EXHIBIT 10.3
SUPPLY AND MANUFACTURING AGREEMENT
BY AND BETWEEN
XXXXXX LABORATORIES
AND
TRIANGLE PHARMACEUTICALS, INC.
THIS AGREEMENT is made as of July 30, 2002, by and between Xxxxxx
Laboratories, an Illinois corporation having a principal place of business at
000 Xxxxxx Xxxx Xxxx, Xxxxxx Xxxx, Xxxxxxxx 00000 ("ABBOTT"), and Triangle
Pharmaceuticals, Inc., a corporation organized under the laws of Delaware,
having a principal place of business at 0 Xxxxxxxxxx Xxxxx, 0000 Xxxxxxxxxx
Xxxxx, Xxxxxx, Xxxxx Xxxxxxxx 00000 ("TRIANGLE").
WHEREAS, Abbott and Triangle previously entered into a supply and
manufacturing agreement dated August 3, 1999 (the "PREVIOUS AGREEMENT");
WHEREAS, Abbott and Triangle have terminated the Previous Agreement
pursuant to a Termination Agreement of even date herewith (the "TERMINATION
AGREEMENT"); and
WHEREAS, Abbott and Triangle desire to enter into a new supply and
manufacturing agreement to facilitate the purchase from Abbott by Triangle of
quantities of Product (as defined below), subject to the terms and conditions
set forth herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements contained herein, the Parties hereto agree as follows:
ARTICLE 1.
DEFINITIONS
In addition to the other terms defined elsewhere herein, the following
terms and phrases shall have the following meanings when used in this Agreement
(and any term defined in the singular shall have the same meaning when used in
the plural and vice versa, unless stated otherwise).
1.1 "AFFILIATE" means any corporation or non-corporate business entity
which controls, is controlled by, or is under common control with a Party. A
corporation or non-corporate business entity shall be regarded in control of
another corporation if it owns or directly
or indirectly controls, at least *** percent (***%) of the voting stock of the
other corporation or non-corporate business entity, or (a) in the absence of the
ownership of at least *** percent (***%) of the voting stock of a corporation or
(b) in the case of a non-corporate business entity, if it possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such corporation or non-corporate business entity, as applicable.
For purposes of this Agreement, TAP Holdings Inc. and its subsidiaries, which
comprise Xxxxxx'x joint venture with Takeda Chemical Industries Ltd., are not
Affiliates of Abbott; provided that neither TAP Holdings, Inc. nor any of its
subsidiaries may manufacture Product.
1.2 "BULK DRUG SUBSTANCE" means the bulk form of Compound, suitable for
formulating into Finished Product.
1.3 "BULK DRUG SUBSTANCE SPECIFICATIONS" means the written
specifications for the Bulk Drug Substance (including any raw materials or
intermediates required to manufacture such Bulk Drug Substance), which are
attached hereto as Exhibit 1.3, as modified from time to time pursuant to
Section 8.5.
1.4 "cGMP" means the FDA's current good manufacturing practices, as
specified in 21 CFR Section 210 and the FDA's guidance documents applicable
thereto, and all successor regulations and guidance documents thereto.
1.5 "COMPOUND" means FTC.
1.6 "CONFIDENTIAL INFORMATION" means Confidential Information as
defined in Section 10.1.
1.7 "DOLLARS" AND "$" means United States Dollars.
1.8 "EFFECTIVE DATE" shall mean the date set forth in the introductory
paragraph of this Agreement.
1.9 "FDA" means the United States Food and Drug Administration or any
successor entity thereto.
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1.10 "FIELD OF USE" means the prevention and treatment of HIV and HBV
and any other uses for the Compound to which Triangle obtains or has obtained
rights from the Triangle Licensor.
1.11 "FINISHED PRODUCT" means any finished pharmaceutical formulation
containing the Compound as an active ingredient, in packaged form.
1.12 "FINISHED PRODUCT SPECIFICATIONS" means the written specifications
for each Finished Product (including any inactive ingredients used to
manufacture such Finished Product), which are attached hereto as Exhibit 1.12.
1.13 "FTC" means (a) the (-) enantiomer with the chemical name (2R-cis)
-4-amino-5-fluoro-1-[2-(hydroxymethyl)-1,3-oxathiolan-5-yl]-2(1H)-pyrimidinone;
(b) any mixture of the (-) enantiomer described in Subsection 1.13(a) and the
(+) enantiomer with the chemical name (2S-cis)-4-amino-5-fluoro-1-[2-
(hydroxymethyl)-1,3-oxathiolan-5-yl]-2(1H)-pyrimidinone,
*** ;(c) any salts, esters (including, but not limited to, all 5'
phosphate esters) and N alkylated derivatives of any of the foregoing; or (d)
any and all polymorphs, hydrates and solvates of any of the foregoing. FTC is
exclusively licensed to Triangle by Emory University pursuant to a License
Agreement dated April 17, 1996, as amended on May 6, 1999 and on July 10, 2000
(the "FTC AGREEMENT") for use in the prevention and treatment of HIV and HBV
throughout the world.
1.14 "HIV" means the human immunodeficiency virus.
1.15 "HBV" means the hepatitis B virus.
1.16 "KEY RAW MATERIALS" means *** and *** .
1.17 "LEGAL REQUIREMENTS" means any and all federal, state, local,
national, and supranational laws, regulations, ordinances, orders and
requirements applicable to the Parties and their Affiliates in performance of
this Agreement, including without limitation, the following within the
Territory: the Prescription Drug Marketing Act of 1987, the Federal Food,
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Drug and Cosmetic Act, and all regulations and other requirements of the FDA or
any equivalent agency.
1.18 "LOSSES" means any liabilities, costs, damages, judgments,
settlements and other reasonable out-of-pocket expenses (including legal
expenses).
1.19 "MAA" means a Marketing Authorization Application submitted to the
European Agency for the Evaluation of Medicinal Products ("EMEA") to obtain
European Commission approval for the marketing of a Product in the European
Union and all subsequent related submissions thereto.
1.20 "NDA" means, in respect of each commercially launched Product, an
approved New Drug Application filed by Triangle with the FDA and all subsequent
related submissions thereto.
1.21 "PRIOR PRODUCTS" means all "Product" manufactured by Abbott under
the Previous Agreement, as the term "Product" is defined therein. Triangle is
and shall remain the sole owner of all Prior Product in inventory at Abbott as
of the Effective Date.
1.22 "PROCESS COST IMPROVEMENTS" means any cost reductions applicable to
the process used to manufacture Product.
1.23 "PRODUCT" means any Bulk Drug Substance and, solely in respect of
Prior Products and the materials included in the Initial Campaign described in
Subsection 8.1, Finished Product.
1.24 "PRODUCT PATENTS" means (a) the patents and patent applications
licensed to Triangle under the FTC Agreement; (b) any patents and patent
applications owned by or otherwise licensed to or controlled by Triangle (to the
extent sublicensing is permissible) during the Term which contain claims
covering or potentially covering the manufacture of the Compound or the Product
(including any intermediates or formulations thereof) within the Field of Use;
and (c) all substitutions, extensions, divisionals, continuations,
continuations-in-part,
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reissues, reexaminations, renewals, supplementary protection certificates or
foreign counterparts of such patents and patent applications identified in
sub-parts (a) and (b).
1.25 "PRODUCT TECHNOLOGY" means the technical information, inventions,
discoveries, trade secrets, information, experience, data, formulas, procedures,
processes, know-how and results which (a) are licensed to Triangle under the FTC
Agreement; or (b) are owned by or otherwise licensed to or controlled by
Triangle (to the extent sublicensing is permissible) during the Term which are
necessary for the manufacture of the Compound or Product within the Field of
Use.
1.26 "REASONABLE BEST EFFORTS" means a reasonable level of effort which
is consistent with that used by other pharmaceutical companies with respect to
other pharmaceutical products of comparable commercial value. Each Party shall
be entitled to exercise prudent and justified business judgment in fulfilling
its obligation to exercise its Reasonable Best Efforts under this Agreement.
1.27 "SPECIFICATIONS" means, in respect of a given Product, the Bulk
Drug Specifications and/or Finished Product Specifications applicable thereto.
1.28 "STANDARD MANUFACTURING COST" for a Product means *** standard
manufacturing cost calculated *** with respect to such Product according to ***
and generally accepted accounting principles applied in a consistent manner with
respect to all products of Xxxxxx'x Specialty Products Division as to Bulk Drug
Substance and of Xxxxxx'x Pharmaceuticals Products Division as to Finished
Product, including *** with the production of such Product, and giving effect to
all Process Cost Improvements.
1.29 "TAXES" means any sales or use tax, excise or similar charge (other
than that assessed against income), license fee, value added, import or export
fees (e.g., custom duties), or other charges lawfully assessed or charged by a
governmental authority on the manufacture, sale or transportation of Product.
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1.30 "TERM" shall have the meaning set forth in Section 14.1.
1.31 "TERRITORY" means the entire world.
1.32 "THIRD PARTY" means any Person that is not a Party or an Affiliate
of a Party.
1.33 "TRIANGLE LICENSOR" means Emory University with respect to FTC.
ARTICLE 2.
GRANT OF LICENSE
2.1 TRIANGLE GRANT. Subject to the terms of this Agreement, Triangle
hereby grants Abbott a non-exclusive, *** worldwide license (including a
sub-license under the FTC Agreement) to utilize the Product Patents and the
Product Technology solely to make and have made the Compound and Products within
the Field of Use in the Territory as and when requested by Triangle during the
Term and to otherwise perform any duties and obligations that Abbott is required
or permitted to perform under this Agreement in the Territory.
2.2 USE OF THIRD PARTIES. Except as provided in Section 19.2, Abbott
shall not have the right to grant sublicenses without the prior express consent
of Triangle, not to be unreasonably withheld, and, to the extent required, the
Triangle Licensor, in which event Triangle shall reasonably cooperate with
Abbott in its efforts to obtain the consent of the Triangle Licensor. No
sublicense granted by Abbott shall relieve Abbott of any obligation hereunder.
ARTICLE 3.
MANUFACTURE AND SUPPLY
3.1 BULK DRUG SUBSTANCE. Subject to the terms of this Agreement, during
the Term Abbott shall manufacture or cause to have manufactured all Product
requested by Triangle.
3.2 FINISHED PRODUCT.
(a) Abbott and Triangle will negotiate in good faith and enter
into a services and supply agreement whereby Triangle may request Abbott to
provide packaging or
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formulation services to produce Finished Product from Bulk Drug Substance
made by Abbott or supplied by Triangle. The agreement will be modeled
structurally upon this Agreement and will incorporate the Finished Product
Specifications (subject to changes agreed by the Parties), include the
pricing terms set forth below, establish commercially reasonable lead and
delivery times for the services contemplated thereby, and have a duration
concurrent with the Term of this Agreement. Abbott and Triangle will use
their best efforts to enter into the agreement on or before *** . If the
Parties have not entered into the agreement on or before that date, either
Party may, at any time after that date, submit the terms not yet agreed to
ADR (as defined in and pursuant to Section 19.3) for resolution, in which
the Neutral shall be deemed empowered to resolve and establish the open
terms, whereupon the Parties promptly will enter into the agreement as so
resolved and established.
(b) The price for Finished Product in capsule or liquid form
ordered on or prior to *** will be the unit prices set forth in Section
8.1(b) in respect of the Initial Campaign, based on the Finished Product
Specifications.
(c) The price for Finished Product ordered after *** will be ***
percent (***%) of Xxxxxx'x Standard Manufacturing Cost for Finished
Product, subject to adjustment under Subsection 3.2(d) and, as applied to
Standard Manufacturing Cost for Finished Product, Article 8 below.
(d) For each calendar year of the Term, Abbott may recalculate its
Standard Manufacturing Cost for Finished Product for the next calendar
year, provided that no increase in any such Standard Manufacturing Cost
shall exceed (i) for the 2003 calendar year, *** percent (***%) of the
respective base costs for Finished Product in capsule or liquid form
established under Subsection 8.1(b), and (ii) for the following years, the
sum of (x) the actual increase in Xxxxxx'x direct cost of raw materials
from the preceding calendar year, plus (y) the product determined by
multiplying the ***
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in the preceding calendar year by the *** , plus (z) any actual cost
increases in the prior year pursuant to Sections 8.5, 8.6 and 8.9 not
previously included in a Standard Manufacturing Cost recalculation. Abbott
shall deliver such recalculated Standard Manufacturing Cost for the next
year to Triangle by *** of the current year in a reasonably detailed form
to include, without limitation, the cost attributed to each Standard
Manufacturing Cost component and a reconciliation against the preceding
calendar year's calculation.
ARTICLE 4.
ORDERS FOR PRODUCT
4.1 PURCHASE ORDERS. From time to time during the Term, Triangle shall
purchase Product at the applicable price by means of purchase orders submitted
to Abbott. Each purchase order shall be governed by the terms of this Agreement
and none of the terms or conditions of Triangle's purchase orders, Xxxxxx'x
acknowledgment forms or any other forms exchanged by the Parties shall be
applicable, except those, to the extent consistent with the terms set forth
herein, specifying quantity ordered, delivery locations and delivery schedule
and invoice information. All purchase orders for delivery of Product which
satisfy the lead and delivery time parameters set forth in Exhibit 4.1 attached
hereto shall be deemed accepted by Xxxxxx. Xxxxxx shall use its Reasonable Best
Efforts to supply Triangle with any Product in excess of this amount, if
requested. All other purchase orders must be accepted or rejected by Abbott, in
writing, by facsimile or air courier, within *** after receipt from Triangle. If
Abbott does not provide such notice of acceptance or rejection within *** , it
shall have been deemed to have accepted such purchase orders in full. All orders
for Product shall be placed in multiples of *** batch sizes (or such smaller
batch size as Abbott specifies in writing). Triangle shall cooperate with Abbott
upon request to review Triangle's non-binding anticipated requirements of
Product for any twelve (12) month period during the Term. Triangle may cancel
all or a part of any purchase order by providing Abbott written notice delivered
prior to the commencement of production by Abbott of Product covered by such
purchase order. In the event Triangle cancels a
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purchase order, Triangle will pay Abbott an amount equal to (a) *** percent
(***%) of Xxxxxx'x Standard Manufacturing Cost, excluding Xxxxxx'x direct and
actual costs for Key Raw Materials or other raw materials purchased by Abbott or
delivered by Triangle specifically for use in such purchase order, for the
cancelled portion of Product ordered on such purchase order, plus (b) Xxxxxx'x
direct and actual costs for Key Raw Materials or other raw materials purchased
by Abbott specifically for use in such purchase order. Triangle may, at its
option and its cost, request delivery of any such Key Raw Materials or other raw
materials covered thereby or any materials provided by Triangle, including Key
Raw Materials, chemical intermediates or Bulk Drug Substance, to Triangle or its
Third Party Designee or require Abbott to hold and store the same for Triangle
for use in satisfying future purchase orders issued by Triangle for Product.
4.2 PRODUCTION AND DELIVERY SCHEDULE. Abbott will initiate production
under each purchase order and deliver Product in accordance with the lead and
delivery time parameters set forth in Exhibit 4.1. The final amounts of Product
delivered by Abbott under any one purchase order may vary from the amount set
forth on such purchase order by up to *** percent (***%), and Abbott shall
invoice Triangle in accordance with Article 8 for the actual amounts of Product
delivered.
4.3 KEY RAW MATERIALS. Abbott shall use its Reasonable Best Efforts,
with Triangle's reasonable assistance, to acquire all necessary Key Raw
Materials at the best available prices with all available discounts and without
unreasonable delay of the manufacturing process. Abbott also will permit
Triangle, at Triangle's request, to provide Key Raw Materials or any necessary
chemical intermediates or to prepay Abbott for Key Raw Materials, in which case
Abbott promptly will receive or acquire such Key Raw Materials or chemical
intermediates (in cooperation with Triangle) and thereafter hold and store the
same for Triangle for use in satisfying future purchase orders issued by
Triangle for Product.
4.4 STORAGE. Notwithstanding any provision in this Agreement to the
contrary, Abbott is not obligated to hold or store any Triangle materials except
those intended by Triangle
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for use by Abbott in manufacturing Product or, in any event, for more than ***.
Triangle will cooperate with Abbott in good faith to recover or make other
arrangements for the storage of any such materials in excess of that period.
ARTICLE 5.
MANUFACTURE OF PRODUCT
5.1 MANUFACTURING STANDARDS. Abbott shall manufacture all Product in
accordance with all Legal Requirements and cGMP and in conformance with the
Specifications. The Specifications may be modified from time to time by written
agreement of the Parties without the necessity of amending this Agreement.
5.2 RIGHT TO AUDIT. Abbott shall permit Triangle or its Third Party
designee access during reasonable business hours and after reasonable notice, to
those areas of Xxxxxx'x manufacturing facilities where Product is manufactured,
stored and handled and to manufacturing records of Product manufactured by
Abbott so that Triangle may perform a quality assurance audit of such facilities
and activities. Any such Third Party designee must be subject, as to information
provided in or observed during any such audit, to a confidentiality obligation
to Abbott imposing limitations on disclosure at least as restrictive as those on
Triangle in Article 10.
5.3 CERTIFICATES OF ANALYSIS AND BATCH RECORDS. Abbott shall be
responsible for releasing Product supplied by Abbott hereunder for secondary
manufacturing or packaging and shall provide Triangle with a certificate of
analysis in the form attached as Exhibit 5.3 for each shipment of Product which
is released for secondary manufacturing or packaging. Each certificate of
analysis will certify that Product covered thereby was manufactured in
accordance with all cGMP and meets the Specifications, and will include any
out-of-Specification deviations or investigations which occurred during the
manufacture and testing of such Product. Abbott shall provide a certificate of
analysis to Triangle for each shipment of Product delivered under this
Agreement. Full batch documentation including batch production records, and
manufacturing and analytical procedures shall be available for review by
Triangle or its Third
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Party designee on site at the manufacturing facility used by Abbott, during
regular business hours and upon reasonable advance notice from Triangle. Any
such Third Party designee must be subject, as to information provided in or
observed during any such audit, to a confidentiality obligation to Abbott
imposing limitations on disclosure at least as restrictive as those on Triangle
in Article 10.
5.4 INSPECTIONS. In the event any Abbott manufacturing facility
producing Product hereunder is inspected by representatives of any federal,
state, local or foreign regulatory agency in connection with the manufacture of
Product, Abbott shall notify Triangle immediately (by telephone, e-mail to ***
or such other e-mail address as Triangle specifies in writing from time to time
and, if possible, in writing) upon learning of such inspection, and shall supply
Triangle with copies of any correspondence or portions of correspondence which
relate to the Product. Abbott will provide Triangle with daily updates of such
inspection and Triangle may send one representative to such manufacturing
facility to participate in the close-out visit to the extent it relates to the
Product, subject to Xxxxxx'x consent, not to be unreasonably withheld. Abbott
also will permit one (1) Triangle representative to participate in any
pre-approval inspection concerning the Product. Any such Triangle representative
who is not an employee of Triangle must be subject, as to information provided
in or observed during any such inspection, to a confidentiality obligation to
Abbott imposing limitations on disclosure at least as restrictive as those on
Triangle in Article 10. In the event Abbott receives any regulatory letter or
comments from any federal, state, local or foreign regulatory agency in
connection with its manufacture of the Product including, but not limited to,
receipt of a Form 483 (Inspectional Observations) or a Warning Letter, Abbott
shall provide Triangle with a copy thereof and a copy of each response for
Triangle review prior to submission of such response and opportunity to comment
where practicable, provided that Abbott shall have the right to redact or
withhold any portion of such copies which are not related to the Product.
5.5 QUALITY ASSURANCE. In addition to the procedures set forth in this
Agreement, for each Product hereunder the Parties shall mutually agree upon a
revision to the intercompany
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quality agreement established under the Previous Agreement to address the
following regulatory and quality issues and identify the responsible Party
therefor: cGMP compliance, quality control, quality assurance, regulatory
compliance, dispute resolution, change management, product and process
validation, annual product review, annual report, drug listing and product
returns. The revised intercompany quality agreement shall be finalized within
thirty (30) days of the Effective Date and shall be developed by conforming the
current quality agreement, a copy of which is attached as Exhibit 5.5 to this
Agreement, to reflect the manufacturing relationship of the Parties contemplated
by this Agreement. Notwithstanding anything to the contrary in the Termination
Agreement, the current quality agreement shall remain in effect, solely for
purposes of this Agreement, until a new quality agreement is executed by the
Parties.
ARTICLE 6.
ACCEPTANCE OF PRODUCT
6.1 FAILURE TO MEET SPECIFICATIONS.
(a) Triangle shall have a period of *** from the date of receipt
of the certificate of analysis accompanying each shipment of Product
manufactured by Abbott to reject any shipment of Product on the grounds
that it does not conform to the Specifications in any manner which could
reasonably be detected by Triangle within such period. Triangle shall have
the right to reject any non-conforming Product. If Triangle rejects Product
pursuant to this Section 6.1, Triangle shall, at Xxxxxx'x option and
expense, destroy or return to Abbott for its disposal the rejected Product
or allow Abbott to retain possession of the rejected Product; provided any
disposal or further use by Abbott of such rejected Product must be
reasonably acceptable to Triangle. Abbott shall thereupon, at Triangle's
option and without limiting any other available remedy (but subject to the
limitation of liability set forth in this Agreement), and at Xxxxxx'x
expense, either (i) replace such nonconforming Product in accordance with
the delivery times set forth on Exhibit 4.1, or (ii) credit or refund
Triangle's account, at Triangle's option, for
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the price invoiced for such nonconforming Product if payment thereof has
previously been made by Triangle for such Product or for any Key Raw
Materials used in manufacturing such Product which were provided or funded
by Triangle.
(b) If a dispute arises as to whether Product manufactured by
Abbott conforms with the Specifications and the Parties are unable to
resolve the dispute, the matter shall be referred to an independent Third
Party testing laboratory located in the United States and agreed to by the
Parties. The testing laboratory shall test the Product in question for
conformance with the Specifications and shall provide results to Triangle
and Abbott. The decision of the testing laboratory regarding conformance
with the Specifications shall be final and binding on the Parties;
provided, that Triangle shall not be obligated to release Product for
distribution which it determines does not meet Specifications. Triangle may
withhold payment for any such Product pending the outcome of the decision
of the testing laboratory. The cost of the testing laboratory shall be paid
by the Party found to be in error.
6.2 STABILITY TESTING AND ANALYTICAL METHODS. Abbott shall perform
definitive stability testing (i.e., final route and source for the initial NDA
and MAA applications) on Product manufactured by Abbott per FDA and
International Conference for Harmonization guidelines and any other applicable
cGMP and such ongoing stability testing as required to support commercial
stability monitoring of the Product, in each circumstance using the stability
protocol attached as Exhibit 6.2, as amended from time to time by mutual
agreement of the Parties in writing. Any costs associated with such stability
testing shall be included in Xxxxxx'x calculation of Standard Manufacturing
Cost.
ARTICLE 7.
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SHIPMENT AND DELIVERY
Abbott shall prepare all Product manufactured by it for shipment to
Triangle or its Third Party designees and shall, if directed by Triangle, ship
such Product immediately upon release of such Product in accordance with the
appropriate purchase order. All Product to be finished by Abbott shall be
delivered C.I.F. Xxxxxx'x or its Affiliates facilities, and all other Product
shall be delivered F.O.B. Xxxxxx'x shipment point, as identified in the
corresponding purchase order.
ARTICLE 8.
PRICE
8.1 INITIAL CAMPAIGN.
(a) Abbott shall supply to Triangle initial amounts of Bulk Drug
Substance at the price and in accordance with the schedule set forth below
and the Bulk Drug Substance Specifications (the "INITIAL CAMPAIGN"). Within
*** of execution of this Agreement, Triangle may increase the quantity of
Bulk Drug Substance to be delivered under the Initial Campaign, by written
notice to Abbott, and any such additional quantity shall be included in the
Initial Campaign, up to the maximum amount of an additional *** of Bulk
Transition Inventory (as defined below).
QUANTITY DATE OF DELIVERY
*** kilograms ***
*** kilograms ***
(b) Abbott will also finish all Prior Product in inventory at
Abbott as of the Effective Date (comprising approximately ***) ("Transition
Inventory") requested by Triangle to be finished and the Initial Campaign
Bulk Drug Substance (including any Permitted Increase) into Finished
Product in accordance with the Finished Product Specifications, for
delivery as follows, with a view toward enabling launch as soon as possible
after FDA approval: (i) by ***, Finished Product from *** of Transition
Inventory, finished according to the clinical testing specifications in
effect as of the Effective
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Date, or according to subpart (ii) below to the extent Triangle elects to
defer any portion thereof for commercial use; (ii) by ***, Finished Product
from the first *** lot of the remainder of the Transition Inventory and the
*** component of the Initial Campaign Bulk Drug Substance, provided Abbott
has received final label and insert inventory by *** (subject to a
day-for-day delay thereafter), and all subsequent lots within *** after
delivery of the first; (iii) by ***, Finished Product from the ***
component of the Initial Campaign Bulk Drug Substance; and (iv) by ***
after manufacture of any Permitted Increase Bulk Drug Substance in
accordance with Subsection 8.1(a) (or later if requested by Triangle),
Finished Product from such Permitted Increase. Delivery of Finished Product
under subparts (ii), (iii) and (iv) by the dates stated assumes Triangle
notifies Xxxxxx of Finished Product forms on or before ***, and ***
respectively, and will be delayed day-for-day to reflect any later
notification from Triangle. The price for Finished Product in liquid and
capsule form produced under this Subsection 8.1(b) will be *** percent
(***%) of the sum of (A) Xxxxxx'x respective Standard Manufacturing Costs
for Finished Product, plus (B) any necessary incremental non-standard costs
or expenses incurred by Xxxxxx to achieve the delivery schedule established
in this subsection (such sum, the "Adjusted Finishing Base Cost"), provided
that such Adjusted Finishing Base Cost shall in no event exceed *** ($***)
for capsule form per thirty (30) capsule bottle unit and *** ($***) for
liquid form per one hundred and seventy (170) mL bottle unit.
Notwithstanding the foregoing, Triangle shall bear the cost to replace any
label or insert materials previously cleared by Triangle to Xxxxxx for
printing, if replacement is required due to label or insert changes after
such clearance.
8.2 PRICING.
(a) The price for the Bulk Drug Substance specified in Section 8.1
(other than any Permitted Increase) will be *** ($***) per kilogram.
(b) The price for additional Bulk Drug Substance ordered on or
prior to ***
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(including any Permitted Increase) will be *** dollars ($***) per
kilogram.
(c) The price for additional Bulk Drug Substance ordered after ***
will be *** percent (***%) of Xxxxxx'x Standard Manufacturing Cost for Bulk
Drug Substance, subject to adjustment under Subsection 8.2(d) and Sections
8.9 and 8.10 below.
(d) For each calendar year of the Term, Xxxxxx may recalculate its
Standard Manufacturing Cost for Bulk Drug Substance for the next calendar
year, provided that no increase in any Standard Manufacturing Cost shall
exceed (i) for the 2003 calendar year, *** dollars ($***), and (ii) for the
following years, *** , plus (y) *** , plus (z) any cost increase pursuant
to Sections 8.5, 8.6 and 8.9 not previously included in a Standard
Manufacturing Cost recalculation. Xxxxxx shall deliver such recalculated
Standard Manufacturing Cost for the next year to Triangle by *** of the
current year in a reasonably detailed form to include, without limitation,
the cost attributed to each Standard Manufacturing Cost component and a
reconciliation against the preceding calendar year's calculation.
8.3 NON-STANDARD EQUIPMENT COSTS. If Triangle requests that Xxxxxx
implement non-standard, specialized equipment (other than any used by Xxxxxx for
the manufacture of Product under the Previous Agreement) in connection with a
change in the Specifications pursuant to Section 8.5, Triangle shall, at
Triangle's option and cost, purchase such equipment or enter into a rental
agreement to loan such equipment to Xxxxxx. Any corresponding actual and direct
cost(s) of Xxxxxx shall be reimbursed by Triangle. Such specialized equipment
shall be used exclusively for manufacturing of Product hereunder or, if utilized
for other products, such cost(s) shall be prorated accordingly. Xxxxxx shall
xxxx Triangle for such cost(s) after Xxxxxx installs the equipment. This Section
8.3 shall not apply to any replacement equipment purchased by Xxxxxx for any
reason.
8.4 AUDIT. Triangle shall have the right to have a Triangle or
independent accountant designated by Triangle verify Xxxxxx'x costs including,
without limitation, the calculation and
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verification of any Standard Manufacturing Cost, any Process Cost Improvements
and any cost(s) incurred or claimed under Sections 8.3, 8.5 and 8.6 of this
Agreement.
8.5 SPECIFICATIONS MODIFICATIONS. The Specifications may be modified
from time to time by written agreement signed by an authorized representative of
each Party without the necessity of amending this Agreement. If such
modifications alter Xxxxxx'x actual cost to manufacture any Product, any
corresponding actual and direct cost(s) of Xxxxxx shall be reflected in Xxxxxx'x
calculation of its Standard Manufacturing Cost for Bulk Drug Substance for the
next following year. If such modification results in the requirement to
reprocess and/or retest otherwise acceptable Product, any additional costs
incurred by Xxxxxx in such reprocessing and/or retesting shall be reimbursed by
Triangle upon submission by Xxxxxx of documentation of such costs.
Notwithstanding the foregoing, Xxxxxx will bear all costs described in this
Section in respect of any such changes in the Specifications required by the
FDA, EMEA or any other regulatory authority for or in the course of initial
approval of Triangle's NDA and MAA for FTC. The revised Specifications shall not
become effective until the Parties agree on any costs caused by such modified
specifications.
8.6 MODIFICATION OF STABILITY PROTOCOL. Triangle may modify the
stability protocol referenced in Section 6.2. If such modifications alter
Xxxxxx'x cost to manufacture or supply any Product, any corresponding actual and
direct cost(s) of Xxxxxx shall be reflected in Xxxxxx'x calculation of its
Standard Manufacturing Cost for Bulk Drug Substance for the next following year.
Notwithstanding the foregoing, Xxxxxx will bear all costs described in this
Section in respect of any such changes in the stability protocol required by the
FDA, EMEA or any other regulatory authority for or in the course of initial
approval of each of Triangle's NDA and MAA for FTC. Such modified stability
protocol shall become effective when the Parties agree upon such costs.
8.7 PAYMENT OF INVOICES. Xxxxxx shall invoice Triangle on a calendar
quarter basis and Triangle shall pay all such invoices issued under this
Agreement net *** from the date of invoice, unless the Product covered by such
invoice is rejected pursuant to Section 6.1. In
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addition, Triangle will pay Xxxxxx *** Dollars ($***) for Bulk Drug Substance
supplied pursuant to the Previous Agreement. Triangle shall pay *** Dollars
($***) to Xxxxxx upon execution of this Agreement. The remaining *** Dollars
($***) shall be paid to Xxxxxx on or before ***.
8.8 INTEREST CHARGE AND TAXES. Without limiting either Party's rights
to pursue any other remedies at law or in equity, if Triangle underpays or
otherwise fails to pay any payment required under this Agreement within *** of
the permitted payment period therefor, then, unless such discrepancy resulted
from the failure of Xxxxxx to supply accurate or complete information, Triangle
shall pay annually simple interest on such amount at an annual rate equal to the
lesser of the legal limit or *** percent (***%) until the date such payment is
paid in full. Any Taxes lawfully assessed or charged on the manufacture, sale or
transportation of Product sold pursuant to this Agreement shall be paid by
Triangle.
8.9 PROCESS CHANGES/COST IMPROVEMENTS. From time to time, Triangle may
request Xxxxxx to make process changes or cost improvements to the manufacturing
process for the Product, and Xxxxxx agrees to use reasonable efforts to
implement all such changes or improvements as soon as possible, provided that
the Parties first agree on any costs associated with such changes or
improvements, which, unless otherwise agreed by the Parties in writing, will be
funded entirely by Triangle. Xxxxxx will recalculate its Standard Manufacturing
Cost for Bulk Drug Substance for the following calendar year to reflect such
process change or Process Cost Improvement, except that if such process change
or Process Cost Improvements requires a regulatory filing and a related process
validation run, Xxxxxx will recalculate its Standard Manufacturing Cost for Bulk
Drug Substance for the current year as soon as practical after validation,
effective beginning with the validation runs.
8.10 PROVISION OF KEY RAW MATERIALS AND INTERMEDIATES. From time to
time, Triangle may provide Xxxxxx with Key Raw Materials or chemical
intermediates for use under a purchase order for Product that Xxxxxx shall use
as directed by Triangle to satisfy such purchase order. Xxxxxx will reduce the
invoice price for Product covered by any invoice for which Triangle has provided
Xxxxxx such Key Raw Materials or chemical intermediates, by an amount
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equal to *** percent (***%) of Xxxxxx'x corresponding Standard Manufacturing
Cost allocation to such Key Raw Materials or chemical intermediates..
ARTICLE 9.
TRIANGLE'S REGULATORY SUBMISSIONS
9.1 NDA AND MAA. Triangle will submit its original NDA, MAA and any
other documentation required under any regulatory filings for Product
referencing Xxxxxx as Bulk Drug Substance and Finished Product supplier and
Xxxxxx will provide Triangle with all required documentation, including
development and analytical reports to support the applications.
9.2 XXXXXX DATA. Xxxxxx shall provide to Triangle, in a timely manner
all necessary data in a format suitable for regulatory submissions to support
the review and approval of each Product's NDA, MAA, and other regulatory
filings, including all development and analytical reports required by any
regulatory agency including the FDA and EMEA to support Bulk Drug Substance and
Finished Product manufacture, review, submissions, approval and inspections.
Xxxxxx shall use, and shall cause its Affiliates to use, Reasonable Best Efforts
to be prepared timely for any FDA pre-approval inspection of the manufacturing
facilities used for the purposes of this Agreement.
9.3 XXXXXX'X RIGHT TO REVIEW. Xxxxxx shall have the right to review
those portions of Triangle's proposed regulatory submissions relating to
Xxxxxx'x packaging or manufacturing procedures for the Product before the
submissions are filed with appropriate regulatory agencies. Xxxxxx shall
complete its review of the submissions and provide comments within *** after
receipt of a proposed regulatory submission. Triangle and Xxxxxx shall consult
with each other in responding to questions from the regulatory agencies
regarding Triangle's submission(s) for Product. Xxxxxx agrees that Triangle
shall be the sole owner of any regulatory submission.
ARTICLE 10.
CONFIDENTIALITY AND NONDISCLOSURE
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10.1 CONFIDENTIALITY OBLIGATION. Except as permitted below, each of
Xxxxxx and Triangle (the "RECEIVING PARTY") shall keep strictly confidential any
information disclosed in writing, orally, visually or in any other manner by the
other Party (the "DISCLOSING PARTY") or otherwise made available to the
Receiving Party which the Disclosing Party considers to be and treats as
proprietary or confidential ("CONFIDENTIAL INFORMATION"). Without limiting the
generality of the foregoing, all proprietary information concerning the
Disclosing Party's business, operations, suppliers, products, product
manufacture, sale, marketing or distribution, trade secrets and intellectual
property shall be considered Confidential Information by the Receiving Party.
Any data or other information relating to or resulting from the clinical trials
of the Product shall be deemed to be Confidential Information of Triangle. The
Disclosing Party shall use commercially reasonable efforts to designate any
written Confidential Information disclosed to the other Party as Confidential
Information by prominently marking it "confidential", "proprietary" or the like,
provided, that the failure to so xxxx shall not exclude such written information
from the provisions of this Article 10. "Confidential Information" shall not
include information:
(a) which is or becomes generally available to the public other
than as a result of disclosure thereof by the Receiving Party;
(b) which is lawfully received by the Receiving Party on a
nonconfidential basis from a Third Party that is not itself under any
obligation of confidentiality or nondisclosure to the Disclosing Party or
any other Person with respect to such information;
(c) which by written evidence can be shown by the Receiving Party
to have been independently developed by or for the Receiving Party; or
(d) which the Receiving Party establishes by competent proof was
in its possession at the time of disclosure by the other Party and was not
acquired, directly or indirectly from the other Party.
10.2 NONDISCLOSURE OF CONFIDENTIAL INFORMATION. The Receiving Party
shall use Confidential Information solely for the purposes of this Agreement and
shall not disclose or
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disseminate any Confidential Information to any Third Party at any time without
the Disclosing Party's prior written consent, except for disclosure to those of
its directors, officers, employees, accountants, attorneys, advisers, permitted
sublicensees, and agents whose duties reasonably require them to have access to
such Confidential Information and, in the case of Triangle, disclosure to the
Triangle Licensor and potential and actual business partners (including any
Third Party with which Triangle collaborates in the development, registration,
manufacture, use or sale of the Compound or Product), provided that such
directors, officers, employees, accountants, attorneys, advisers, agents, the
Triangle Licensor and business partners are required to maintain the
confidentiality of such Confidential Information to the same extent as if they
were Parties hereto.
10.3 EXCEPTION. The foregoing confidentiality and nondisclosure
obligations shall not apply to information which is required to be disclosed by
law or by regulation; provided, that (a) the Receiving Party gives the
Disclosing Party reasonable advance notice of the disclosure, to the extent
reasonably practicable and legally permissible; (b) the Receiving Party uses
reasonable efforts to resist and limit disclosing the Confidential Information;
(c) the Receiving Party reasonably cooperates with the Disclosing Party on
request to obtain a protective order or otherwise limit the disclosure; and (d)
upon the reasonable request of the Disclosing Party, the Receiving Party shall
provide a letter from its counsel confirming that the Confidential Information
is, in fact, required to be disclosed.
10.4 INJUNCTIVE RELIEF. The Parties acknowledge that either Party's
breach of this Article 10 may cause the other Party irreparable injury for which
it would not have an adequate remedy at law. In the event of a breach, the
non-breaching Party shall be entitled to injunctive relief in addition to any
other remedies it may have at law or in equity.
10.5 SCIENTIFIC AND OTHER PUBLICATIONS. Notwithstanding anything herein
to the contrary, it is the understanding of each Party that scientific,
scholarly and other related publications or presentations concerning the
development of the Compound and the Product including their pre-clinical and
clinical development, shall emanate solely from Triangle and the trials and
studies sponsored by Triangle and that, as against Xxxxxx, Triangle shall have
full
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control over the preparation, review and approval of such publications and
presentations, which publications and presentations shall not be restricted
hereunder.
10.6 SURVIVAL. The confidentiality and nondisclosure obligations of this
Article 10 shall survive the expiration or termination of this Agreement and
remain in effect for a period of *** years following the expiration or
termination of this Agreement.
ARTICLE 11.
WARRANTIES
11.1 TRIANGLE WARRANTY. Triangle warrants that it has the right to xxxxx
Xxxxxx the license granted in Section 2.1 of this Agreement.
11.2 XXXXXX WARRANTY. Xxxxxx warrants to Triangle that Product and Prior
Product delivered to Triangle pursuant to this Agreement and the Previous
Agreement shall:
(a) at the time of shipment to Triangle or its designees (i)
comply with (or have complied with, as to Prior Products) the
Specifications, and (ii) be owned by Triangle free from all liens and
encumbrances of any kind, subject only to the payment by Triangle of the
purchase price therefor; and
(b) be (or have been, as to the Prior Products) manufactured in
compliance with the requirements of all Legal Requirements and cGMP,
including, but not limited to, those relating to the management and
disposal of hazardous wastes. For purposes of the immediately preceding
sentence, "hazardous wastes" shall be deemed to include any hazardous or
toxic waste, substance or material as defined in any federal, state or
local statute, law, ordinance, code, rule or regulation.
11.3 DEBARMENT WARRANTY. Xxxxxx represents and warrants to Triangle that
it is not debarred and has not and will not knowingly use in any capacity the
services of any Person debarred under subsections 306(a) or (b) of the Generic
Drug Enforcement Act of 1992. If at any time this representation and warranty is
no longer accurate, Xxxxxx shall immediately notify Triangle of such fact.
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11.4 NO OTHER WARRANTIES. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS
AGREEMENT, EACH PARTY MAKES NO OTHER WARRANTIES OR REPRESENTATIONS, INCLUDING
FITNESS FOR PURPOSE INTENDED OR MERCHANTABILITY, WHETHER EXPRESS OR IMPLIED.
ARTICLE 12.
LIMITATION ON LIABILITY
EXCEPT AS OTHERWISE PROVIDED, NEITHER PARTY SHALL BE LIABLE FOR ANY
SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL LOSSES ARISING OUT OF OR RELATING
TO THIS AGREEMENT; PROVIDED HOWEVER, THIS LIMITATION SHALL NOT APPLY TO LOSSES
ARISING FROM THIRD PARTY CLAIMS FOR WHICH A PARTY IS INDEMNIFIED UNDER THE TERMS
OF THIS AGREEMENT.
ARTICLE 13.
INDEMNIFICATION
13.1 INDEMNIFICATION
(a) INDEMNIFICATION BY TRIANGLE. Except as may be otherwise
provided herein, Triangle shall defend, indemnify and hold Xxxxxx, all of
its directors, officers and employees (collectively the "XXXXXX
INDEMNITEES") harmless from and against all Losses incurred in connection
with any Third Party suits, claims or causes of action arising out of or
resulting from:
(i) The development, testing, use, manufacture,
distribution, promotion, marketing, sale, packaging, labeling,
handling, storage, and/or disposal of Product;
(ii) Triangle's breach of any representation, warranty,
covenant, or other obligation provided for in this Agreement;
(iii) The negligence, recklessness or willful misconduct of
Triangle and its directors, officers or employees; or
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(iv) Any patent infringement claim arising from the
utilization of process technology other than Xxxxxx Patents or
Xxxxxx Technology (as those terms are defined in the Termination
Agreement) in the manufacture, importation, use or sale of a
Product.
Provided, however, that Triangle shall not be required to indemnify the Xxxxxx
Indemnitees to the extent that any Losses arise out of or result from: (A) the
negligence, recklessness or willful misconduct of any of the Xxxxxx Indemnitees,
(B) utilization of the Xxxxxx Patents or Xxxxxx Technology for the manufacture
of Product or Prior Products, (C) continued manufacture in a country after
receipt of notice from Triangle indicating that the manufacture of such Product
in such country should be terminated because such further manufacture would
constitute willful infringement of a valid and issued patent in such country
and/or (D) any breach by Xxxxxx of this Agreement.
(b) INDEMNIFICATION BY XXXXXX. Except as may be otherwise provided
herein, Xxxxxx shall defend, indemnify and hold Triangle, its directors,
officers and employees and the Triangle Licensor (collectively the
"TRIANGLE INDEMNITEES") harmless from and against all Losses incurred in
connection with any Third Party suits, claims or causes of action arising
out of or resulting from:
(i) Xxxxxx'x breach of any representation, warranty,
covenant, or other obligation provided for in this Agreement;
(ii) The negligence, recklessness or willful misconduct of
Xxxxxx, its directors, officers or employees, including their
directors, officers or employees; or
(iii) Any patent infringement claim arising from Xxxxxx'x or
its Affiliates or permitted sublicensee's utilization of the Xxxxxx
Patents or Xxxxxx Technology for the manufacture of Product or
Prior Product.
Provided, however, that Xxxxxx shall not be required to indemnify the Triangle
Indemnitees to the extent that any Losses arise out of or result from: (A) the
negligence, recklessness or willful misconduct of any Triangle Indemnitee;
and/or (B) any breach by Triangle of this Agreement.
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13.2 INDEMNIFICATION PROCEDURE. Any Xxxxxx Indemnitee or Triangle
Indemnitee, as the case may be, shall notify Triangle or Xxxxxx (the
"INDEMNIFYING PARTY") promptly in writing of an indemnifiable claim or cause of
action under Section 13.1(a) or 13.1(b) upon receiving notice or being informed
of the existence thereof. The Indemnifying Party shall assume, at its cost and
expense, the sole defense of such claim or cause of action through counsel
selected by the Indemnifying Party and reasonably acceptable to the other Party.
The Indemnifying Party shall maintain control of such defense, including any
decision as to settlement; provided that, in the event that the Indemnifying
Party does not diligently defend such claim or cause of action on a timely
basis, then, without prejudice to any other rights and remedies available to the
other Party under this Agreement, the other Party may take over such defense
with counsel of its choosing at the Indemnifying Party's cost and expense. The
other Party may, at its option and expense, participate in the Indemnifying
Party's defense, and if the other Party so participates, the Parties shall
cooperate with one another in such defense. The Indemnifying Party shall bear
the total costs of any court award or settlement of such claim or cause of
action and all other costs, fees and expenses related to the resolution thereof
(including reasonable attorneys' fees except for attorneys' fees for which the
other Party is responsible in the event that the other Party participates in the
Indemnifying Party's defense of such claim or cause of action). The
indemnification obligations herein shall apply on a first dollar basis without
limitation or reduction due to any deductible or self-insured retention which
Triangle or Xxxxxx respectively may have under their respective insurance
coverage.
ARTICLE 14.
TERM AND TERMINATION
14.1 EFFECTIVE DATE AND TERMINATION DATE. The term of this Agreement
shall commence on the Effective Date and shall continue until *** unless
terminated sooner in accordance with Section 14.2 (the "TERM"); provided,
however, that at Triangle's request, provided no later than ***, Xxxxxx will
negotiate in good faith a *** extension of
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the Term of this Agreement on terms and conditions no less favorable to Triangle
than those under the Previous Agreement.
14.2 TERMINATION. Triangle may terminate this Agreement at any time, for
any or no reason, upon sixty (60) days written notice to Xxxxxx. In addition,
upon the occurrence of the following events, either Party may terminate this
Agreement by giving the other Party *** days prior written notice:
(a) Upon the bankruptcy or insolvency of the other Party; or
(b) Upon the material breach of any provision of this Agreement by
the other Party if the breach is not remedied prior to the expiration of
such sixty (60)-day notice period, or if the breach is of a type that
cannot be remedied within sixty (60) days, then a remedy promptly commenced
and diligently pursued until complete remediation.
14.3 EFFECT OF TERMINATION. If this Agreement is terminated as a result
of Xxxxxx'x breach, other than documents required to be returned for regulatory
compliance, Xxxxxx shall use its Reasonable Best Efforts to destroy all data,
writings and other documents and tangible materials supplied to Xxxxxx by
Triangle or the Triangle Licensor. Xxxxxx shall further provide Triangle with
full and complete copies of all toxicity, efficacy, and other data generated by
Xxxxxx or its permitted sublicensees, contractors or agents in the course of
Xxxxxx'x efforts to obtain governmental approval for the sale of the Product,
including but not limited to any registration filings or other documents filed
with any government authority. Triangle and the Triangle Licensor shall be
authorized to cross-reference any such registration filings made in the
Territory where permitted by law. Triangle and the Triangle Licensor shall be
authorized to provide data pertaining to such patents and technology to any
Third Party with a bona fide interest in licensing such technology. Such data
shall be provided on a confidential basis; provided, however, that if such Third
Party enters into a license with Triangle and the Triangle Licensor, such Third
Party shall be free to use such data for all purposes, including to obtain
government approvals to sell Product containing any Compound. Xxxxxx shall
cooperate reasonably (at no unreimbursed expense to Xxxxxx) with any Third Party
licensee of Triangle or the Triangle Licensor in pursuing governmental approval
to sell any Product containing any
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Compound, including but not limited to, permitting such Third Parties to
cross-reference any regulatory filings filed with or any product approval
obtained in any foreign countries (provided that any expenses incurred at the
request of Triangle are reimbursed). Upon expiration or termination of this
Agreement, whichever is sooner, for any reason, Xxxxxx shall manufacture and
deliver in accordance with the appropriate purchase order, and Triangle shall
purchase in accordance with the provisions hereof, any and all amounts of
Product ordered by Triangle hereunder on purchase orders issued to Xxxxxx prior
to such expiration or termination.
14.4 SURVIVAL. All rights granted and obligations undertaken by the
Parties hereunder shall terminate immediately upon the event of any termination
or expiration of this Agreement, except for the following which shall survive on
a Product-by-Product basis according to their terms:
(a) The obligation of each Party to pay to the other Party any and
all payments accrued under this Agreement prior to such
termination or expiration;
(b) The limitations on liability of Article 12;
(c) The confidentiality and nondisclosure obligations of Article
10;
(d) The indemnification obligations of Article 13;
(e) The insurance obligations of Article 16; and
(f) The provisions of Articles 11 and 18 and Sections 14.3, 19.3,
19.6, 19.10, 19.11 and 19.12.
In addition, expiration or termination of this Agreement shall not affect the
remedies of the Parties otherwise available at law or in equity in relation to
any rights accrued under this Agreement prior to expiration or termination.
14.5 NONEXCLUSIVE RIGHTS AND REMEDIES. Except as otherwise set forth in
this Agreement, none of the various rights and remedies of the Parties provided
under this Agreement are exclusive and all are in addition to any other rights
and remedies provided by law or under this Agreement.
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ARTICLE 15.
ADVERSE EVENTS, RECALLS, AND OTHER REGULATORY MATTERS
15.1 ADVERSE REACTION REPORTING. Xxxxxx shall keep Triangle promptly
informed of information in or coming into its possession or control concerning
safety, adverse events, side effects, injury, toxicity or sensitivity reaction
and incidents of severity thereof ("ADVERSE EVENTS") associated with commercial
and clinical uses, studies, investigations, handling, manufacturing, storage or
tests of Product. Triangle shall keep Xxxxxx promptly informed of information in
or coming into its possession or control concerning material Adverse Events
associated with the manufacture of Product. Triangle shall have responsibility
for responding to all such information except as set forth below and Xxxxxx
agrees to provide reasonable assistance to Triangle in the course thereof.
15.2 PRODUCT COMPLAINTS AND INQUIRIES. Xxxxxx shall promptly provide
Triangle with copies of all complaints or other medical or technical
Product-related inquiries from consumers, physicians or other Third Parties
received by Xxxxxx related to Product manufactured under this Agreement and
shall maintain files of the same in accordance with applicable regulatory
requirements. Triangle shall have responsibility, with Xxxxxx'x reasonable
assistance, for responding to all complaints relating to the manufacture of such
Product. Triangle shall have responsibility, with Xxxxxx'x reasonable
assistance, for reporting all complaints relating to such Product and preparing
responses thereto to the FDA, EMEA and any other regulatory authority,
including, but not limited to, complaints relating to the manufacture of such
Product, provided that Xxxxxx has the ability to cooperate and consult with
Triangle in preparing such responses.
15.3 PRODUCT RECALL. In the event (a) any government authority issues a
request, directive or order that Product manufactured under this Agreement be
recalled, (b) a court of competent jurisdiction orders such a recall, or (c)
Triangle and/or Abbott reasonably determine after consultation with each other
that such Product should be recalled or otherwise removed from the market, the
Parties will determine and Abbott, in cooperation with Triangle, will take all
appropriate corrective actions, including administering any necessary recalls.
Triangle shall have the sole authority to decide whether to commence a recall or
removal of such Product. In the
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event that such recall results from the failure of such Product to meet the
Specifications, and such failure could not reasonably be detected by Triangle
within the *** acceptance period set forth in Section 6.1, Abbott shall be
responsible for all expenses of such recall or removal. In other cases, Triangle
shall be responsible for all expenses of such recall or removal. For the
purposes of this Agreement, the expenses of any recall or removal shall include
the expense of notification and destruction or return of the recalled or removed
Product.
15.4 GOVERNMENT CONTACT REPORTING. Each Party shall promptly notify the
other Party upon being contacted by the FDA, EMEA or any other federal, state,
or local governmental agency for any material regulatory purpose pertaining to
this Agreement or to the Product. Except as set forth above, Abbott shall not
respond to the FDA or such governmental agency before consulting with Triangle,
unless under the circumstances pursuant to which FDA or such other federal,
state, local, national, or supranational governmental agency contacts Abbott, it
is not reasonably practical or lawful for Abbott to give Triangle advance
notice, in which event Abbott shall inform Triangle of such contact as soon as
reasonably practical and lawful.
ARTICLE 16.
INSURANCE
Each Party shall, at its sole cost and expense, obtain and keep in force
general liability insurance with bodily injury, death and property damage limits
of *** U.S. Dollars (U.S.$***) in the aggregate and *** U.S. Dollars (U.S.$***)
in the aggregate of product liability coverage. Upon the Effective Date, each
Party shall furnish to the other a certificate of insurance evidencing the
insurance coverage required by this Agreement and providing for at least ten
(10) days prior written notice to the other Party of any cancellation,
termination, material change or reduction of such insurance coverage.
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ARTICLE 17.
FORCE MAJEURE
If any circumstance beyond the reasonable control of either Party occurs
which delays or renders impossible the performance of certain of that Party's
obligations under this Agreement on the dates herein provided (a "FORCE
MAJEURE"), such obligations shall be postponed for such time as such performance
necessarily has had to be suspended or delayed on account thereof, provided such
Party shall notify the other Party in writing as soon as practicable, but in no
event more than ten (10) business days after the occurrence of such event of
Force Majeure, which notice shall reasonably attempt to identify such
obligations under this Agreement and the extent to which performance thereof
will be affected. In such event, the Parties shall meet promptly to determine an
equitable solution to the effects of any such event, provided that such Party
who fails because of an event of Force Majeure to perform its obligations
hereunder shall upon the cessation of the Force Majeure event take all
reasonable steps within its power to resume with the least possible delay
compliance with its obligations. Events of Force Majeure shall include, without
limitation, war, revolution, invasion, insurrection, terrorist acts, riots, mob
violence, sabotage or other civil disorders, acts of God, limitations imposed by
exchange control regulations or foreign investment regulations or similar
regulations, laws, regulations or rules of any government or governmental
agency, any inordinate and unanticipated delays in the regulatory review or
governmental approval process that are within the sole control of such
government or governmental agency, any delay or failure in manufacture,
production or supply by Third Parties of any goods or services, or any
withdrawal or recall of a Product at the direction of any governmental
authority.
ARTICLE 18.
TRANSITION SERVICES
18.1 TRANSITION SERVICES. Abbott shall, and shall cause its Affiliates
to provide Triangle or its Third Party designee all necessary information,
cooperation and assistance to transition the manufacture of Product to
Triangle's Third Party designee through successful validation, including the
transfer of all necessary or useful manufacturing process technology and
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all necessary assistance in obtaining any related necessary regulatory
qualifications. Such transitional services shall be provided by Abbott and its
Affiliates in accordance with the "TRANSITION SERVICES PLAN" attached as Exhibit
18. The Transition Services Plan shall govern the transitional services to be
provided by Abbott and will define at least the intended Third Party designee,
technology transfer, scope, process, schedule for completing each part of the
transition, estimated budget for such transitional services and any other
resources to be provided by Abbott or its Affiliates for such transfer. Except
to the extent otherwise due under the Transition Services Plan, Abbott will
commence performing the transition services within *** after Triangle's request
and shall continue performance on the schedule Triangle reasonably requests,
consistent with the Transition Services Plan. Triangle may change such intended
Third Party designee, in which event Triangle and Abbott will develop in good
faith a corresponding replacement Transition Services Plan including associated
costs. Such replacement Transition Services Plan will provide for all necessary
transition services to be provided by Abbott, as reasonably determined by
Triangle in consultation with Abbott, and will incorporate a pricing structure
and price levels substantially comparable to those set forth in Exhibit 18, as
adjusted to reflect the level of services requested by Triangle. If the Parties
are not able to agree on a replacement Transition Services Plan for any reason,
either Party may submit the terms not yet agreed to ADR (as defined in and
pursuant to Section 19.3) for resolution, in which the Neutral shall be deemed
empowered to resolve and establish the open terms, whereupon the Parties will
promptly adopt the replacement Transition Services Plan as so resolved and
established. Abbott shall not be required to provide any services and Triangle
shall not be obligated to pay any costs except as specified in the Transitional
Services Plans or as otherwise agreed upon by the Parties in writing. Abbott
will keep Triangle reasonably informed on a monthly basis (or more frequently as
reasonably necessary or appropriate) of its progress under and resource
allocations and costs for the Transition Services Plan to Triangle, and
understands that timely response to requests and timely completion of tasks (as
directed by
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Triangle) is necessary to assure the transition of manufacture of Product within
the Transition Services Plans.
18.2 TRANSITION SERVICES COST. Triangle shall pay Abbott for all
reasonable internal costs and reasonable out-of-pocket expenses actually
incurred by Abbott in connection with the transitional services; provided that
such internal costs and out-of-pocket expenses shall not exceed the agreed to
budget for such transitional services in the Transitional Services Plans. Abbott
shall invoice Triangle on a quarterly basis in reasonable detail (showing
without limitation FTE hours per person per project) for services rendered in
the prior quarter, and such invoices shall be paid in full by Triangle within
thirty (30) days after receipt of Xxxxxx'x invoice. Triangle shall bear its own
costs and expenses and pay all third party costs and expenses incurred pursuant
to and as set forth in the Transitional Services Plans. Triangle shall contract
directly with such third parties for their support and assistance, and Abbott
shall not commit or enter into any contracts with any such third parties for
transitional services on Triangle's behalf.
ARTICLE 19.
MISCELLANEOUS
19.1 RELATIONSHIP OF THE PARTIES. Each of the Parties shall be
furnishing its services hereunder as an independent contractor, and nothing
herein shall create any association, partnership or joint venture between the
Parties or any employer-employee relationship. No agent, employee or servant of
either Party shall be or shall be deemed to be the employee, agent or servant of
the other Party, and each Party shall be solely and entirely responsible for its
acts and the acts of its employees.
19.2 RELATIONSHIP WITH AFFILIATES. Unless the context otherwise
indicates, (a) any reference to a Party herein shall include the Affiliates of
such Party and (b) each Party may utilize the services of its Affiliates to
perform services, activities and/or obligations permitted or required under this
Agreement to the same extent as if such Affiliate were a party to this
Agreement; provided that any such services, activities or obligations under this
Agreement permitted or required to be performed by such Party relating to the
Territory will be performed only by such Party or a wholly-owned U.S. subsidiary
of such Party and that such Affiliate has
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established to the satisfaction of the other Party the capability of performing
in accordance with the terms of this Agreement. Any Affiliates so utilized shall
be subject to all the terms and conditions applicable to such Party under this
Agreement, including but not limited to provisions establishing standards for
performance. With respect to the Territory, Abbott may use its Affiliates as set
forth in this Section 19.2; provided that Abbott shall make all payments
required and provide all reports or data required under this Agreement. The use
of any Affiliates as set forth in this Section 19.2 shall in no way relieve the
applicable Party of any of its obligations or liabilities hereunder and each
Party shall be liable for the actions of its Affiliates under this Agreement and
the indemnification provisions of Article 13 shall apply with respect to all
actions of a Party's Affiliates under this Agreement.
19.3 DISPUTE RESOLUTION. The Parties recognize that a bona fide dispute
as to certain matters may arise from time to time during the term of this
Agreement which may relate to either Party's rights and/or obligations
hereunder. The Parties agree that any dispute that arises in connection with
this Agreement, which cannot be amicably resolved by such management discussions
shall be resolved by binding Alternative Dispute Resolution ("ADR") in the
manner described in Exhibit 19.3. Notwithstanding the foregoing, nothing shall
limit the Parties' right to seek judicial injunctive relief pursuant to Section
10.4 with respect to a breach or threatened breach of the requirements set forth
in Article 10 hereof.
19.4 COUNTERPARTS. The Agreement may be executed simultaneously in any
number of counterparts and may be executed by facsimile. All counterparts shall
collectively constitute one and the same Agreement.
19.5 NOTICES. In any case where any notice or other communication is
required or permitted to be given hereunder, such notice or communication shall
be in writing, and sent by overnight express or registered or certified mail
(with return receipt requested) and shall be sent to the following address (or
such other address as either Party may designate from time to time in writing):
If to Triangle:
Triangle Pharmaceuticals, Inc.
0 Xxxxxxxxxx Xxxxx
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0000 Xxxxxxxxxx Xxxxx
Xxxxxx, Xxxxx Xxxxxxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Attention: Chief Operating Officer
Copy to: General Counsel
Copy to:
Xxxxxx X. Xxxxx
Xxxxx Xxxxxxxx Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxxxx L.L.P.
0000 Xxxxx Xxxxx Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
If to Xxxxxx:
Xxxxxx Laboratories
Dept. R50A; Bldg. AP34
000 Xxxxxx Xxxx Xxxx
Xxxxxx Xxxx, XX 00000-0000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
Attention: Vice President, Global Licensing/New Business
Development
Copy to:
General Counsel
Xxxxxx Laboratories
Dept. 364; Bldg. AP6D
000 Xxxxxx Xxxx Xxxx
Xxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
19.6 BINDING EFFECT; ASSIGNMENT. This Agreement may not be assigned, in
whole or in part, by either Party without the prior written consent of the other
Party, and any attempted assignment without such consent shall be null and void;
provided that no prior written consent shall be required in the event that a
Third Party acquires substantially all of the assets or outstanding shares of,
or merges with, the assigning Party, but only so long as such Third Party
34
agrees to be bound by all of the assigning Party's responsibilities and
obligations hereunder. No assignment of this Agreement or of any rights
hereunder shall relieve the assigning Party of any of its obligations or
liability hereunder. This Agreement shall inure to the benefit of and be binding
upon each of the Parties hereto and their respective successors and permitted
assigns.
19.7 ENTIRE AGREEMENT. The terms and conditions contained herein
constitute the entire agreement between the Parties relating to the subject
matter hereof and thereof and shall supersede all previous communications
between the Parties with respect to the subject matter hereof and thereof,
respectively. Neither Party has entered into this Agreement in reliance upon any
representation, warranty, covenant or undertaking of the other Party that is not
set out or referred to in this Agreement.
19.8 AMENDMENT. The Agreement may be varied, amended or extended only by
the written agreement of the Parties through their duly authorized officers or
representatives, specifically referring to this Agreement.
19.9 SEVERABILITY. In case any one or more of the provisions contained
herein shall, for any reason be held to be invalid, illegal or unenforceable in
any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Agreement, but this Agreement shall be construed as
if such invalid, illegal or unenforceable provision or provisions had never been
contained herein unless the deletion of such provision or provisions would
result in such a material change as to cause completion of the transactions
contemplated herein to be impossible and provided that the performance required
by this Agreement with such clause deleted remains substantially consistent with
the intent of the Parties.
19.10 COMPANY EMPLOYEES. Each Party shall not, directly or indirectly
solicit for employment, any employee of the other Party who has been directly
involved in the performance of this Agreement during the Term and for one year
after the earlier of the termination or expiration of this Agreement or the
termination of such individual's employment, with the other Party. It shall not
be a violation of this provision if any employee responds to a Party's general
advertisement of an open position.
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19.11 PUBLICITY. Except as otherwise provided herein, each Party shall
maintain the confidentiality of all provisions of this Agreement and this
Agreement itself and, without the prior written consent of both Parties, neither
Party shall make any press release or other public announcement of or otherwise
disclose to any Third Party this Agreement or any of its provisions except: (a)
for disclosure to those of its directors, officers, employees, accountants,
attorneys, advisers and agents whose duties reasonably require them to have
access to the Agreement and, in the case of Triangle, disclosure to the Triangle
Licensor and actual and potential business partners (including any Third Party
with which Triangle collaborates in the development, registration, manufacture,
use or sale of the Compounds or Products), provided that such directors,
officers, employees, accountants, attorneys, advisers, agents, licensors and
business partners are required to maintain the confidentiality of the Agreement
to the same extent as if they were Parties hereto, and (b) except for such
disclosures as may be required by Legal Requirements, in which case the
disclosing Party shall provide the nondisclosing Party with prompt advance
notice of such disclosure so that the nondisclosing Party shall have the
opportunity if it so desires to seek a protective order or other appropriate
remedy and, in connection with any disclosure to the Securities and Exchange
Commission, the disclosing Party shall use reasonable efforts to obtain
confidential treatment for such disclosure.
19.12 APPLICABLE LAW. The Agreement shall be governed by the laws of the
State of Delaware applicable to contracts made and to be performed entirely
within such jurisdiction and without giving effect to its choice or conflict of
laws rules or principles. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing Party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements, in
addition to any other relief to which the Party may be entitled.
19.13 HEADINGS. The descriptive headings contained in this Agreement are
included for convenience of reference only and shall not affect the meaning or
interpretation of this Agreement.
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19.14 INTERPRETATION.
(a) Wherever any provision of this Agreement uses the term
"including" (or "includes"), such term shall be deemed to mean "including
without limitation" and "including but not limited to" (or "includes
without limitation" and "includes but is not limited to") regardless of
whether the words "without limitation" or "but not limited to" actually
follow the term "including" (or "includes").
(b) Wherever any provision of this Agreement provides that a
Party's consent shall not be unreasonably withheld, such provision shall be
deemed to provide that such consent shall in addition not be unreasonably
delayed.
(c) The recitals set forth at the start of this Agreement, along
with the Exhibits to this Agreement, and the terms and conditions
incorporated in such recitals and Exhibits shall be deemed integral parts
of this Agreement and all references in this Agreement to this Agreement
shall encompass such recitals and Exhibits and the terms and conditions
incorporated in such recitals and Exhibits.
(d) In the event of any conflict between the terms and conditions
of this Agreement and any terms and conditions that may be set forth on any
order, invoice, verbal agreement or otherwise, the terms and conditions of
this Agreement shall govern.
(e) Unless otherwise explicitly stated, in the event of any
conflict between the terms of this Agreement and the terms and conditions
of any of the Exhibits hereto, the terms of this Agreement shall prevail.
(f) The Agreement shall be construed as if both Parties drafted it
jointly, and shall not be construed against either Party as principal
drafter.
(g) Unless otherwise provided, all references to Sections,
Articles and Exhibits in this Agreement are to Sections, Articles and
Exhibits of and to this Agreement.
19.15 NO WAIVER OF RIGHTS. No failure or delay on the part of either
Party in the exercise of any power or right hereunder shall operate as a waiver
thereof. No single or partial
37
exercise of any right or power hereunder shall operate as a waiver of such right
or of any other right or power. The waiver by either Party of a breach of any
provision of this Agreement shall not operate or be construed as a waiver of any
other or subsequent breach hereunder.
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[SIGNATURE PAGE TO SUPPLY AND MANUFACTURING AGREEMENT]
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the date first written
above.
XXXXXX LABORATORIES TRIANGLE PHARMACEUTICALS, INC.
By: /s/ Xxxxxxx X. Leiden, MD, Ph.D By: /s/ Xxxxx X. Xxxxxx
-------------------------------------- ---------------------
Name: Xxxxxxx X. Leiden, MD, Ph.D Name: Xxxxx X. Xxxxxx
-------------------------------------- ------------------------
Title: President and Chief Operating Officer, Title: President and COO
Pharmaceutical Products Group ------------------------
--------------------------------------
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