a result of the application of Section 2.5.1(a)(ii), and ▇▇▇▇▇ shall be free to license to a Third Party the Discovery Patent Rights for such Next Generation Indication Program [*].
On an Indication-by-Indication basis during the Option Period or the Program Extension Research Term solely with respect to such Designated Product for an Indication subject to such Program Extension Research Term until the earlier of: (a) [*], or (b) [*], Gemma shall not collaborate with any Third Party to develop another Gene Therapy Product for the same Indication (as that term is defined as of the Effective Date and as it may be updated during the Term when additional New Indications are included pursuant to the terms of this Agreement) (“Limited Collaboration Exclusivity Covenant”). Notwithstanding the foregoing, the Limited Collaboration Exclusivity Covenant shall end on an Indication-by-Indication and Licensed Product-by-Licensed Product basis upon the earlier of: (i) [*]; (ii) [*]; or (iii) [*]. For clarity, [*].
During the Term, Gemma will not itself, or with or through any of its Affiliates or any Third Party, (a) either (i) directly or indirectly, conduct or participate in, or (ii) grant a license or covenant not to sue under intellectual property rights to any Third Parties for, in each case ((i) or (ii)), the research, development, commercialization, or other exploitation of any [*].
In the event that the Research Program associated with any Licensed Products for any particular Indication fails at a key decision point during the Research Program, as such failure is objectively defined in the work plan for such project, and a decision is subsequently made by Passage to discontinue further development of the program for such Indication (“Failed Indication”), any remaining Research Support Amount allocated for the Failed Indication program (minus wind-down and non-cancellable expenses) will be refunded to Passage within [*] after Passage’s delivery of written notice to ▇▇▇▇▇ of such decision to discontinue. Such Failed Indication will be removed promptly from the Indication definition of this Agreement, with written confirmation of such reversion of rights promptly provided by Passage to ▇▇▇▇▇. In addition, any [*] shall terminate immediately with respect to any Failed Indication.
| 2.11.1 | Joint Steering Committee. |
| (b) | Specific Responsibilities. The JSC will: |
| (c) | Reporting. Each Party shall keep the JSC informed on the progress of the activities under each of the Research Programs then currently ongoing under the Research Plans, including delivering quarterly written updates of its progress under each of the Research Plans to the JSC at least one (1) week in advance of each JSC meeting. |
| (d) | Meetings. During the performance of any of the Research Plans by ▇▇▇▇▇, the JSC will meet at least quarterly. Following the completion of ▇▇▇▇▇’s performance of all of the Research Plans, the Parties may agree to meet to discuss items previously addressed by the JSC. The JSC may meet in person, by videoconference or by teleconference. Notwithstanding the foregoing, at least two (2) meetings per Calendar Year will be in person unless the Parties mutually agree in writing to waive such requirement. In-person JSC meetings will be held at locations alternately selected by ▇▇▇▇▇ and by Passage; provided, however, |
| that Passage shall reimburse Gemma for its JSC representatives’ costs in connection with attending such in-person JSC meeting at a Passage-selected location other than ▇▇▇▇▇. Meetings of the JSC will be effective only if at all representatives of each Party are present or participating in such meeting. The JSC shall keep accurate minutes of its deliberations which shall record all proposed decisions and all actions recommended or taken. The secretary of the JSC (as appointed by the members of the JSC) shall be responsible for the preparation of draft minutes. Draft minutes shall be sent to all members of the JSC within [*] after each meeting and shall be approved, if appropriate, at the next meeting. All records of the JSC shall at all times be available to both Gemma and Passage. |
| (e) | Decision-Making. The representatives from each Party on the JSC will have, collectively, one (1) vote on behalf of that Party, and all decision making will be by [*]. If the JSC is unable to reach agreement on any issue or matter for which it is responsible, such disputed matter will be escalated to Passage’s Chief Executive Officer and ▇▇▇▇▇’s Chief Executive Officer, for discussion in good faith. In the event that after escalation the Parties are unable to reach agreement with respect to the disputed matter, then (1) for disputed matters relating to submissions to [*], and (2) for all other disputed matters: (i) [*] or (ii) [*]. |
| (a) | promoting effective communication between the Parties; |
| (b) | developing a mutually agreed alliance plan covering any activities and systems that the Parties need to implement within the first [*] after the Effective Date to support each of the Research Programs; |
| (c) | supporting the members (including secretary) of the JSC with organization of meetings, information exchange, meeting minutes, and facilitating dispute resolution as necessary; |
| (d) | preparing status and progress reports on the above as determined necessary by the JSC; and |
| (e) | ensuring proper approval of publications prior to submission as required in Section 7.4. |
| 3.1.1 | Subject to the terms and conditions of this Agreement, ▇▇▇▇▇ hereby grants to Passage the following rights and licenses (collectively, the “License”): |
| (a) | an exclusive, worldwide, Royalty-bearing right and license (with the right to sublicense through multiple tiers, subject to the provisions of Section 3.4), under (i) Licensed Patent Rights A, to make, have made, use, sell, offer for sale and |
| import Licensed Products for the Indications ([*]), in the Field of Use during the Term, and (ii) Licensed Patent Rights B to make, have made, use, sell, offer for sale and import Designated Products for the Indications ([*]) in the Field of Use during the Term; provided, for clarity, [*]; |
| (b) | a non-exclusive, world-wide Royalty-bearing right and license [*], under Licensed Know-How and Licensed Materials (and ▇▇▇▇▇’s intellectual property rights therein) to use and practice the same in order to make, have made, use, sell, offer for sale and import Licensed Products for the Indications ([*]) in the Field of Use during the Term; and |
| (e) | Without limiting the foregoing, Gemma will not license or grant any other rights in or to, any Licensed Patent Rights, Licensed Know-How, DRG Patent Rights or DRG Know-How to any Third Party for any Specified Licensed Product under this Agreement for any indication in the Field of Use. |
| (f) | If, during the [*], additional Patent Rights Controlled by ▇▇▇▇▇ ▇▇▇▇▇▇▇ from research solely conducted by ▇▇▇▇▇ are identified by either Party as necessary for the development and commercialization of Licensed Products for the Indications for the Field of Use, [*]. |
| 3.1.2 | Subject to the terms and conditions of this Agreement, ▇▇▇▇▇ hereby grants to Passage the following license to the DRG Technology (collectively, the “DRG License”): |
| (a) | a non-exclusive, worldwide, Royalty-bearing right and license ([*]), under Gemma DRG Patent Rights to make, have made, use, sell, offer for sale and import [*] for the Indications in the Field of Use during the Term; and |
| (b) | a non-exclusive, worldwide, Royalty-bearing right and license ([*]), under Gemma DRG Know-How to make, have made, use, sell, offer for sale and import [*] for the Indications in the Field of Use during the Term. |
| 3.1.3 | Notwithstanding anything to the contrary, to the extent the License with respect to a Licensed Product is expanded to additional indications as set forth in Section 3.1.1(d), the DRG License will automatically be expanded to the same indications other than the DRG Excluded Indications for so long as such DRG Excluded Indications are exclusively licensed from Gemma to a Third Party, it being understood that such expansion shall be on a non-exclusive basis. |
| 3.2.1 | Notwithstanding the License, ▇▇▇▇▇ retains the right under Licensed Patent Rights, Discovery Patent Rights and DRG Patent Rights to: (a) conduct research, clinical, and patient care activities itself, including, but not limited to sponsored research, and (b) authorize non-commercial Third Parties to conduct educational, research, clinical and patient care activities; [*]. |
The License is expressly subject to all applicable provisions of any license to the United States Government executed by ▇▇▇▇▇ and is subject to any overriding obligations to the United States Federal Government under 35 U.S.C. §§200-212, applicable governmental implementing regulations, and the U.S. Government sponsored research agreement or other guidelines, including that products that result from intellectual property funded by the United States Federal Government that are sold in the United States be substantially manufactured in the United States.
| (a) | Reasonable record keeping, audit and reporting obligations sufficient to enable Passage and Gemma to reasonably verify the payments due to Passage and Gemma under such Sublicense and to reasonably monitor such Sublicensee’s progress in developing and/or commercializing Licensed Product, provided that such obligations shall be no less stringent that those provided in this Agreement for Passage. |
| (b) | Infringement and enforcement provisions that do not conflict with the restrictions and procedural requirements imposed on Passage and do not provide greater rights to Sublicensee than as provided in Section 6.3. |
| (c) | Confidentiality provisions with respect to Confidential Information of ▇▇▇▇▇ consistent with the restrictions on Passage in Article 7 of this Agreement. |
| (d) | Covenants by Sublicensee that are equivalent to those made by Passage in Section 8.5. |
| (e) | A requirement of indemnification of Gemma by Sublicensee that is equivalent to the indemnification of Gemma by Passage under Section 9.1 of this Agreement. |
| (f) | A requirement of obtaining and maintaining insurance by Sublicensee that is equivalent to the insurance requirements of Passage under Section 9.4 of this Agreement, including coverage under such insurance of Gemma as provided in Section 9.4. |
| (g) | Restriction on use of ▇▇▇▇▇’s names, etc. consistent with Section 11.4 of this Agreement. |
| (h) | A requirement of antidiscrimination by Sublicensee no less stringent than that provided in Section 11.5 of this Agreement. |
| (i) | A requirement that ▇▇▇▇▇ is a third party beneficiary of such Sublicense. |
Any Sublicense that does not include all of the terms and conditions set forth in this Section 3.4.2 or which is not issued in accordance with the terms and conditions set forth in this Section 3.4, shall be considered null and void with no further notice from Gemma unless separately approved by ▇▇▇▇▇ in writing.
| 3.4.3 | Within [*] after of the execution of a Sublicense Document, Passage shall provide a complete and accurate copy of such Sublicense Document to Gemma, in the English Language. ▇▇▇▇▇’s receipt of a Sublicense Document, however, will constitute neither an approval nor disapproval of the Sublicense Document nor a waiver of any right of Gemma or obligation of Passage under this Agreement. |
| 3.4.4 | Passage shall provide an annual Sublicense Development Report on or before December 1 of each year during the Term (“SDR Report”), a form of which is attached hereto as Exhibit F. |
Upon completion of a Research Program on a Licensed Product-by Licensed Product basis, [*], Gemma shall, upon Passage’s reasonable written request and at Passage’s cost and expense, disclose and deliver Licensed Know-How and/or Licensed Materials to Passage applicable to the Licensed Product, and [*] such Licensed Know-How and/or Licensed Materials for the exploitation of the License.
Each Party acknowledges that the rights and licenses granted in this Agreement are limited to the scope expressly granted. Accordingly, except for the rights expressly granted under this Agreement, no right, title, or interest of any nature whatsoever is granted whether by implication, estoppel, reliance, or otherwise, by either Party to the other Party. All rights with respect to any Know-How, patent or other intellectual property right that are not specifically granted herein are reserved to the owner thereof.
| 4.1.2 | New Indication Multiplier. Notwithstanding anything herein, for any New Indication that is added to the License upon exercise by Passage of a New Indication Option prior to completion of the IND-enabling studies, the milestone, sublicensing fee percentages and Royalties outlined below shall apply as set forth in this Agreement; provided, that for any New Indication that is added to the License [*], a multiplier of [*] shall be applied to each of [*]. |
| 4.2.1 | Development Milestones. |
Development Milestone | Milestone Payment (in U.S. dollars) for each Licensed Product for the first Indication (except as noted in the column to the right) | Milestone Payment (in U.S. dollars) for Licensed Product arising from the TLE Research Program |
[*] | [*] | [*] |
[*] | [*] | [*] |
[*] | [*] | [*] |
[*] | [*] | [*] |
| (b) | Notwithstanding anything to the contrary, to the extent a product is a Licensed Product solely by virtue of incorporating DRG Technology, and no other Licensed Patent Right or Licensed Know-How, the milestone amounts set forth in the table |
| above in Section 4.2.1(a) solely for such Licensed Product shall be replaced with the amounts set forth in the table below: |
Development Milestone | Milestone Payment (in U.S. dollars) |
[*] | [*] |
[*] | [*] |
[*] | [*] |
| (c) | Each time a Development Milestone is achieved for a Licensed Product for an Indication, then any other Development Milestone Payments with respect to earlier Development Milestones that have not yet been paid will be due and payable together with the Development Milestone Payment for the Development Milestone that is actually achieved. |
| (d) | Notwithstanding the foregoing, in the event that the Licensed Product is applicable to any indication(s) outside of the named Indication in the applicable Research Program (and ▇▇▇▇▇ has the right to grant a License to such additional indication in accordance with Section 3.1), the foregoing milestones shall be due and payable by Passage to Gemma on such additional indication(s) as follows: (i) for a second indication of a Licensed Product, Passage shall pay Gemma [*] of the foregoing Development Milestones for the Licensed Product for the second indication, and (ii) for a third indication of the Licensed Product, Passage shall pay Gemma [*] of the foregoing Development Milestones for the Licensed Product for such third indication. No Development Milestones will apply to the fourth (or any later) indication of a given Licensed Product. |
| (e) | For clarity, Development Milestone Payments are due and payable on Licensed Product and on products that, upon Regulatory Approval, would become Licensed Product. |
| 4.2.2 | Commercial Milestone Payments. |
Commercial Milestone Event (payable once per Licensed Product) | One-Time Milestone Payment (U.S. dollars) |
[*] | [*] |
[*] | [*] |
[*] | [*] |
[*] | [*] |
| (b) | For clarity, the foregoing Commercial Milestone Payments shall be due once per Licensed Product. |
| 4.3.1 | Royalty. |
Annual Worldwide Net Sales (of the applicable Licensed Product) | Royalty Rate |
|---|---|
Less than [*] | [*] |
Greater than or equal to [*] and less than or equal to [*] | [*] |
Greater than [*] | [*] |
For clarity, the foregoing Royalty rates are tiered such that each rate applies only to the portion of annual Net Sales that is within the corresponding tier. That is, within any given Calendar Year, the first [*] of Net Sales of a given Licensed Product will accrue Royalties at [*] the next [*] of Net Sales of such Licensed Product will accrue Royalties at [*], and any Net Sales of such Licensed Product in excess of [*] will accrue Royalties at [*].
| (b) | Notwithstanding anything to the contrary, to the extent a product is a Licensed Product solely by virtue of incorporating DRG Technology, and no other Licensed Patent Right or Licensed Know-How, then the royalty rates set forth in the table above in Section 4.3.1(a) solely for such Licensed Product shall be replaced by a single royalty rate equal to [*] of Net Sales for such Licensed Product. |
| 4.3.3 | Step-Down. On a country-by-country and Licensed Product-by-Licensed Product basis, during any portion of the Royalty Period in which the applicable Licensed Product is not covered by at least one Valid Claim in the applicable country and is not subject to data exclusivity conferred by the applicable Regulatory Authority: (a) the Royalty rate under Section 4.3.1 shall be reduced to [*] of the Royalty rate otherwise payable pursuant to Section 4.3.1; and (b) no Royalty at all will apply to such Licensed Product [*]. |
| 4.3.4 | Royalty Reductions. |
| (a) | Notwithstanding anything in this Section 4.3, in the event that Gemma or Passage receives a request for a Compulsory License anywhere in the world, it shall promptly notify the other Party. If any Third Party obtains a Compulsory License in any country, then: (i) Gemma or Passage (whoever has first notice) shall promptly notify the other Party; and (ii) beginning as of the date the Third Party obtained such Compulsory License in such country, the Royalty rate payable under this Section 4.3 to Gemma for Net Sales in such country will be adjusted to [*]. |
| (b) | Third Party Licenses. |
| 4.3.5 | Calculations. Passage must pay Royalties owed to Gemma on a Calendar Quarter basis on or before the following dates: |
| (a) | [*] for any Sales that took place in the Calendar Quarter ending December 31, of the prior year; |
| (b) | [*] for any Sales that took place in the Calendar Quarter ending March 31 of such Calendar Year; |
| (c) | [*] for any Sales that took place in the Calendar Quarter ending June 30 of such Calendar Year; and |
| (d) | [*] for any Sales that took place in the Calendar Quarter ending September 30 of such Calendar Year. |
Stage in Licensed Product development at which sublicense is granted by Passage | % of Sublicense IncomePayable to Gemma |
|---|---|
[*] | [*] |
[*] | [*] |
[*] | [*] |
| 4.4.2 | Passage will make such payment to Gemma on or before the following dates: |
| (a) | [*] for any Sublicense Income received by Passage in the Calendar Quarter ending December 31, of the prior year; |
| (b) | [*] for any Sublicense Income received by Passage in the Calendar Quarter ending March 31 of such Calendar Year; |
| (c) | [*] for any Sublicense Income received by Passage in the Calendar Quarter ending June 30 of such Calendar Year; and |
| (d) | [*] for any Sublicense Income received by Passage in the Calendar Quarter ending September 30 of such Calendar Year. |
Payments under this Agreement shall be made in USD. Payments to a Party shall be made by electronic wire transfer of immediately available funds to the account of the other Party, as designated in writing to the paying Party. All Royalties payable under this Agreement shall be calculated first in the currency of the jurisdiction in which the payment was made, and if not in the United States, then converted into USD. The exchange rate for such conversion shall be the average of the rates quoted in The Wall Street Journal for the last business day of each month in the Calendar Quarter in respect of which such Royalty payment made.
Within [*] after the end of each Calendar Quarter, Passage shall deliver to Gemma a report (“Financial Report”) setting out all details necessary to calculate the Royalty and Gemma Sublicense Income due under this Article 4 for such Calendar Quarter, including:
| (a) | [*]; |
| (b) | Gross sales and Net Sales of each Licensed Product made by Passage, its Affiliates and Sublicensees; |
| (c) | Royalties; |
| (d) | Sublicense Income and the calculation of Gemma Sublicense Income; |
| (e) | The method and currency exchange rates (if any) used to calculate the Royalties and Gemma Sublicense Income; |
| (f) | A specification of all deductions and their dollar value that were taken to calculate Net Sales; |
| (g) | A list of all countries in which Licensed Product is being manufactured (on a Licensed Product-by-Licensed Product basis); and |
| (h) | Date of First Commercial Sale in the United States (this need only be reported in the first Financial Report following such First Commercial Sale in the United States). |
Each Financial Report shall be in the form of the sample report attached hereto as Exhibit G.
In addition to any other remedies available to Gemma, including the right to terminate this Agreement as provided in Section 10.3, any failure by Passage to make a payment within [*] after the date when due shall obligate Passage to pay computed interest, the interest period commencing on the due date and ending on the actual payment date, to Gemma at a rate per annum equal to [*], or the highest rate allowed by Law, whichever is lower.
In the event of default in payment of any payment owing to Gemma under the terms of this Agreement, and if it becomes necessary for ▇▇▇▇▇ to undertake legal action to collect said payment, Passage shall pay reasonable, documented legal fees and costs incurred in connection therewith.
Each Party shall calculate all amounts, and perform other accounting procedures required, under this Agreement and applicable to it in accordance with GAAP.
Passage will keep accurate books and records of all Licensed Products developed, manufactured, used or sold and all Sublicenses, collaboration agreements and joint venture agreements entered into by Passage that involve Licensed Patent Rights. Passage will preserve these books and records for at least [*] from the date of the Financial Report to which they pertain. Upon reasonable notice, key personnel, books and records will be made reasonably available and will be open to examination by representatives or agents of Gemma during regular office hours to determine their accuracy and assess Passage’s compliance with the terms of this Agreement, provided that Passage shall not have an obligation to provide access more than once in any given [*] period.
In addition to the right of ▇▇▇▇▇ to examine the books and records and interview key personnel as provided in Section 4.10 above, ▇▇▇▇▇, at its own cost, through an independent auditor reasonably acceptable to Passage (and who has executed an appropriate confidentiality agreement
reasonably acceptable to Passage that requires the auditor to keep any information learned by it confidential except as needed to report its audit conclusions to ▇▇▇▇▇), may inspect and audit the relevant records of Passage pertaining to the calculation of any Development Milestone Payments, Commercial Milestone Payments, Royalties and Gemma Sublicense Income due to Gemma under this Agreement. Passage shall provide such auditors with access to the relevant records during reasonable business hours. Such access need not be given to any such set of records more often than once each year or more than [*] after the date of any report to be audited. ▇▇▇▇▇ shall provide Passage with written notice of its election to inspect and audit the records related to the Development Milestone Payments, Commercial Milestone Payments and Royalties due hereunder not less than [*] prior to the proposed date of review of Passage’s records by ▇▇▇▇▇’s auditors. Should the auditor find any underpayment of Development Milestone Payments, Commercial Milestone Payments, Royalties or Gemma Sublicense Income by Passage, Passage shall (a) promptly pay Gemma the amount of such underpayment; (b) reimburse Gemma for the cost of the audit, if such underpayment equals or exceeds the higher of (i) [*] or (ii) [*] of combined Development Milestone Payments, Commercial Milestone Payments, Royalties and Gemma Sublicense Income paid during the time period audited; and (c) provide such auditors with an audit right exercisable within [*] after ▇▇▇▇▇ receives the audit report. If the auditor finds overpayment by Passage, then Passage shall have the right to deduct the overpayment from any future Development Milestone Payments, Commercial Milestone Payments, Royalties or Sublicense Income due to Gemma by Passage or, if no such future Development Milestone Payments, Commercial Milestone Payments, Royalties or Sublicense Income are payable, then ▇▇▇▇▇ shall refund the overpayment to Passage within [*] after Gemma receives the audit report. [*].
All payments made by Passage to Gemma under this Agreement shall be made free and clear of and without any deduction for or on account of any Taxes on or with respect to such payments.
Passage shall provide Gemma with a development plan no later than [*] during the Term. The development plan shall include a timeline for detailed activities to be conducted by Passage, its Affiliates and Sublicensees, and Passage shall provide Gemma with [*] progress reports regarding achievements and activities under such development plan. For clarity, [*].
Passage shall have the first right to sponsor all clinical activities and lead regulatory interactions for the Licensed Products for each Indication under this Agreement. Without limiting the foregoing, Passage will have the first option, but not an obligation, to conduct a FIH Clinical Study for each Licensed Product developed under the Research Programs. Passage will consider in good faith using Gemma as a study site for one or more studies where ▇▇▇▇▇ can reasonably demonstrate that ▇▇▇▇▇’s capabilities and costs are reasonably comparable to other potential study sites. If ▇▇▇▇▇ (in its sole discretion) is willing and able to conduct a Clinical Study for a Licensed Product developed under the Research Programs, the Parties will negotiate a separate clinical trial agreement and a separate clinical trial budget prior to initiation of such Clinical Study. For clarity, any Clinical Study funding by Passage shall be separate and in addition to the Research Support Amount.
Passage will have sole responsibility for and sole decision-making over all commercialization activities for the Licensed Products for the Indications in the Field of Use, and will be solely responsible for the associated costs of such commercialization activities.
Except as otherwise provided in this Agreement or in the Research Plans, Passage will have responsibility for and decision-making authority over all manufacturing activities and associated costs for the clinical development (including GMP manufacturing for clinical trials) and commercialization of the Licensed Products in the Field of Use for the Indications post-DTP for such Licensed Product. Passage and Gemma will have joint responsibility for and shall mutually agree upon any manufacturing activities for pre-clinical manufacturing, [*] and at Passage’s cost.
| 5.5.1 | Subject to Section 2.11.1(b), Passage will have responsibility for and decision-making over regulatory activities for the Licensed Products for the Indications in the Field of Use. Passage will have the right to conduct all communications with Regulatory Authorities, including all meetings, conferences and discussions (including advisory committee meetings), with regard to Licensed Products for the Indications in the Field of Use; [*]. Passage will lead and have control over preparing and submitting all regulatory filings related to the Licensed Products for the Indications in the Field of Use, including all applications for Regulatory Approval, provided, however, that Passage shall provide Gemma with copies of all such applications prior to submission to the extent such submission includes any Research Results or Confidential Information of ▇▇▇▇▇. Passage will own any and all applications for Regulatory Approvals (including INDs), Regulatory Approvals, and other regulatory filings related to the Licensed Products for the Indications in the Field of Use, which will be held in the name of Passage or its designees. |
| 5.5.2 | Gemma will cooperate with any reasonable request from Passage with respect to obtaining any Regulatory Approval for a Licensed Product for an Indication in the Field of Use including, at Passage’s cost: (a) [*], (b) [*], and (c) [*]. |
Passage will use Commercially Reasonable Efforts to actively develop, obtain Regulatory Approval and commercialize at least one Licensed Product in each Indication within the Field of Use.
| 5.7.1 | Passage, itself or through any of its Affiliates or Sublicensees, shall achieve each of the following Diligence Events by the corresponding Achievement Date for each Licensed Product: |
Diligence Event | Achievement Date |
[*] | [*] |
[*] | [*] |
[*] | [*] |
▇▇▇▇▇ acknowledges that the timeline for each Achievement Date is based on the assumption that development and commercialization of a Licensed Product does not encounter material regulatory or other delays for reasons outside of Passage’s reasonable control. Where such circumstances exist, ▇▇▇▇▇ agrees to negotiate in good faith with Passage, upon Passage’s written request and provided such request is made at least [*] prior to the Achievement Date for a Diligence Event, an extension of the Achievement Date for a Diligence Event for such Licensed Product as reasonably requested by Passage. If the Parties have not agreed on a requested extension within [*] after such request, [*].
To the extent Passage has achieved any Diligence Event by the corresponding Achievement Date in relation to a given Licensed Product for an Indication, Passage will be deemed to have also met its diligence obligations under Section 5.6 with respect to such Licensed Product for such associated Indication through the corresponding Achievement Date.
| 5.8.2 | Each Progress Report must include all of the following for each annual period: |
| (a) | Summary of material development activities; |
| (b) | Summary of material commercialization activities; |
| (c) | Identification of filings for Regulatory Approval and other material correspondence with Regulatory Authorities; |
| (d) | An updated SDR Report listing of any and all Sublicenses granted by Passage; and |
| (e) | The names and addresses of all Sublicensees, and a current and valid phone number and e-mail address for a principal point of contact at each such Sublicensee who is responsible for administering the Sublicensee. |
| Licensed Patent Rights and ▇▇▇▇▇ will consider (and require Penn to consider, as applicable) in good faith reasonable comments and suggestions made by Passage to such filings, and [*] (collectively, the “Product Specific Patent Rights”), ▇▇▇▇▇ will incorporate (or request that Penn incorporate) any reasonable comments or suggestions by Passage with respect to same. ▇▇▇▇▇ will instruct (or request Penn to instruct) Patent Counsel to copy Passage on all correspondence related to Licensed Patent Rights A and Licensed Patent Rights B (including copies of each patent application, office action, response to office action, request for terminal disclaimer, and request for reissue or reexamination of any patent or patent application) and to interact with Passage with respect to the preparation, filing, prosecution and maintenance of such Licensed Patent Rights A and Licensed Patent Rights B. ▇▇▇▇▇ has the right to take action to preserve rights and minimize cost [*], and will use commercially reasonable efforts to not allow any Licensed Patent Rights and DRG Patent Rights it (or Penn, as applicable) prosecutes and maintains and for which Passage is licensed and is underwriting the costs to lapse or become abandoned without Passage’s written authorization under this Agreement, [*], provided that, ▇▇▇▇▇ shall have no requirement to file, prosecute, or maintain Licensed Patent Rights, Discovery Patent Rights or DRG Patent Rights if Passage is not current with the Patent Cost obligations as set forth in this Agreement. For the purposes of this Agreement, “maintenance” of the Licensed Patent Rights, Discovery Patent Rights, and DRG Patent Rights includes [*], provided ▇▇▇▇▇’s participation in such proceedings is undertaken in good-faith consultation with Passage. For further clarity, [*] will be handled pursuant to the provisions of Section 6.3. |
| Passage upon Passage’s exercise of an applicable option, and whenever such number changes, and at any other time upon Passage’s reasonable written request). |
| 6.3.2 | If infringing activity [*] has not been abated within [*] following the date the Infringement Notice for such activity was provided, then (except as otherwise provided in Section 6.3.4) |
| during [*], the “Exclusive Licensed Patent Rights”), and the infringing product is [*], Passage may institute suit for patent infringement of such [*] against the infringer after providing ▇▇▇▇▇ (a) [*] and (b) [*]. For clarity, [*]. ▇▇▇▇▇ may voluntarily join such suit at Passage’s reasonable expense, [*]. If in a claim initiated by Passage, ▇▇▇▇▇ is involuntarily joined other than by Passage, then Passage [*]. Passage shall be free to enter into a settlement, consent judgment or other voluntary disposition, provided that any settlement, consent judgment or other voluntary disposition that (i) [*] or (ii) [*]. Passage’s request for such approval shall include complete copies of final settlement documents, a detailed summary of such settlement, and any other information material to such settlement. Gemma shall provide Passage notice of its approval or denial within [*] after receipt of any request for such approval from Passage, provided that (A) [*] and (B) [*]. |
| 6.3.5 | Any recovery or settlement received in connection with any suit will first be [*] and next [*]. Any remaining recoveries shall be allocated as follows: |
For any portion of the recovery or settlement, other than for amounts attributable and paid as enhanced damages for [*]:
| (a) | for any suit that is initiated by Passage and in which ▇▇▇▇▇ was not a party in the litigation, ▇▇▇▇▇ shall receive [*] of the recovery and Passage shall receive the remainder; and |
| (b) | for any suit that is initiated by Passage or Gemma and that the other Party joins voluntarily ([*]) or involuntarily, the non-initiating Party shall receive [*] of such recovery, while the initiating Party shall receive the remainder. |
For any portion of the recovery or settlement paid as enhanced damages for [*]:
| (c) | for any suit that is initiated by Passage or Gemma and the other Party joins voluntarily ([*]) or involuntarily, Gemma shall receive [*] and Passage shall receive the remainder; and |
| (d) | for any suit that is initiated by Passage and in which ▇▇▇▇▇ was not a party in the litigation, ▇▇▇▇▇ shall receive [*] and Passage shall receive the remainder. |
For any portion of the recovery or settlement received in connection with any suit that is initiated by ▇▇▇▇▇ and in which Passage was not a party in the litigation, any recovery in excess of litigation costs will belong to ▇▇▇▇▇.
| 6.3.6 | Each Party will reasonably cooperate and assist the other in litigation proceedings instituted hereunder but at the expense of the Party who initiated the suit (unless such suit is being jointly prosecuted by the Parties). For clarity, [*]. If ▇▇▇▇▇ is subjected to Third Party discovery related to the Licensed Patent Rights or Licensed Products licensed to Passage hereunder, Passage will pay ▇▇▇▇▇’s documented out of pocket expenses with respect to same. |
Passage shall place in a conspicuous location on any Licensed Product (or its packaging where appropriate and practicable) made or sold under this Agreement a patent notice in accordance with the Laws concerning the marking of patented articles where such Licensed Product is made or sold, as applicable.
The Parties shall reasonably cooperate with each other in obtaining patent term extensions when applicable to any Licensed Patent Right in any country or regulatory jurisdiction under any statute or regulation equivalent or similar to 35 U.S.C. §156. [*].
Subject to the terms set forth in this Section 6.5, in each instance the non-filing Party shall abide by such election and the terms set forth herein and cooperate as reasonably requested by the other Party in connection with the foregoing (including by providing appropriate information and executing appropriate documentation). The filing Party shall provide the non-filing Party a copy of such filing in advance and will consider in good faith reasonable comments and suggestions by the non-filing Party. Passage shall ensure that all Sublicensees and Affiliates are bound by the terms and conditions set forth in this Section 6.5.
Passage shall not disclose Confidential Information (as defined below) to Gemma unless it is anticipated to be necessary or useful to the performance of any of the Research Programs or is reasonably responsive to Passage’s reporting obligations under this Agreement or any other request of ▇▇▇▇▇. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing, the Parties agree that, during the Term and for [*] thereafter, the receiving Party (the “Receiving Party”) and its Affiliates will keep confidential and will not publish or otherwise disclose or use for any purpose, other than as provided for in this Agreement, any confidential or proprietary information or materials, patentable or otherwise, in any form (written, oral, photographic, electronic, magnetic, or otherwise), including trade secrets, Know-How, inventions or discoveries, proprietary information, formulae, processes, techniques and information relating to the past, present and future marketing, financial, and research and development activities of any product or potential product or useful technology of the Disclosing Party or its Affiliates and the pricing thereof (collectively, “Confidential Information”), which is disclosed to it by the other Party (the “Disclosing Party”) or its Affiliates or otherwise received or accessed by a Receiving Party in the course of performing its obligations or exercising its rights under this Agreement.
“Confidential Information” does not include information that (a) was in the lawful knowledge and possession of the Receiving Party or its Affiliates prior to the time it was disclosed to, or learned by, the Receiving Party or its Affiliates, or was otherwise developed independently by the Receiving Party or its Affiliates, as evidenced by written records kept in the ordinary course of business, or other documentary proof of actual use by the Receiving Party or its Affiliates; (b) was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party or its Affiliates, as evidenced by written records of the Receiving Party or its Affiliates; (c) became generally available to the public or otherwise part of the public domain after its disclosure other than through any act or omission of the Receiving Party or its Affiliates in breach of this Agreement; or (d) was disclosed to the Receiving Party or its Affiliates, other than under an obligation of confidentiality, by a Third Party who had no obligation to the Disclosing Party or its Affiliates not to disclose such information to others. In the event a Receiving Party is required to make a disclosure under Law or regulation, the order of a court of competent jurisdiction, or the rules of the U.S. Securities and Exchange Commission (including by reason of any securities offering by Passage), any stock exchange or listing entity, such disclosure will not constitute a breach of this Article 7, provided such Receiving Party shall provide [*] to the Disclosing Party and take all reasonable steps to limit the extent of the disclosure and obtain confidential treatment for any remaining required disclosure.
In order to preserve the patentability of either Party’s intellectual property and to preserve either Party’s publication rights, each Party shall [*].
Each Party (the “Publishing Party”) shall have the sole and exclusive first right to publish, publicly present or otherwise publicly disclose Research Results generated by such Party for any purpose, subject to the following provisions; provided, however, that if the other Party (the “non-Publishing Party”) provides written request to the Publishing Party to publish, publicly present or otherwise publicly disclose the Research Results, and the Publishing Party does not publish, publicly present or otherwise publicly disclose such Research Results within [*], the non-Publishing Party shall be entitled to publish, publicly present or otherwise publicly disclose such Research Results in accordance with the provisions of this Section 7.4. The Publishing Party shall furnish the non-Publishing Party with a copy of any proposed publication, presentation, or other public disclosure at least [*] in advance of the date of such presentation or public disclosure or the submission of said proposed publication in order for the non-Publishing Party to review and comment on said proposed publication, presentation, or other public disclosure to (a) determine whether it contains any of the non-Publishing Party’s Confidential Information and (b) enable the non-Publishing Party to identify any of the Publishing Party’s intellectual property that it wishes the Publishing Party to file patent applications on or to seek other intellectual property protection for. If within the [*] review period (i) the non-Publishing Party notifies the Publishing Party in writing that the non-Publishing Party requires deletion of the non-Publishing Party’s Confidential Information from the publication, presentation, or other disclosure, the Parties will cooperate to modify the same to ensure that the non-Publishing Party’s Confidential Information is not disclosed or (ii) if the non-Publishing Party requests in writing that publication, presentation, or other disclosure be delayed to allow for patent filings or other intellectual property protection on certain items in the proposed publication, presentation, or other disclosure, the Publishing Party shall delay the same for up to
[*] to allow for the filing of patent applications or other intellectual property protection. For clarity, [*]; provided, however, [*].
Mutual Representations and Warranties.
| 8.1.1 | such Party is duly organized and validly existing under the Laws of the jurisdiction of its incorporation or organization; |
| 8.1.2 | such Party has taken all action necessary to authorize the execution and delivery of this Agreement and the performance of its obligations under this Agreement; |
| 8.1.3 | this Agreement is a legal and valid obligation of such Party, binding upon such Party and enforceable against such Party in accordance with the terms of this Agreement, except as enforcement may be limited by applicable bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other laws relating to or affecting creditors’ rights generally and by general equitable principles; and |
| 8.1.4 | such Party has all right, power and authority to enter into this Agreement, and to perform its obligations under this Agreement. |
| 8.2.1 | Gemma has all rights, capabilities and resources necessary to conduct the Research Plans; |
| 8.2.2 | Gemma Controls all Licensed Patent Rights, Discovery Patent Rights and DRG Patent Rights; |
| 8.2.3 | Gemma Controls all [*] that were, prior to the Effective Date, Controlled by Penn and necessary or useful to exploit the licenses granted to Passage under this Agreement; |
| 8.2.4 | [*]; |
| 8.2.5 | subject to the Specified Obligations, ▇▇▇▇▇ has neither granted nor agreed to grant, any license to the Exclusive Licensed Patent Rights in the CNS Field in the Field of Use anywhere in the world; |
| 8.2.6 | [*]; |
| 8.2.7 | all data included in the Licensed Know-How and/or which has been or will be used to support the filing, prosecution or maintenance of the Licensed Patent Rights has been generated, and the Research Programs will be conducted, in a thorough and professional manner; and |
| 8.2.8 | [*]. |
| 8.3.1 | Other than the representations and warranties provided in Sections 8.1 and 8.2 above, ▇▇▇▇▇ MAKES NO REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND EXPLICITLY DISCLAIMS ANY REPRESENTATION AND WARRANTY, INCLUDING WITH RESPECT TO ANY ACCURACY, COMPLETENESS, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, COMMERCIAL UTILITY, NON-INFRINGEMENT OR TITLE FOR THE INTELLECTUAL PROPERTY, PATENT RIGHTS, LICENSE AND ANY LICENSED PRODUCT. |
| 8.3.2 | Furthermore, nothing in this Agreement will be construed as: |
| (a) | A representation or warranty by ▇▇▇▇▇ as to the validity or scope of any Licensed Patent Right, Discovery Patent Right or DRG Patent Right; |
| (b) | A representation or warranty that anything made, used, sold or otherwise disposed of under the License is or will be free from infringement of patents, copyrights, trademarks or any other forms of intellectual property rights or tangible property rights of Third Parties; |
| (c) | Obligating Gemma to bring or prosecute actions or suits against Third Parties for patent, copyright or trademark infringement; and |
| (d) | Conferring by implication, estoppel or otherwise any license or rights under any Patent Rights of ▇▇▇▇▇ other than Licensed Patent Rights as defined herein, regardless of whether such Patent Rights are dominant or subordinate to Licensed Patent Rights or DRG Patent Rights. |
| 8.3.3 | [*]. |
| 8.4.1 | neither Gemma nor its Affiliates will grant any option, right or license to any Third Party relating to any of the intellectual property rights it Controls (including, without limitation, the Licensed Patent Rights, Licensed Know-How, Licensed Materials, DRG Patent Rights, and DRG Know-How) with respect to any Licensed Product which conflict with the option, rights or licenses granted to Passage in the Field of Use hereunder; |
| 8.4.2 | subject to ▇▇▇▇▇’s retained rights as set forth in Section 3.2, except as otherwise expressly agreed to by Passage in writing, neither Gemma nor its Affiliates will use or otherwise exploit (and neither will grant any Third Party the right to use or otherwise exploit) any Licensed Product for any purposes; |
| 8.4.3 | except as otherwise expressly permitted under this Agreement, ▇▇▇▇▇ will not, and will cause its Affiliates not to assign, transfer, convey, encumber (through a lien, charge, security interest, mortgage or similar encumbrance) or dispose of, or enter into any agreement with any Third Party to assign, transfer, convey, encumber (through a lien, charge, security interest, mortgage or similar encumbrance) or dispose of, any Licensed Patent Rights, Licensed Know-How, Licensed Materials, DRG Patent Rights, DRG Know-How or any Licensed Product, except to the extent that such assignment, transfer, |
| conveyance, encumbrance or disposition would not conflict with, be inconsistent with or adversely affect in any respect any of the option, rights or licenses granted to Passage hereunder; |
| 8.4.5 | all activities conducted by or on behalf of Gemma or its Affiliates hereunder with respect to any Licensed Product will be conducted in accordance with all applicable Laws, and in sufficient detail and in a good scientific manner appropriate for scientific, regulatory and intellectual property protection purposes, and all records kept in connection with such activities will be complete and accurate, and fully and accurately reflect all work done, data and developments made, and results achieved in the performance of the Research Programs; |
| 8.4.6 | if ▇▇▇▇▇ receives notice of an alleged Default by Gemma or its Affiliates under the Upstream License Agreement, where termination of the Upstream License Agreement or any diminishment of the scope or exclusivity of the licenses granted to Passage under the Licensed Patent Rights, Licensed Know-How, Licensed Materials, DRG Patent Rights, or DRG Know-How is being or could be sought by the counterparty or result from such Default, then Gemma will promptly, but in no event less than [*] thereafter, provide written notice thereof to Passage; |
| 8.4.7 | Gemma will not (a) modify, amend, or terminate the Upstream License Agreement or exercise, waive, release, or assign any rights or claims thereunder, in each case in a manner that would adversely affect Passage’s rights or ▇▇▇▇▇’s ability to perform its obligations under this Agreement or (b) modify or amend the Upstream License Agreement in a manner that would impose additional obligations on Passage as a sublicensee under such Upstream License Agreement, in each case ((a) and (b)), without first obtaining Passage’s prior written consent; |
| 8.4.8 | all of Gemma’s employees, officers and consultants who will perform activities under this Agreement with respect to any Licensed Product or Research Program have executed or will execute agreements or have existing obligations under applicable Laws requiring assignment to Gemma of all inventions made during the course of and as the result of their association with ▇▇▇▇▇, free from any encumbrances, and obligating the individual to maintain as confidential ▇▇▇▇▇’s Confidential Information as well as the confidential information of other parties (including Confidential Information of Passage and its Affiliates) which such individual may receive (it being understood that such confidentiality obligations may be general in nature and need not be specific to Confidential Information under this Agreement), in each case above, to the extent required to support ▇▇▇▇▇’s obligations under this Agreement; |
| 8.4.9 | without limitation of ▇▇▇▇▇’s other obligations under this Agreement, if at any time after execution of this Agreement ▇▇▇▇▇ becomes aware that it or any employee, agent, or Approved Subcontractor of ▇▇▇▇▇ who participated, or is participating, in the performance of any activities with respect to any of the Research Programs is on, or is being added to, the list of firms or persons debarred pursuant to Section 306(a) or 306(b) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 335(a)), it will provide written notice of this to Passage within [*] of its becoming aware of this fact; and |
| 8.4.10 | Gemma will use commercially reasonable efforts to maintain security systems and intellectual property protection practices within its organization equivalent to international industry standards to avoid the unauthorized disclosure of intellectual property rights, including Know-How and Confidential Information of Passage, to any Third Party. |
| 8.5.2 | Passage will comply with all Laws that apply to its activities or obligations under this Agreement. For example, Passage will comply with applicable United States export laws and regulations. The transfer of certain technical data and commodities may require a license from the applicable agency of the United States government and/or written assurances by Passage that Passage will not export data or commodities to certain foreign countries without prior approval of the agency. |
| 8.5.3 | Passage will not grant a security interest in or to any Licensed Patent Rights, Discovery Patent Rights, or DRG Patent Right. |
| (a) | the negligence, recklessness or wrongful intentional acts or omissions of Passage, its Affiliates or Sublicensees and its or their respective directors, officers, employees and agents, in connection with Passage’s performance of its obligations or exercise of its rights under this Agreement; |
| (b) | any breach of this Agreement by Passage; or |
| (c) | the Development, Manufacturing or Commercialization (including commercial manufacturing, packaging and labeling of Licensed Products, and all product liability losses) of a Licensed Product by or on behalf of Passage or its Affiliates or Sublicensees; |
provided that Passage’s obligations pursuant to this Section 9.1 shall not apply to the extent such Losses arise out of any conditions set forth in Sections 9.2.1(a)-(b) for which ▇▇▇▇▇ is obligated to indemnify any Passage Indemnitee under Section 9.2.
| (b) | any breach of this Agreement by ▇▇▇▇▇; |
provided that ▇▇▇▇▇’s obligations pursuant to this Section 9.2 shall not apply to the extent such Losses arise out of any conditions set forth in Sections 9.1(a)-(c) for which Passage is obligated to indemnify any Gemma Indemnitee under Section 9.1.
| agree as to the application of Section 9.1 or Section 9.2 to any Third Party Claim, pending resolution of the dispute pursuant to Section 11.10, the Parties may conduct separate defenses of such Third Party Claim(s), with each Party retaining the right to claim indemnification from the other Party in accordance with Section 9.1 or Section 9.2, as applicable, upon resolution of the underlying claim. If the Indemnifying Party does not assume and conduct the defense of the Third Party Claim as provided above, (A) the Indemnified Party may defend against and consent to the entry of any judgment, or enter into any settlement with respect to, the Third Party Claim in any manner the Indemnified Party may deem reasonably appropriate, and (B) the Indemnifying Party will remain responsible to indemnify the Indemnified Party as provided under Section 9.1 or Section 9.2. Notwithstanding anything to the contrary in this Section 9.3.2, in the event that Passage believes in good faith that a bona fide conflict exists between ▇▇▇▇▇ and Passage or any other Passage Indemnitee with respect to a claim or suit subject to indemnification hereunder, then Passage or any other Passage Indemnitee shall have the right to defend against any such claim or suit itself, including by selecting its own counsel, with any reasonable attorney’s fees and litigation expenses being paid for by ▇▇▇▇▇. Gemma will pay such fees and expenses either directly or will reimburse such Person within [*] after ▇▇▇▇▇’s receipt of an invoice for such fees and expenses. |
| (a) | Each occurrence[*]; |
| (b) | General aggregate[*] |
Prior to the commencement of clinical trials, if applicable, involving Licensed Product:
| (c) | Clinical trials liability insurance[*] |
Prior to the First Commercial Sale of a Licensed Product:
| (d) | Products liability insurance[*] |
Gemma may review periodically the adequacy of the minimum amounts of insurance for each coverage required by this Section 9.4.1, and has the right to require Passage to adjust the limits in ▇▇▇▇▇’s reasonable discretion.
| 9.4.3 | Passage expressly understands, however, that the coverages and limits in Section 9.4.1 do not in any way limit Passage’s liability or indemnification obligations. Passage’s insurance will: |
| (a) | Be issued by an insurance carrier with an [*] or better; |
| (b) | Provide for [*] advance written notice to ▇▇▇▇▇ of any modification; |
| (c) | State that ▇▇▇▇▇ is endorsed as an additional insured with respect to the coverages in Section 9.4.1; and |
| (d) | Include a provision that the coverages will be primary and will not participate with nor will be excess over any valid and collective insurance or program of self insurance carried or maintained by ▇▇▇▇▇. |
| 9.4.4 | Passage must furnish to Gemma with (a) valid certificate of insurance evidencing compliance with all requirements of this Agreement and (b) additional insured endorsements for Passage’s applicable policies naming ▇▇▇▇▇ and “The Trustees of the University of Pennsylvania” as additional insureds. Passage must furnish both documents within [*] of the Effective Date, once per year thereafter and at any time there is a modification in such insurance. |
EXCEPT FOR DAMAGES ARISING FROM A BREACH OF ARTICLE 7 OR DAMAGES ARISING FROM A PARTY’S INDEMNIFICATION OBLIGATIONS UNDER THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY OF ITS AFFILIATES FOR SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING LOSS OF PROFITS, WHETHER IN CONTRACT, WARRANTY, TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREIN OR ANY BREACH HEREOF.
The term of this Agreement (the “Term”) shall commence on the Effective Date and, unless terminated sooner as provided below, shall continue in full force and effect on a country-by-country and Licensed Product-by-Licensed Product basis until the latest of (a) expiration of the last Valid Claim of the Licensed Patent Rights or DRG Patent Rights in such country for such Licensed Product, (b) expiration of the Royalty Period, whereupon the License to such country for such Licensed Product will become perpetual and fully paid-up, and (c) the expiration or termination of the Option Period and any Program Extension Research Terms.
Passage may, at its convenience, terminate this Agreement or terminate any Licensed Product for an Indication in the Field of Use, upon providing at least [*] prior written notice to Gemma of such intention to terminate, provided that upon termination Passage ceases using the License for making, using, or selling the affected Licensed Product(s) in all Fields of Use.
| 10.3.2 | In addition to all other remedies available to it, ▇▇▇▇▇ may terminate this Agreement (a) on an Indication-by-Indication basis, upon at least [*] written notice, upon a failure of Passage to pay the Research Support Amount for the Research Program for such Indication when due pursuant to Section 2.3, unless Passage cures such failure within such notice period, (b) on an Indication-by-Indication basis, upon [*] written notice if Passage fails to comply with any Laws that apply to its activities or obligations under this Agreement with respect to such Indication(s), which failure(s) can be remedied, and Passage fails to remedy such lack of compliance within such [*] period, (c) in its entirety, upon written notice, with immediate effect, if Passage grants a security interest in any Licensed Patent Right, Discovery Patent Right, or DRG Patent Right, or (d) in its entirety, upon written notice, with immediate effect, if Passage breaches Section 8.5.1. |
| 10.3.4 | Either Party may terminate this Agreement, upon written notice, with immediate effect if, at any time, the other Party is unable to pay its debts, including any debts related to exclusive sublicensees, when they come due, or files in any court or agency pursuant to any statute or regulation of any state, country or jurisdiction, a petition for the appointment of a receiver or trustee of such Party or of its assets, or if such Party proposes a written agreement of composition or extension of its debts, or if such Party is served with an involuntary petition against it, filed in any insolvency proceeding, and such petition is not dismissed within [*] after the filing thereof, or if such Party is a party to any dissolution or liquidation, or if such Party makes an assignment for the benefit of its creditors of all or substantially all its assets. |
| 10.4.1 | Notwithstanding the termination of this Agreement, the following provisions shall survive: Sections [*]. Furthermore, where this Agreement is terminated in relation to fewer than all of the Indications or Licensed Products (as provided above), it will remain in effect as to the non-terminated Indication(s) or non-terminated Licensed Product(s). |
| 10.4.2 | Termination of this Agreement shall not relieve the Parties of any obligation or liability that, at the time of termination, has already accrued hereunder, or which is attributable to a period prior to the effective date of such termination. Termination of this Agreement shall |
| not preclude either Party from pursuing all rights and remedies it may have hereunder or at Law or in equity with respect to any breach of this Agreement nor prejudice either Party’s right to obtain performance of any obligation. |
| 10.4.5 | Upon termination of this Agreement, the License immediately terminates and Passage, its Affiliates and Sublicensees will promptly cease selling the Licensed Product(s) subject to such termination. Each Party will return (or destroy, as directed by the other Party) all data, files, records and other materials containing or comprising the other Party’s Confidential Information with respect to this Agreement, except to the extent such Confidential Information is necessary or useful to conduct activities in connection with surviving portions of this Agreement. Notwithstanding the foregoing, the Parties will be permitted to retain one copy of such data, files, records, and other materials for archival and legal compliance purposes. |
| 10.4.6 | Upon termination of this Agreement or any Licensed Product for an Indication in the Field of Use by Passage under Section 10.2 or by Gemma under Sections 10.3 or 10.4, Passage agrees [*]. |
Nothing in this Agreement is intended or shall be deemed, for financial, tax, legal or other purposes, to constitute a partnership, agency, joint venture or employer-employee relationship between the Parties. The Parties are independent contractors and at no time will either Party make commitments or incur any charges or expenses for or on behalf of the other Party.
Except as otherwise provided in this Agreement, each Party shall pay its own expenses and costs incidental to the preparation of this Agreement and to the consummation of the transactions contemplated hereby.
The Parties agree that each Sublicensee is a third party beneficiary of this Agreement with respect to Section 10.4.3.
Neither Party nor its Affiliates (and, in the case of Passage, its Sublicensees) shall use the name, logo, seal, trademark, or service mark (including any adaptation of them) of the other Party or any of its Affiliates (and, in the case of Passage, its Sublicensees) or representatives, without the prior written consent of such other Party. Notwithstanding the foregoing, each Party may use the name of the other Party in a non-misleading and factual manner solely in (a) executive summaries, business plans, offering memoranda and other similar documents used by such Party for the purpose of raising financing for the operations of such Party as related to Licensed Products, or entering into commercial contracts with Third Parties, but in such case only to the extent necessary to inform a reader that the Licensed Patent Rights, DRG Patent Rights, DRG Know-How and/or Licensed Know-How (subject to the provisions of Article 7) have been licensed from Gemma to Passage, and/or that such Party is collaborating with the other Party on the Research Programs, and to inform a reader of the identity and published credentials of inventors of intellectual property, and (b) any securities reports required to be filed with the Securities and Exchange Commission.
Neither Gemma nor Passage will discriminate against any employee or applicant for employment because of race, color, sex, sexual or affectional preference, age, religion, national or ethnic origin, handicap, or veteran status.
| 11.6.1 | The terms and provisions hereof shall inure to the benefit of, and be binding upon, the Parties and their respective successors and permitted assigns. |
| 11.6.2 | Neither Party may assign or transfer this Agreement or any of such Party’s rights or obligations created hereunder without the prior written consent of the other Party, provided that: (a) such other Party shall not unreasonably withhold, condition or delay its consent; and (b) either Party may assign this Agreement, without the other’s consent, to an Affiliate |
| of such Party or to a successor entity by way of merger, acquisition, or the sale of all or substantially all of such Party’s assets or business to which this Agreement relates; provided, that (i) the assignee shall expressly agree in writing to be bound by such Party’s obligations and liabilities under this Agreement, and (ii) each Party shall promptly notify the other Party of any assignment or transfer under the provisions of this Section 11.6. |
| 11.6.3 | Any assignment not in accordance with this Section 11.6 shall be void. |
Each Party agrees to execute, acknowledge and deliver such further instruments and to do all such other acts as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement.
This Agreement, together with the Exhibits, Appendices, or Schedules hereto, constitutes and contains the entire understanding and agreement of the Parties respecting the subject matter hereof and cancels and supersedes any and all prior negotiations, correspondence, understandings and agreements between the Parties, whether oral or written, regarding such subject matter. No waiver, modification or amendment of any provision of this Agreement shall be valid or effective unless made in a writing referencing this Agreement and signed by a duly authorized officer of each Party.
This Agreement shall be governed by and interpreted in accordance with the laws of the Commonwealth of Pennsylvania, excluding application of any conflict of laws principles that would require application of the law of a jurisdiction outside of the Commonwealth of Pennsylvania.
If a dispute arises between the Parties concerning this Agreement, then the Parties will confer, as soon as practicable, in an attempt to resolve the dispute (in accordance with the provisions of Section 2.11 as applicable); provided, however, that nothing in this Section 11.10 will prohibit either Party from (a) [*] or (b) [*]. In addition, in the event of a dispute regarding the interpretation of this Agreement, or whether a Party has committed and/or cured a material breach of this Agreement (for purposes of the other Party’s termination rights under Article 10), if the dispute is not resolved within [*] under the first sentence of this Section 11.10, then: (i) upon either Party’s request such dispute will be escalated to Passage’s Chief Executive Officer and ▇▇▇▇▇’s Chief Executive Officer, for discussion in good faith in an effort to resolve such dispute; and (ii) if such dispute remains unresolved another [*] following such escalation, then either Party shall be free to bring any action in, the state and Federal courts located in the Eastern District of Pennsylvania.
Any notice, request, approval or consent required or permitted to be given under this Agreement shall be in writing and directed to a Party at its address or facsimile number shown below or such other address or facsimile number as such Party shall have last given by notice to the other Party. A notice will be deemed received: if delivered personally, on the date of delivery; if mailed, five (5) days after deposit in the United States mail; if sent via courier, one (1) business day after deposit
with the courier service; or if sent via facsimile, upon receipt of confirmation of transmission provided that a confirming copy of such notice is sent by certified mail, postage prepaid, return receipt requested.
For Gemma | with a copy to: |
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Gemma Biotherapeutics, Inc. ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇: Chief Executive Officer | ▇▇▇▇▇▇▇▇▇ Will & ▇▇▇▇▇ LLP ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇: ▇▇▇▇▇ ▇▇▇▇ |
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For Passage: | with a copy to: |
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Passage Bio | Passage Bio |
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ | ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ |
Philadelphia, PA 19103 | Philadelphia, PA 19103 |
Attention: Chief Executive Officer | Attention: General Counsel |
A waiver by either Party of any of the terms and conditions of this Agreement in any instance shall not be deemed or construed to be a waiver of such term or condition for the future, or of any other term or condition hereof. Except as otherwise provided herein, all rights, remedies, undertakings, obligations and agreements contained in this Agreement shall be cumulative and none of them shall be in limitation of any other remedy, right, undertaking, obligation or agreement of either Party.
When possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under Law, but if any provision of this Agreement is held to be prohibited by or invalid under Law, such provision will be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement. The Parties shall make a good faith effort to replace the invalid or unenforceable provision with a valid one which in its economic effect is most consistent with the invalid or unenforceable provision.
The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” All references herein to Articles, Sections, Schedules and Exhibits shall be deemed references to Articles and Sections of, Schedules and Exhibits to, this Agreement unless the context shall otherwise require. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time. Unless the context otherwise requires, countries shall include territories. References to any specific Law or article, section or other division thereof, shall be deemed to include the then-current amendments or any replacement Law thereto.
This Agreement may be executed in counterparts, each of which will be deemed an original, and all of which together will be deemed to be one and the same instrument. A facsimile or a portable
document format (PDF) copy of this Agreement, including the signature pages, will be deemed an original.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, duly authorized representatives of the Parties have executed this Agreement as of the Effective Date.
▇▇▇▇▇ BIOTHERAPEUTICS, INC. | |
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| |
By:/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | By:/s/ ▇▇▇▇ ▇▇▇▇ |
Name:▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | Name:▇▇▇▇ ▇▇▇▇, M.D. |
Title:President | Title:Chief Executive Officer |
Exhibit A
Licensed Patent Rights A
[*]
Exhibit B
Research Plans
[*]
Exhibit C
Research Program Budget
[*]
Exhibit D
Discovery Patent Rights
[*]
Exhibit E
Specified Obligations
[*]
Exhibit F
Form of SDR Report
[*]
Exhibit G
Form of Financial Report
[*]
Exhibit H
DRG Patent Rights
[*]
Exhibit I
▇▇▇▇▇▇ Laboratory Gene Therapy Product Policy on Clinical Candidate Designations
(effective as of September 23, 2020)
[*]