Portions herein identified by [***] have been omitted pursuant to a request for confidential treatment and have been filed separately with the Commission pursuant to Rule 406 of the Securities Act of 1933, as amended. LICENSE AGREEMENT
Exhibit
10.7
Portions
herein identified by [***] have been omitted
pursuant to a request for confidential treatment and have been filed separately
with the
Commission
pursuant to Rule 406 of the Securities Act
of 1933, as amended.
This
AGREEMENT is made by and between BTG INTERNATIONAL LTD., a British corporation
with its principal place of business at 00 Xxxxx Xxxxx, Xxxxxxxxxx Xxxx, Xxxxxx,
XX0X 0XX, Xxxxxxx (“BTG”); and COUGAR BIOTECHNOLOGY INC., a Delaware Corporation
with its principal place of business in Los Angeles, California, USA
(“Licensee”).
The
background of this agreement is as follows:
|
1.
|
BTG
is the assignee of, and has the right to grant licenses under, certain
patents and patent applications in various countries.
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2.
|
BTG
has access to certain technical information, data and knowhow relating
to
the inventions which are the subject matter of the patents and patent
applications, and has the right to license and transfer such technical
information, data and knowhow.
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3.
|
Licensee
wants to obtain a license under the patent rights, and wants to obtain
access to and a license under the technical information and knowhow,
to
make, have made, use and sell Licensed
Products.
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NOW
THEREFORE, in consideration of the mutual covenants and agreements herein
contained, BTG and Licensee agree as follows:
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I.
|
DEFINITIONS.
As
used in this Agreement, the following terms have the meanings
assigned:
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1.1
|
"Affiliate"
means any organization, firm, or entity (i) with respect to which
the
parties have or will have during the term of this Agreement ownership
interest of more than fifty percent (50%) or (ii) which directly
or
indirectly, through one or more intermediates, controls, is controlled
by,
or is in common control with the
party.
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1.2
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“Applicable
Laws” means all laws, ordinances, rules and regulations of any kind
whatsoever of any governmental or regulatory authority (international,
foreign, federal, state or local), including, without limitation,
all
laws, ordinances, rules and regulations promulgated by the United
States
Food and Drug Administration
(“FDA”).
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1.3
|
“Distributor”
means any entity with whom Licensee, its Affiliates or Sublicensees
establish a business arrangement for the commercial marketing of
Licensed
Product.
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1
of 22
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1.4
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“Effective
Date” means the day on which this Agreement is executed on behalf of both
parties.
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1.5
|
“Fair
Market Value” means the cash consideration that Licensee or its
Affiliates, Sublicensees or Distributors would realize from an
unaffiliated, unrelated buyer in an arm's length sale of an identical
item
sold in the same quantity and at the same time and place of the
transaction.
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1.6
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“Field
of Use” shall mean any therapeutic use that is intended to prevent, treat,
ameliorate or cure a human disease, pathology or
condition.
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1.7
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“Force
Majeure” means any extraordinary,
unexpected and unavoidable event such as acts of God, floods, fires,
riots, war, labor disturbances, failures of sources of supply, or
any such
event caused by the reason of any law, order, proclamation, regulation,
ordinance, demand or requirement of any relevant government or any
authority or representative thereof, or by reason of any other cause,
provided that the party claiming relief on account of such other
cause can
demonstrate that it was extraordinary, unexpected and unavoidable
by the
exercise of reasonable care.
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1.8
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“Initiation”
means, with respect to the Pivotal Clinical Trial, the administration
of
the first dose of a Licensed Product to the first enrolled subject
of the
Pivotal Clinical Trial.
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1.9
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“Licensed
Knowhow” means all trade secrets, inventions, confidential or proprietary
information and data: (i) that is disclosed to Licensee by or at
the
direction of BTG or BTG’s assignor; (ii) that is owned by or licensed to
BTG or BTG’s assignor at the time of such disclosure; and (iii) that
relates to the inventions that are the subject matter of the Licensed
Patents. Licensed Knowhow includes, without limitation, technical
data, knowhow, chemical compounds, biological material, reports,
manufacturing processes, formulations, modes of delivery and methods
of
use, pre-clinical and clinical data, documentation relating to regulatory
submissions and marketing authorizations (including any Investigational
New Drug Applications, New Drug Applications and equivalent documents),
and post-registration clinical trial information and data relating
to the
Licensed Products.
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1.10
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"Licensed
Patents" means: (i) the patents and patent applications (and any
patents
issuing therefrom) listed on Schedule 1.10 and all foreign counterpart
patents and patent applications; (ii) all continuation, divisional,
extension, reissue patents and reexamination certificates granted
thereon,
including Supplementary Protection Certificates; and (iii) patents
and
patent applications (and any patents issuing therefrom) that may
hereafter
be filed by BTG relating or pertaining to any Licensed Knowhow, together
with all continuations, divisional, extension, reissue patents and
reexamination certificates granted thereon, including Supplementary
Protection Certificates.
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of 22
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1.11
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”Licensed
Product” means any product made, sold, or otherwise disposed of by or on
behalf of Licensee which: (i) falls within the scope of, or utilizes
any
method or process that falls within the scope of, the Licensed Patents;
or
(ii) incorporates, or is itself, the invention which is the subject
of the
Licensed Patents; or (iii) embodies or uses, or the design, manufacture,
production or sale of which embodies or uses, any of the Licensed
Knowhow.
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1.12
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“Licensee
Technology” means all inventions, ideas, conceptions or
reductions-to-practice, patentable or not, information, works and
data
that are generated, identified, discovered, created, made or controlled
by
Licensee, its employees or a third party on behalf of Licensee, relating
to the Licensed Product or its production, including,
without limitation, technical data, knowhow, chemical compounds,
biological material, reports, manufacturing processes, formulations,
modes
of delivery and methods of use, pre-clinical and clinical data,
documentation relating to regulatory submissions and marketing
authorizations (including any Investigational New Drug Applications,
New
Drug Applications and equivalent documents), and post-registration
clinical trial information and data relating to the Licensed
Products.
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1.13
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“Licensed
Territory” shall mean the world.
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1.14
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“Net
Sales” shall mean the amounts received by Licensee or an Affiliate or
Sublicensee or Distributor of the Licensee from the sale of Licensed
Products to a third party purchaser, less the following deductions,
to the
extent that such amounts are included in the gross amounts received:
(i)
freight, packaging and insurance costs incurred in transporting the
Licensed Product to customers; (ii) quantity, cash and other trade
discounts actually allowed and taken (other than advertising allowances;
and fees or commissions to Licensee’s employees); (iii) customs duties,
surcharges, sales and other taxes (but excluding income taxes) and
other
governmental charges incurred in connection with the sale, transfer,
use,
exportation or importation of Licensed Products; and (iv) amounts
repaid
or credited by reason of returns, recalls, rejections or retroactive
price
reductions.
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For
purposes of this Section 1.14, sales of Licensed Products shall be deemed to
be
made when the revenue for such sales is recognized by Licensee in accordance
with Licensee’s standard accounting practices consistently applied. However, if
Licensee subsequently takes a bad debt charge against any receivable resulting
from the sale of Licensed Products, Licensee shall be entitled to credit
one-half of the amount of the royalty paid under Section 5.1 attributable to
such sale against future payments owed by Licensee to BTG hereunder, until
and
unless the amount of the bad debt charge is subsequently recovered.
In
the
case of any sale, lease, hire or other disposition to any third party which
is
not an arm’s length transactions, Licensed Products shall be valued at the Fair
Market Value for purposes of calculating Net Sales.
3
of 22
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1.14.1
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Transfer
of a Licensed Product to an Affiliate, Sublicensee or Distributor
for sale
by the Affiliate, Sublicensee or Distributor shall not be considered
a
sale; in the case of such a transfer the Net Sales shall be based
on the
gross billing price of the Licensed Products by the Affiliate, Sublicensee
or Distributor to its ultimate arms-length customer.
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1.14.2
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In
addition to a bona fide sale to a bona fide customer, every commercial
use
or disposition of any Licensed Product shall be considered a sale
of such
Licensed Product at the price then payable in an arm's length transaction,
except for the following uses or dispositions: (i) in assuring product
testing or control; (ii) for reasonable, limited promotional distribution
to physicians; (iii) for distribution to researchers for the sole
purpose
of industry research by or on behalf of Licensee or any of its Affiliates,
Sublicensees or Distributors; (iv) in obtaining Regulatory Approvals;
or
(v) required to be provided to a regulatory agency or a court of
law.
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1.15
|
“Pivotal
Clinical Trial” means a human clinical trial (whether denominated “Phase
II”, “Phase III”, or otherwise) conducted to establish efficacy of
Licensed Product and to meet the requirements to file a New Drug
Application for Licensed Product with health regulatory authorities
in the
particular indication tested.
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1.16
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“Qualified
Licensee Equity” means stock, warrants or other equity interests in
Licensee (or, if this Agreement is assigned by Licensee under Article
XIV
hereof, in any assignee), provided: (i) that such stock, warrants
or other
equity interests are registered under applicable securities laws
and
regulations; and (ii) that such stock, warrants or other equity interests
are actively traded on a recognized market on the day in which it
is
issued to BTG.
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1.17
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“Regulatory
Approval” means: (i) in the United States, approval of a New Drug
Application and satisfaction of any related applicable FDA registration
and notification requirements, and (ii) in any country other than
the
United States, approval by any governmental or regulatory body comparable
to the FDA that is necessary to make and sell Licensed Products
commercially in such country.
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1.18
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“Reporting
Period” means a three (3) month period ending March 31, June 30, September
30, and December 31 of each calendar
year.
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1.19
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“Non-Royalty
Consideration” means all amounts, and all consideration (including but not
limited to equity, stock options, stock warrants and the like) received
by
Licensee from its Sublicensees in consideration of any grant of rights
with respect to Licensed Patents, Licensed Knowhow or Licensed Products,
including but not limited to payments or other consideration for
options
for licenses, exercise of such options, grant of licenses, paid up
licenses, initial license fees, milestone payments, license maintenance
payments, and all other payments or other consideration made to Licensee
for such grant other than the
following:
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of 22
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1.19.1
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payments
received from the sale of debt or equity securities of the Company,
so
long as such payments received from the sale of debt or equity securities
do not constitute more than [***] percent [***] of the total
Non-Royalty Consideration received by Licensee in any one transaction,
and
to the extent that such payments exceed [***] percent [***] of
the total Non-Royalty Consideration in any one transaction, all amounts
in
excess of [***] percent [***] percent shall be deemed to be
Non-Royalty Consideration for purposes of Section 4.4 hereof; and
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1.19.2
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payments
received by the Licensee that are specifically designated in any
agreement
with a third party to be dedicated to the research and development
of the
Licensed Products or dedicated to establish a marketing and sales
force
for sales of Licensed Products; provided, however, that the amount
of such
payments: (i) reasonably correlates with the amounts which Licensee
can
reasonably be expected to expend for such purposes; and (ii) is consistent
with the amounts of such payments which are customarily made in comparable
transactions in the pharmaceutical industry.
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If
Licensee receives any payments from an Affiliate or Sublicensee based upon
the
milestone events described in Section 4.2, and if the amount of those payments
exceeds the sums set forth in Section 4.2, then the excess amount of such
payments will be deemed Non-Royalty Consideration hereunder.
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1.20
|
“Sublicensee”
means any entity to whom Licensee grants a sublicense pursuant to
Article
III of this Agreement
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II.
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LICENSE
GRANT.
|
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2.1
|
BTG
hereby grants to Licensee and Licensee hereby accepts for the term
of this
Agreement the non-transferable, exclusive, royalty-bearing license
under
Licensed Patents in the Field of Use to make, have made, use, lease,
sell
and otherwise dispose of Licensed Products in the Licensed
Territory.
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of 22
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2.2
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BTG
hereby grants to Licensee and Licensee hereby accepts for the term
of this
Agreement the non-transferable, exclusive, royalty-bearing license
to use
the Licensed Knowhow the
Field of Use to
make, have made, use, lease, sell and otherwise dispose of Licensed
Products in
the Licensed Territory.
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2.3
|
BTG
agrees not to assert any claim of infringement of any of the Licensed
Patents against customers, mediate and immediate, of Licensee or
its
Affiliates, Sublicensees or Distributors with respect to any Licensed
Products obtained directly or indirectly from Licensee or its Affiliates,
Sublicensees or Distributors.
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2.4
|
For
so long as the licenses granted in this Article II remain exclusive,
BTG
will not grant any other person a license under the Licensed Patents
and/or Licensed Knowhow to make, have made, use, lease, sell or otherwise
dispose of Licensed Products, and will not itself make, have made,
use,
lease, sell or otherwise dispose of Licensed
Products.
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2.5
|
Nothing
contained in this Agreement shall be construed as a license, express
or
implied, under any patents owned by or licensed to BTG other than
the
Licensed Patents, or under any information owned by or licensed to
BTG
other than the Licensed Knowhow.
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III.
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SUBLICENSING.
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3.1
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Licensee
may grant sublicenses under the rights granted to it in Article II,
provided that such sublicenses shall be at least as favorable to
BTG as
this Agreement, and provided that each Sublicensee is bound under
a
written agreement with Licensee containing terms and conditions consistent
with and no less restrictive than those applicable to Licensee hereunder.
Licensee will include a copy of this Agreement as an exhibit to all
sublicenses. Without limitation, all sublicenses shall include the
following:
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|
3.1.1
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A
provision specifying that the sublicense is personal to the Sublicensee,
and may not be further sublicensed or
assigned.
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3.1.2
|
A
provision allowing direct access by BTG or its representatives to
inspect
and audit the books and records of the Sublicensee for purposes of
verifying royalties payable
thereunder.
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3.1.3
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Provisions
permitting termination of the sublicense in accordance with Section
3.2
below and other provisions for termination equivalent to those contained
in this Agreement.
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3.1.4
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A
provision for conversion to a license directly between the Sublicensee
and
BTG upon termination of this Agreement as provided in Section
12.4.1.
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of 22
Licensee
will notify BTG of the proposed terms of any sublicenses in advance, and will
permit BTG to comment upon the legal and commercial reasonableness of the
proposed terms.
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3.2
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The
Licensee shall be responsible for the observance and performance
by every
Sublicensee of the terms and conditions of the sublicense, and shall
be
directly liable to BTG for any breach, non-observance or non-performance
by any Sublicensee which results in a breach by the Licensee under
this
Agreement.
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3.3
|
Following
the grant of sublicense, Licensee shall:
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3.3.1
|
Forward
a copy of the sublicense agreement within thirty (30) days of
execution.
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3.3.2
|
Notify
BTG in the case of any breach by the Sublicensee, and if requested
by BTG,
promptly serve notice upon the Sublicensee specifying the breach,
and
terminating the sublicense in accordance with its terms if the breach
is
not timely cured.
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IV.
|
LICENSE
FEES, MILESTONES AND NON-ROYALTY
CONSIDERATION.
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4.1
|
Licensee
shall pay to BTG the sum of [***] as an Initial License Fee, which
amount
shall not be refunded to Licensee because of any condition precedent
or
condition subsequent. The Initial License Fee will be paid by wire
transfer of immediately available funds within two (2) business days
of
the execution of this Agreement.
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4.2
|
Licensee
shall pay to BTG the following non-refundable, non-creditable Development
Milestone License Fees, payable within thirty (30) days following
the
milestone event date, whether such milestones are achieved by Licensee
or
by any Licensee Affiliate or
Sublicensee:
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4.2.1
|
Upon
Initiation of the Pivotal Clinical Trial: [***], up to [***] of which
may
be paid in the form of Qualified Licensee
Equity.
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4.2.2
|
Upon
submission of a New Drug Application or similar application for Regulatory
Approval: [***].
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4.2.3
|
Upon
Regulatory Approval in the United States:
[***].
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4.2.4
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Upon
the earlier to occur of: (i) Regulatory Approval in any country in
the
European Union; or (ii) one year following first commercial sale
of
Licensed Products anywhere in the world:
[***].
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4.2.5
|
Upon
Regulatory Approval in Japan:
[***].
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4.3
|
Until
the first commercial sale of a Licensed Product, Licensee shall pay
to BTG
a non-refundable, non-creditable License Maintenance Fee of [***],
payable
upon the one-year anniversary date of the Effective Date of this
Agreement, and upon each successive one-year anniversary date thereafter
until Regulatory Approval. The amount of such License Maintenance
Fee
payments may be credited against any milestone payments described
in
Section 4.2 made during the calendar year in which such License
Maintenance Fee is paid, but may not be credited against milestone
payments made during any preceding or subsequent calendar year, or
against
any royalty payments due hereunder.
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4.4
|
Licensee
shall pay to BTG a portion of all Non-Royalty Consideration as
follows:
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4.4.1
|
If
Licensee sublicenses rights to the Licensed Product prior to Initiation
of
the Pivotal Clinical Trial, Licensee will pay BTG [***] percent
of all Non-Royalty Consideration, until such time as Licensee has
recouped
an amount equal to all out-of-pocket development costs and expenditures
(but not including any overhead or other internal cost allocations)
directly incurred and paid by Licensee prior to the date of such
sublicense in developing Licensed Products pursuant to the Development
Plan described in Section 7.2, and thereafter, Licensee will pay
BTG [***] percent of all Non-Royalty
Consideration.
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4.4.2
|
If
Licensee sublicenses rights to the Licensed Product after Initiation
of
the Pivotal Clinical Trial, Licensee will pay BTG [***] percent of
all Non-Royalty Consideration.
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4.4.3
|
Licensee
will pay BTG the portion of all royalties received from Sublicensees
as
provided in Section 5.3.
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4.5
|
If
Licensee sublicenses rights to the Licensed Products under Article
III,
Licensee will pay BTG the following sublicense milestone fees based
on the
Sublicensee’s total cumulative sales of Licensed
Products:
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4.5.1
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When
the Sublicensee has sold a cumulative total of [***] in Net Sales,
[***].
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4.5.2
|
When
the Sublicensee has sold a cumulative total of [***] in Net Sales,
[***].
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4.5.3
|
When
the Sublicensee has sold a cumulative total of [***] in Net Sales,
[***].
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4.5.4
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When
the Sublicensee has sold a cumulative total of [***] in Net Sales,
[***].
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BTG
agrees that up to [***] percent of any of the payments described in this
Section 4.5 may be made in the form of Qualified Licensee Equity.
|
4.6
|
Within
ten (10) days after receipt, Licensee shall forward to BTG copies
of
regulatory correspondence relevant to the (i) Initiation and Completion
event milestones and (ii) the marketing application submission and
approval milestones specified in this Article IV and, further, copies
of
correspondence from a regulatory agency that grants approval for
marketing
or other commercial use of a Licensed Product in any country. Such
correspondence shall be subject to the confidentiality and limited
use
obligations of Article VII.
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V.
|
ROYALTIES
AND MINIMUM ROYALTIES.
|
|
5.1
|
In
consideration of the license granted in Article II, Licensee shall
pay BTG
a royalty calculated upon the Net Sales of all Licensed Products
sold by
Licensee and its Affiliates and Distributors as
follows:
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|
5.1.1
|
For
the first [***] in net sales made by Licensee and its Affiliates
and
Distributors in each calendar year, [***] percent of the Net
Sales.
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5.1.2
|
For
the next [***] in net sales made by Licensee and its Affiliates and
Distributors in each calendar year, [***] percent of the Net
Sales.
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5.1.3
|
For
all net sales in excess of [***] made by Licensee and its Affiliates
and
Distributors in each calendar year, [***] percent of the Net
Sales.
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of 22
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5.2
|
Beginning
in the fourth full calendar year after Regulatory Approval, BTG will
have
the right to terminate the exclusive grant of rights herein contained
if
in any such year the royalties payable to BTG hereunder are less
than
[***], subject to the following:
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|
5.2.1
|
In
the fourth full calendar year after Regulatory Approval, so long
as actual
earned royalties payable hereunder are at least [***], Licensee will
have
the right to retain its exclusivity hereunder by paying BTG the difference
between [***] and the amount of earned royalties. Beginning in the
fifth
full calendar year after Regulatory Approval, the [***] in minimum
royalties must be from actual earned
royalties.
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5.2.2
|
The
provisions of this Section 5.2 shall not apply if, and only to the
extent
that, Licensee is prevented from making or selling Licensed Products
due
to Force Majeure; provided that, to the extent feasible, Licensee
takes
reasonable steps to overcome or mitigate the effects of the Force
Majeure
event, and thereafter commences
and continues diligent performance whenever the Force Majeure is
removed.
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5.2.3
|
If
BTG exercises its right to terminate the exclusive grant of rights
herein
contained under this Section 5.2, Licensee will thereafter have and
retain
the non-exclusive right and license to make, have made, use, lease,
sell
and otherwise dispose of Licensed Products, including the rights
to
sublicense or assign its rights, upon all of the terms and conditions
herein contained. The provisions of Section 12.4, and in particular
Section 12.4.2, shall not apply to any termination of Licensee’s exclusive
rights under this Section 5.2.
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|
5.3
|
Licensee
shall pay BTG [***] percent of all royalties that it receives from
its Sublicensees; however, in no event will Licensee pay BTG an amount
that is less than [***] percent of the Net Sales received by its
Sublicensees or their Affiliates or Distributors for their sales
or other
dispositions of Licensed Products.
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5.4
|
Licensee
will provide BTG with good faith annual forecasts of the projected
amount
of its sales of Licensed Products. Such forecasts shall be for BTG’s
planning purposes only. Licensee does not warrant the accuracy of
such
sales forecasts, and will not be liable to BTG in any way for any
inaccuracy, or for any act or omission of BTG in reliance upon such
forecasts.
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10
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|
VI.
|
ROYALTY
PAYMENTS, REPORTS, AND OTHER ACCOUNTING
MATTERS.
|
|
6.1
|
Within
thirty (30) days after each Reporting Period, Licensee will submit
to BTG
a report summarizing (i) the total Net Sales for sales or other
dispositions by Licensee during such Reporting Period separately
enumerated by country, (ii) the computation of any royalty payable
during
that Reporting Period, and (iii) the amount of royalty due for such
Reporting Period. Licensee will pay the amount of any royalty due
simultaneously with submission of its report.
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|
6.2
|
All
sums payable to BTG pursuant to this Agreement will be paid in United
States Dollars. If royalties accrue in a currency other than United
States
Dollars, those royalties will be converted to United States Dollars
at the
exchange rate listed in the Wall Street Journal on the last day of
the
Reporting Period during which the royalties accrued. Licensee’s reports,
as required by Section 6.1, will contain a statement setting forth
any
such computation of the number of United States Dollars remitted.
All
royalties that remain unpaid for more than thirty (30) days after
their
due date will bear interest from the due date until paid at a
rate [***] percent greater than the prime interest rate published in
the New York edition of the Wall Street
Journal.
|
|
6.3
|
All
sums payable to BTG under this Agreement are exclusive of any sales
tax or
equivalent, which will be payable by Licensee. In addition, all such
sums
will be paid in full without deduction of taxes, charges and other
duties
(including any withholding or other income taxes) that may be imposed;
provided, that where Licensee is required by law to make such deduction
or
withholding, Licensee will be entitled to deduct such amounts and,
if BTG
so requests, will provide BTG with evidence of payment of such amount.
|
|
6.4
|
Licensee
and its Affiliates, Sublicensees and Distributors will keep records
that
are adequate to establish the accuracy of the reports and the computation
of royalties due under this Agreement for a period of five (5) calendar
years including the five (5) years following termination or expiration
of
the licenses granted under Article II. Licensee will permit these
records
to be inspected and audited, at BTG’s expense, to verify the correctness
of such reports and computations. Such inspections and audits will
be
during reasonable business hours and on reasonable notice to Licensee.
If
royalties are found to have been understated by an amount in excess
of
[***], Licensee shall reimburse BTG for its costs and expenses incurred
in
having the inspection and audit
conducted.
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|
6.5
|
Royalties
shall be due upon all Licensed Products manufactured during the term
of
this Agreement that remain unsold at its expiration or termination,
and
shall be calculated and paid when sold in accordance with Section
6.1.
|
|
6.6
|
Nothing
in this Agreement will be construed as requiring Licensee to pay
royalties
under any expired patent, or any applicable claim or claims of a
Licensed
Patent that are declared invalid or not infringed or unenforceable
by a
court of competent jurisdiction from whose decision no appeal is
or can be
taken.
|
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|
VII.
|
DILIGENCE;
DEVELOPMENT AND COMMERCIALIZATION OF THE LICENSED
PRODUCTS.
|
|
7.1
|
Promptly
following BTG’s receipt of the Initial License Fee forth in Section 3.1,
BTG will provide Licensee with any Licensed Knowhow that has not
already
been provided to Licensee prior to the Effective Date hereof.
|
|
7.2
|
Licensee
has provided BTG with its plan for development, Regulatory Approval,
manufacture, commercial exploitation and marketing of the Licensed
Products (the “Development Plan”), a copy of which is attached as Schedule
7.2.
|
|
7.3
|
Licensee
shall use all commercially reasonable efforts to diligently develop
Licensed Products and seek Regulatory Approval in accordance with
the
Development Plan.
Licensee
shall diligently commence and conduct development of the Licensed
Products, and will diligently undertake all actions required to obtain
Regulatory Approval. Once Regulatory Approval has been obtained,
Licensee
will diligently commercialize the Licensed Products in all countries
in
which Regulatory Approval has been obtained; will use its best
efforts to promote the distribution and sale of Licensed Products;
and
will seek to maximize demand for Licensed Products. Licensee will
make
available all necessary manufacturing, marketing and sales resources
and
facilities necessary to meet market demand for Licensed
Products.
|
|
7.4
|
As
of the Effective Date, Licensee shall be responsible, financially and
otherwise, for all development of the Licensed Products conducted
by or
for Licensee and for seeking Regulatory Approval. BTG may provide
Licensee
with certain existing information and clinical data that is included
as
part of the Licensed Knowhow which Licensee may use in connection
with
Regulatory Approval; provided, that BTG will have no responsibility
or
liability for any actions or omissions in connection with Licensee’s use
of such information and clinical data. Licensee or its Affiliates
or
Sublicensees shall hold legal title to all applications for marketing
authorizations submitted by Licensee, and shall assume full responsibility
for the clinical protocols developed in support of such applications
for
marketing authorization.
|
|
7.5
|
At
least once every six (6) months, Licensee will provide BTG with a
summary
midyear report on the status of development of the Licensed Products,
and
the efforts undertaken by Licensee and all Sublicensees to seek Regulatory
Approval. Each such report shall include with respect to the applicable
six (6) month period a description of the research and development
and
regulatory activities conducted both in the United States and outside
the
United States with respect to the Licensed Products. BTG and Licensee
will
meet or confer every six (6) months with respect to Licensee’s activities
described in this Section 7.5.
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|
VIII.
|
INTELLECTUAL
PROPERTY.
|
|
8.1
|
BTG
will, at
its own expense, apply for, prosecute, seek prompt issuance of, and
maintain the Licensed Patents. BTG will have the discretion to prosecute
and maintain the Licensed Patents in the manner that BTG deems legally
and
commercially justified, including the right to cancel, amend or abandon
any Licensed Patent, and to determine the countries in which the
Licensed
Patents will be prosecuted or maintained. Notwithstanding the foregoing,
BTG and Licensee will confer at least once every six (6) months to
discuss
reasonable and commercially appropriate actions to prosecute and
maintain
the Licensed Patents, and BTG will consider in good faith any comments
or
suggestions that Licensee may offer with the view towards strengthening
the scope, claims and geographic coverage of the Licensed
Patents.
|
|
8.2
|
Licensee
will cooperate with BTG, at BTG’s expense, in the filing, prosecution and
maintenance of the Licensed Patents. In addition, Licensee
shall cooperate fully with BTG in pursuing and securing available
extensions or restoration of patent term for the Licensed Patents,
including Supplementary Protection Certificates. Any patent extension
or
restoration of patent term or other supplemental product protection
which
is secured by BTG shall be deemed within the Licensed
Patents.
|
|
8.3
|
Licensee
and BTG will promptly notify the other of any infringement or suspected
infringement that may come to its attention of any intellectual property
rights relating to the Licensed Product, including, without limitation,
the Licensed Patents and Licensed Knowhow. If a third party infringes
any
Licensed Patent or Licensed Knowhow, BTG will have the first right
(but
not the obligation), at its own expense, to pursue any and all injunctive
relief and any or all compensatory and other remedies and relief
against
such third party, and Licensee will have the right to participate
in such
action at its own expense. If BTG determines not to pursue a claim
with
respect to such infringement within one hundred eighty (180) days
after
receipt of written notice from Licensee requesting BTG to do so,
then
Licensee will have the right (but not the obligation), to do so at
its own
expense, and BTG shall have the right to participate in such action
at its
own expense.
|
|
8.4
|
If
a party elects to pursue a claim of infringement against a third
party,
the other party will use all reasonable efforts to assist and cooperate
with the party pursuing such claim, including joining in any action
or
providing a power of attorney if necessary. Each party will bear
its own
costs and expenses relating to such pursuit. Any damages or other
amounts
collected will be distributed, first, to the party that pursued the
claim
to cover its costs and expenses and second, to the other party to
cover
its costs and expenses, if any, relating to the pursuit of such claim.
Any
damages or costs recovered in connection with any action filed by
Licensee
hereunder which exceed the parties’ out-of-pocket costs and expenses of
litigation, shall be deemed to be Net Sales from sales of Licensed
Products in the fiscal quarter in which received by Licensee, and
Royalties shall be payable by Licensee to BTG thereon in accordance
with
the terms of this Agreement. If the action is filed and pursued by
BTG,
then all damages or costs recovered which exceed the parties’
out-of-pocket costs and expenses of litigation shall be retained
by BTG.
No
settlement, consent judgment or other final disposition of an action
for
infringement or validity may be entered into as to any Licensed Patent
or
Licensed Knowhow without BTG's prior written
consent.
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|
8.5
|
If
a third party institutes a patent infringement, trade secret
misappropriation or similar proceeding against Licensee during the
term of
this Agreement, alleging that the manufacture, marketing, sale, use
or
importation of the Licensed Product infringes one or more patent
or other
intellectual property rights held by such third party, then Licensee
will
have the sole right (but not the obligation), at its sole expense,
to
assume direction and control of the defense of such claim. Licensee
will
not have the right to settle or otherwise dispose of any such claim
without the consent of BTG, which consent will not be unreasonably
withheld.
|
|
8.6
|
Licensee
will legibly xxxx all Licensed Products (or, if marking Licensed
Products
themselves is infeasible, will xxxx all associated packaging and
product
literature) with an appropriate patent notice in accordance with
laws that
govern marking of patented
products.
|
|
IX.
|
CONFIDENTIALITY.
|
|
9.1
|
BTG
and Licensee agree that all Licensed Knowhow and the Licensee Technology,
and all other information of either party pertaining to the subject
matter
of this Agreement which either party designates as confidential in
accordance with Section 9.5 (collectively, “Confidential Information”)
will be transmitted and received in confidence. In addition, “Confidential
Information” shall also include all information and data provided to
Licensee prior to the Effective Date of this Agreement under the
terms of
the Confidential Disclosure Agreement between the parties dated August
20,
2003. Each party agrees to use the same degree of care to prevent
disclosure of the Confidential Information as it uses to protect
and
safeguard its own highly valuable proprietary information, but in
any
event, not less than a reasonable degree of care. Licensee agrees
to use
the Licensed Knowhow solely and exclusively pursuant to the licenses
granted to Licensee in Article II of this Agreement, and BTG agrees
to use
the Licensee Technology Knowhow solely and exclusively pursuant to
the
licenses granted to BTG in Section 12.4 of this
Agreement.
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|
9.2
|
Except
for disclosure to each party’s Sublicensees under Article III and Section
12.4.3, neither party will disclose any Confidential Information
to any
third party without the disclosing party’s written consent. Each party
will obtain from its employees and Sublicensees written undertakings
to
maintain in confidence the Confidential Information, and will obtain
similar written undertakings to maintain in confidence the Confidential
Information from consultants, contractors, suppliers, or other third
parties who receive, or are granted access to, the Confidential
Information with the disclosing party’s consent.
|
|
9.3
|
Upon
termination of this Agreement for any reason, except as provided
herein,
each party agrees that it will make no further use of the Confidential
Information, will keep the Confidential Information in confidence,
and
will immediately deliver to the disclosing party all written or tangible
Confidential Information and all copies thereof.
|
|
9.4
|
The
obligations of confidentiality set forth in this Article IX will
not apply
to any Confidential Information that: (i) is already known to the
receiving party at the time of disclosure; (ii) is publicly available
or
becomes publicly available without a breach of this Agreement by
the
receiving party; (iii) is rightfully received by the receiving party
from
a third party without duty of confidentiality; (iv) is independently
developed by the receiving party; or (v) is required to be disclosed
as a
result of a final order of a court of competent
jurisdiction.
|
|
9.5
|
To
be subject to the obligations of this Article IX, all Confidential
Information in written or tangible form must be marked with an appropriate
designation, such
as "CONFIDENTIAL" or “PROPRIETARY". All Confidential Information that is
orally or visually disclosed will be subject to the obligations of
this
Article IX only if it is identified as confidential or proprietary
at the
time the disclosure is made and is subsequently described in a written
document that is marked with the appropriate designation and delivered
to
the receiving party within thirty (30) days after the date of oral
or
visual disclosure. Notwithstanding the foregoing, any report or disclosure
made or provided to BTG by Licensee pursuant to the terms of this
Agreement shall be treated as Confidential Information regardless
of
whether it is disclosed verbally or in writing and whether it has
been
marked as "CONFIDENTIAL" or “PROPRIETARY".
|
|
9.6
|
Nothing
contained in this Agreement will be construed to obligate either
party to
disclose to the other party information obtained from a non-Affiliate
third party under obligations restricting disclosure
thereof.
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9.7
|
BTG
and Licensee will jointly agree upon the terms of a press release
communicating the existence of this Agreement and the parties’
relationship hereunder, which will be issued on or shortly after
the
Effective Date. Licensee will also acknowledge BTG as the source
of the
Licensed Patents and Licensed Knowhow in all future public communications
relating to the Licensed Product, provided, that Licensee will provide
BTG
with an advance copy of all press releases and other public communications
relating to the Licensed Products in which BTG is
named.
|
|
X.
|
REPRESENTATIONS,
WARRANTIES AND
DISCLAIMERS.
|
|
10.1
|
BTG
represents and warrants that, as of the Effective Date of this
Agreement:
|
|
10.1.1
|
It
has the legal power to extend the rights granted to License under
this
Agreement.
|
|
10.1.2
|
No
license or covenant not to xxx has been granted to any third party
to
make, have made, use, have used, develop, have developed, improve,
have
improved, import, have imported, export, have exported, lease, have
leased, sell, and/or have sold any product under the Licensed
Patents.
|
|
10.1.3
|
Neither
BTG nor its Affiliates has made any claim against a third party alleging
any infringement, misappropriation or violation of any of the Licensed
Patents.
|
|
10.1.4
|
There
have been no claims or judicial proceedings commenced by or against
BTG
concerning any of the Licensed Patents or the Licensed Knowhow, and
BTG
has received no notice alleging or threatening any such claims or
judicial
proceedings.
|
|
10.1.5
|
BTG
has granted no lien or encumbrance involving the Licensed Patents
or
Licensed Knowhow, and BTG will not encumber the Licensed Patents
after the
Effective Date of this Agreement.
|
|
10.2
|
Each
party represents and warrants that it has the full corporate power
and
authority to enter into and perform this Agreement. This Agreement
has
been duly authorized and duly executed and delivered by both parties,
and
it is valid, binding and enforceable against both parties in accordance
with its terms.
|
|
10.3
|
Except
as set forth in this Article X, neither party makes or extends any
other
representations or warranties, and BTG makes no representation or
warranties, express, implied or statutory, with respect to the Licensed
Patents or Licensed Knowhow that is not expressly set forth in this
Article. Except as provided herein, all Licensed Patents and Licensed
Knowhow are made available to Licensee on an "as is" basis, and all
Licensee Technology is made available to BTG on an “as is” basis. BTG does
not warrant that the Licensed Patents are valid or enforceable; that
the
Licensed Patents or Licensed Knowhow have utility, are error free,
or that
they will meet Licensee's requirements; or that their exploitation
does
not or will not infringe any existing or future patent of another
person,
or that any of the Licensed Patents are valid. ANY IMPLIED WARRANTIES
OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NONINFRINGEMENT
OF
THIRD PARTY PATENTS, ARE EXPRESSLY DISCLAIMED AND EXCLUDED. The entire
risk as to the results obtained by practicing under the Licensed
Patents
and utilizing the Licensed Knowhow, or performance of the Licensed
Products, is assumed by Licensee.
|
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|
10.4
|
BTG
and Licensee specifically agree that in no event shall either party
be
liable for indirect, incidental, special or consequential damages
of any
kind, including without limitation economic damage or lost profits,
even
if the party has been advised or is aware of the possibility of such
damages.
|
|
XI.
|
LIABILTIY
AND INDEMNIFICATION.
|
|
11.1
|
Licensee
will defend, indemnify and hold harmless BTG, and its assignor, and
their
respective officers, directors, employees, agents and consultants,
from
and against all claims, demands, actions, liabilities and damages,
and any
costs and expenses which they incur in defending any action (including
attorneys’ fees and expenses), in connection with the clinical testing,
manufacture, use, sale, offer for sale, importation, lease or other
transfer or disposal of any products (including Licensed Products)
by
Licensee and its Sublicensees other than with respect to claims arising
out of the gross negligence or willful misconduct of BTG. The scope
of
such obligation to defend, indemnify and hold harmless includes,
without
limitation, any damage, loss or liability arising from injury or
death of
any person or damage to any property, and any fines or other penalties
imposed by any governmental body arising from or related in any way
to the
import, export, manufacture, use, sale, offer for sale, lease or
other
transfer or disposal of products (including Licensed Products) or
the
waste stream resulting from the manufacture or handling
thereof.
|
|
11.2
|
Insurance.
Without limiting Licensee's indemnity obligations under the preceding
paragraph, Licensee shall, prior to any clinical trial or sale of
any
Licensed Product, cause to be in force, an “occurrence based type”
liability insurance policy which:
|
|
11.2.1
|
Insures
BTG for all claims, damages, and actions mentioned in this Section
of this
Agreement;
|
|
11.2.2
|
Includes
a contractual endorsement providing coverage for all liability which
may
be incurred by Indemnitees in connection with this Agreement for
which
Licensee has an indemnification obligation hereunder;
|
|
11.2.3
|
Requires
the insurance carrier to provide BTG with no less than thirty (30)
days'
written notice of any change in the terms or coverage of the policy
or its
cancellation; and
|
|
11.2.4
|
Provides
BTG product liability coverage in an amount no less than [***] per
occurrence for bodily injury and [***] per occurrence
for property damage, subject to a reasonable aggregate
amount.
|
|
11.3
|
If
Licensee is unable to obtain “occurrence based type” liability insurance,
Licensee shall procure “claims made type” liability coverage to be
effective prior to any clinical trial or sale of any Licensed Patent,
and
throughout the term of this Agreement and “tail coverage”, extending at
least ten (10) years after termination of this Agreement. Licensee
shall
notify BTG prior to its first clinical trial or first commercial
sale of
any Licensed Product, of all insurance coverage available to Licensee
to
meet Licensee‘s obligations under Article 11 of this Agreement and other
assets available to Licensee which may be used by Licensee should
the
insurance coverage available to Licensee not be sufficient to meet
Licensee obligations hereunder.
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|
XII.
|
TERM
AND TERMINATION.
|
|
12.1
|
Unless
terminated as provided in this Article XII, the term of this Agreement
shall commence upon its Effective Date and shall remain in force
until the
date of expiration of the last to expire of any patent of the Licensed
Patents. Upon expiration of the term of the Agreement as provided
in this
Section 12.1, Licensee’s rights to Licensed Knowhow will thereupon become
perpetual, irrevocable and fully paid-up, and Licensee may thereafter
use
the Licensed Knowhow to make, have made, use, lease, sell and otherwise
dispose of any products in any country of the world without any further
royalty payment to BTG.
|
|
12.2
|
Either
party may terminate this Agreement if the other party is in material
default of any of its obligations and such default remains uncured
for at
least sixty (60) days after written notice of the default is given
to the
defaulting party by the non-defaulting party. In addition, if either
party
files a petition in bankruptcy or insolvency or is adjudged bankrupt
or
insolvent, or makes an assignment for the benefit of creditors or
otherwise acknowledges insolvency, the other party may terminate
this
Agreement by providing ten (10) days prior written
notice.
|
|
12.3
|
BTG
may terminate this Agreement and the licenses herein granted upon
thirty
(30) days' written notice to the Licensee, or may terminate the licenses
herein granted with respect to any geographic territory without
terminating it as to other geographic territories, if any of the
following
events occurs:
|
|
12.3.1
|
if
Licensee at any time ceases to develop Licensed Products for a continuous
period of six (6) months unless such failure is as a result of Force
Majeure; provided
that, to the extent feasible, Licensee takes reasonable steps to
overcome
or mitigate the effects of the Force Majeure event, and thereafter
commences
and continues with diligent performance whenever the Force Majeure
event
is removed;
|
|
12.3.2
|
if
Licensee fails to achieve the following development milestones within
six
(6) months after the timeframes specified in this Section 12.3.2,
unless
such failure is as a result of Force Majeure; provided
that, to the extent feasible, Licensee takes reasonable steps to
overcome
or mitigate the effects of the Force Majeure event, and thereafter
commences
and continues with diligent performance whenever the Force Majeure
event
is removed: (i) Optimization of manufacturing process and preparation
of
GMP batches of API within [***] months following the Effective Date;
and (ii) Submission of an IND within [***] months after completion of
item (i) above; provided, however, that if the Licensee using all
commercially reasonable efforts, is unable to meet the aforementioned
timelines, BTG shall negotiate in good faith, a reasonable extension.
|
|
12.3.3
|
if
Licensee fails to commence selling Licensed Products in any geographic
territory within [***] months following Regulatory Approval in that
territory, or if Licensee thereafter ceases to sell Licensed Products
in a
geographic territory for a continuous period of [***] months after
the Licensed Products are first made available in the market in that
territory, BTG may terminate the licenses herein granted with respect
to
that geographic territory or territories;
or
|
|
12.3.4
|
if
control of Licensee is acquired by any entity, or entity or person(s)
not
having control of Licensee at the Effective Date and such change
in
control materially adversely affects the development and marketing
of
Licensed Product as contemplated under this Agreement or materially
adversely affects BTG's rights or legal interests under this Agreement
or
the economic benefits to BTG under this Agreement. For the purposes
hereof, "control" shall mean the power to direct or cause the direction
of
the management and policies of an entity, whether through the ownership
of
voting securities, by contract or otherwise.
|
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|
12.4
|
If
BTG terminates this Agreement under Section 12.2 or 12.3 prior to
the
expiration of the Agreement term, then the following will take effect
upon
the effective date of such
termination:
|
|
12.4.1
|
All
rights under the Licensed Patents and the Licensed Knowhow granted
by BTG
to Licensee pursuant to Article II will terminate, and all rights
granted
therein will immediately revert to BTG with no further notice or
action
required on BTG’s behalf. In that event, any sublicense granted by
Licensee shall be automatically assigned by Licensee to BTG without
any
action of either Party such that the sublicense becomes a direct
license
between BTG and the applicable Sublicensee.
|
|
12.4.2
|
Licensee
automatically grants to BTG a non-exclusive, world-wide, royalty-free
license, with the right to sublicense, under Licensee Technology
to make,
have made, use, offer to sell, sell and import Licensed Products.
In
addition to the license granted under this Section 12.4.2, Licensee
will
also promptly provide BTG with reasonable access to all Licensee
Technology, and will provide BTG with copies of all Licensee Technology
that exists in tangible form, including but not limited to, any
pre-clinical and clinical trial results and regulatory files related
to
the Licensed Product. If BTG so requests, Licensee will provide reasonable
assistance of appropriate Licensee personnel to discuss the Licensee
Technology. BTG will reimburse License for all reasonable out-of-pocket
expenses that its personnel incur in providing such assistance.
|
|
12.4.3
|
Licensee
shall immediately transfer possession and ownership to BTG (and shall
cause all contractors used by Licensee to transfer possession and
ownership) of all Regulatory Approvals, together with pre-clinical
and
clinical data and information, all clinical trial databases, all
data
generated in support of applications for marketing authorization,
and all
other information and documents relating to Regulatory Approval,
and all
correspondence between Licensee and any contractor of Licensee and
any
regulatory agency, that were created and/or developed by Licensee
in
connection with obtaining or seeking to obtain Regulatory Approval.
|
|
12.5
|
The
provisions of Sections 10.3, 10.4, 12.4 and Articles V, IX and XI
will
survive any termination or expiration of this
Agreement.
|
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|
XIII.
|
NOTICES
AND OTHER COMMUNICATIONS.
|
|
13.1
|
Any
notice or other communication required or permitted to be made or
given to
either party shall be sent to the other party by overnight courier
service
(Federal Express or the like), addressed to the party at its address
set
forth below, or to such other address as the party may designate
by
written notice given to the other
party.
|
In
the
case of BTG:
BTG
International, Inc.
Five
Tower Bridge
000
Xxxx
Xxxxxx Xxxxx
Xxxx
Xxxxxxxxxxxx, XX. 00000
Attn:
General Counsel
In
the
case of Licensee:
00000
Xxxxxxxx Xxxx., Xxxxx 000
Xxx
Xxxxxxx, Xxxxxxxxxx 00000 XXX
Attention:
President
|
XIV.
|
ASSIGNMENTS.
|
|
14.1
|
This
Agreement and the rights and duties apper-taining hereto may not
be
assigned by either party without first obtaining the written consent
of
the other which consent shall not be unreasonably withheld. Any such
purported assignment, without the written con-sent of the other party,
shall be null and of no effect. Notwith-standing the foregoing, BTG
may
assign this Agreement and its right to receive payments hereunder,
and
Licensee may assign this A-greement without such consent to a purchaser,
merging or consolidating corpo-ra-tion, or acquirer of substantially
all
of the Company's assets or business and/or pursuant to any
reorgani-za-tion quali-fying under section 368 of the Internal Revenue
Code of 1986 as amended, as may be in effect at such
time.
|
|
XV.
|
MISCELLANEOUS.
|
|
15.1
|
Licensee
shall obtain the prior written approval of BTG prior to making use
of the
name of any BTG employee or the name BTG for any commercial purpose,
except as required to comply with law, regulation or court
order.
|
|
15.2
|
Each
of the parties will from time to time at the other’s reasonable request
and expense, and without further consideration, execute and deliver
such
other documents and take such further action as the other party may
reasonably require to more effectively evidence, perfect, or complete
any
matter provided for herein.
|
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|
15.3
|
Any
consent by any party to, or waiver of, a breach by the other party,
whether express or implied, will not constitute a consent to, or
waiver
of, any other different or subsequent
breach.
|
|
15.4
|
If
any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, it shall be severed
from this Agreement and the remaining provisions shall remain in
full
force without being impaired or invalidated in any
way.
|
|
15.5
|
The
parties are independent contractors. Neither party has any express
or
implied right or authority to assume or create any obligations on
behalf
of the other or to bind the other to any contract, agreement or
undertaking with any third party.
|
|
15.6
|
No
amendment or modification of this Agreement shall be valid or binding
upon
the parties unless made in writing and signed by or on behalf of
the party
against which enforcement is
sought.
|
|
15.7
|
This
Agreement shall be construed, and the legal relationships between
the
parties hereto shall be determined, in accordance with the laws of
the
State of Delaware, United States of America, without giving effect
to its
conflicts of laws provisions.
|
|
15.8
|
This
Agreement embodies the entire understanding of the parties and shall
supersede all previous communications, representations, or understandings,
either oral or written, between the parties relating to the subject
matter
hereof.
|
[The
remainder of this page is intentionally left blank]
21
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IN
WITNESS WHEREOF, the parties intending to be legally bound, have caused this
Agreement to be duly executed in duplicate original on the dates set forth
below, the later of which is the Effective Date.
|
BTG
INTERNATIONAL LTD.
|
|
|
By:
_____________________________
|
By:
_______________________________
|
|
Title:
___________________________
|
Title:
______________________________
|
|
Date:
___________________________
|
Date:
______________________________
|
|
By:
____________________________
|
|
|
Title:
___________________________
|
|
|
Date:
___________________________
|
22
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