EXHIBIT 10.9
Dated April 30, 1993
SALIX PHARMACEUTICALS, INC (1)
and
AB ASTRA (2)
-------------------------------------------------
CO-PARTICIPATION
AGREEMENT
-------------------------------------------------
[*] CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
TABLE OF CONTENTS
1. DEFINITIONS...................................... 2
PART A - RESEARCH AND DEVELOPMENT.............................. 5
2. SALIX' OBLIGATIONS AND THE PRODUCT............... 5
3. COMPLETION OF THE PROJECT........................ 8
4. ASTRA'S OBLIGATIONS.............................. 8
5. CLINICAL TRIALS.................................. 8
6 COSTS AND FUNDING................................ 10
PART B - DISTRIBUTION.......................................... 14
7. APPOINTMENT OF ASTRA............................. 14
8. REGULATORY APPROVALS............................. 15
9. PROMOTION, MARKETING AND SALE.................... 17
10. PRODUCT DATABASE AND ADVERSE REACTIONS REPORTING. 20
l1. CONSIDERATION.................................... 22
PART C - SUPPLY AND MANUFACTURE................................ 23
12. SUPPLY OF PRODUCT................................ 23
13. PRICE............................................ 26
14. TERMS OF PAYMENT................................. 29
l5. DELIVERY......................................... 30
16. LICENSE TO MANUFACTURE........................... 30
PART D - TRADEMARK LICENSE..................................... 34
17. TRADEMARK LICENSE................................ 34
18. LICENSE PAYMENT.................................. 35
PART E - MISCELLANEOUS......................................... 36
19. INDEMNIFICATION.................................. 36
20. CONFIDENTIAL INFORMATION......................... 37
21. INTELLECTUAL PROPERTY............................ 39
22. SUB-DISTRIBUTORS AND SUB-LICENSEES............... 43
23. ASSIGNMENT....................................... 43
24. FORCE MAJEURE.................................... 43
25. COSTS............................................ 44
26. CONFIDENTIALITY OF THIS AGREEMENT................ 44
27. NATURE OF THE AGREEMENT......................... 44
28. NOTICES......................................... 47
PART F - TERMINATION AND EFFECTS THEREOF....................... 48
29. TERMINATION..................................... 48
30. CONSEQUENCES OF TERMINATION..................... 51
PART G - ASTRA OPTION.......................................... 53
31. ASTRA OPTION.................................... 53
1 (53)
THIS CO-PARTICIPATION AGREEMENT is made the 30th day of April, 1993
BETWEEN:
-------
(1) SALIX PHARMACEUTICALS, INC a company incorporated under the laws of
California and whose registered office is at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇ ("Salix"); and
(2) AB ASTRA a company incorporated under the laws of Sweden whose principal
place of business is at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
("Astra").
WHEREAS:
A. By an agreement dated 17th January, 1991 and made between Salix of the one
part and Biorex Laboratories Limited ("Biorex") of the other part, Biorex
granted Salix an exclusive license to develop, manufacture, use and sell
pharmaceutical products incorporating Balsalazide in the U.S. (as
hereinafter defined) under patents granted to Biorex upon the terms of such
license.
B. Salix and Astra have agreed to collaborate in the programme of development
of such pharmaceutical products for the creation of a Dossier to be
registered in the U.S. and for the commercial exploitation of such products
in the U.S.
NOW IT IS HEREBY AGREED as follows:
2 (53)
1. DEFINITIONS
1.1 In this Agreement the following words shall have the following meanings:
"Advisory Committee" means the committee consisting of representatives of
Astra and Salix to be formed and function as described in Article 9.1.1.
"Applications" means the treatment of Diseases of the Digestive System
according to WHO classification of diseases Class 52.
"Primary Applications" means the treatment of acute relapse in ulcerative
colitis.
"Astra Associate" means any company which is a holding company of Astra or
a subsidiary of Astra and any other subsidiary of any such holding company
or subsidiary. For this purpose a company shall be deemed to be a
"subsidiary" of another if that other is a member of it and controls the
composition of its Board of Directors.
"Astra Coordinator" means one individual employee of Astra or an Astra
Associate nominated and appointed from time to time by Astra as a member of
the Project Team.
"Balsalazide" means 5- [4(2- Carboxyethylcarbamoyl) - phenylazo]-salicylic
acid disodium salt dihydrate.
"Biorex" means Biorex Laboratories Limited, a company incorporated in
England under Company Registration Number 390233 whose registered office is
at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇.
"Biorex Agreement" means an agreement dated 17th January, 1991 between
Salix and Biorex, as amended.
"Biorex/Astra Agreement" means the agreement of even date herewith entered
into between Biorex and Astra and attached hereto as Exhibit A.
"Developmental Product" means a pharmaceutical preparation for the Primary
Applications containing
3 (53)
Balsalazide, as previously developed by Biorex and licensed to Salix
pursuant to the Biorex Agreement.
"Dossier" means the master regulatory dossier relating to the Developmental
Product which shall be prepared during the Project and which shall in the
reasonable opinion of Salix and the Project Team be:
(1) in accordance with the published standard required for master
regulatory dossiers by the FDA as at the date of completion of the Dossier;
and
(2) in a form suitable for submission to and suitable for approval by the
FDA in connection with obtaining health registration for the Developmental
Product in the U.S.
"FDA" means the Food and Drug Administration of the U.S.
"Force Majeure" means in relation to either party any circumstances beyond
the reasonable control of that party (including but not limited to strike,
lock out or other form of industrial action, act of God, war, riot,
accident, breakdown in plant or machinery, fire, flood, explosion or
government action).
"Launch" means a commercial launch by Astra (or any Astra Associate) of the
Product throughout the U.S. supported by such marketing expense and
supported and launched in such quantities as may reasonably be appropriate
for the Product to have a significant effect on total sales of any similar
or competitive product.
"NDA" means a New Drug Application.
"Net Sales" means the ex factory sales price of each individual Product
actually charged by Astra (or any Astra Associate) for each shipment of
Product on an arms length open market basis to any third party (being a
person, firm or company which is not an Astra Associate), net only of sales
and purchase taxes, customs or import duties, delivery charges, returns and
allowances, discounts and chargebacks actually charged on each such
shipment.
"Patents" means the patents and applications therefore for Balsalazide
listed in Schedule 1 and any substitutes, renewals, reissues and extensions
thereof, plus any patent rights, now existing or
4 (53)
hereafter acquired by Salix (including patent applications therefor) in the
U.S. pertaining to Product and securing the exclusive use and sale in the
U.S. of Product for treatment of ulcerative colitis and Crohn's disease.
"Product" means a pharmaceutical preparation in capsule form containing
Balsalazide for the Applications and such other pharmaceutical preparations
containing Balsalazide for the Applications as may be developed by or on
behalf of Astra or Salix during the term of this Agreement.
"Product Information" means the chemical, pharmaceutical, preclinical,
clinical and other information relating to the Developmental Product and
Balsalazide delivered to Astra by Salix in full or in summary form or as
expert opinion of the data prior to the date hereof as identified and
listed in Schedule 3.
"Project" means the development program in connection with the development
of the Developmental Product, and the preparation and completion of the
Dossier and obtaining the grant of approval to market the Developmental
Product in the U.S. conducted in accordance with the terms of this
Agreement and as summarized in Schedule 2.
"Project Team" means the team of experts appointed by Salix from time to
time in connection with the Project, plus the Astra Coordinator.
"RoW" means the whole world except the U.S., Japan, Korea and Taiwan.
"Trademark" means the trade name "Colazide" registered as a trademark for
use on pharmaceutical preparations in the U.S. and any other tradename
designated by Salix for use in the U.S. in connection with the Product.
"U.S." means the United States of America, its territories and possessions.
1.2 The headings in this Agreement are for convenience only and shall not
affect its interpretation.
5 (53)
1.3 Reference to any document in the approved form shall be reference to the
document agreed between the parties and initialled for the purposes of
identification by each party.
PART A - RESEARCH AND DEVELOPMENT
2. SALIX' OBLIGATIONS AND THE PRODUCT
2.1 Salix shall manage the Project Team and conduct or procure the conduct of
the Project in a competent manner and shall use all reasonable endeavors to
prepare and/or procure the preparation of the Dossier.
2.2 The Project shall be conducted in respect of and relate only to the
Developmental Product as defined herein and notwithstanding the wider
definition of the Product.
2.3 Salix shall conduct and manage the Project in close liaison with the
Project Team and Salix shall keep Astra fully informed of the progress,
costs and conduct of the Project and shall take account of comments and
proposals made by the Project Team with regard to the scientific content
and methods involved in the Project. Astra may be represented by
additional individuals at Project Team meetings save that only the Astra
Coordinator is a member of the Project Team. The actions of the Project
Team will be governed by the principles of good faith. For the avoidance
of doubt, Salix remains responsible for the conduct of the Project and the
completion of the Dossier and, consequently, Salix will always have the
final say for all matters discussed by the Project Team.
6 (53)
2.4 Without prejudice to the generality of the foregoing, Salix hereby agrees:
2.4.1 that Salix shall use all reasonable endeavors to complete the
Project without undue delay; and
2.4.2 that the nature and procedures of any clinical trials conducted or
required to be conducted as part of the Project by Salix (or by any
third party duly authorized by Salix) will be agreed in advance with
Astra (subject to the rights of Salix as provided in Section 2.3
regarding final say in all matters) and Salix shall ensure that the
results of any such trials or other clinical data relating to such
trials shall be made freely available to Astra as soon as is
reasonably practicable; and
2.4.3 to manage the Project team and to ensure that the Project Team shall
meet at least once in every twelve (12) week period during the
Project to review and coordinate the Project and to share and
exchange all information relating to the Project; and
2.4.4 to prepare a quarterly written report on the progress of the Project
and to submit such report to Astra each calendar quarter. (The first
report shall be submitted to Astra within one calendar quarter from
the date of this Agreement); and
2.4.5 to use reasonable endeavors to ensure that all the contractors
working on the Project [including without limitation the members of
the Project Team (excluding the Astra Coordinator)] at the date of
this Agreement
7 (53)
are either recruited as employees of Salix or enter into contracts
for the supply of their services to Salix; and
2.4.6 to coordinate all documentation in connection with the Project.
2.5 Astra hereby confirms and acknowledges that any information, assistance,
representation or warranty given or made by Astra, any Astra Associate or
any of its representatives or the Astra coordinator shall be supplied in
good faith to, and may be accepted by and used by Salix in the performance
of the Project Provided Always that Salix shall remain solely responsible
for the performance of the Project and shall not be entitled to rely upon
any such representation, warranty or information supplied by any such Astra
representative or the Astra Coordinator.
2.6 Upon completion of the Dossier, Salix shall file the NDA for the
Developmental Product with the FDA and shall apply for and pursue obtaining
approval for the marketing and sale of the Developmental Product in the
U.S., which includes the responsibility to fund, perform and complete any
Phase IV studies upon which such approval is conditioned.
2.7 The conduct of the Project and the preparation of the Dossier in accordance
with the terms hereof shall include the undertaking by Salix to perform all
pre-clinical trials and human pharmacokinetics trials and such clinical
trials for the Developmental Product as are necessary to obtain approval in
the U.S. pursuant to Article 2.6.
8 (53)
3. COMPLETION OF THE PROJECT
Upon any application for approval in the U.S. made by Salix under Article 2.6 or
in addition thereto, Salix shall be named as applicant and shall name Astra in
such application as the distributor for the Product in the U.S.
4. ASTRA'S OBLIGATIONS
4.1 Astra shall be solely responsible for all costs and expenses incurred by or
payable to the Astra Coordinator or any other Astra representative in
connection with the Project.
4.2 Astra acknowledges that the Project meetings under Article 2.4.3 shall take
place in the U.S. at such places as shall be reasonably nominated by Salix.
Astra hereby agrees to bear the entire cost and expense in connection with
the attendance at such meetings of any Astra representative and the Astra
Coordinator.
5. CLINICAL TRIALS
5.1 Astra may undertake clinical trials for the Product (beyond the clinical
trials conducted as part of the Project as specified in Article 2.6) at
Astra's sole cost and expense Provided always that:
5.1.1 the trials are planned, organized and carried out solely by Astra
and shall not interfere with trials conducted or to be conducted by
or on behalf of Salix in connection with the Project; and
5.1.2 prior to the conduct of the trials, the clinical trial objectives
and the clinical trial protocols are agreed in writing between Astra
and Salix (such agreement not
9 (53)
to be unreasonably withheld or delayed and Provided Always that such
agreement shall be deemed to have been given by Salix in the event
that no response is received by Astra from Salix within 20 working
days of receipt by Salix of any request from Astra for approval);
and
5.l.3 Astra shall provide all medical resources and clinical trials
monitors at its own cost and expense; and
5.l.4 Astra shall bear all the costs and expenses associated with such
clinical trials including but without limitation the costs of
documentation and administrative payments to trialists; and
5.l.5 Salix shall provide such supplies of finished capsules of Product to
Astra as Astra may reasonably require for the conduct of such trials
in accordance with Articles 12.4, 12.6, 12.7, 12.8, 12.9 and 13.5;
and
5.1.6 Unless otherwise agreed by Salix, Astra shall use and promote the
Trademark in connection with such trials,
5.2 In the event that any clinical trials are conducted by Astra pursuant to
Article 5.1, Astra undertakes:
5.2.1 to keep Salix fully informed as to the conduct of such clinical
trials and to provide to Salix full unrestricted access to such
results; and
5.2.2 to permit Salix to use such results and to disclose the same to
third parties in
10 (53)
connection with the use and sale of the Product in RoW.
Provided Always that Salix shall provide full unrestricted access to Astra
to the results of any clinical trials and other studies conducted by Salix
and/or any third party authorized by Salix or Glycyx (as defined in Article
23.1) in connection with the use and sale of the Product in the RoW.
6. COSTS AND FUNDING
6.1 Astra shall fund the total development cost for the Project with an amount
of [*] Astra agrees to remit monies into Salix' bank account (details of
which are set out below) in respect of such costs and expenses in
accordance with Schedule 2 to this Agreement.
[*]
Provided Always that any payments, costs and expenses expressly stated in
this Agreement to be the sole responsibility of Astra shall be paid over
and above such [*] and such costs shall not be taken into account in
calculating such maximum. It is understood that any monies [*] hereunder
not paid by Astra on the date an approved NDA for the Developmental Product
is granted by the FDA shall be remitted to Salix within 60 days after the
date of such approval.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
11 (53)
6.2 Salix shall be solely responsible for funding or obtaining funding for any
excess of the actual costs for completion of the Project above Astra's
contributions as provided in this Agreement.
6.3 Salix shall be solely responsible for making all payments to all third
parties working in the Project and Salix shall maintain detailed and
accurate accounts and records in connection with all such payments.
6.4 Salix shall submit to Astra a summary of the accounts and records
maintained by it in connection with the conduct of the Project on a
calendar quarterly basis. The first summary of accounts and records shall
be submitted to Astra three calendar months from the date of this
Agreement. Salix shall allow Astra or its auditors or representative
reasonable access during normal business hours to inspect the books of
accounts of Salix in order to verify incurred costs in the Project. If such
examination reflects an overpayment of five percent (5%) or more of the
amount that should have been paid for during the period audited, then Salix
will bear the expenses of the audit; otherwise Astra shall bear the
expenses of the audit.
6.5 In the event that the actual costs incurred by Salix in the performance of
the Project exceed the total amount under Article 6.1, Salix shall be
solely liable for any excess costs incurred; Provided Always that in the
event that Salix shall thereafter at any time (in its sole discretion)
decide that it is unable or unwilling to incur expenses in excess of such
amount and to complete the Project in accordance with the terms of this
Agreement, it shall forthwith notify Astra in writing and Astra may at its
sole option (exercised by 30 days notice in writing to Salix served within
90 days of receipt
12 (53)
of any such notice from Salix) determine whether the Project shall be
continued or discontinued, In Such event:
6.5.l If Astra decides that the Project will be discontinued, this
Agreement will be terminated automatically upon receipt of such
notice by Salix. If Astra determines that the Project shall be
continued and the NDA for the Developmental Product has been filed
and the payment under Article 11.1.2 consequently has been made,
Salix will continue to perform under this Agreement in accordance
with a revised and agreed Schedule 2. Astra will make available
additional funds in accordance with the agreed payment schemes under
such revised Schedule 2 up to a maximum of the total amount not yet
paid under Article 11.1.3. Any amount so used to complete the
Project to an approved NDA for the Developmental Product shall be
subtracted from what is to be paid by Astra under said Article
11.1.3. Any remaining amount not so used will be payable in
accordance with Article 11.1.3.
6.6 In the event that the actual cost incurred by Salix in the performance of
the Project either exceeds the [*] funded by Astra as referred to in
------
Article 6.1 and the total funds referred to under Article 6.5.1 or exceeds
--
the total amount under Article 6.1 and Article 6.5.1 is not applicable,
and, in either case, Salix decides that it is unable or unwilling to incure
expenses in excess of such amounts and to complete the Project, Salix shall
forthwith notify Astra in writing. Astra may at its sole option (exercised
by 30 days notice in writing to Salix served within 90 days of receipt of
any such notice from Salix) either decide to discontinue or continue
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
13 (53)
the Project. If Astra decides to discontinue the Project, this Agreement
will be terminated automatically upon receipt of such notice by Salix. If
Astra decides to continue the Project, Astra will assume all obligations in
connection with the conduct and completion of the Project, the filing of
the Dossier in accordance with Article 3 hereof and obtaining regulatory
approval under Article 2.6; provided however, that Astra will do the NDA
filing and will be the applicant and the following will apply:
6.6.1 The rights of Astra to distribute the Product under this Agreement
will remain and for the avoidance of doubt payments under Article
11.1 shall remain due and payable in accordance with the terms of
such Article 11.1; and
6.6.2 The right of Astra to manufacture Product pursuant to Article 16
shall be deemed to be granted pursuant to Article 16.2.2 thereof;
and
6.6.3 Astra shall have no claims against Salix and Salix shall not be
liable for any breach by it of its obligations to complete the
Project in accordance with the terms of this Agreement; and
6.6.4 Astra may in its sole discretion supply information relating to or
arising in the Project to third parties who are licensed to use the
Patents to exploit the Product in the RoW but shall not be under any
obligation to do so and such supply may be upon such terms as may be
agreed between Astra and such third party.
14 (53)
PART B - DISTRIBUTION
7 APPOINTMENT OF ASTRA
7.1 With effect from the date of this Agreement and in accordance with the
terms and conditions contained in this Agreement, Salix hereby appoints
Astra as its exclusive distributor for the Product within and throughout
the U.S.
7.2 The rights granted hereunder to Astra shall be in respect of the Product
only. In the event that either party shall become aware of any indications
or applications for Balsalazide other than the Applications, it shall
forthwith notify the other party and shall supply the other party with such
details of the other indications and applications as may be available to it
Provided Always That:
7.2.1 Astra shall have a first option to enter into good faith negotiations
with Salix during the period six months from the supply of such
details in respect of an agreement concerning the development of such
other indications and applications and the grant to Astra of the
right to exploit the same in the U.S.; and
7.2.2 Astra shall have no right whatsoever to use and exploit Balsalazide
in any such other indications and/or applications unless and until
completion of such good faith negotiations and the execution of a
written agreement in respect thereof; and
7.2.3 During such period in which Astra shall continue to negotiate in good
faith Salix shall not disclose details of such other
15 (53)
indications and/or applications to any third party or grant any third
party any rights therein in the U.S. provided that Salix shall not be
prevented or precluded from disclosing the same to any third party
which shall have entered good faith negotiations for the acquisition
of the right to exploit such other indications and/or applications
outside the U.S.; and
7.2.4 In respect of any such other applications and indications disclosed
by Astra to Salix, Salix shall not use or exploit the same (either
itself or through any third party) whether in the U.S. or elsewhere
without the prior consent of Astra (such consent not to be
unreasonably withheld or delayed); and
7.2.5 In respect of any such other applications and indications disclosed
by Salix to Astra, Salix shall not use or exploit the same (either
itself or through any third party) in the U.S. without the prior
consent of Astra (such consent not to be unreasonably withheld or
delayed).
8. REGULATORY APPROVALS
8.1 As stated in Articles 2.6 and 2.7 Salix undertakes to use all reasonable
endeavors to file the Dossier and to apply for and obtain all relevant
regulatory health approvals for the marketing and use of the Developmental
Product in the U.S. as soon as reasonably practicable.
8.2 Astra undertakes to use all reasonable endeavors to effect Launch of the
Product in the U.S. within
16 (53)
90 days of the receipt of all necessary approvals for such Launch.
8.3 In the event that Astra shall fail to effect Launch in the U.S. within a
period of 180 days after the grant of necessary registrations and approvals
for such Launch, then Salix may in its absolute discretion serve written
notice on Astra (within 30 days of the expiry of such period of 180 days)
amending the rights of Astra granted hereunder to those of a non-exclusive
distributor for the Product in the U.S. Thereafter Salix for the avoidance
of doubt shall also be entitled to exploit such rights and to market and
exploit the Product in the U.S. (whether directly or indirectly through any
agent, contractor or licensee) in such manner as it may in its sole
discretion think fit Provided Always that Astra will retain exclusive
rights to use the Trademark in the U.S.
8.4 In the event that Astra's failure to effect Launch as stated in Article 8.3
exceeds a period of twelve months from the grant of all necessary
registrations and approvals for such Launch, Salix may at its sole
discretion serve written notice on Astra (within 90 days of the expiry of
such period of twelve months) terminating this Agreement in full in
accordance with Article 29.2. Thereafter Salix for the avoidance of doubt
shall be entitled to exploit such rights and to market and exploit the
Product in the U.S. (whether directly or indirectly through any agent,
contractor or licensee) in such manner as it may in its sole discretion
think fit free of any obligation to Astra and Astra shall have no rights
with respect to Product or the Trademark in the U.S.
17 (53)
9. PROMOTION, MARKETING AND SALE
9.1 Astra shall use reasonable endeavors to promote, market and sell the
Product throughout the U.S. and undertakes to allocate such promotional and
sales resources and such technical support for the promotion, marketing and
sales of the Product as may reasonably be required to sell the Product.
Astra agrees generally to use the same channels and methods, exercising the
same diligence and adhering to the same standards which it employs with
respect to its other products.
9.1.1 For the purposes of utilizing the support and competence of Salix in
the most efficient way the parties have agreed to form the Advisory
Committee, which will be comprised of two members from Salix and
Astra respectively as determined by the parties separately. The
Advisory Committee will primarily be responsible for the development
of the strategy and promotional plans for the Product. It is
envisaged that Salix will at its own expense agree to perform certain
promotional activities such as symposias and medical, scientific and
technical programs as specified by the Advisory Committee and
accepted by Salix. The actions of the Advisory Committee will be
governed by the principles of good faith. For the avoidance of doubt,
Astra remains responsible for the promotion, marketing and sale of
the Product and consequently Astra will always have the final say in
all matters discussed by the Advisory Committee.
9.2 Astra shall promote, market and sell the Product in the U.S. entirely in
accordance with the terms of
18 (53)
any product license, price approval (if applicable), and other restrictions
and regulations for the Product as may be relevant and applicable in the
U.S.
9.3 Astra undertakes:
9.3.1 To promote, market and sell the Product solely in the U.S. under the
Trademark only and not to use any other trade name, trademark or
logo for or on the Product (Provided That the name "Balsalazide" may
be used but only as a generic name for the Product in accordance
with and as required by applicable laws and regulations); and
9.3.2 To enter into Trademark user agreements and such other agreements
(whether relating to the Trademark, technical standards or
otherwise) as may reasonably be required by Salix or as required by
applicable regulations in connection with the promotion, marketing
and sale by Astra of the Product and/or the use by Astra of the
Trademark; and
9.3.3 To notify Salix immediately of any improper or wrongful use of the
Trademark, the Patents or otherwise any proprietary or confidential
information of Salix or Biorex relating to the Product coming to
Astra's knowledge; and
9.3.4 Forthwith to refer to Salix all inquiries received for the supply of
the Product outside the U.S.; and
9.3.5 Not to seek or sell to customers for the Product outside the U.S.;
and
19 (53)
9.3.6 To develop and design packaging for the Product in each part of the
U.S. at its sole cost and expense and further that Astra agrees to
state on packages containing the Product that such Product was
manufactured by Salix Pharmaceuticals, Inc., Palo Alto, California
and distributed by Astra USA, Inc. (provided that such wording is in
compliance with U.S. laws and regulations); and
9.3.7 Not to use any misleading statements or misrepresentations on the
Product packaging or use any defective packaging materials and to
comply in all respects with all regulations and laws in connection
with the Product packaging and the information provided thereon; and
9.3.8 In the sale, use and promotion of the Product in each part of the
U.S. to comply with all relevant regulatory health and pricing
regulations and approvals in the U.S. For the avoidance of doubt,
Salix shall not be responsible or liable in any manner whatsoever
for compliance with any such regulations and approvals (whether or
not it shall have assisted Astra in or approved the sale or use of
the Product in the U.S.); and
9.3.9 Not to use any packaging which may adversely affect the Product in
any way whatsoever including but without limitation the Product's
approved shelf-life; and
9.3.10 Not to incur any liability on behalf of Salix or in any manner
pledge or purport to pledge Salix' credit or accept any order or
20 (53)
make any contract binding on Salix or give or make any
representation, warranties or conditions with reference to the
Product on behalf of Salix. Astra is not and shall not be deemed to
be the agent of Salix and in all correspondence and dealings with
third parties shall not indicate that it is acting as an agent of
Salix; and
9.3.11 To be solely responsible for the acts and omissions of its employees
and representatives in connection with the performance of its rights
and obligations hereunder; and
9.3.12 To purchase Product for sale in the U.S. solely from Salix during
the term hereof (except as specifically provided in this Agreement).
9.4 Astra shall be entirely responsible for the collection of debts due to it
and shall bear all losses owing to its failure so to do.
9.5 To the extent legal, practical and feasible, Astra and Salix shall agree on
appropriate mentioning in promotional material that the Product has been
developed in collaboration between Salix and ▇▇▇▇▇.
▇▇. PRODUCT DATABASE AND ADVERSE REACTIONS REPORTING
10.1 Salix shall maintain a database of all adverse and other reactions or
events occurring in connection with the Product in any part of the world
except Japan, Taiwan and Korea and shall use reasonable endeavors to assure
that any such adverse and other reactions are notified to it in a timely
manner by any third party authorized by Salix or Glycyx (as defined in
Article 23.1) who are licensed to use and
21 (53)
exploit the Product in such countries.
10.2 Astra undertakes to notify Salix:
10.2.1 forthwith (or in any event in sufficient time to allow Salix to
report such information in compliance with applicable regulations)
in the event that it becomes aware of any serious adverse reactions
(as defined by the FDA regulations) or contra indications to the
Product; and
10.2.2 within three months (or in any event in sufficient time to allow
Salix to report such information in compliance with applicable
regulations) after it becomes aware of other adverse reactions, or
contra indications to the Product other than stated under 10.2.1.
10.3 Salix undertakes to notify Astra:
10.3.1 forthwith (or in any event in sufficient time to allow Salix to
report such information in compliance with applicable regulations)
in the event that it becomes aware of any serious adverse reactions
(as defined by the FDA regulations) or contra indications to the
Product in any part of the world; and
10.3.2 within three months (or in any event in sufficient time to allow
Salix to report such information in compliance with applicable
regulations) after it becomes
22 (53)
aware of other adverse reactions or contra indications to the
Product other than stated under 10.3.1.
10.4 In the event that Salix or any third party authorized by Salix or Glycyx
(as defined in Article 23.1) shall conduct clinical studies of the Product
outside the U.S. in support of any promotional or marketing activities of
Salix or such third party, Salix shall use reasonable endeavors to grant or
procure the grant to Astra of full unrestricted access to the results of
such trials so that Astra shall be entitled to use such results in
connection with the marketing, sale and use of the Product in the U.S.
11. CONSIDERATION
11.1 In consideration of the rights hereby granted by Salix to Astra, Astra
hereby agrees to pay to Salix a sum of [*] such sum to be nonrefundable and
payable to Salix as follows:
11.1.1 [*]
11.1.2 [*]
11.1.3 [*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
23 (53)
[*]
PART C - SUPPLY AND MANUFACTURE
12. SUPPLY OF PRODUCT
12.1 Astra shall notify Salix in writing of its forecast requirements for
quantities of the Product (in the form of bulk filled capsules and
including Product to be used as samples) and details of its proposals for
Launch twelve months prior to its expected Launch. With such forecast
Astra shall deliver a detailed forecast of its requirements for the Product
for the twelve month period from the date of such notice. Thereafter,
Astra shall, on a quarterly basis, deliver to Salix revised forecasts for
the subsequent 12 month period commencing on the subsequent April 1st, July
1st, October 1st and January 1st respectively. Astra's ambition is to
provide Salix with forecasts indicating Astra's expected requirements per
month.
12.2 Salix shall fulfill all written orders placed on it by Astra for the
Product in the form of bulk filled capsules, subject to the provisions of
Article 12.3.
12.3 Whilst the forecasts delivered by Astra to Salix under Article 12.1 shall
be non-binding and will not place any obligation on either Astra to order
such quantities or Salix to deliver such quantities:
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
24 (53)
12.3.1 Astra shall use all reasonable endeavors to estimate accurately in
such forecasts its requirements for the Product; and
12.3.2 Astra shall ensure that all written orders are placed permitting a
lead time for manufacturing of the Product of not less than 16
weeks; and
12.3.3 Astra acknowledges that Salix shall not be obliged to fulfil any
firm written orders placed on it that may be in excess [*] of the
last forecast quantities (in accordance with Article 12.1) for such
period; and
12.3.4 Astra shall place written orders and accept delivery of quantities
of the Product that are not less [*] of the last forecast quantities
(in accordance with Article 12.1) for such period.
12.4 Salix shall supply Astra with such quantities of the Product as Astra may
reasonably require (in bulk filled capsule form) for clinical trials
undertaken by Astra hereunder. Astra shall endeavor to provide Salix with
the maximum period of notice of such requirements and in any event shall
place firm written orders on Salix therefore not less than 60 days before
any requested delivery date, provided that failure of Salix to deliver
sooner than within 90 days shall not constitute breach under this
Agreement.
12.5 Salix shall supply Astra with such quantities of the Product in bulk filled
capsule form as Astra shall reasonably require for use as product samples
and as shall have been forecasted and ordered by Astra in accordance with
Articles 12.1 and 12.3.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
25 (53)
12.6 Salix hereby warrants and undertakes that all quantities of the Product (in
bulk filled capsule form) supplied by it to Astra under the terms of this
Agreement shall as at the date of delivery be supplied fully in accordance
with the Bulk Product Specifications and the Finished Product
Specifications contained in Schedule 3 and shall have been manufactured in
accordance with all applicable laws and regulations including FDA Good
Manufacturing Practices, and in compliance with the Drug Master File for
the Product.
12.7 Upon the receipt of any delivery of the Product from Salix, Astra shall
test such Product (in accordance with the Quality Test Procedures to be
agreed and incorporated into Schedule 4 to this Agreement after execution
of this Agreement) and in the event that such Quality Test Procedures
reveal any breach of the warranty given in Article 12.6, Astra shall be
entitled to reject the full shipment of the Product within 45 days of
receipt of such shipment by notice in writing to Salix. Failure of Astra
to reject Product after such 45 day period shall constitute acceptance
thereof by Astra.
12.8 In the event of any dispute between the parties concerning any allegation
of breach of the warranty contained in Article 12.6 or concerning any
rejection or purported rejection of any shipment of the Product, a sample
quantity of the Product in question shall be delivered to an independent
laboratory (nominated by the mutual agreement of the parties) which shall
be supplied with copies of the Bulk Product Specifications, the Finished
Product Specifications and the Drug Master File and shall carry out testing
in accordance with the Quality Test Procedures and whose decision as to the
quality of such Product and as to any breach of warranty by such Product
shall, in the absence of manifest
26 (53)
error, be final and binding an the parties. The fees and expenses of such
laboratory testing shall be borne entirely by the party against whom such
findings are made.
12.9 The terms and conditions relating to the supply of the Product by Salix to
Astra shall be as set out in this Agreement and each written order placed
on Salix by Astra shall form a separate contract for the supply of the
Product. In the event of any conflicting term between this Agreement and
any order placed by Astra, this Agreement will apply.
13. PRICE
13.1 The price charged for the Product by Salix to Astra shall (save as provided
in Article 12.4, 13.5 and 13.6) be established in US Dollars as follows:
13.1.1 The price for the Product shall be finally determined by the end of
February of each calendar year for the preceding calendar year and
shall equal [*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
27 (53)
[*]
13.1.2 Until the price can be finally determined in accordance with
Article 13.1.1 the Product will be supplied at provisional prices
per unit as determined in good faith by Salix and Astra (at Launch
and thereafter on January 1 of each year) based on historical
figures, forecasts (including forecasted Net Sales for Product) and
best estimates;
13.1.3 Any balance resulting from differences between the provisional and
the final prices shall be settled by March 15 of the calendar year
in which the final prices are established;
13.1.4 The parties confirm their understanding that they will at the
latest three (3) months prior to Launch in good faith establish a
"floor price" for the supply by Salix to Astra of the Product. It
is understood that Salix will be under no obligation to supply the
Product for commercial use hereunder at a price which is lower than
such established floor price unless otherwise agreed.
13.2 In order to calculate the price charged by Salix to Astra pursuant to
Article 13.1, Astra shall keep Salix informed of its best available
estimate of the annual Net Sales which it reasonably considers will be
obtained for the Product by Astra in the U.S.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
28 (53)
13.3 Astra shall keep full, proper and up-to-date books of account and records
showing clearly all transactions relating to the calculation of the Net
Sales. During the term of this Agreement, after Launch, Astra shall
furnish to Salix on a quarterly basis a written report covering Astra's
fiscal quarters showing the gross sales of all Product sold by Astra and/or
any Astra Associates during the reporting period and the calculation of Net
Sales from such gross sales. Reports shall be due forty-five (45) days
following the close of each respective quarter.
13.4 Astra shall allow Salix or its auditors or representative reasonable access
during normal business hours to inspect the books of account of Astra (or
any Astra Associate) in order to verify the annual Net Sales of Product
under this Article 13 Provided That such verification shall be at the sole
cost and expense of Salix. If such examination however reflects an
underpayment of five percent (5%) or more of the amount that should have
been paid for the period audited, then Astra will bear the expense of the
audit.
13.5 Salix shall provide such supplies of the Product to Astra as Astra may
reasonably require for the conduct of clinical trials at cost to Salix (as
specified in Article 13.6).
13.6 The Product supplied by Salix to Astra for the purpose of Product samples
shall be supplied to Astra [*] for a period of [*] from the date of Launch
Provided That:
13.6.1 The quantities so delivered in any one year shall not exceed [*] of
the total aggregate units of Product sold by Astra in such year; and
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
29 (53)
13.6.2 For the purpose of determining [*] it is understood that this shall
include direct costs of material, labor and interest direct
manufacturing overhead, and insurance and shipping costs, but shall
not in any circumstances exceed [*] of such Product in the U.S. for
such year (determined as if such Product had been sold by Astra at
the average Net Sales price per unit of Product during such period);
and
13.6.3 Articles 13.3 and 13.4 shall apply mutatis mutandis with respect to
Salix for the purpose of verifying [*] prices charged;
Provided Further That for the avoidance of doubt Salix shall be entitled to
charge and receive the price for Product calculated in accordance with
Article 13.1 (as if such Product had been sold by Astra at the average Net
Sales price per unit of Product during such period) in respect of any
supplies of Product samples made after such [*] period or made during such
[*] period which are in excess of such [*] figure.
14. TERMS OF PAYMENT
14.1 Payment is strictly net cash to be paid to Salix within thirty (30) days
from the date of invoice in US Dollars. Such payment shall be made in USD
by express payment through the banking system into such bank account as
Salix shall designate for such purpose.
14.2 If payment is not made as set out in Article 14.1 for any bulk delivery of
the Product to Astra Salix
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
30 (53)
reserves the right:
14.2.1 To charge interest to Astra at the lower of the rate of 2% (two per
cent) per annum above the prime rate set by the Bank of America on
all past due amounts (such interest to accrue on a day-to-day basis
to the date of payment or the maximum interest allowable by law; and
14.2.2 To require payment in advance for any delivery of the Product made
prior to receipt of such payment in full.
15. DELIVERY
15.1 Delivery of the Product to Astra by Salix shall be F.O.B. any continental
U.S. manufacturing plant of Product (including Puerto Rico) or any port of
entry into the continental U.S. (the "FOB Location").
15.2 Risk in the Product shall pass to Astra on delivery to the FOB Location and
Astra shall be responsible for insuring the Product from the date of
delivery to the FOB Location at its own cost and expense.
16. LICENSE TO MANUFACTURE
16.1 Save only in the circumstances set out below, Salix shall manufacture the
Product and shall supply Astra with such quantities of the Product as it
shall require (subject to the provisions of Article 12) and (save as
expressly provided in this Article 16) Astra shall have no right, title or
interest in any of the Patents or proprietary rights relating to the
Product and is entitled to use the same only under the terms of this
Agreement;
31 (53)
16.2 In the event that Salix shall:
16.2.1 Be in breach of its obligations to supply the Product as specified
in Article 12 and shall fail to remedy such breach within 90 days of
written notice from Astra requiring remedy; or
16.2.2 Give Astra 180 days notice in writing of its intention to cease to
supply Astra with the Product; or
16.2.3 By reason of Force Majeure be prevented from supplying the Product
to Astra for a period exceeding 180 days;
Astra shall be entitled, by service of notice in writing to Salix forthwith
upon receipt of such notice from Salix, to acquire a non-exclusive license
to manufacture the Product. So manufactured Product may only be sold in
the U.S. on an exclusive basis in accordance with the terms of this
Agreement. Such license shall commence upon the effective date of such
notice and shall be granted and continue upon the terms and conditions
contained in Schedule 5.
16.3 In the event that during any period in which Salix shall fail to supply the
Product to Astra by reason of;
16.3.1 any breach by Salix in respect of which notice shall have been
served under Article 16.2.1; or
16.3.2 any Force Majeure notified by Salix to Astra under Article 16.2.3
Astra wishes to manufacture quantities of the
32 (53)
Product to satisfy requirements for the Product in the U.S. Astra shall (by
notice in writing to Salix) forthwith be entitled to a temporary license to
manufacture the Product during such period only and Provided That:
16.3.3 Such license shall be upon the terms specified in Schedule 5; and
16.3.4 Such license shall permit manufacture by Astra of only such
quantities of the Product as may reasonably be required to fulfill
actual and reasonably anticipated orders on Astra for the Product
during such period and a reasonable period thereafter.
16.4 In order to satisfy itself of its ability to manufacture the Product, Astra
(or an Astra Associate) shall be entitled at any time during the term of
this Agreement to effect one trial manufacture of bulk quantity of the
Product Provided Always That:
16.4.1 Salix shall provide such assistance and technical information as
Astra may reasonably require for such trial; and
16.4.2 Salix shall be entitled to attend and observe such trial; and
16.4.3 Such trial shall be conducted at the sole cost and expense of Astra
and if such trial quantity is used by Astra for commercial purposes
in the U.S., be entitled to charge Astra for the Product produced as
if it were Product sold by Salix to Astra under this Agreement at a
price calculated [*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILLED SEPARATELY
WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS
BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
33 (53)
obtained by Salix on the supply of Product under the terms of this
Agreement, [*] in the U.S. (determined as if such Product had been
sold by Astra at the average Net Sales price per unit of Product
during such period) or such higher figure as Salix may show by
documentary evidence [*].
16.4.4 Astra shall be solely responsible and liable for the quality of the
Product produced in the trial and for all expenses necessary to
register Astra as a supplier of Product in the U.S.; and
16.4.5 Astra shall be licensed to use the Patents and any intellectual
property rights existing in the Product for such trial only and
solely for purposes of sales in the U.S.; and
16.4.6 Astra shall not use all or any information received for the purpose
of the trial for any other purpose whatsoever and shall not use the
same after the trial unless and until a license to manufacture
Product shall became effective under the terms of Articles 16.2 and
16.3; and
16.4.7 Upon the successful completion of Astra's trial manufacture under
Article 16.4, Salix shall apply, at Astra's expense, for
registration of Astra as a supplier of Product in the U.S. under the
Drug Master File for the Product Provided Always That Astra shall
not exercise any right as such a registered supplier unless and
until a
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
34 (53)
manufacturing license shall become effective under Articles 16.2
and 16.3.
PART D - TRADEMARK LICENSE
17. TRADEMARK LICENSE
17.1 Salix hereby grants to Astra a sole and exclusive license to use the
Trademark on the Product and in connection with the marketing and
commercialization of the Product in the U.S. only. Astra agrees to utilize
the Trademark on all Product sold in the U.S. during the term of the
trademark license granted hereunder.
17.2 Salix undertakes to procure the grant of such rights and license as may
reasonably be required to give effect to Article 17.1 from the Trademark
owner and shall use reasonable endeavors to obtain such owner's execution
of such agreements as are referred to in Article 9.3.2.
17.3 Astra hereby confirms and acknowledges that it is licensed to use the
Trademark only as set out in this Agreement and Astra further:
17.3.1 Acknowledges that all goodwill in the Trademark in the U.S.
(whether or not generated by the activities of Astra under this
Agreement) shall vest in such trademark owner as Salix shall
identify; and
17.3.2 Acknowledges that any application for registration of the Trademark
shall only be made in the name of such trademark owner as Salix
shall identify; and
35 (53)
17.3.3 Undertakes to transfer and assign to Salix (or as it may direct)
any right, title or interest required by Salix for registration of
the Trademark in any part of the U.S. in the name of such owner of
the Trademark as Salix shall direct and for all goodwill in the U.S.
to such owner.
17.4 In consideration of the rights and license granted to Astra by Salix in
respect of the Trademark, Astra shall pay to Salix a license fee at the
rate of [*] of all Product bearing the Trademark supplied by Astra (or any
Astra Associate) to any third party. Such license fee shall commence on the
date of this Agreement and shall continue to be payable for such period of
time in which Astra shall continue to use the Trademark under the license
hereby granted.
18. LICENSE PAYMENT
18.1 Astra shall keep true and accurate records of the sales of all Product
manufactured by it pursuant to any license granted under Articles 16.2 and
16.3 and of all Product sold by it at any time bearing the Trademark and
Astra shall within ninety (90) days of the end of each period of three
months (such periods to end on March 31, June 30, September 30 and December
31) send Salix a full statement showing the calculation of all sums due and
owing to Salix:
18.1.1 In respect of the manufacturing license under the provisions of
Article 6 of Schedule 5; and
18.1.2 In respect of the Trademark License under the provisions of Article
17
and with such statement shall make payment in US Dollars by express payment
through the banking
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
36 (53)
system into such bank account as Salix shall designate for such purpose, of
such sum as is shown as due on the statement.
18.2 Astra shall allow Salix or its auditors or representative reasonable access
during normal business hours to inspect the books of account of Astra or
any Astra Associate in order to verify the accuracy and calculation of any
statements delivered under Article 18.1 Provided That such verification
shall be at the sole cost and expense of Salix. If such examination however
reflects an underpayment of five percent (5%) or more of the amount that
should have been paid for the period audited, then Astra will bear the
expense of the audit.
18.3 Interest shall be payable to Salix by Astra at the lower of the rate of two
percent (2%) above the prime lending rate set by the Bank of America from
time to time or the maximum interest allowable by law on all on all past
due amounts payable by Astra to Salix under the provisions of this Article
18, both before and after judgement.
PART E - MISCELLANEOUS
19. INDEMNIFICATION
19.1 Salix hereby agrees to indemnify Astra against any action, claim, loss and
damage suffered by or awarded against Astra (as well as attorney's fees and
defense costs) in connection with any claim against Astra from a third
party arising from any statement or presentation with respect to the
Product or Balsalazide made by Salix or its authorized agents or employees
(excluding Astra or any Astra Associate) which is inconsistent,
37 (53)
contradictory or misleading to the information of or for the Product
included in the package insert for Product, or from any breach by Salix (or
its subcontractors or nominees) of the warranty and undertaking contained
in Article 12.6 Provided Always That such indemnity shall not extend to any
liability, cost, expense or damage suffered or incurred by reason of any
defect in any Product which was detected or should have been detected by
Astra by means of the Quality Test Procedures applied (or which should have
been applied) by Astra within 45 days of the date of delivery of the
Product under the provisions of Article 12.7.
19.2 Astra undertakes to indemnify and hold Salix harmless against all and any
action, loss, damage, claim or liability (including Attorney's fees and
defense costs) suffered or incurred by Salix in any circumstances
whatsoever save only where Salix is liable under Article 19.1.
20. CONFIDENTIAL INFORMATION
20.1 Astra hereby agrees and undertakes that during the application of this
Article 20 and for a period of ten years thereafter (howsoever termination
may be caused or arise) Astra and any Astra Associate shall keep
confidential and shall not without the prior written consent of Salix
disclose to any third party or use (except as specifically provided in this
Agreement) any information of a confidential nature belonging to Salix or
Biorex (including without limitation trade secrets and information of
commercial value) which may become known to Astra from Salix in connection
with this Agreement Provided Always That such obligation of confidentiality
shall not extend to any part of such confidential information which:
38 (53)
20.1.1 Shall otherwise than by reason of any default by Astra or any Astra
Associate become freely available to the general public; or
20.1.2 Astra can show by documentary evidence was in its possession or
control prior to disclosure free of any obligation of
confidentiality; or
20.1.3 Astra can show by documentary evidence shall have come into the
possession or control of Astra from a third party free of any
obligation of confidentiality subsequent to disclosure hereunder; or
20.1.4 Astra is obliged by law or regulation to disclose to a third party
provided that such disclosure shall only be to the extent required
by such law or regulation.
20.1.5 Astra or any Astra Associate is authorized to use under separate
agreements with Biorex or its licensees, provided however that any
such use shall be governed by and limited to what is stated in such
agreements.
and Provided Further that in the event that this Agreement is terminated by
Salix, Astra shall forthwith cease any use of such information for any
purpose whatsoever.
20.2 Astra shall ensure that any employee of, or consultant to, Astra or any
Astra Associate who shall obtain any confidential information in connection
with the performance of this Agreement shall be bound by obligations of
confidentiality substantially similar to the provisions of Article
39 (53)
20.1.
20.3 Salix acknowledges the importance of keeping all material information
relating to the Product confidential and Salix will use all reasonable
endeavors to make sure that no such information is made public or otherwise
made available to third parties in any manner which would jeopardize the
exclusivity in the U.S. granted to Astra hereunder.
21. INTELLECTUAL PROPERTY
21.l Salix hereby represents and warrants to Astra as at the date of this
Agreement (with the intent that Astra has relied upon such representations
and warranties in entering into this Agreement) that:
21.1.1 The Biorex Agreement (which has been disclosed to Astra) contains
all the terms concerning the arrangements between Biorex and Salix
affecting the U.S. and that there is no other fact or circumstance
relating to the Biorex Agreement that is material to the Project
and/or this Agreement and which might reasonably be expected to
affect the decision of Astra to enter into this Agreement which has
not been disclosed to Astra by Salix; and
21.1.2 Biorex is the sole legal owner of the Patents listed in Schedule 1;
and
21.1.3 So far as Salix is aware the issued Patents are valid and
subsisting; and
21.1.4 So far as Salix is aware and save as indicated therein the Product
Information is accurate and complete in all material
40 (53)
respects and there is nothing contained therein which might render
the Product Information misleading in any material respect; and
21.1.5 Except as disclosed in writing to Astra, so far as Salix is aware
the Trademark is available for use in connection with the Product in
the U.S. and does not infringe the rights of any third party;
Provided Always That Salix shall not be liable in any respect for any
breach of the warranties contained in Articles 21.1.1 and 21.1.5 unless
notice in writing specifying details of such breach shall have been served
on Salix by Astra prior to the twelfth anniversary of the date of this
Agreement.
21.2 Astra acknowledges that save as expressly provided herein or as may be
required in connection with the performance by Astra of any obligations
hereunder, Astra shall have no right, title, interest or license in or to
the Patents or otherwise any intellectual property rights of Biorex or
Salix in Balsalazide, the Trademark or the Product, including without
limitation the results of the Project.
21.3 In the event that either party becomes aware of any infringement by any
third party within the U.S. of any intellectual property rights of Salix
and/or Biorex in the Patents, Balsalazide, the Product or the Trademark it
shall forthwith notify the other party. Salix shall be entitled to take
such action (or procure such action by Biorex) as it may in its sole
discretion consider appropriate against any such third party infringer
Provided Always That:
21.3.1 Astra shall give such assistance as Salix
41 (53)
may reasonably require in connection with any such action (subject
to reimbursement by Salix of all costs reasonably incurred by
Astra); and
21.3.2 Salix shall keep Astra informed of the conduct and progress of such
action but shall be entitled to conduct, pursue and settle such
action in such manner as it shall reasonably consider appropriate
and to retain any damages awarded against any such infringer;
In the event that such infringement shall continue for a period of sixty
(60) days after Salix has knowledge of the infringement and Salix shall
fail to take or procure any action to prevent any continued infringement
Astra may (in its sole discretion) at its sole expense initiate and pursue
such action as it considers appropriate to prevent any continued
infringement Provided Further That:
21.3.3 Salix shall give (and shall use reasonable endeavors to procure
from Biorex) such assistance as Astra may reasonably require in
connection with any such action (subject to reimbursement by Astra
or all costs reasonably incurred by Salix and/or Biorex); and
21.3.4 Astra shall keep Salix informed of the conduct and progress of such
action but shall be entitled to conduct, pursue and settle such
action in such manner as it shall reasonably consider appropriate
(having regard to the continuing value of any such intellectual
property rights to Salix and/or Biorex and the effect which any such
infringement shall have had or will have on the sale in the U.S. by
Astra
42 (53)
of the Product) and to retain any damages awarded against any such
infringer.
21.4 In the event that any claim is made against Astra by any third party
alleging infringement of any rights of any third party by the use and
exploitation of the Product by Astra, Astra shall be entitled at its sole
cost and expense to defend any such claim in such manner as it may in its
sole discretion consider appropriate Provided Always That:
21.4.1 Salix shall give (and shall use reasonable endeavors to procure
from Biorex) such assistance as Astra may reasonably require in such
action (subject to reimbursement by Astra of all costs reasonably
incurred by Salix and/or Biorex); and
21.4.2 Astra shall keep Salix informed of the conduct and progress of such
action but shall be entitled to conduct, pursue and settle such
action in such manner as it shall reasonably consider appropriate
(having regard to the continuing value of any such intellectual
property rights to Salix and/or Biorex and the effect which any such
infringement shall have had or will have on the sale in the U.S. by
Astra of the Product) and to retain any damages awarded against such
infringer; and
21.4.3 Save only for any liability arising by reason of any breach by
Salix of the warranties contained in Article 21.1, Salix shall not
be liable in any manner whatsoever to Astra for any loss or damages
suffered incurred or awarded against Astra in connection with any
such claim.
43 (53)
22. SUB-DISTRIBUTORS AND SUB-LICENSEES
22.1 Astra is hereby granted the right to appoint subdistributors for the
Product Provided Always That
22.1.1 Astra shall remain solely liable for the performance of its
obligations hereunder; and
22.1.2 Any sub-distributor appointed shall only be an Astra Associate.
23. ASSIGNMENT
23.1 The benefit of this Agreement is personal to Astra and Salix and shall not
be capable of assignment by either of them without the prior consent in
writing of the other party (such consent not to be unreasonably withheld or
delayed). Salix may however assign this Agreement to its associated
company, Glycyx Pharmaceuticals Ltd. a company incorporated under the laws
of Bermuda with its registered office at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇,
▇▇▇▇▇▇▇ ("Glycyx").
24. FORCE MAJEURE
24.1 If the performance of any obligations under this Agreement by either party
is affected by Force Majeure, it shall forthwith notify the other party of
the nature and extent thereof.
24.2 Neither party shall be deemed to be in breach of this Agreement or
otherwise be liable to the other by reason of any delay in performance or
nonperformance of any of its obligations hereunder to the extent that such
delay or nonperformance is due to any Force Majeure which has been notified
to the other party in writing.
44 (53)
25. COSTS
25.1 Each party hereto shall bear its own costs in relation to the negotiation,
drafting, preparation and execution of this Agreement.
25.2 All payments made by Astra to Salix under this Agreement shall be made free
and clear of, and shall shall not be reduced or offset by any non-U.S.
withholding taxes, which shall be the sole responsibility of Astra. Astra
shall make all such required payments and shall provide Salix with a
certificate evidencing payment of any such withholding tax.
26. CONFIDENTIALITY OF THIS AGREEMENT
26.1 The content of this Agreement shall remain confidential as between the
parties. Neither party shall, without the prior written consent of the
other (such consent not to be unreasonably withheld without justification),
disclose any of the financial terms of this Agreement to any other person,
firm or company save for:
26.1.1 disclosure by Salix to Biorex, Glycyx or proposed investors in
circumstances where such third party shall have accepted obligations
of confidentiality in respect of the information disclosed; and
26.1.2 such disclosure as may be required by any relevant law or
regulatory authority.
27. NATURE OF THE AGREEMENT
27.1 Nothing in this Agreement shall create or be deemed to create any
partnership, joint venture or the relationship of principal and agent
between the
45 (53)
parties.
27.2 EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, SALIX MAKES NO
REPRESENTATION OR WARRANTY AS TO THE PRODUCTS, EXPRESS OR IMPLIED, EITHER
IN FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND SALIX
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES,
INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR WARRANTY
OF FITNESS FOR A PARTICULAR PURPOSE.
27.3 EXCEPT AS PROVIDED IN THIS AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE
LIABLE FOR COSTS OF PROCUREMENT OF SUBSTITUTE PRODUCTS OR SERVICES, OR FOR
ANY LOST PROFITS OR OTHER CONSEQUENTIAL, INCIDENTAL, SPECIAL, OR INDIRECT
DAMAGES OF THE OTHER PARTY, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY,
ARISING OUT OF THIS AGREEMENT. THESE LIMITATIONS SHALL APPLY
NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.
27.4 This Agreement (including all the Schedules) and any agreements entered
into pursuant to this Agreement constitutes the entire understanding and
agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements, negotiations and discussions
between the parties relating to this Agreement.
27.5 This Agreement may not be released, discharged, abandoned, charged or
modified, in any manner, except by an instrument in writing signed by a
duly authorized officer of representative from each of the parties hereto.
27.6 Dispute Resolution; Governing Law. This Agreement shall be governed by and
---------------------------------
construed in accordance with the laws of the state of New York, excluding
any choice of law rules which may direct the
46 (53)
application of the law of any other jurisdiction. In the event of the
occurrence of a dispute relating to a party's rights or obligations
hereunder, either party may, by notice to the other party, have such
dispute referred to their respective President or other designee, for
attempted resolution by good faith negotiations within thirty (30) days
after such notice is received. All such disputes shall be addressed in
English. In the event such officers are not able to resolve such dispute
within such thirty (30) day period, the parties agree that the dispute will
be submitted to binding arbitration which shall be in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. Any
arbitration or litigation initiated hereunder shall be (i) held in Santa
▇▇▇▇▇ County, California if the demand for arbitration or litigation is
initiated by Astra and (ii) held in Boston, Massachusetts if the demand for
arbitration or litigation is initiated by Salix. In the event of
arbitration, there shall be three (3) arbitrators, one (1) chosen by Astra,
one chosen by Salix and a third to be selected by the two arbitrators so
chosen. The costs of arbitration including reasonable attorney's fees,
shall be borne by the party designated by the arbitrators. For the purpose
of accepting service of process in connection with any action commenced
hereunder, the parties hereto hereby absolutely, unconditionally and
irrevocably appoint the following agents to accept process on their behalf;
it being unconditionally agreed that for this purpose such process will be
properly and effectively served if the same is left at the addresses set
out below:
Astra: Astra USA, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
F.A.O. President
47 (53)
Salix: Salix Pharmaceuticals, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
F.A.O. President
28. NOTICES
28.l All Notices to be served by the parties to this Agreement shall be served
only in the English language.
28.2 Notices shall be sufficiently served if dispatched by first class or
express post (meaning the fastest normal method of mail transmit in the
country of dispatch) to the address of the receiving party set out below
Astra: AB ▇▇▇▇▇
▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
F.A.O. Vice President Legal Affairs
copy to: Astra USA, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
F.A.O. President
Salix: Salix Pharmaceuticals, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇
F.A.O. President
Any modification to these address must in itself be notified in writing to
the other party in accordance with the terms of this sub-clause.
28.3 In the absence of proof to the contrary and subject to Article 28.4,
notices properly sent hereunder shall be deemed to have been duly served 10
days after the date of dispatch.
28.4 It shall be permitted for notices to be served hereunder by facsimile
transmission and for this purpose the following fax numbers below shall
apply:
48 (53)
28.4.1 In the case of Salix at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇, ▇▇▇ facsimile transmission number (▇▇▇) ▇▇▇-▇▇▇▇ and
marked for the attention of the President; and
28.4.2 In the case of Astra at ▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ facsimile
transmission number (▇) ▇▇ ▇▇ ▇▇ ▇▇ and marked for the attention of
Vice President Legal Affairs with copy to ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇, ▇▇▇ facsimile transmission number (▇▇▇) ▇▇▇-▇▇▇▇ and
marked for the attention of the President;
provided that such notice is confirmed by return facsimile and shall be
deemed served 24 hours after the time of receipt of such return facsimile.
PART F - TERMINATION AND EFFECTS THEREOF
29. TERMINATION
29.1 Unless terminated earlier as set forth in this Agreement, the rights and
obligations of the parties contained in Articles 2-16 and 21-31 shall cease
forthwith upon the later of (i) the date of expiry of the validity of the
last to expire of the Patents (including any exclusivity extension for the
Product in the U.S. granted by or through the FDA or applicable
governmental body), or (ii) nine (9) years from the Launch of Product
Provided Always That:
29.1.1 The Trademark License granted under Article 17 shall continue
thereafter in accordance with its terms and Article 18 will remain
valid with respect to Article 17; and
49 (53)
29.1.2 Any license granted to Astra to manufacture under Article 16.2
shall continue indefinitely thereafter in accordance with Article
6.4 of Schedule 5; and
29.1.3 Astra is entitled to continue to sell the Product indefinitely
thereafter.
29.1.4 Salix is free to manufacture and sell the Product in the U.S.
indefinitely thereafter to any party.
29.2 Either party to this Agreement shall be entitled to terminate this
Agreement forthwith by notice in writing to the other in the event that:
29.2.1 The other party shall fail to pay any sum due hereunder on the due
date and shall fail to remedy such breach within thirty (30) days of
being required in writing by the other party so to do; or
29.2.2 The other party shall commit a material breach of any of the terms
and conditions of this Agreement and shall fail to remedy the same
(if capable of remedy) within ninety (90) days of being required in
writing by the other party so to do; provided that such right of
termination shall not arise in the event of any breach by Salix of
its obligations under Article 12 which circumstance is governed by
the provisions of Article 16 only; or
29.2.3 The other party goes into liquidation (either voluntary or
compulsory or shall be the subject of any petition for winding up;
or
50 (53)
29.2.4 The other party shall make any assignment or arrangement for the
benefit of its creditors or cease to carry on its business in the
ordinary course; or
29.2.5 A receiver, administrative receiver, or receiver and manager, or
judicial manager or administrator is appointed over the whole or any
part of the assets of either party or if any court proceedings are
commenced for the appointment of an administrator or receiver to
either party; or
29.2.6 The other party shall become unable to pay its debts as they become
due in the ordinary course of business or shall otherwise become
subject or seek relief under any law relating to insolvency in any
jurisdiction relevant to such other party; or
29.2.7 The party serving such notice shall have served notice of
termination on such other party under the provisions of Article 29.2
provided that in the event that Astra assumes all obligations in
connection with the conduct and completion of the Project in
accordance with Article 6.5 or 6.6, no event referred to in such
Article 6.5 or 6.6 shall constitute grounds for breach under this
Agreement.
51 (53)
29.3 Any waiver by either party of a breach of any provision of this Agreement
shall not be considered as a waiver of any subsequent breach of the same or
any other provisions of this Agreement.
29.4 Any termination of this Agreement shall be without prejudice to the right
of either party to recover any monies due to it under this Agreement or the
rights or remedies of either party in respect of any breach prior to the
effective date of termination of this Agreement.
29.5 Salix undertakes that during the term of this Agreement it shall not
exercise any right which it may have (or may acquire) to terminate the
Biorex Agreement without prior consultation with Astra and without taking
such action as may be appropriate to ensure that the rights granted to such
other hereunder are not prejudiced to any material extent.
30. CONSEQUENCES OF TERMINATION
30.1 In the event of termination of this Agreement under Article 29.2 by Salix
or as provided in Articles 6.5.1 or 6.6, prior to its expiry under Article
29.1 Astra shall:
30.1.1 Forthwith, cease all marketing, sale and promotion of the Product;
and
30.1.2 Immediately telegraphically transfer all monies due and payable to
Salix as at the date of termination into Salix's bank account
designated under Article 14.1; and
30.1.3 Immediately return to Salix all information and data of whatsoever
nature relating to the Product together with all copies thereof
(other than correspondence between
52 (53)
Salix and Astra) which Astra may have in its possession or under its
control including but without limitation all scientific, medical and
safety data relating to the Product; and
30.1.4 Immediately cease use of (i) all or any confidential information of
Salix delivered in connection with this Agreement and (ii) the
Trademark; and
30.1.5 Take all such steps as may reasonably be required to transfer or
procure the transfer to Salix (or its nominee) of all such product
licenses and approvals as may have been obtained for the marketing
and sale of the Product in any part of the U.S.; and
30.1.6 Salix shall purchase such stocks of the Product (inclusive of
packaging) as Astra shall still have in its possession (once Astra
has fulfilled all orders outstanding as at the date of termination)
at a price calculated as cost price to Astra Provided That Salix
shall not be obliged to purchase any of the stocks of the Product
which do not have at least two thirds of its approved shelf-life
unexpired or are otherwise not of merchantable quality.
30.2 In the event of termination of this Agreement under Article 29.2 by Astra
prior to its expiry under Article 29.1, the rights and obligations of Astra
shall be as provided by the terms of the Biorex/Astra Agreement.
53 (53)
PART G - ASTRA OPTION
31. ASTRA OPTION
Astra will have a first right of refusal to obtain U.S. marketing rights to
gastrointestinal products for which Salix has obtained such rights from a third
party and where Salix chooses not to assume the sole and exclusive
responsibility for marketing.
Salix will submit to Astra a proposal including commercial terms and
technical information sufficient for Astra to make an informed decision.
Astra will have exclusive rights to evaluate and negotiate with Salix for
the following 6 months and during which time Salix will negotiate in good
faith. Upon expiration of 6 months, Salix can contract with third parties
but at terms no less favorable than those last offered by Astra.
For gastrointestinal products which Salix obtains as a result of its own
internal research and development efforts, Salix agrees to discuss these
products first with Astra with the intention of initiating a business
discussion.
This Agreement has been duly executed by the duly authorized representatives of
the parties hereto effective as of the day and year first above written.
SALIX PHARMACEUTICALS INC AB ASTRA
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ By: /s/ signature unreadable
Title: President Title: President & CEO
EXHIBIT A
DATED April 30 1993
-----------------------------------------
BIOREX LABORATORIES LIMITED (1)
- and -
AB ASTRA (2)
AGREEMENT
TABLE OF CONTENTS
-----------------
Page
----
1. Definitions............................................ 1
2. Commencement........................................... 3
3. Appointment of Astra................................... 4
4. Regulatory Approvals................................... 5
5. Astra's Undertakings................................... 6
6. Product Database and Adverse Reactions Reporting....... 7
7. Clinical Trials and Developments....................... 8
8. Licence to Manufacture................................. 9
9. Trademark Licence...................................... 10
10. Licence Payment........................................ 11
11. Product Liability...................................... 12
12. Confidential Information............................... 12
13. Intellectual Property.................................. 13
14. Sub-Distributors....................................... 14
15. Termination............................................ 14
16. Consequences of Termination............................ 15
17. Assignment............................................. 16
18. Force Majeure.......................................... 16
19. Costs.................................................. 17
20. Confidentiality of This Agreement...................... 17
TABLE OF CONTENTS - (Cont.)
---------------------------
Page
----
21. Nature of the Agreement............................... 17
22. Notices............................................... 18
THIS AGREEMENT is made the 30th day of April, 1993
--------------
BETWEEN:
-------
(1) BIOREX LABORATORIES LIMITED, a company incorporated under the laws of
---------------------------
England and Wales having its registered office at ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ ("Biorex"); and
(2) AB ASTRA, a company incorporated under the laws of Sweden whose principal
--------
place of business is at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇ ▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
("Astra").
WHEREAS:
-------
(A) Salix Pharmaceuticals, Inc., a company incorporated under the laws of
California and whose registered office is at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇ ("Salix") and Biorex have entered into a License Agreement
dated as of January 17, 1991, as amended and restated by an agreement of
even date herewith. The January 17, 1991 Agreement, as amended, is
referred to in this Agreement as the "Biorex/Salix Agreement."
(B) By a Co-Participation Agreement of even date herewith between Salix and
Astra (the "Salix/Astra Agreement"), Salix has entered into arrangements
with Astra concerning further research and development of the
pharmaceutical product licensed to Salix by Biorex, and Salix has sub-
licensed certain of the rights granted to it by Biorex under the terms of
the Biorex/Salix Agreement to Astra for a defined territory.
(C) Astra wishes to ensure that its rights to manufacture and distribute such
pharmaceutical product will not be prejudiced by any action by Salix or
circumstances which might give Biorex rights to terminate the Biorex/Salix
Agreement or by any termination by Astra of the Salix/Astra Agreement and
Biorex and Astra have agreed to enter into this Agreement upon the terms
and conditions hereof.
NOW IT IS HEREBY AGREED as follows:
-----------------------
1. DEFINITIONS
-----------
1.1 In this Agreement the following words shall have the following meanings:
"Applications" means the treatment of Diseases of Digestive System
according to WHO classification of diseases Class 52.
"Astra Associate" means any company which is a holding company of Astra
or a subsidiary of Astra and any other subsidiary of
any such holding company or subsidiary and for this
purpose a company
-1-
shall be deemed to be a "subsidiary" of another if that
other is a member of it and controls the composition of
its board of directors.
"Balsalazide" means 5-[4(2-carboxyethylcarbamoyl)-phenylazo]-
salicylic acid disodium salt dihydrate.
"Biorex/Salix
Agreement" means the agreement dated January 17, 1991 between
Salix and Biorex, as amended and restated by an
agreement of even date to this Agreement.
"Salix/Astra
Agreement" means the Co-Participation Agreement of even date to
this Agreement between Salix and Astra.
"Dossier" shall mean the master regulatory dossier relating to
the Product prepared under and in accordance with the
terms of the Salix/Astra Agreement.
"Excluded
Territory" the entire world excluding the Territory, Japan, Korea
and Taiwan.
"Factory Sale Price" means the ex factory sales price of each Product
actually charged by Astra (or any Astra Associate) for
each shipment of Product on an arms length open market
basis to any third party (being a person firm or
company which is not an Astra Associate) net only of
sales and purchase taxes, customs or import duties,
delivery charges, and returns and allowances. discounts
and chargebacks actually charged on each such shipment.
"Filing Date" means the date upon which the Dossier (completed in
accordance with the terms of die Salix/Astra Agreement)
shall be submitted by Salix for registration within the
U.S. under Clause 2.6 of the Salix/Astra Agreement.
"Force Majeure" means in relation to either party any circumstances
beyond the reasonable control of that party (including
but not limited to strike, lock out or other form of
industrial action, act of God, war, riot, accident,
breakdown in plant or machinery, fire, flood, explosion
or government action).
-2-
"Salix" means Salix Pharmaceuticals, Inc.. a company
incorporated under the laws of California and whose
registered office is at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇
▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
"Launch" means a commercial launch by Astra (or any Astra
Associate) of the Product throughout the Territory
supported by such marketing expense and support and
launched in such quantities as may reasonably be
appropriate for the Product to have a significant
effect on total sales of any similar or competitive
product.
"the Patents" means the patents and applications therefor relating to
Balsalazide listed in Schedule 1 to the Salix/Astra
Agreement.
"Product" means a pharmaceutical preparation in capsule form
containing Balsalazide for the Applications and such
other pharmaceutical preparations containing
Balsalazide for the Applications as may be developed by
Salix during the term of the Salix/Astra Agreement or
by Biorex during the term of this Agreement.
the "Territory" means the United States of America, its territories and
possessions.
the "Trade ▇▇▇▇" means the trade name "Colazide" registered as a
trademark for use on pharmaceutical preparations in the
Territory and any other tradename designated by Biorex
for use in connection with the Product in any part of
the Territory.
1.2 The headings in this Agreement are for convenience only and shall not
affect its interpretation.
1.3 References to documents in the approved form shall be references to
documents in the form agreed between the parties and initialled by both
parties for the purposes of identification.
2. COMMENCEMENT
------------
2.1 The rights and obligations of the parties under this Agreement shall only
come into force if either:
2.1.1 Biorex terminates the Biorex/Salix Agreement in accordance with its
terms; or
-3-
2.1.2 Astra terminates the Salix/Astra Agreement pursuant to Clause 29.2
thereof and consequently Biorex terminates the Biorex/Salix Agreement
in accordance with its terms.
2.2 For the avoidance of doubt Biorex shall not be liable to Astra or incur any
obligation to Astra for any act or omission of Salix in respect of the
Salix/Astra Agreement.
2.3 Any payments which would otherwise have become payable to Salix pursuant to
Clause 11.1.3 of the Salix/Astra Agreement but which have not at the date
of termination of the Biorex/Salix Agreement or at the date of termination
of the Salix/Astra Agreement (as the case may be) in accordance with Clause
2.1 above become due and payable to Salix shall be paid directly to Biorex
by Astra.
3. APPOINTMENT OF ASTRA
--------------------
3.1 With effect from the date this Agreement comes into force pursuant to
Clause 2.1 and in accordance with the terms and conditions contained in
this Agreement, Biorex hereby grants Astra an exclusive licence to sell
within and throughout the Territory Product manufactured in the Territory
by Astra pursuant to the licence granted in Clause 8.1. Astra shall not
have the right to grant sublicenses under this license or pursuant to the
Salix/Astra Agreement, except to an Astra Associate.
3.2 The rights granted hereunder to Astra shall be in respect of the Product
only. In the event that either party shall become aware of any indications
or applications for Balsalazide other than the Applications, it shall
forthwith notify the other party and shall supply the other party with such
details of the other indications and applications as may be available to it
Provided Always That:
3.2.1 Astra shall have a lint option to enter into good faith negotiations
with Biorex during the period six months from the supply of such
details in respect of an agreement concerning the development of
such other indications and applications and the grant to Astra of
the right to exploit the same in the Territory; and
3.2.2 Astra shall have no right whatsoever to use and exploit Balsalazide
in any such other indications and/or applications unless and until
completion of such good faith negotiations and the execution of a
written agreement in respect thereof; and
3.2.3 during such period in which Astra shall continue to negotiate in
good faith, Biorex shall not disclose details of such other
indications and/or applications to any third party or grant any
third party any rights therein in the Territory; provided that
Biorex shall not be prevented or precluded from disclosing the same
to any third party which shall have entered good faith negotiations
for the
-4-
acquisition of the right to exploit such other indications and/or
applications outside the Territory; and
3.2.4 in respect of any such other applications and indications disclosed
by Astra to Biorex of which Biorex was not already aware at the time
of such disclosure (as evidenced by its written records), Biorex
shall not use or exploit the same (either itself or through any
third party) in the Territory without the prior consent of Astra
(such consent not to be unreasonably withheld or delayed).
4. REGULATORY APPROVALS
--------------------
4.1 Astra shall not be able to exercise its rights hereunder unless and until
the Dossier shall have been completed and is available for filing with the
relevant regulatory authority in the Territory.
4.2 Astra undertakes to use all reasonable endeavours to file the Dossier and
to apply for and obtain all relevant regulatory health and price approvals
for the marketing and use of the Product in the Territory as soon as
reasonably practicable after the Filing Date.
4.3 Astra undertakes to use its best endeavours to apply for and obtain all
relevant regulatory health and price approvals for the marketing and use of
the Product in the Territory and to effect Launch of the Product in the
Territory within 90 days of the receipt of all necessary approvals for such
Launch.
4.4 Astra shall be solely responsible for effecting (at its sole cost and
expense) such amendments and translations to the Dossier as may be required
to procure that the Dossier complies with and satisfies the requirements of
any regulatory or approval authority within any particular part of the
Territory and Biorex shall not be obliged to incur any cost or conduct any
further test or development work or otherwise amend or translate the
Dossier whether before or after the Filing Date.
4.5 In the event that Astra shall fail to effect Launch in the Territory within
a period of 180 days after the grant of all necessary registrations,
approvals, price approvals, and reimbursements, then Biorex may in its
absolute discretion serve written notice on Astra (within 30 days of the
expiry of such period of 180 days) amending the rights of Astra to be
granted hereunder in respect of the Territory to those of a non-exclusive
distributor for the Product for the Territory only. Thereafter Biorex for
the avoidance of doubt shall also be entitled to exploit such rights and to
market and exploit the Product in the Territory (whether directly or
indirectly through any agent, contractor or licensee) in such manner as it
may in its sole discretion think fit; Provided Always that Astra will
retain exclusive rights to use the Trade ▇▇▇▇ in the Territory.
4.6 In the event that Astra's failure to effect Launch as stated in Clause 4.5
exceeds a period of twelve months from the grant of all necessary
registrations, approvals, price
-5-
approvals and reimbursements in the Territory, Biorex may at its sole
discretion serve written notice on Astra (within 90 days of the expiry of
such period of twelve months) terminating all rights granted hereunder to
Astra in respect of the Territory only and thereafter Biorex for the
avoidance of doubt shall be entitled to exploit such rights and to market
and exploit the Product in the Territory (whether directly or indirectly
through any agent, contractor or licensee) in such manner as it may in its
sole discretion think fit, free of any obligation to Astra; and Astra shall
have no rights with respect to the Product or the Trade ▇▇▇▇ in the
Territory.
5. ASTRA'S UNDERTAKINGS
--------------------
5.1 Astra shall use reasonable endeavours to promote, market and sell the
Product throughout the Territory and undertakes to allocate such
promotional and sales resources and such technical support for the
promotion, marketing and sales of the Product as may reasonably be required
to sell the Product. Astra agrees generally to use the same channels and
methods, exercising the same due diligence and adhering to the same
standards which it employs with respect to its other products.
5.2 Astra shall promote market and sell the Product in the Territory entirely
in accordance with the terms of any product licence, price approval (where
applicable) and other restrictions and regulations for the Product as may
be relevant and applicable within the Territory.
5.3 Astra further undertakes:
5.3.1 to promote, market and sell the Product in the Territory under the
Trade ▇▇▇▇ only and not to use any other trade name, trademark or
logo for or on the Product (Provided That the name "Balsalazide" may
be used but only as a generic name for the Product in accordance
with and as required by applicable laws and regulations); and
5.3.2 to enter into trade ▇▇▇▇ user agreements and such other agreements
(whether relating to the Trade ▇▇▇▇, Technical Standards or
otherwise) as may reasonably be required by Biorex or is required by
applicable regulations in any part of the Territory in connection
with the exploitation by Astra of the Product and/or the use by
Astra of the Trade ▇▇▇▇; and
5.3.3 to notify Biorex immediately of any improper or wrongful use of the
Trade ▇▇▇▇, the Patents or otherwise any proprietary or confidential
information of Biorex relating to the Product coming to Astra's
knowledge; and
5.3.4 forthwith to refer to Biorex all enquiries received for the supply
of the Product outside the Territory; and
-6-
5.3.5 not actively to seek customers for the Product outside the
Territory; and
5.3.6 to develop and design packaging for the Product in each part of the
Territory at its sole cost and expense Provided Always That the
general quality design and content of such packaging and any
information supplied with the Product by Astra shall be subject to
prior approval by Biorex: and
5.3.7 not to use any misleading statements or misrepresentations on the
Product packaging or use any defective packaging materials and to
comply in all respects with all local regulations and laws in
connection with the Product packaging and the information provided
thereon; and
5.3.8 in the sale and use of the Product in each part of the Territory to
comply with all relevant regulatory, health and pricing regulations
and approvals in such part of the Territory. For the avoidance of
doubt, Biorex shall not be responsible or liable in any manner
whatsoever for compliance with any such regulations and approvals
(whether or not it shall have assisted Astra in or approved the sale
or use of the Product in such part of the Territory); and
5.3.9 not to use any packaging which may adversely affect the Product in
any way whatsoever including but without limitation the Product's
approved shelf-life; and
5.3.10 not to incur any liability on behalf of Biorex or in any manner
pledge or purport to pledge Biorex's credit or accept any order or
make any contract binding on Biorex or give or make any
representation, warranties or conditions or quantities with
reference to the Product on behalf of Biorex. Astra is not and shall
not be deemed to be the agent of Biorex and in all correspondence
and dealings with third parties shall clearly indicate that it is
acting as a principal; and
5.3.11 To be solely responsible for the acts and omissions of its
employees and representatives in connection with the performance of
its rights and obligations hereunder.
5.4 Astra shall be entirely responsible for the collection of debts due to it
and shall bear all losses owing to its failure so to do.
6. PRODUCT DATABASE AND ADVERSE REACTIONS REPORTING
------------------------------------------------
6.1 Biorex shall maintain a database of all adverse and other reactions or
events occurring in connection with the Product in any part of the
Territory or the Excluded Territory and shall use reasonable endeavours to
procure that any such adverse and other reactions are notified to it in a
timely manner by any sub-licensee and/or distributor of the Product in the
Territory and the Excluded Territory.
-7-
6.2 Astra undertakes to notify Biorex:
6.2.1 forthwith in the event that it becomes aware of any serious or
previously unknown adverse reaction or contra indications to the
Product; and
6.2.2 within three months, on a quarterly basis of other adverse reactions
or contra indications to the Product other than stated under 6.2.1
6.3 Biorex undertakes to notify Astra:
6.3.1 forthwith in the event that it becomes aware of any serious or
previously unknown adverse reaction or contra indications to the
Product in any part of the Territory and the Excluded Territory; and
6.3.2 within three months, on a quarterly basis of other adverse reactions
or contra indications to the Product other than stated under 6.2.1.
6.4 In the event that Biorex or any third party shall conduct clinical studies
in support of any promotional or marketing activities of Biorex or such
third party within the Territory or the Excluded Territory, Biorex shall
use reasonable endeavours to grant or procure the grant to Astra of full
unrestricted access to the results of such trials so that Astra shall be
entitled to use such results in connection with the marketing, sale and use
of the Product in the Territory.
7. CLINICAL TRIALS AND DEVELOPMENTS
--------------------------------
7.1 Astra is authorised by Biorex to undertake clinical studies after the
Filing Date in support of Astra's regulatory, promotional and marketing
activities and to enhance the Product's approval and/or use within the
Applications Provided Always That:
7.1.1 such trials are conducted solely for such purposes and not for any
other purpose whatsoever; and
7.1.2 prior to the conduct of such trials, the trial objectives and
protocols are approved by Biorex (such approval not to be
unreasonably withheld or delayed and Provided Always That such
approval shall be deemed given by Biorex in the event that no
response is received by Astra from Biorex within 20 working days of
receipt by Biorex of any request for approval); and
7.1.3 Astra shall keep Biorex fully informed as to the conduct, progress
and results of such trials; and
-8-
7.1.4 Biorex shall have full unrestricted access to the results of such
trials and shall be entitled to disclose the same to third parties
for use in connection with the registration. marketing, sale and use
of the Product in the Excluded Territory only; and
7.1.5 Astra shall bear all the costs and expenses associated with such
trials (including but without limitation the costs of documentation
and administrative payments to trialists); and
7.1.6 such trials shall be conducted only in accordance with any
regulatory permissions and/or approvals granted for the Product in
such part of the Territory in which the trials are conducted.
7.2 It is anticipated that Astra shall support any symposia organised, arranged
or sponsored by Biorex involving areas of medicine relating to diseases of
the gastro-intestinal tract and similar conditions and shall nominate and
sponsor key physicians in the said field of medicine to attend at those
symposia (and in particular shall sponsor those physicians presenting the
results of clinical research studies relating to the Product).
8. LICENCE TO MANUFACTURE
----------------------
8.1 In consideration of the royalties payable under Clause 8.6 and subject to
the terms of this Agreement, Biorex hereby grants to Astra a licence to
manufacture the Product in the Territory for sale in the Territory pursuant
to the licence granted in Clause 3.1.
8.2 For the avoidance of doubt Biorex shall not be prevented from manufacturing
or continuing to manufacture the Product or appointing sub-contractors to
manufacture the Product for sale by Biorex or its customers both inside and
outside the Territory subject to the exclusivity granted to Astra in
respect of the Territory under Clause 3.1 above.
8.3 Biorex shall supply Astra with such technical information as it has in its
possession and is free to disclose as Astra may reasonably require (and
which has not previously been supplied to Astra by Salix) to assist Astra
to produce the Product in commercial quantities Provided Always that Biorex
shall be reimbursed all costs and expenses incurred by it in supplying such
information and assistance to Astra.
8.4 Astra undertakes to Biorex that it will manufacture the Product fully in
accordance with the Bulk Product Specification and the Finished Product
Specification set out in the Salix/Astra Agreement and with the Drug Master
File for the Product and in accordance with United States current Good
Manufacturing Practices.
8.5 Astra shall be entitled to market, distribute and sell the Product
manufactured by it only in accordance with the terms and provisions of this
Agreement.
-9-
8.6 In consideration of the licences granted in Clauses 3.1 and 8.1, Astra
shall pay to Biorex a royalty [*]
8.7 Astra shall be solely liable in all losses, damages, costs and expenses
arising out of any claim by any third party in connection with any Product
manufactured by Astra and Astra hereby agrees fully and effectively to
indemnify Biorex against any claims, damages, costs, expenses, or other
losses incurred by Biorex arising out of or in connection with any Product
manufactured by Astra.
8.8 In the event that Astra decides to have the Product manufactured by a sub-
contractor, Astra may appoint such sub-contractor provided that Astra shall
ensure that the sub-contractor shall perform in accordance with this
Agreement and Astra shall remain liable for the acts of its sub-contractor
so appointed.
9. TRADE ▇▇▇▇ LICENCE
------------------
9.1 Biorex hereby grants to Astra an exclusive licence to use the Trade ▇▇▇▇ on
the Product and in connection with the marketing and exploitation of the
Product in the Territory only.
9.2 Astra hereby confirms and acknowledges that it is licensed to use the Trade
▇▇▇▇ only as set out in this Agreement and Astra further:
9.2.1 acknowledges that all goodwill in the Trade ▇▇▇▇ in any part of the
Territory (whether or not generated by the activities of Astra under
this Agreement) shall vest in Biorex; and
9.2.2 acknowledges that any application for registration of the Trade ▇▇▇▇
shall be made in the name of Biorex only; and
9.2.3 undertakes to transfer and assign to Biorex (or as it may direct)
any right, title or interest required by Biorex for registration of
the Trade ▇▇▇▇ in any part of the Territory in the name of Biorex
and for all goodwill in the Territory to vest in Biorex.
9.3 In consideration of the rights and licence granted to Astra by Biorex in
respect of the Trade ▇▇▇▇, Astra shall pay to Biorex a licence fee at the
rate of [*] of the Factory Sales Price of all Product bearing the Trade
▇▇▇▇ supplied by Astra (or any Astra Associate) to any third party. Such
licence fee shall commence on the date this Agreement comes into force
pursuant to Clause 2.1 and shall continue to be payable for such period of
time in which Astra shall continue to use the Trade ▇▇▇▇ under the licence
hereby granted.
-10-
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
10. LICENCE PAYMENT
---------------
10.1 Astra shall keep true and accurate records of the sales of all Product
manufactured by or on behalf of it or any Astra. Associate pursuant to any
licence granted under Clause 8 and of all Product sold by it or any Astra
Associate at any time and Astra shall within ninety (90) days of the end of
each period of three months (such periods to end on 31 March, 30 June, 30
September and 31 December) send Biorex a full statement showing the
calculation of all sums due and owing to Biorex
10.1.1 in respect of the licence to sell under the provisions of Clause
3.1 and the manufacturing licence under the provisions of Clause
8.1; and
10.1.2 in respect of the Trade ▇▇▇▇ Licence under the provisions of Clause
9;
and with such statement shall make payment in pounds sterling by express
payment through the banking system into such bank account as Biorex shall
designate for such purpose, of such sum as is shown due on the statement.
10.2 For the conversion of the relevant currencies into Sterling Pounds under
Clause 10.1, the official average exchange rates for the sale and purchase
of foreign currency at the SE-Banken, Stockholm on the last banking day of
the calendar half-year in question shall be applied. With respect to
currencies not quoted by the SE-Banken, the average rate for purchasing
Sterling Pounds in the respective country as published by any leading
London Bank shall apply.
10.3 Astra shall allow Biorex or its auditors or representative reasonable
access during normal business hours to inspect the books of account of
Astra or any Astra Associate in order to verify the accuracy and
calculation of any statements delivered under Clause 10.1 Provided That
such verification shall be at the sole cost and expense of Biorex.
10.4 In the event of any dispute between the parties concerning the
calculation and/or payment of any fee due under this Clause 10, an
independent auditor shall be appointed by the agreement of the parties or
in the absence of agreement at the request of either party by the President
for the time being of the Institute of Chartered Accountants in England and
Wales who acting as an expert and not as an arbitrator shall have full an
free access to all relevant information and data and shall be asked to
determine and settle any such dispute and in the absence of manifest error
his decision shall be final and binding on the parties. The independent
auditor's fees shall be paid by the parties in such proportions as he
shall direct.
10.5 Interest shall be payable to Biorex by Astra at a rate of two per cent
(2%) above the base lending rate from time to time of Barclays Bank plc
on all outstanding fees due and payable by Astra to Biorex under the
provisions of this Clause 10 both before and after judgment.
-11-
11. PRODUCT LIABILITY
-----------------
11.1 Astra undertakes to indemnify and hold Biorex harmless against all and any
loss, damage, claim or liability suffered or incurred by Biorex in
connection with the sale and use of the Products hereunder.
12. CONFIDENTIAL INFORMATION
------------------------
12.1 Astra hereby agrees and undertakes that during the application of this
Clause 12 and for a period of ten years thereafter (howsoever termination
may be caused or arise) it shall keep confidential and shall not without
the prior written consent of Biorex disclose to any third party or use
except for the purposes of this Agreement any information of a confidential
nature belonging to Biorex (including trade secrets and information of
commercial value) which may become known to Astra from Biorex in connection
with this Agreement and/or the Salix/Astra Agreement Provided Always that
such obligation of confidentiality shall not extend to any part of such
confidential information which:
12.1.1 shall otherwise than by reason of any default by Astra, become
freely available to the general public; or
12.1.2 Astra can show by documentary evidence was in its possession or
control prior to disclosure free of any obligation of
confidentiality; or
12.1.3 Astra can show by documentary evidence shall have come into the
possession or control of Astra from a third party free of any
obligation of confidentiality subsequent to disclosure hereunder;
or
12.1.4 Astra is obliged by law or regulation to disclose to a third party
provided that such disclosure shall only be to the extent required
by such law or regulation.
12.2 Astra shall ensure that any employee of, or consultant to, or sub-
contractor of, Astra who shall obtain any confidential information in
connection with the performance of this Agreement shall be bound by
obligations of confidentiality substantially similar to the provisions of
Clause 12.1.
12.3 Biorex acknowledges the importance of keeping all material information
relating to the Product confidential and Biorex will use all reasonable
endeavours to make sure that no such information is made public or
otherwise made available to third parties in any manner which would
jeopardize the exclusivity in the Territory granted to Astra hereunder.
-12-
13. INTELLECTUAL PROPERTY
---------------------
13.1 Astra acknowledges that save as expressly provided herein Astra shall have
no right, title, interest or licence in or to the Patents. the Trade ▇▇▇▇
or otherwise any intellectual property rights of Biorex in Balsalazide or
the Product.
13.2 In the event that either party becomes aware of any infringement by any
third party within the Territory of any intellectual property Tights of
Biorex in the Patents. Balsalazide, the Product or the Trade ▇▇▇▇ it shall
forthwith notify the other party. Biorex shall be entitled to take such
action as it may in its sole discretion consider appropriate against any
such third party infringer Provided Always That:
13.2.1 Astra shall give such assistance as Biorex may reasonably require
in connection with any such action (subject to reimbursement by
Biorex of all costs reasonably incurred by Astra); and
13.2.2 Biorex shall keep Astra informed of the conduct and progress of
such action but shall be entitled to conduct, pursue and settle
such action in such manner as it shall reasonably consider
appropriate and to retain any damages awarded against any such
infringer;
In the event that such infringement shall continue and Biorex shall fail to
take or procure any action to prevent any continued infringement (for the
avoidance of doubt, any such failure on the part of Biorex shall not
constitute a breach of this Agreement) Astra may (in its sole discretion)
at its sole expense initiate and pursue such action as it considers
appropriate to prevent any continued infringement Provided Further That:
13.2.3 Biorex shall give such assistance as Astra may reasonably require
in connection with any such action (subject to reimbursement by
Astra of all costs reasonably incurred by Biorex); and
13.2.4 Astra shall keep Biorex informed of the conduct and progress of
such action but shall be entitled to conduct, pursue and settle
such action in such manner as it shall reasonably consider
appropriate (having regard to the continuing value of any such
intellectual property rights to Biorex and the effect which any
such infringement shall have had or will have on the exploitation
in the Territory by Astra of the Product) and to retain any damages
awarded against any such infringer.
13.3 In the event that any claim is made against Astra by any third party
alleging infringement of any rights of any third party by the use and
exploitation of the Product by Astra, Astra shall be entitled at its sole
cost and expense to defend any such claim in such manner as it may in its
sole discretion consider appropriate Provided Always That
-13-
13.3.1 Biorex shall give such assistance as Astra may reasonably require
in such action (subject reimbursement by Astra of all costs
reasonably incurred by Biorex); and
13.3.2 Astra shall keep Biorex informed of the conduct and progress of
such action but shall be entitled to conduct, pursue and settle
such action in such manner as it shall reasonably consider
appropriate (having regard to the continuing value of any such
intellectual property rights to Biorex and the effect which any
such infringement shall have had or will have on the exploitation
in the Territory by Astra of the Product) and to retain any damages
awarded against any such infringer; and
13.3.3 Biorex shall not be liable in any manner whatsoever to Astra for
any loss or damage suffered incurred or awarded against Astra in
connection with any such claim.
14. SUB-DISTRIBUTORS
----------------
14.1 Astra is hereby granted the right to appoint sub-distributors for the
Product in the Territory Provided Always That:
14.1.1 Astra shall remain solely liable for the performance of its
obligations hereunder in each part of the Territory; and
14.1.2 in any part of the Territory where there is resident an Astra
Associate any sub-distributor appointed shall only be such Astra
Associate
15. TERMINATION
-----------
15.1 The rights and obligation of the parties contained in Clauses 2, 3, 4, 5,
6, 7, 8.3, 8.6, 13, 14 and 17 shall cease forthwith upon the later of (i)
the expiry of the last to expire of the Patents or (ii) the expiry of a
period of 9 years from the date of first Launch Provided Always That
15.1.1 the Trade ▇▇▇▇ licence granted under Clause 9 shall continue
thereafter in accordance with its terms and Clause 10 will remain
valid with respect to Clause 9; and
15.1.2 the licence granted to Astra to manufacture under Clause 8 shall
continue indefinitely thereafter subject to no additional
compensation or royalty to Biorex; and
15.1.3 any licence or interest in all or any part of the Patents,
Balsalazide and/or the Product shall continue indefinitely
thereafter.
-14-
15.2 Either party to this Agreement shall be entitled to terminate this
Agreement forthwith by notice in writing to the other in the event that:
15.2.1 the other party shall fail to pay any sum due hereunder on the due
date and shall fail to remedy such breach within (30) thirty days
of being required in writing by the other party so to do; or
15.2.2 the other party shall commit a material breach of any of the terms
and conditions of this Agreement and shall fail to remedy the same
(if capable of remedy) within ninety (90) days of being required in
writing by the other party so to do; or
15.2.3 The other party goes into liquidation (either voluntary or
compulsory) or shall be the subject of any petition for winding up;
or
15.2.4 the other party shall make any assignment or arrangement for the
benefit of its creditors or cease or threaten to cease to carry on
its business in the ordinary course; or
15.2.5 a receiver, administrative receiver, or receiver and manager, or
judicial manager or administrator is appointed over the whole or
any part of the assets of either party or if any court proceedings
are commenced for the appointment of an administrator or receiver
to either party; or
15.2.6 the other party shall become unable to pay its debts as they become
due in the ordinary course of business or shall otherwise become
subject or seek relief under any law relating to insolvency in any
jurisdiction relevant to such other party.
15.3 Any waiver by either party of a breach of any provision of this Agreement
shall not be considered as a waiver of any subsequent breach of the same or
any provisions of this Agreement.
15.4 Any termination of this Agreement shall be without prejudice to the right
of either party to recover any monies due to it under this Agreement or the
rights or remedies of either party in respect of any breach prior to the
effective date of termination of this Agreement.
16. CONSEQUENCES OF TERMINATION
---------------------------
16.1 In the event of termination of this Agreement under Clause 15.2 by Biorex
or Astra prior to the later of (i) the expiry of the last to expire of the
Patents or (ii) expiry of a period of 9 years from date of Launch, Astra
shall:
-15-
16.1.1 forthwith, cease all marketing, sale and promotion of the Product;
and
16.1.2 immediately telegraphically transfer all monies due and payable to
Biorex as at the date of termination into Biorex's bank account
designated under Clause 10; and
16.1.3 immediately return to Biorex all information and data of whatsoever
nature relating to the Product together with all copies thereof
which Astra may have in its possession or under its control
including but without limitation all scientific, medical and safety
data relating to the Product; and
16.1.4 immediately cease use of all or any confidential information of
Biorex delivered in connection with this Agreement and the Trade
▇▇▇▇; and
16.1.5 take all such steps as may reasonably be required to transfer or
procure the transfer to Biorex (or its nominee) of all such product
licences and approvals as may have been obtained for the marketing
and sale of the Product in any part of the Territory; and
16.1.6 Biorex shall purchase such stocks of the Product (inclusive of
packaging) as Astra shall still have in its possession once it has
fulfilled all orders outstanding as at the date of termination at a
price calculated as cost price to Astra Provided That Biorex shall
not be obliged to purchase any of the stocks of the Product which
do not have at least two thirds of its approved shelf life
unexpired or are otherwise not of merchantable quality.
17. ASSIGNMENT
----------
17.1 The benefit of this Agreement is personal to Astra and to Biorex and shall
not be capable of assignment by either of them without the prior consent in
writing of the other party (such consent not to be unreasonably withheld or
delayed).
18. FORCE MAJEURE
-------------
18.1 If the performance of any obligations under this Agreement by either party
is affected by Force Majeure it shall forthwith notify the other party of
the nature and extent thereof.
18.2 Neither party shall be deemed to be in breach of this Agreement or
otherwise be liable to the other by reason of any delay in performance or
non-performance of any of its obligations hereunder to the extent that such
delay or non-performance is due to any Force Majeure which has been
notified to the other party in writing.
-16-
19. COSTS
-----
19.1 Each party hereto shall bear its own costs in relation to the negotiation,
drafting, preparation and execution of this Agreement.
20. CONFIDENTIALITY OF THIS AGREEMENT
---------------------------------
20.1 The contents of this Agreement shall remain confidential as between the
parties. Neither party shall, without the prior written consent of the
other (such consent not to be unreasonably withheld without justification),
disclose any of the financial terms of this Agreement to any other person,
firm or company save for
20.1.1 such disclosure as may be required by any relevant law or regulatory
authority.
21. NATURE OF THE AGREEMENT
-----------------------
21.1 Nothing in this Agreement shall create or be deemed to create any
partnership, joint venture or the relationship of principal and agent
between the parties.
21.2 Each party acknowledges that, in entering into this Agreement, it does not
do so on the basis of, and does not rely on, any representation, warranty
or other provision except as expressly provided herein and all conditions,
warranties or other terms implied by Statute or common law are hereby
excluded to the fullest extent permitted by law.
21.3 This Agreement (including all the Schedules and other documents referred
to) and any agreements entered into pursuant to this Agreement constitutes
the entire understanding and agreement between the parties with respect to
the subject matter of this Agreement and supersedes all prior agreements,
negotiations and discussions between the parties relating to this
Agreement.
21.4 This Agreement may not be released, discharged, abandoned, charged or
modified, in any manner, except by an instrument in writing signed by a
duly authorised officer or representative from each of the parties hereto.
21.5 This Agreement shall be governed by and construed in all respects in
accordance with the laws of England and each party hereby submits to the
exclusive jurisdiction of the English courts. For the purpose of accepting
service of process in connection with any action commenced before the High
Court in England the parties hereto hereby absolutely, unconditionally and
irrevocably appoint the following agents to accept process on their behalf,
it being unconditionally agreed that for this purpose such process will be
properly and effectively served if the same is left at the addresses set
out below:
-17-
Astra: F.A.O. The Managing Director
Astra Pharmaceuticals Limited
Home ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇ ▇▇▇
Biorex: F.A.O. The Managing Director
Biorex Laboratories Limited
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
22. NOTICES
-------
22.1 All notices to be served by the parties to this Agreement shall be served
only in the English language.
22.2 Notices shall be sufficiently served if dispatched by First class or
express post (meaning the fastest normal method of mail transmit in the
country of dispatch) to the address of the receiving party set out below:
Biorex: ▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇
F.A.O. L Baxendale
Astra: ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇
▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇
F.A.O. Vice President Legal Affairs
Any modification to this address must in itself be notified in writing to
the other party in accordance with the terms of this sub-clause.
22.3 In the absence of proof to the contrary notices properly sent hereunder
shall be deemed to have been duly served 10 days after the date of
dispatch.
22.4 It shall be permitted for notices to be served hereunder by facsimile
transmission and for this purpose the following fax number below shall
apply:
-18-
22.4.1 in the case of Biorex facsimile transmission number 081 367 4627
and marked for the attention of Miss L Baxendale; and
22.4.2 in the case of Astra at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇.▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ facsimile transmission number ▇▇▇ ▇▇▇ ▇▇ ▇▇ ▇▇ and marked
for the attention of Vice President Legal Affairs;
provided that such notice is confirmed by first class or express post in
accordance with Clause 22.2 and shall be deemed served on the next business
day following transmission of such facsimile.
-19-
AS WITNESS the hands of the duly authorised representatives of the parties
hereto the day and year first above written.
SIGNED by ) /s/ signature unreadable
for and on behalf of BIOREX )
LABORATORIES LIMITED in the presence )
of:- )
/s/ signature unreadable
Director
SIGNED by ) /s/ signature unreadable
for and on behalf of AB ASTRA )
in the presence of:- )
/s/ signature unreadable
/s/title unreadable
-20-
SCHEDULE 1
-----------
BALSALAZIDE PATENTS AND APPLICATIONS
-----------------------------------
United States Patent Number 4,412,992
Title: "2-Hydroxy-5-Phenylazobenzoic Acid Derivatives and Methods of Treating
Ulcerative Colitis Therewith"
Issued: November 1, 1983
SCHEDULE 2
----------
SUMMARY OF PROJECT AND ASTRA FUNDING
------------------------------------
The major elements of the Project relate to the preparation and submission
of an NDA for the treatment of acute relapse of ulcerative colitis. A
large-scale clinical program will be undertaken in the U.S. in support of
the NDA, though the studies have been designed to be of use outside the
U.S. as well. Non-clinical data will be obtained from past and in-progress
work in the U.K. under the management of Glycyx Pharmaceuticals, Ltd. Salix
will contribute toward the cost of these studies. The major elements of
the Project are as follows:
Pre-clinical Safety and Pharmacology
------------------------------------
Relevant pre-clinical studies conducted by Biorex will be re-formatted,
summarized and included in the NDA as appropriate. Additional data and
reports will be acquired from Glycyx's U. K. studies over an 18 month
period. Summary reports will be prepared, as necessary.
Human Clinical and Metabolic Studies
------------------------------------
Two pivotal studies of efficacy are planned. A double-blind controlled,
multi-center, dose ranging trial is scheduled to begin in May 1993. The
trial has a target enrollment of 230 patients, in 3 treatment groups:
placebo, Balsalazide (BSZ) 4.50g/d, and BSZ 6.75g/d. Completion is
forecast for 4Q 1993. A second double-blind controlled trial, comparing
Balsalazide to Asacol is planned to begin 4Q 1993. Target enrollment is
230 patients in 3 arms: ▇▇▇ ▇.▇▇▇/▇, ▇▇▇ 6.75g/d, and Asacol. Completion
is forecast for 2Q 1994. Both trials will be multi-center, encompassing
15-20 clinics throughout the U.S. Salix has previously received IND
approval for a Phase III study and an amendment for the above two protocols
will be filed in April 1993. BRI, a Contract Research Organization, has
been retained by Salix
-1-
for trial administration, data collection and analysis. The clinical plan
and protocols have been developed through consultation with representatives
of Astra Draco.
A short-duration pharmacokinetic study in healthy volunteers will be
conducted to measure dose proportionality and other parameters. The plan
and protocol are currently under preparation. Completion is expected prior
to that of the pivotal studies. Data from the U.K. pharmacokinetic studies
will be acquired from Glycyx.
Manufacturing and Controls
--------------------------
Active ingredient and pharmaceutical process will be transferred to Salix
from Glycyx. Supplementary process development and documentation for the
drug product will be developed by Salix. An outside company is under
contract to produce "Colazide" capsules in the U.S. Balsalazide chemical
will be procured from the current European manufacturers.
Dossier Preparation and Regulatory Affairs
------------------------------------------
The NDA will be assembled and submitted by Salix staff, with assistance
from BRI. To the extent possible, all sections of the NDA will be prepared
and submitted in advance of the completion of the final pivotal clinical
study. Post-submission follow up and requests from FDA will be managed by
Salix staff. A review period of two years is forecast.
It is planned that approximately 70% of Salix's current administrative
resources will be dedicated to the Project.
Expenses
--------
Estimated costs for the Project are shown on the following page. Payments
from Astra to Salix shall be made no later than the first day of each
calendar quarter.
-2-
SCHEDULE 2
SUMMARY OF PROJECT AND ASTRA FUNDING
------------------------------------
PROJECT SUMMARY
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
1
LISTING OF COMPLETED AND PLANNED PHARMACOKINETIC STUDIES WITH BASALAZIDE
------------------------------------------------------------------------
Requested by ▇.▇. ▇▇▇▇▇▇, CAMAS Partners, 31 August 1992.
Prepared by ▇. ▇. ▇▇▇▇▇, Pharmac Consultants, 1 September 1992.
1. A list of the non-clinical studies "completed by Biorex" has been prepared
by Glycyx Pharmaceuticals Ltd., in their COLAZIDE - INVENTORY OF STUDIES
(annotated copy attached). None of these have, in fact, been written up as
formal reports; therefore, they all need to be "reconstructed". The
possible use Of a standard format for the preclinical reports has been
discussed with ▇. ▇▇▇▇▇ Consultancy, who are exploring this. When they
are complete, however, the kinetic reports will only provide limited
support the NDA. All of the studies listed as "pharmacokinetics and
distribution " under PART IIIG (categories 1-3) only involve the
measurement of radioactivity, and in many cases this is complicated by the
simultaneous use of two different 3H-forms of BSZ and/or failure to
separate out the tritiated water. Reports of all the studies are however
required to provide some data for the ferret, mouse and rabbit, and
supportive information for the new rat data.
2. The Biorex results in rats and ferrets suggest that both balsalazide and 4-
ABA are highly cleared; therefore, the exposure of organs and tissues
should be low. Data in the rat also suggest that the systemic exposure to
balsalazide and its metabolites, after administration of the lowest dose
used in the toxicity studies, may be lower than that achieved with
therapeutic doses in patients. New ADME studies are planned in the rat to
confirm this. Similar studies are planned to determine whether this will
also apply to the dog, which has been selected as an additional "non-
rodent" for toxicology. These are listed, as an attachment. Limited
studies may also be required in the mouse and rabbit, depending upon the
rewrites.
3. If it is confirmed that the clearance of balsalazide and/or metabolites is
higher in laboratory animals than humans, reasoned arguments to justify the
validity of the toxicology will need to be included in the NDA [e.g.
exposure of the colon (the primary target organ) is related to total dose
and the expected secondary effect is the salicylate-like action of 5-ASA on
the kidney, which will be determined by species sensitivity and/or total
renal clearance of active metabolite rather than plasma concentrations.]
Comparative protein binding data ("free drug fractions") may also need to
be determined in this context.
2
Listing of Completed and Planned Pharmacokinetic Studies with Balsalazide
-------------------------------------------------------------------------
cont.
4. The dog was selected as the "non-rodent" for toxicology on the basis that
it is one of the species recommended by various regulatory authorities, and
because it was used for the recently submitted applications for olsalazine
and mesalazine (FDA Summary Basis or Approval). However the metabolism of
both 5-ASA and 4-ABA in this species is unlikely to reflect that in man,
where N-acetylation is expected to be the major route. This can probably
be justified for 5-ASA, because the dog's lack of secondary metabolism will
maximise exposure to the active and potentially (salicylate) toxic moiety.
Exposure to the N-acetyl metabolite of 4-ABA is likely, however, to only be
covered in the rat. If this proves to be very low relative to that in
humans, additional (short-term) toxicology, either with this metabolite or
in a further species, may need to be considered.
5. I am aware of 3 Biorex human pharmacokinetic studies: (i) the comparative
study with sulphasalazine (which was written up as a publication, and for
the UK submission in 1985) (ii) a single dose bioequivalence comparison of
solution and capsules and (iii) monitoring of Nottingham study, in patients
receiving escalating doses. The last two studies also need to be reported
formally, as supportive data for the NDA.
6. To date, two new human studies (shown in the Glycyx inventory) have been
planned. The need for further kinetic studies will depend upon the outcome
of this program; for example, a randomised dose proportionality study could
be required, if the repeat dose fails to reassure authorities (especially
the FDA). In addition: further patient monitoring data will be required,
plus possibly a single dose human radiolabelled study (depending upon
results from the metabolic studies in animals). Bioequivalence studies may
also be needed, depending upon changes in formulations, suppliers etc.
/S/ ▇.▇. ▇▇▇▇▇
3
Summary of Preclinical ADME Studies planned for Balsalazide
-----------------------------------------------------------
Balsalazide and 4-ABA, randomly labelled with Carbon-14 in the aromatic ring are
being prepared by Amersham International, for ADMI studies at Hazleton U.K.
These materials will be used for.
1. A quantitative whole body autoradiographic study with 14C-balsalazide in
pregnant pigmented rats, to determine (i) general distribution after oral
administration, (ii) placental transfer and foetal penetration and (ii)
melanin binding after a single oral administration by gavage.
2. Absorption, distribution, metabolism and excretion of single doses of 14C-
balsalazide administered to male rats intravenously (one dose level) and
orally by gavage (two dose levels, corresponding to the high and low doses
used for 26 week toxicology).
3. Absorption, distribution, metabolism and excretion of single doses of 14C-
ABA administered to male rats intravenously (one dose level) and orally by
gavage (one dose level, equivalent to the low dose used for 26 week
toxicology).
4. Absorption, distribution, metabolism and excretion of single doses of 14C-
balsalazide administered to beagles intravenously (one dose level) and
orally by gavage (two dose levels, corresponding to the high and low doses
used for 26 week toxicology).
In addition, monitoring of the rat and dog MTD, 26 week toxicology and rat
carcinogenicity will be used to assess dose-proportionality of absorption and
elimination during repeated oral administration. Notification has also been
received recently from Biorex that 30 mCI of tritiated balsalazide were held at
University of Surrey; arrangements to transfer this material to HUK have been
made, as a contingency measure.
4
▇.▇ ▇▇▇▇▇ CONSULTANCY
--------------------------------------------------------------------------------
Tel (0929) 48 1197 "Badgers".
Fax: (0929) 48 ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇
re: Balsalazide
Non-Clinical Safety Evaluation Studies - Toxicology
---------------------
I have examined the animal toxicology studies and genetic toxicology conducted
by and on behalf of Biorex laboratories Ltd. of Crossfield ▇▇▇▇▇▇▇▇, Gladbeck
Way, Enfield, Mddx. England and which were conducted to December 1991.
Although many of the studies were not conducted to the format and conditions now
expected by Regulatory Agencies, it is my opinion that the data shows that
balsalazide has a low order of toxicity and that the signs and reactions to
dosage as seen in the animal species studied are compatible with the
pharmacology of the product administered. No adverse toxicities are clearly
apparent within the reports which I have examined which are aberrant in
consideration of the chemical nature of the principal metabolite, 5. ASA. The
studies refered to include long term administration to rats and ferrets and
carcinogenicity studies in the mouse and rat.
Notwithstanding the above, a programme of toxicological evaluation of
balsalazide has been designed to fulfil the present day requirements of the
major Regulatory Agencies World Wide. This programme includes re-evaluation of
the consequences of repeated administration to rodents and non-rodents,
reproduction toxicology and necessary toxicokinetics to enable overall
evaluation.
To date the initial findings in preliminary studies using high doses of
balslazide at large multiples of the proposed dose for man, are substantiating
the balsalazide has a low order of toxicity.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇.
Dated: 31st, August, 1992.
--------------------------------------------------------------------------------
Adviser on Toxicology and Safety Evaluation
5
COLAZIDE(R) DEVELOPMENT - Completed Studies and Additional Work
---------------------------------------------------------------
--------------------------------------------------------------------------------
EC Registration Dossier Headings Completed Glycyx
by Biorex Repeat/New Reconstruct
--------------------------------------------------------------------------------
PART IIIA Single dose toxicity
- Mouse, oral o
- Mouse, ip o
- Rat oral o *
- Rat, ip (iv) o *
- Mouse, oral: 4-ABA o
- Rat, oral: 4-ABA o
- Mouse, oral: 5-ASA o
- Rat, oral: 5-ASA o
- Mouse, oral: 5-ASA/4-ABA o
- Rat, oral: 5-ASA/4-ABA o
- Mouse, oral: BSZ impurity o
- Mouse, ip: BSZ impurity o
- Mouse, ip: Colazide o
Part IIIB - Repeated dose toxicity
Max. Tolerated Dose
-------------------
- Dog o
!unreadable!
- Rat, 14 days, oral o o *
- Mouse, 7 days, oral: BSZ o *
- Mouse, 28 day, oral BSZ o *
- Rat, 7 days, oral: BSZ o *
- Rat, 28 day, oral: BSZ o *
- Dog, 28 days, oral o
Chronic
-------
- Rat, 96 week, oral o o
- Ferret, 26 week, oral o o
- Dog, 26 week, gavage o
- Rat 26 week, gavage o
PART IIIC Reproduction Studies
1. Fertility and general reproductive
performance
----------------------------------
- Rat fertility, oral o o
- Rat, comparative fertility with
sulphasalazine, oral o
- Mouse, comparative fertility
with sulphasalazine, oral o
--------------------------------------------------------------------------------
Page 1 *under consideration
6
COLAZIDE(R) DEVELOPMENT - Completed Studies and Additional Work
---------------------------------------------------------------
--------------------------------------------------------------------------------
EC Registration Dossier Headings Completed Glycyx
by Biorex Repeat/New Reconstruct
--------------------------------------------------------------------------------
2. Embryotoxicity
- Mouse teratology oral o
- Rat teratology o
- Rabbit teratology, oral o o
3. Peri-/postnatal potential
- Mouse perinatal o
- Rat peri-/post natal o
PART IIID Mutagenic Potential
In vitro
--------
- ▇▇▇▇ test o
- Cultured human lymphocytes o
- HGPRT locus Chinese hamster
V79 cells o
In vivo
-------
- Micronucleus test o
PART IIIE - Oncogenic/carcinogenic
potential
- Mouse carcinogenicity, oral o o
- Rat carcinogenicity, oral o o o
(new study is 104 week)
PART IIIF General Pharmacology
1. Pharmacodynamic effects relating
to proposed indications
--------------------------------
- Carrageenin-induced ulcerative
colitis o *
- Gastrointestinal studies
- Ulcerogenic potential o *
- GI motility and smooth muscle
activity o *
- Ethanol-induced gastric
necrosis in rats o *
- Effect of BSZ on GSH levels
in rectocolonic mucosa o *
- Effect on BSZ on ethanol-induced
rectocolonic damage o *
- Effect on BSZ and metabolites
on ethanol-induced gastric
necrosis o *
- Effect on BSZ on eicosanoid
release o *
- Effect on BSZ and SASP on
rectocolonic lesions o *
- Anti-inflammatory activity o *
- Analgesic activity
- Acetic acid-induced writhing
test o *
- Hyperalgesia test in rats o *
- Yeast-induced pyrexia o *
--------------------------------------------------------------------------------
Page 2 * under consideration
7
COLAZIDE(R) DEVELOPMENT-Completed Studies and Additional Work
-------------------------------------------------------------
--------------------------------------------------------------------------------
EC Registration Dossier Headings Completed Glycyx
by Biorex Repeat/New Reconstruct
--------------------------------------------------------------------------------
2. General Pharmacodynamics
---------------------------
- Central nervous system
- Barbiturate-induced sleeping
time o *
- Spontaneous locomotor activity o *
- Endocrine system
- Vaginal comification test o *
- Uterine weight response o *
- Cardiovascular system
- Effect of BSZ on CV system and
respiration in ferrets o *
- Effect of BSZ on cat BP and
respiration o *
- Effect of BSZ (I.V.) on BP,
HR and respiration in
anesthetized male cat o *
- Effect of BSZ on BP, HR and
respiration in anesthetized rats o *
- Effect of BSZ on BP, HR and
respiration of ferrets o *
- Effect of impurity (BX769A) on
rat BP, HR and respiration o *
- Effect of impurity (BX769A)
(I.V.) on BP, HR and respiration
of anesthetized rats o *
- Effect of BSZ metabolites on BP,
HR and respiration of
anesthetized cats o *
- Electrolyte Excretion
- Diuretic test o *
- Effect of BSZ and related
compounds on water induced
diuresis in the rat o *
- Other Systems
- Effects of BSZ on rat peritoneal
mast cell degranulation o *
- Effects of BSZ in vitro on
erythrocyte membrane
stabilization o *
- Effect of BSZ and its impurity
(BX769A) on erythrocyte membrane
stabilization o *
- Effect of SASP and BSZ on cell
membrane stability and histamine
release o *
- Possible anti-microbial activity
of BSZ and related compounds on
organisms of gut microflora o *
- Comparative suppression of
lymphocyte transformation by
SASP analogues o *
2. Drug Interactions
--------------------
- No studies
--------------------------------------------------------------------------------
Page 3 * Under Consrtuction
8
COLAZIDE(R) DEVELOPMENT-Completed Studies and Additional Work
-------------------------------------------------------------
--------------------------------------------------------------------------------
EC Registration Dossier Headings Completed Glycyx
by Biorex Repeat/New Reconstruct
--------------------------------------------------------------------------------
PART IIIG-Pharmacokinetics
1. Pharmacokinetics after a
single dose
- Drug excretion in rat
and ferret o o
- Rat blood concentrations,
oral and iv o o
- Rat bioavailability, oral
liquid vs solid dose o o
- Ferret blood concentrations,
oral and iv o o
- Ferret blood concentrations,
dietary dosing o o
2. Pharmacokinetics after repeated
administration
- Rat blood concentrations,
oral, 28 days dosing o o
- Ferret blood concentrations,
oral 28 days dosing o o
3. Distribution in normal and
pregnant animals
- Rat tissue concentrations,
oral o o
- Ferret tissue concentrations,
oral o o
- Rat QWBA o
4. Biotransformation
- Mouse excretion, oral o o
- Rat excretion, oral o o
- Rat biliary excretion, oral o o
- Ferret excretion, oral o o
- Ferret biliary excretion, oral o o
- Rat ADME, iv and gavage o
- Rat ADME (4-ABA), iv and gavage o
- Dog ADME, iv and gavage o
Comparison pharmacokinetics rat &
ferret o
PART IIIH-Local Tolerance
- No studies
PART IIIQ-Other Information
- No studies
--------------------------------------------------------------------------------
Page 4 *under consideration
9
COLAZIDE(R) DEVELOPMENT-Completed Studies and Additional Work
-------------------------------------------------------------
--------------------------------------------------------------------------------
EC Registration Dossier Headings Completed Glycyx
by Biorex Repeat/New Reconstruct
--------------------------------------------------------------------------------
PART IV A Clinical Pharmacology
1. Pharmacodynamics
-------------------
2. Pharmacokinetics
-------------------
- Serum concentrations of
BX661A, sulphasalazine
and metabolites in man o
- Comparative tolerability
and pharmacokinetic
study of balsalazide,
sulphasalazine and
mesalazine following a
single oral dose o
- Single dose bioequivalence o o
- Tolerability and pharmacokinetic
study of balsalazide following
repeated oral doses o
- High dose patient monitoring o o
PART IV B - Clinical Experience
1. Clinical trials
Double Blind, Controlled Studies
in Acute Active Ulcerative Colitis
- Balsalazide 6.75g/d vs SASP
3g/d in the treatment of mild
first episode ulcerative
colitis (Protocol 028/011) o
- Balsalazide 6.75g/d vs SASP
3g/d in the treatment of acute
relapse or first episode
ulcerative colitis(Protocol
028/017) o
Double-Blind, Controlled Studies
in Maintenance of Remission of
Ulcerative Colitis
Low dose pilot (6 month) study:
- Balsalazide 2g/d vs SASP 2g/d
in the maintenance of remission
of patients with ulcerative
colitis (Protocol: 028/001) o
Medium dose subchronic (12 month)
study:
- Balsalazide 2g/d vs 4g/d in the
maintenance of remission of
patients with ulcerative colitis
(Protocol: 028/005) o
--------------------------------------------------------------------------------
Page 5 *under consideration
SCHEDULE 3
----------
"Bulk Product Specifications"
and
"Finished Product Specifications"
BALSALAZIDE SODIUM
------------------
Specification - "IN-HOUSE"
--------------------------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
BALSALAZIDE SODIUM
------------------
Specification - "PL Submission"
-------------------------------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
SCHEDULE 4
----------
QUALITY TEST PROCEDURES
-----------------------
To be mutually agreed upon prior to Launch.
-------------------------------------------
COLAZIDE (TM) CAPSULES
----------------------
1. GENERAL CHARACTERISTICS
-----------------------
Red/maroon, hard gelatin lock-fit capsule shells, size 00, containing a
dry orange/yellow powder.
2. FINISHED PRODUCT SPECIFICATION
------------------------------
[*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
1 (4)
SCHEDULE 5
TERMS AND CONDITIONS APPLICABLE TO THE
MANUFACTURING LICENCE UNDER ARTICLE 16.2
----------------------------------------
l. With effect from the effective date of notice served by Astra under and in
accordance with Article 16.2 of the Agreement (and consequently also
Article 6.6) Salix shall grant Astra a licence to manufacture the Product
both inside and outside the U.S. for sale in the U.S. only under the terms
of the Agreement and this Schedule 5.
2. For the avoidance of doubt Salix shall not be prevented from manufacturing
or continuing to manufacture the Product or appointing sub-contractors to
manufacture the Product for sale by Salix or its customers both inside and
outside the U.S. subject to the exclusivity granted to Astra in respect of
the U.S. under the terms of the Agreement.
3. Salix shall supply Astra with such technical information and assistance as
Astra may reasonably require (and which has not previously been supplied to
Astra pursuant to Article 16.4) to enable Astra to produce the Product in
commercial quantities Provided Always That Salix shall be reimbursed all
costs and expenses incurred by it in supplying such
2 (4)
information and assistance to Astra.
4. Astra undertakes to Salix that it will manufacture the Product fully in
accordance with the Bulk Product Specification and the Finished Product
Specification (annexed to the Agreement in the approved form) and with the
Drug Master File for the Product and in accordance with FDA Good
Manufacturing Practice.
5. Astra shall be entitled to market, distribute and sell the Product
manufactured by it only in accordance with the terms and provisions of the
Agreement,
6. In consideration of the licence to manufacture Astra shall pay to Salix a
fee calculated as a percentage of the Net Sales of all Product manufactured
by or on behalf of Astra pursuant to this license and sold by Astra or any
Astra Associate such percentage to be:
6.1 [*]
6.2 [*]
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
3 (4)
6.3 [*]
6.3.1 [*]
6.3.2 the actual cost of manufacture of the Product incurred by Astra
shall be calculated upon the expiry of 12 months from the date of
service of notice under Article 16 (and fees shall be payable during
such 12 month period on an estimate and shall be adjusted
retrospectively upon such calculation) by Astra which shall produce
to Salix full details of all actual direct costs of manufacture
(being materials labour and direct manufacturing overhead and
interest) and its calculation of the average actual cost per
kilogram of Product incurred in such 12 month period and upon
agreement by Salix of such actual cost, it shall remain fixed
thereafter for the period in which fees under this Article 6
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
4 (4)
shall remain payable.
6.4 [*]
6.5 [*]
7. Astra shall be solely liable for all losses, damages, costs and expenses
arising out of any claim by any third party in connection with any Product
manufactured by Astra and Astra hereby agrees fully and effectively to
indemnify Salix against any claims, damages, costs, expenses, or other
losses incurred by Salix arising out of or in connection with any Product
manufactured by Astra.
8. The licence to manufacture granted hereunder shall continue for such period
in which Astra may wish to manufacture the Product provided always that
such licence shall terminate in the event of termination of the Agreement
by Salix under the provisions of Article 29.2
9. In the event that Astra decides to have the Product manufactured by a sub-
contractor Astra may appoint such sub-contractor provided that Astra shall
ensure that the sub-contractor shall perform in accordance with this
Agreement and Astra shall remain liable for the acts of its sub-contractor
so appointed.
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
AMENDMENT NO. 1 TO CO-PARTICIPATION AGREEMENT
This Amendment No. 1 to Co-Participation Agreement (the "Amendment") is
entered into effective as of September 30, 1993 between Salix Pharmaceuticals,
Inc., a company incorporated under the laws of California whose registered
office is at ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇
("Salix"), and AB Astra, a company incorporated under the laws of Sweden whose
principal place of business is at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇, ▇-▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ("Astra")
Recitals
--------
Salix and Astra entered into a Co-Participation Agreement dated as of April
30, 1993 (the "Co-Participation Agreement") with respect to a collaboration in a
programme of development and commercial sale in the United States of
pharmaceutical products incorporating Balsalazide. The parties now desire to
amend the Co-Participation Agreement on the following terms and conditions.
Unless otherwise defined herein, capitalized terms shall have the meanings
provided in the Co-Participation Agreement.
Agreement
---------
Now, therefore, in consideration of the premises and the mutual covenants
set forth herein, the parties hereto mutually agree as follows:
1. Amendment to Schedule 2. In order to better reflect the estimated
------------------------
expenses to be incurred by Salix and funded by Astra pursuant to Section 6.1 of
the Co-Participation Agreement, Schedule 2 to the Co-Participation Agreement is
hereby amended as follows:
[*]
2. Miscellaneous. Except as specifically amended as set forth above, the
--------------
Co-Participation Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, the parties, by their respective authorized officers,
have executed this Amendment effective as of the date first above written.
AB ASTRA SALIX PHARMACEUTICALS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ Lerenius By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Lerenius ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
Executive Vice President General Counsel President
Title: ___________________________
[*] CERTAIN INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED SEPARATELY WITH
THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS.
