Exhibit 10.11
CONFIDENTIAL TREATMENT
RESEARCH, LICENSE AND COLLABORATION AGREEMENT
BETWEEN
CELLTECH R & D LIMITED
AND
NEOGENESIS DRUG DISCOVERY, INC.
DATED JULY 11, 2001
TABLE OF CONTENTS
Page
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ARTICLE I. DEFINITIONS ............................................................ 1
Section 1.1. AAA ........................................................ 2
Section 1.2. AFFILIATE .................................................. 2
Section 1.3. AGREEMENT .................................................. 2
Section 1.4. ALIS ....................................................... 2
Section 1.5. APPLICABLE LAWS ............................................ 2
Section 1.6. APPROVAL LETTER ............................................ 2
Section 1.7. APPROVED TARGET(S) ......................................... 2
Section 1.8. APPROVED TARGET EXCLUSIVITY PERIOD ......................... 2
Section 1.9. CELLTECH INDEMNIFIED PARTY ................................. 3
Section 1.10. CELLTECH TECHNOLOGY ........................................ 3
Section 1.11. CELLTECH DERIVATIVES ....................................... 3
Section 1.12. CIP ........................................................ 4
Section 1.13. COMMERCIALIZATION .......................................... 4
Section 1.14. COMMERCIALLY REASONABLE EFFORTS ............................ 4
Section 1.15. CONFIDENTIAL INFORMATION ................................... 4
Section 1.16. CONTROL OR CONTROLLED ...................................... 4
Section 1.17. DESIGNATED COMPOUND ........................................ 4
Section 1.18. DISCLOSING PARTY ........................................... 5
Section 1.19. EFFECTIVE DATE ............................................. 5
Section 1.20. FDA ........................................................ 5
Section 1.21. FD&C Act ................................................... 5
Section 1.22. FIRST COMMERCIAL SALE ...................................... 5
Section 1.23. FOB ........................................................ 5
Section 1.24. FORCE MAJEURE .............................................. 5
Section 1.25. FTE ........................................................ 6
Section 1.26. GOOD CLINICAL PRACTICE ..................................... 6
Section 1.27. GOOD LABORATORY PRACTICE ................................... 6
Section 1.28. GOOD MANUFACTURING PRACTICE ................................ 6
Section 1.29. INDEMNIFIED PARTY(IES) ..................................... 6
Section 1.30. INDEMNIFYING PARTY ......................................... 7
Section 1.31. KNOW HOW ................................................... 7
Section 1.32. LICENSED PRODUCT(S) ........................................ 7
Section 1.33. LOCK UP PERIOD ............................................. 7
Section 1.34. MAJOR COUNTRY .............................................. 7
Section 1.35. MANUFACTURING .............................................. 7
Section 1.36. MASK ....................................................... 8
Section 1.37. NDA ........................................................ 8
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Section 1.38. NEOGENESIS INDEMNIFIED PARTY(IES) .......................... 8
Section 1.39. NEOGENESIS TARGET .......................................... 8
Section 1.40. NEOGENESIS TECHNOLOGY ...................................... 8
Section 1.41. NEOGENESIS DERIVATIVES ..................................... 8
Section 1.42. NEOMORPH CHEMISTRY ......................................... 9
Section 1.43. NEOMORPH FOCUSED LIBRARIES ................................. 9
Section 1.44. NEOMORPH SCREENING LIBRARY ................................. 9
Section 1.45. NET SALES .................................................. 9
Section 1.46. PATENTS .................................................... 10
Section 1.47. PERSON ..................................................... 10
Section 1.48. PHASE I CLINICAL TRIALS .................................... 10
Section 1.49. PHASE III CLINICAL TRIALS .................................. 10
Section 1.50. PRELIMINARY COMPOUND ....................................... 11
Section 1.51. PRELIMINARY COMPOUND EXCLUSIVITY PERIOD .................... 11
Section 1.52. PRIMARY ACTIVE COMPOUND .................................... 11
Section 1.53. PRIMARY ACTIVE COMPOUND EXCLUSIVITY PERIOD ................. 11
Section 1.54. PROGRAM TECHNOLOGY ......................................... 11
Section 1.55. PROPRIETARY TARGET ......................................... 12
Section 1.56. PUBLIC TARGET .............................................. 12
Section 1.57. QSCD ....................................................... 12
Section 1.58. QSCD PRELIMINARY COMPOUNDS ................................. 12
Section 1.59. QSCD PRIMARY ACTIVE COMPOUNDS .............................. 12
Section 1.60. QUARTER .................................................... 12
Section 1.61. R&D Program ................................................ 12
Section 1.62. RECEIVING PARTY ............................................ 13
Section 1.63. REGULATORY APPROVALS ....................................... 13
Section 1.64. REGULATORY AUTHORITY ....................................... 13
Section 1.65. RESEARCH COLLABORATION ..................................... 13
Section 1.66. RESEARCH COLLABORATION PLAN ................................ 13
Section 1.67. RESEARCH TERM .............................................. 13
Section 1.68. STEERING COMMITTEE ......................................... 13
Section 1.69. STOCK PURCHASE AGREEMENT ................................... 14
Section 1.70. TARGET ..................................................... 14
Section 1.71. TARGET GUIDELINES .......................................... 14
Section 1.72. TERM ....................................................... 14
Section 1.73. TERRITORY .................................................. 14
Section 1.74. THIRD PARTY (THIRD PARTIES) ................................ 14
Section 1.75. THIRD PARTY CLAIM .......................................... 14
ARTICLE II. GRANT, RIGHTS AND RESTRICTIONS ........................................ 14
Section 2.1. GRANT OF RESEARCH LICENSE. .................................. 14
Section 2.2. NEOGENESIS GRANT OF LICENSE. ................................ 15
Section 2.3. RETAINED RIGHTS. ............................................ 16
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ARTICLE III. RESEARCH COLLABORATION PLAN .......................................... 16
Section 3.1. DILIGENCE. .................................................. 16
Section 3.2. RESEARCH COLLABORATION. ..................................... 16
Section 3.3. NUMBER OF TARGETS. .......................................... 16
ARTICLE IV. STEERING COMMITTEE .................................................... 17
Section 4.1. STEERING COMMITTEE. ......................................... 17
(a) STEERING COMMITTEE ACTIVITIES. ............................. 17
(b) STEERING COMMITTEE MEETINGS. ............................... 17
(c) STEERING COMMITTEE GOVERNANCE. ............................. 18
ARTICLE V. RESEARCH FUNDING ....................................................... 18
Section 5.1. RESEARCH COLLABORATION FUNDING. ............................. 18
(a) STOCK PURCHASE. ............................................ 18
(b) FTE FUNDING. ............................................... 19
(c) QUARTERLY PAYMENTS. ........................................ 19
ARTICLE VI. MILESTONES AND ROYALTY PAYMENTS ....................................... 19
Section 6.1. MILESTONES. ................................................. 19
(a) PHASE I. ................................................... 19
(b) PHASE III. ................................................. 20
(c) APPROVAL LETTER. ........................................... 20
(d) MILESTONE FREQUENCY. ....................................... 20
Section 6.2. ROYALTIES. .................................................. 20
(a) NON-QSCD DISCOVERED COMPOUNDS. ............................. 21
(b) QSCD DISCOVERED COMPOUNDS. ................................. 21
(c) ROYALTY PAYMENTS AND TERM. ................................. 21
(d) ROYALTY ADJUSTMENTS. ....................................... 21
Section 6.3. REMITTANCE. ................................................. 21
(a) FUNDS/EXCHANGE RATE. ....................................... 21
(b) INTEREST. .................................................. 22
Section 6.4. RECORDS. .................................................... 22
Section 6.5. INSPECTION. ................................................. 22
(a) AUDIT. ..................................................... 22
(b) DISPUTES. .................................................. 23
Section 6.6. TAXES. ...................................................... 23
ARTICLE VII. REGULATORY AND MARKETING OBLIGATIONS ................................. 24
Section 7.1. PRODUCT DEVELOPMENT. ........................................ 24
Section 7.2. MANUFACTURE OF PRODUCT. ..................................... 24
Section 7.3. REGULATORY MATTERS. ......................................... 24
Section 7.4. MARKETING AND SALE. ......................................... 24
(a) RESPONSIBILITY. ............................................ 24
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(b) MARKING. ................................................... 24
(c) THIRD PARTY LICENSES. ...................................... 25
Section 7.5. PERIODIC REVIEW. ............................................ 25
ARTICLE VIII. RIGHTS IN TECHNOLOGY, PATENTS AND KNOW HOW .......................... 25
Section 8.1. OWNERSHIP OF PROGRAM TECHNOLOGY. ............................ 25
(a) CELLTECH OWNED PROGRAM TECHNOLOGY. ......................... 25
(b) NEOGENESIS OWNED PROGRAM TECHNOLOGY. ....................... 26
(c) JOINTLY OWNED PROGRAM TECHNOLOGY. .......................... 26
Section 8.2. DISCLOSURE BY EMPLOYEES, AGENTS OR INDEPENDENT CONTRACTORS. . 27
Section 8.3. PATENT PROSECUTION AND RELATED ACTIVITIES. .................. 27
(a) NEOGENESIS OWNED PROGRAM TECHNOLOGY. ....................... 27
(b) CELLTECH OWNED PROGRAM TECHNOLOGY. ......................... 28
(c) JOINTLY OWNED PROGRAM TECHNOLOGY. .......................... 28
(d) COOPERATION. ............................................... 29
Section 8.4. THIRD PARTY INFRINGEMENT. ................................... 29
(a) ENFORCEMENT. ............................................... 29
(b) FAILURE TO ENFORCE. ........................................ 29
(c) DIVISION OF RECOVERIES. .................................... 30
(d) COOPERATION. ............................................... 30
Section 8.5. INFRINGEMENT CLAIMS BY THIRD PARTIES. ....................... 30
(a) THIRD PARTY CLAIMS. ........................................ 30
(b) RESPONSE TO THIRD PARTY CLAIMS. ............................ 31
ARTICLE IX. CONFIDENTIALITY ....................................................... 31
Section 9.1. CONFIDENTIALITY. ............................................ 31
Section 9.2. OBLIGATIONS OF CONFIDENTIALITY. ............................. 32
Section 9.3. LEGAL DISCLOSURE. ........................................... 32
Section 9.4. OWNERSHIP OF INFORMATION. ................................... 33
Section 9.5. EXPIRATION OR TERMINATION. .................................. 33
Section 9.6. PUBLICITY. .................................................. 33
Section 9.7. PUBLICATION. ................................................ 34
ARTICLE X. REPRESENTATIONS AND WARRANTIES ......................................... 34
Section 10.1. NEOGENESIS REPRESENTATIONS AND WARRANTIES. ................. 34
(a) ORGANIZATION. .............................................. 34
(b) AUTHORITY. ................................................. 35
(c) GOVERNMENTAL CONSENTS. ..................................... 35
(d) NO CONFLICT WITH OTHER AGREEMENTS. ......................... 35
(e) PATENT INFRINGEMENT. ....................................... 36
(f) DEBARRED. .................................................. 36
(g) DISCLAIMER. ................................................ 36
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Section 10.2. CELLTECH REPRESENTATIONS AND WARRANTIES. ................... 36
(a) ORGANIZATION. .............................................. 36
(b) AUTHORITY. ................................................. 37
(c) GOVERNMENTAL CONSENTS. ..................................... 37
(d) NO CONFLICT WITH OTHER AGREEMENTS. ......................... 37
(e) DISCLAIMER. ................................................ 37
ARTICLE XI. INDEMNIFICATION ....................................................... 38
Section 11.1. LIMITATION OF LIABILITY. ................................... 38
Section 11.2. INFRINGEMENT INDEMNIFICATION. .............................. 38
(a) NEOGENESIS. ................................................ 38
(b) CELLTECH. .................................................. 39
Section 11.3. OTHER CLAIMS. .............................................. 39
(a) NEOGENESIS. ................................................ 39
(b) CELLTECH. .................................................. 40
Section 11.4. PROCEDURE. ................................................. 40
ARTICLE XII. TERM AND TERMINATION ................................................. 40
Section 12.1. TERM. ...................................................... 40
Section 12.2. TERMINATION. ............................................... 41
(a) MATERIAL BREACH. ........................................... 41
(b) BANKRUPTCY OR RECEIVERSHIP OF A PARTY. ..................... 41
(c) TERMINATION BY CELLTECH. ................................... 41
Section 12.3. EFFECT OF TERMINATION. ..................................... 41
(a) TERMINATION ACTIVITIES. .................................... 42
(b) RETURN OF CONFIDENTIAL INFORMATION. ........................ 42
(c) RIGHTS UPON TERMINATION. ................................... 42
(d) No ReleaSE OF MATURED OBLIGATION. .................................... 43
SECTION 12.4 SURVIVAL. ......................................... 43
ARTICLE XIII. GENERAL PROVISIONS .................................................. 43
Section 13.1. ISSUE RESOLUTION. .......................................... 43
(a) NOTIFICATION OF DISPUTE. ................................... 43
(b) LIMITATIONS. ............................................... 44
(c) ARBITRATION RULES. ......................................... 44
(d) APPLICABLE LAW. ............................................ 45
(e) RESTRICTIONS ON DAMAGES. ................................... 45
Section 13.2. GOVERNING LAW. ............................................. 45
Section 13.3. AMENDMENT AND WAIVER. ...................................... 46
Section 13.4. INDEPENDENT CONTRACTORS. ................................... 46
Section 13.5. ASSIGNMENT. ................................................ 46
Section 13.6. SUCCESSORS AND ASSIGNS. .................................... 47
Section 13.7. NOTICES. ................................................... 47
Section 13.8. SEVERABILITY. .............................................. 47
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Section 13.9. CAPTIONS. .................................................. 47
Section 13.10. WORD MEANINGS. ............................................ 47
Section 13.11. ENTIRE AGREEMENT. ......................................... 48
Section 13.12. RULES OF CONSTRUCTION. .................................... 48
Section 13.13. COUNTERPARTS. ............................................. 48
Section 13.14. FORCE MAJEURE. ............................................ 48
Section 13.15. FURTHER ASSURANCES. ....................................... 48
EXHIBIT A ........................................................................... A-1
EXHIBIT B ........................................................................... B-1
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RESEARCH,
LICENSE AND COLLABORATION AGREEMENT
This Research,
License and Collaboration Agreement (the "Agreement") is
entered into as of July 11, 2001 ("Effective Date") by and between Celltech R &
D Limited whose registered office is situate at 000 Xxxx Xxxx, Xxxxxx, Xxxxxxxxx
XX0 0XX, Xxxxxxx ("Celltech") and NeoGenesis Drug Discovery, Inc., having an
address of 000 Xxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000, XXX ("NeoGenesis"). Each of
Celltech and NeoGenesis may individually be referred to as a "Party" and
collectively as "Parties".
WHEREAS, Celltech is a biopharmaceutical company with an ongoing
interest in research, development and commercialization of pharmaceutical
products for treatment of certain human diseases and wishes to identify
compounds that exhibit a high affinity and functional activity to protein
targets for the development, manufacture and commercialization of pharmaceutical
products;
WHEREAS, NeoGenesis is a chemical genomics based drug discovery company
and has certain technology and know-how, including screening processes of
libraries of mass-encoded small molecule compounds built around an expanding set
of diverse cores, relating to the identification, discovery, validation and
optimization of chemical compounds that exhibit a high affinity to protein
targets useful for development of pharmaceutical products;
WHEREAS, Celltech has certain technology and know-how relating to the
identification of protein targets implicated in disease;
WHEREAS, Celltech and NeoGenesis desire to jointly collaborate in
research to identify compounds from NeoGenesis' libraries that exhibit high
affinity and functional activity to specific protein targets provided by
Celltech;
NOW THEREFORE, in consideration of the mutual covenants and promises
contained in this Agreement, Celltech and NeoGenesis agree as follows:
ARTICLE I.
DEFINITIONS
Capitalized terms used in this Agreement and not otherwise defined
herein shall have the meaning set forth below.
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SECTION 1.1. AAA shall have the meaning set forth in Section 13.1 (c)
hereof.
SECTION 1.2. AFFILIATE shall mean with respect to either Party, any
Person that, directly or indirectly, is controlled by, controls or is under
common control with such Party. For purposes of this definition, control means,
with respect to any Person, the direct or indirect ownership of more than fifty
percent (50%) of the voting or income interest in such Person or the possession
otherwise, directly or indirectly, of the power to direct the management or
policies of such Person.
SECTION 1.3. AGREEMENT shall mean this Research,
License and
Collaboration Agreement and any Exhibits or Schedules appended hereto, as the
same may be amended from time to time by the Parties in accordance with Section
3.2 or Section 13.3, as applicable.
SECTION 1.4. ALIS shall mean the Automated Ligand Identification
System, an automated, ultra-high throughput ligand selection system proprietary
to NeoGenesis that is used to identify multiple classes of chemical compounds
against target proteins.
SECTION 1.5. APPLICABLE LAWS shall mean all laws, statutes, regulations
and ordinances of any Regulatory Authority, including without limitation the
FD&C Act.
SECTION 1.6. APPROVAL LETTER shall have the meaning set forth in
Section 6.1(c) hereof.
SECTION 1.7. APPROVED TARGET(S) shall mean any Target that NeoGenesis
has approved for entry into the Research Collaboration based on the Target
Guidelines.
SECTION 1.8. APPROVED TARGET EXCLUSIVITY PERIOD shall mean the period
of time during which NeoGenesis will not approve or screen an Approved Target
for a Third Party. For a Public Target and homologs thereof that are [*]
homologus at the peptide level such exclusivity period shall begin upon
NeoGenesis' approval of such Target as set forth in Exhibit A, paragraph 1(a) or
paragraph 1(b) of the Research Collaboration Plan and end [*] thereafter. For a
Proprietary Target, such exclusivity period shall begin upon NeoGenesis'
approval of such Approved Target as set forth in Exhibit A, paragraph 1(a) or
paragraph 1(b) of the Research Collaboration Plan and end as follows: (i) where
a patent(s) has issued to Celltech or an Affiliate, in any Major Country in the
Territory claiming such target, the exclusivity period
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shall end when the last of the patent(s) expires, lapses, or is held invalid or
unenforceable by a final decision, which is unappealed or unappealable, of a
court of competent jurisdiction or of an administrative agency having authority
over patents; and (ii) where a patent application has been filed and such patent
application has not been the subject of a rejection notice from which an appeal
cannot be taken or in respect of which the applicable period of appeal has not
expired, the exclusivity period shall end on the later of: (A) the date that is
[*] after the priority date of such patent application (measured from the
original filing date) or (B) the date that is [*] after NeoGenesis' receipt of
such Approved Target from Celltech. Where a patent issues from a patent
application as described in (ii) above, such patent shall be covered under (i)
as set forth above.
SECTION 1.9. CELLTECH INDEMNIFIED PARTY shall have the meaning set
forth in Section 11.1 (a) hereof.
SECTION 1.10. CELLTECH TECHNOLOGY shall mean any and all Patents and
Know-How that are owned or Controlled by Celltech necessary for the performance
of this Agreement, as determined by Celltech. The term Celltech Technology,
however, does not include the NeoGenesis Technology or any Know-How, after such
time as it becomes generally available to the public.
SECTION 1.11. CELLTECH DERIVATIVES shall mean those derivatives of
Designated Compounds that are developed through optimizations performed by
Celltech and that have a Kd [*] and are functionally active against the
relevant Approved Target, functional activity being deemed if IC(50) is [*].
Derivatives shall include, but not be limited to analogs, isomers, chemical
homologs and salts thereof.
SECTION 1.12. CIP shall mean "Carriage and Insurance Paid", as that
expression is defined in INCOTERMS 2000, ICC Publishing S.A.
SECTION 1.13. COMMERCIALIZATION shall mean any and all activities of
using, importing, exporting, marketing, promoting, distributing, offering for
sale and selling a Licensed Product. When used as a verb, "COMMERCIALIZE" means
to engage in Commercialization.
SECTION 1.14. COMMERCIALLY REASONABLE EFFORTS shall mean, with respect
to (i) any objective by any Party, reasonable, diligent, good faith efforts to
accomplish such objective as such Party would normally use to accomplish a
similar objective under similar circumstances; and (ii) with respect to any
objective relating to the development or Commercialization of any Licensed
Product by any Party efforts and resources normally used by
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such Party with respect to a product owned by such Party or to which such Party
has similar rights which is of similar market potential at a similar stage in
the development or life of such product, taking into account issues of safety,
efficacy, product profile, the competitiveness of the marketplace, the
proprietary position of the product, the regulatory structure involved,
profitability of the product and other relevant commercial factors.
SECTION 1.15. CONFIDENTIAL INFORMATION shall have the meaning set forth
in Section 9. l.
SECTION 1.16. CONTROL OR CONTROLLED shall mean with respect to any (a)
item of information or (b) intellectual property right, including, without
limitation, Celltech Technology and NeoGenesis Technology, the possession
(whether by ownership or license, other than pursuant to this Agreement) by a
Party or an Affiliate thereof of the ability to grant to the other Party access
or a license under such item or right without violating the terms of any
agreement or other arrangements, between such Party or its Affiliate and any
Third Party, existing before or after the Effective Date.
SECTION 1.17. DESIGNATED COMPOUND shall mean any (a) Preliminary
Compound(s), Primary Active Compound, QSCD Preliminary Compound(s), QSCD
Primary Active Compound(s) designated by Celltech pursuant to paragraph 4(a)
of the Research Collaboration Plan and (b) NeoGenesis Derivatives of such
compounds designated from Primary Active Compounds and QSCD Primary Active
Compounds but not designated from Preliminary Compounds or QSCD Preliminary
Compounds provided, that such NeoGenesis Derivatives have a Kd [*] and are
functionally active against the relevant Approved Target, functional activity
being deemed if IC(50) is [*].
SECTION 1.18. DISCLOSING PARTY shall have the meaning set forth in
Section 9.1.
SECTION 1.19. EFFECTIVE DATE shall mean the date first written above.
SECTION 1.20. FDA shall mean the United States Food and Drug
Administration or any successor entity thereto.
SECTION 1.21. FD&C ACT shall mean the United States Federal Food, Drug
and Cosmetic Act of 1938, as amended.
SECTION 1.22. FIRST COMMERCIAL SALE shall mean the first transfer for
value in an arms-length transaction to an independent Third Party
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distributor, agent or end user after obtaining all necessary Regulatory
Approvals as may be necessary for such transfer of Licensed Product(s).
SECTION 1.23. FOB means "Free On Board", as that expression is defined
in INCOTERMS 2000, ICC Publishing S.A.
SECTION 1.24. FORCE MAJEURE shall mean any event beyond the control of
the Parties, including, without limitation, failures of computers,
computer-related equipment, hardware or software, fire, flood, riots, strikes,
epidemics, war (declared or undeclared and including the continuance, expansion
or new outbreak of any war or conflict now in existence), embargoes and
governmental actions or decrees.
SECTION 1.25. FTE shall mean the per annum rate of a full time,
(including reasonable and customary vacations, sick days and holidays), work of
a NeoGenesis employee who is adequately trained to perform screening and
optimization and who performs screening and optimization activities pursuant to
this Agreement.
SECTION 1.26. GOOD CLINICAL PRACTICE shall mean the then current
standards for clinical trials for pharmaceuticals, as set forth in the FD&C Act
and applicable regulations promulgated thereunder, as amended from time to time,
and such standards of good clinical practice as are required by the European
Union and other Regulatory Authorities in countries in which the Licensed
Product is intended to be sold, to the extent such standards are not in
contravention with United States Good Clinical Practices.
SECTION 1.27. GOOD LABORATORY PRACTICE shall mean the then current
standards for laboratory activities for pharmaceuticals, as set forth in the
FD&C Act and applicable regulations promulgated thereunder, as amended from time
to time, and such standards of good laboratory practice as are required by the
European Union and other Regulatory Authorities in countries in which the
Product is intended to be sold, to the extent such standards are not in
contravention with United States Good Laboratory Practices.
SECTION 1.28. GOOD MANUFACTURING PRACTICE shall mean the current
standards for the manufacture of pharmaceuticals, as set forth in the FD&C Act
and applicable regulations promulgated thereunder, as amended from time to time,
and such standards of good manufacturing practice as are required by the
European Union and other Regulatory Authorities in countries in which the
Product is intended to be sold, to the extent such
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standards are not in contravention with United States Good Manufacturing
Practices.
SECTION 1.29. INDEMNIFIED PARTY(IES) shall mean a Celltech Indemnified
Party or NeoGenesis Indemnified Party, as the case may be.
SECTION 1.30. INDEMNIFYING PARTY shall have the meaning set forth in
Section 11.3.
SECTION 1.31. KNOW-HOW shall mean, to the extent not publicly known,
any information and materials relating to, or discoveries made (whether in
electronic, magnetic, graphic or written form), including, without limitation,
regulatory approvals, processes, techniques, formulas, data, database
information, methods, equipment designs, know-how, show-how and trade secrets,
discoveries, practices, knowledge, ideas, skill, experience, inventions,
technology, manufacturing procedures, test procedures, purification and
isolation techniques, instructions, technical and scientific data, pre-clinical
and clinical data, test data and other intellectual property, whether or not
patentable, tangible or intangible. Know-How does not include Patents.
SECTION 1.32. LICENSED PRODUCT(S) shall mean any product (a) whose
pharmaceutical composition contains any formulation or dosage of a Designated
Compound or any Celltech Derivatives or improvements thereof as a
pharmaceutically active ingredient and (b) the development, manufacture, use, or
sale of which, absent the rights assigned and licenses granted to Celltech under
this Agreement, would infringe the NeoGenesis Technology or which makes use of
any Patents comprised in Program Technology with respect to which NeoGenesis is
an inventor.
SECTION 1.33. LOCK UP PERIOD shall mean the period of time ending
eighteen (18) months from the Effective Date.
SECTION 1.34. MAJOR COUNTRY shall mean any or all of the United States,
the United Kingdom, France, Germany, and Japan, as the case may be.
SECTION 1.35. MANUFACTURING shall mean any and all activities involved
in the production of a Licensed Product to be developed and/or Commercialized
under this Agreement. When used as a verb, Manufacture means to engage in
Manufacturing.
SECTION 1.36. MASK shall mean the process whereby NeoGenesis shall take
all necessary steps to prevent a Preliminary Compound or Primary
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Active Compound from being identified or revealed as a ligand against any Third
Party targets during the Preliminary Compound Exclusivity Period or Primary
Active Compound Exclusivity Period, as the case may be.
SECTION 1.37. NDA shall mean a new drug application as defined in the
FD&C Act and applicable regulations thereunder.
SECTION 1.38. NEOGENESIS INDEMNIFIED PARTY(IES) shall have the meaning
set forth in Section 11.1 (b)
SECTION 1.39. NEOGENESIS TARGET shall mean a target that is the subject
of an ongoing research project for NeoGenesis at the time NeoGenesis is
requested by Celltech to determine whether it can accept a Target for entry into
the Research Collaboration by reference to the Target Guidelines.
SECTION 1.40. NEOGENESIS TECHNOLOGY shall mean any and all Patents and
Know-How that are owned or Controlled by NeoGenesis necessary for the
performance of this Agreement. The term NeoGenesis Technology, however, does not
include any Celltech Technology or any Know-How, after such time as such
Know-How becomes generally available to the public.
SECTION 1.41. NEOGENESIS DERIVATIVES shall mean those derivatives of
Designated Compounds that are developed through optimizations performed by
NeoGenesis and that have a Kd [*] and are functionally active against the
relevant Approved Target, functional activity being deemed if IC50 is [*].
Derivatives shall include, but not be limited to analogs, isomers, chemical
homologs and salts thereof.
SECTION 1.42. NEOMORPH CHEMISTRY shall mean the process, proprietary to
NeoGenesis, of forming libraries and sub-libraries of discrete compounds by
coupling a broad set of diverse cores with diverse sets of building blocks
employing proprietary mass-coding algorithms.
SECTION 1.43. NEOMORPH FOCUSED LIBRARIES shall mean those compounds
synthesized by NeoGenesis during the optimization of either the Preliminary
Compounds identified from the NeoMorph Screening Library or further optimization
of compounds identified in any rounds of optimization.
SECTION 1.44. NEOMORPH SCREENING LIBRARY shall mean the constantly
expanding collection of libraries consisting of mass-encoded small molecule
organic compounds owned by NeoGenesis and developed with
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7
NeoMorph Chemistry, currently comprising about 10,000,000 unique compounds.
SECTION 1.45. NET SALES means the aggregate amounts invoiced for the
first sale or transfer for value of Licensed Products by Celltech, its
Affiliates or any of its sublicensees to an independent non-sublicensee Third
Party distributor, agent or end user in the Territory (other than sales of
Licensed Products at cost by Celltech, its Affiliates or sublicensees to a
non-sublicensee Third Party for use in a clinical study prior to Regulatory
Approval of such Licensed Product in a Major Country) less the following
deductions: (a) credits, refunds, allowances and price adjustments separately
and actually credited to such customers for defective, spoiled, damaged,
outdated, and returned Licensed Products, (b) offered and taken trade and cash
discounts and rebates in amounts customary to the trade and as required to do
business in the country in which they are made, (c) sales, excise, value added,
turnover, use, and other like taxes, and customs duties, paid, absorbed or
allowed excluding net income tax, and (d) special outbound packing,
transportation, insurance and handling charges separately billed to Celltech,
its Affiliates or sublicensees or prepaid. Net Sales shall not include revenue
received by Celltech, its Affiliates or sublicensees from transactions with an
Affiliate or sublicensee, where the Licensed Product in question will be resold
to an independent non-sublicensee Third Party distributor, agent or end user by
the Affiliate or sublicensee PROVIDED such revenue received by the Affiliate or
sublicensee from such resale is included in Net Sales. Net Sales received by
Celltech (or any of its Affiliates) from transactions with an Affiliate, where
the Licensed Product in question is used by the Affiliate solely for such
Affiliate's internal purposes shall not be included in Net Sales. In the event
that a Licensed Product is sold as part of a kit or combination product, Net
Sales from the kit or combination product for the purposes of determining
royalty payments, shall be determined by multiplying the Net Sales (as defined
above) of the combination product by the fraction, A/(A+B) where A is the
average sale price of the Licensed Product when sold separately in finished form
and B is the average sale price of the other product(s) sold separately in
finished form, so that A+B is the average sale price of the product(s) together.
In the event that such average sale price cannot be determined for both the
Licensed Product and such other product(s) in combination, Net Sales shall be
determined by good faith negotiation between the parties, and that failing, by
arbitration in accordance with Section 13.
SECTION 1.46. PATENTS shall mean (i) any foreign or domestic patent
applications and patents, and all patents and patent applications based on, or
claiming or corresponding to the priority date(s), of any of the foregoing; (ii)
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SEPARATELY WITH THE COMMISSION.
8
any reissues, extensions (or other governmental actions that provide exclusive
rights to the patent holder in the patented subject matter beyond the original
patent expiration date), substitutions, confirmations, registrations,
revalidations, re-examinations, additions, continuations, continued
prosecutions, continuations-in-part, or divisions of or to any of the foregoing;
and (iii) any supplementary protection certificates.
SECTION 1.47. PERSON shall mean any individual, corporation,
association, partnership (general or limited), joint venture, trust, estate,
limited liability company, limited liability partnership, unincorporated
organization, government (or any agency or political subdivision thereof) or
other legal entity or organization.
SECTION 1.48. PHASE I CLINICAL TRIALS shall have the meaning set forth
in Section 6.1(a).
SECTION 1.49. PHASE III CLINICAL TRIALS shall have the meaning set
forth in Section 6.1(b).
SECTION 1.50. PRELIMINARY COMPOUND shall mean any NeoGenesis compound
identified from the NeoMorph Screening Library which binds an Approved Target
with a minimum affinity set by the Steering Committee on an Approved Target by
Approved Target basis.
SECTION 1.51. PRELIMINARY COMPOUND EXCLUSIVITY PERIOD shall mean the
period of time from the identification of a Preliminary Compound until Celltech
abandons the Preliminary Compound. Abandonment shall occur on a specific
Preliminary Compound upon the first to occur of the following: (i) express
abandonment in writing by Celltech, (ii) lack of functional biological activity
in a cell-based assay as set forth in paragraph 3(b) of the research
Collaboration Plan or (iii) failure of Celltech to determine activity, as set
forth in paragraph 3(b) of the Research Collaboration Plan, within [*] of
receipt by Celltech of such Preliminary Compound.
SECTION 1.52. PRIMARY ACTIVE COMPOUND shall mean any Preliminary
Compound which demonstrates an activity in a cell-based functional assay as set
forth in paragraph 3(b) of the research Collaboration Plan.
SECTION 1.53. PRIMARY ACTIVE COMPOUND EXCLUSIVITY PERIOD shall mean the
period of time from the identification of a Primary Active Compound until
Celltech abandons the Primary Active Compound. Abandonment shall occur on a
specific Primary Active Compound upon the
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9
first to occur of the following: (i) express abandonment in writing by Celltech,
or (ii) failure of Celltech to designate such Primary Active Compound as a
Designated Compound within the applicable time period specified in paragraph
4(a) of the Research Collaboration Plan.
SECTION 1.54. PROGRAM TECHNOLOGY shall mean individually and
collectively all Patents, Know-How, discoveries, inventions, techniques,
methodologies, modifications, improvements, works of authorship, designs and
data (whether or not protectable under patent, copyright, trade secrecy or
similar laws) that are conceived, created, discovered, developed, or reduced to
practice or tangible medium of expression during the Research Term in the course
of the Research Collaboration Plan, including without limitation, all
Preliminary Compound(s), NeoMorph Focused Libraries, Primary Active Compound(s),
QSCD Preliminary Compound(s), QSCD Primary Active Compound(s) and Designated
Compound(s), (a) solely by one or more employees or consultants of NeoGenesis;
(b) jointly by one or more employees or consultants of NeoGenesis and one or
more employees or consultants of Celltech, or (c) solely by one or more
employees or consultants of Celltech.
SECTION 1.55. PROPRIETARY TARGET shall mean a Target for which (a) a
patent has issued to and is Controlled by Celltech or an Affiliate, in any Major
Country in the Territory claiming such target and such patent has not expired,
lapsed, or been held invalid or unenforceable by a final decision, which is
unappealed or unappealable, of a court of competent jurisdiction or of an
administrative agency having authority over patents; or (b) a patent application
has been filed and is Controlled by Celltech or an affiliate and such patent
application has not been the subject of a rejection notice from which an appeal
cannot be taken or in respect of which the applicable period for appeal has not
expired.
SECTION 1.56. PUBLIC TARGET shall mean any target that is not a
Proprietary Target.
SECTION 1.57. QSCD shall mean Quantisized Surface Complementary
Diversity, a technology proprietary to NeoGenesis, in terms of which discrete
chemical complements to the surfaces of Approved Targets may be defined.
SECTION 1.58. QSCD PRELIMINARY COMPOUNDS shall have the meaning set
forth in Exhibit A, paragraph 3(e).
SECTION 1.59. QSCD PRIMARY ACTIVE COMPOUNDS shall have the meaning set
forth in Exhibit A, paragraph 3(e).
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SECTION 1.60. QUARTER shall mean a three (3) month period ending March
31, June 30, September 30 and December 31.
SECTION 1.61. R&D PROGRAM means on a Designated Compound-by-Designated
Compound and country-by-country basis the activities necessary or desirable to
be undertaken in connection with the research and development of such Designated
Compound prior to obtaining Regulatory Approval for a Licensed Product in such
country (regardless of the country in which such activities are conducted).
SECTION 1.62. RECEIVING PARTY shall have the meaning set forth in
Section 9.1.
SECTION 1.63. REGULATORY APPROVALS shall mean, for any country in the
Territory, those authorizations by the appropriate Regulatory Authority(ies)
required for the manufacture, importation, marketing, promotion, pricing and
sale of the Licensed Product(s) in such country.
SECTION 1.64. REGULATORY AUTHORITY shall mean any national,
supra-national, regional, state or local regulatory agency, department, bureau,
commission, council or other governmental entity in the Territory, including,
without limitation, the FDA.
SECTION 1.65. RESEARCH COLLABORATION means the joint effort between
Celltech and NeoGenesis to identify compounds from NeoGenesis' libraries that
exhibit high affinity and functional activity to specific Targets.
SECTION 1.66. RESEARCH COLLABORATION PLAN shall mean the screening
program for each Approved Target described on Exhibit A as the same may be
amended during the Research Term by the Steering Committee (as defined below).
The goals of the Plan will be directed toward the discovery and development of
Preliminary Compounds, QSCD Preliminary Compounds, Primary Active Compounds,
QSCD Primary Active Compounds and Designated Compounds for the Approved Targets.
SECTION 1.67. RESEARCH TERM shall have the meaning set forth in Section
3.2 hereof.
SECTION 1.68. STEERING COMMITTEE shall have the meaning set forth in
Section 4.1.
SECTION 1.69. STOCK PURCHASE AGREEMENT shall mean the Subscription
Agreement between Celltech and NeoGenesis signed
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11
contemporaneously with this Agreement pursuant to which Celltech is purchasing
NeoGenesis Series E Preferred Stock.
SECTION 1.70. TARGET shall mean a specific polypeptide sequence or
protein selected by Celltech to enter the Research Collaboration.
SECTION 1.71. TARGET GUIDELINES shall mean the following parameters
pursuant to which NeoGenesis shall be able to reject a Target from entering the
Research Collaboration: the Target is [*] at the peptide level with (1) a target
that is subject to an exclusivity period in an ongoing agreement between
NeoGenesis and a Third Party at the time Celltech requests inclusion of the
Target in the Research Collaboration or (2) the Target is a NeoGenesis Target.
SECTION 1.72. TERM shall have the meaning set forth in Section 12.1
hereof.
SECTION 1.73. TERRITORY shall mean all the countries of the world.
SECTION 1.74. THIRD PARTY (THIRD PARTIES) shall mean any person other
than NeoGenesis and its Affiliates and Celltech and its Affiliates.
SECTION 1.75. THIRD PARTY CLAIM shall have the meaning set forth in
Section 8.5.
ARTICLE II.
GRANT, RIGHTS AND RESTRICTIONS
SECTION 2.1. GRANT OF RESEARCH LICENSE. Subject to the terms and
conditions of this Agreement, Celltech hereby grants to NeoGenesis and
NeoGenesis hereby accepts, a nonexclusive, nonsublicenseable; nontransferable,
non-assignable, royalty-free license to Celltech Technology solely for purposes
of performing NeoGenesis' obligations to Celltech under the Research
Collaboration Plan during the Research Term. NeoGenesis shall not use Celltech
Technology for any other purpose. NeoGenesis shall not (i) grant, or attempt to
grant, a sub-license to Celltech Technology to any Person, (ii) perform any
tests on any Approved Target(s) other than as part of the Research Collaboration
Plan, or (iii) modify the Approved Targets supplied by Celltech, including,
without limitation, the making of any derivatives, analogs or components
thereof. In the event that NeoGenesis does not consume all of the Approved
Target(s) supplied by Celltech in performance of the Research Collaboration
Plan, NeoGenesis shall, upon Celltech's request, promptly return to Celltech any
remaining quantities of such Approved Target(s).
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SECTION 2.2. NEOGENESIS GRANT OF LICENSE. Subject to the terms and
conditions of this Agreement, including the payment of all applicable fees,
NeoGenesis hereby grants to Celltech, and its Affiliates:
(a) an exclusive, worldwide, right and license, within the Territory to
NeoGenesis Technology and NeoGenesis' interest in any Program Technology, as
embodied in or related to any Preliminary Compound(s), Primary Active
Compound(s), QSCD Preliminary Compound(s), QSCD Primary Active Compound(s) and
Designated Compounds solely for the purpose of conducting Celltech's activities
under the Research Collaboration, to research, develop, make, have made, use and
import Preliminary Compound(s), Primary Active Compound(s), QSCD Preliminary
Compound(s), QSCD Primary Active Compound(s) and Designated Compounds to develop
Licensed Product(s); and
(b) an exclusive, worldwide, right and license, within the Territory,
to the NeoGenesis Technology and NeoGenesis' interest in any Program Technology,
as embodied in or related to any Designated Compounds, necessary to make, have
made, develop, have developed, use, distribute for sale, promote, market, offer
for sale, sell, have sold, import and export Licensed Product(s).
(c) Celltech and its Affiliates may grant sublicenses of its rights
under this Section 2.2; provided that Celltech obtains each sublicensee's
written agreement to be subject to similar obligations as is Celltech and its
Affiliates under Sections 2.3, 6.4-6.6, 7.4(b) and all of Article IX of this
Agreement (or substantially identical provisions).
SECTION 2.3. RETAINED RIGHTS. This Agreement does not convey to
NeoGenesis any ownership rights in any Celltech Technology by implication,
estoppel or otherwise except for the rights expressly granted in Section 2.1 and
Section 8.1. This Agreement does not convey to Celltech any ownership rights in
any NeoGenesis Technology by implication, estoppel or otherwise except for the
rights expressly granted in Section 2.2 and Section 8.1.
ARTICLE III.
RESEARCH COLLABORATION PLAN
SECTION 3.1. DILIGENCE. The Parties hereto agree to use Commercially
Reasonable Efforts to conduct the Research Collaboration under this Agreement
during the Research Term.
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SECTION 3.2. RESEARCH COLLABORATION. The Research Collaboration shall
be carried out in accordance with the Research Collaboration Plan, as detailed
in Exhibit A, as may be amended from time to time by the Steering Committee
during the Research Term. The Research Term shall begin on the Effective Date
and end December 31, 2005, unless earlier terminated pursuant to Article XII
("Research Term"). The Research Term may be amended by the Parties consistent
with the terms of the Agreement.
SECTION 3.3. NUMBER OF TARGETS. NeoGenesis shall fulfill its
obligations under the Research Collaboration Plan for a minimum of [*] Approved
Targets during the Research Term. The following schedule may be utilized by the
Steering Committee as a general guideline for the number of Approved Targets to
be completed per year under the Research Collaboration Plan. Any Approved
Targets not completed in a given year shall carryover to any of the following
years until [*] Approved Targets have completed pursuant to the Research
Collaboration Plan.
TARGET SCHEDULE
YEAR APPROVED TARGETS
---- -----------------
2001 [*]
2002 [*]
2003 [*]
2004 [*]
2005 [*]
---
TOTAL [*]
===
ARTICLE IV.
STEERING COMMITTEE
SECTION 4.1. STEERING COMMITTEE. The Steering Committee shall consist
of six members, three members to be appointed by each of NeoGenesis and Celltech
("Steering Committee"). Each Party may, with written notice to the other,
substitute any of its members serving on the Steering Committee. The initial
Celltech members shall be Xxxxxxx Xxx, Xxxx X. Xxxxxx and Xxxx Montana and the
initial NeoGenesis members shall be Xxxxxx Xxxxxx, Xxx Xxxx and Xxxxxx Xxxxxxxx.
(a) STEERING COMMITTEE ACTIVITIES. The Steering Committee shall be
responsible for the management and conduct of the Research Collaboration Plan
during the Research Term and shall in particular: (i) consider, review and amend
the Research Collaboration Plan from time to time in such manner as may be
appropriate; (ii) monitor progress of the Research Collaboration Plan; (iii)
report regularly to the management of both
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14
Parties upon the progress of the Research Collaboration Plan; and (iv) be the
initial medium for transfer of information between the Parties. All oversight
activities and governance rights of the Steering Committee shall terminate, on a
compound by compound basis, on a compound has been designated as a Designated
Compound. Upon conclusion of the Research Term, the Steering Committee shall
only perform the functions set forth in Article VIII hereof, or as otherwise
agreed by the Parties in writing.
(b) STEERING COMMITTEE MEETINGS. The Steering Committee shall hold
meetings as mutually agreed by the Parties (but in no event less than Quarterly
during the Research Term) to review the Research Collaboration Plan. The first
meeting of the Steering Committee shall be held within forty-five (45) days of
the Effective Date and shall be held in Cambridge, MA. Thereafter, meetings may
be held by telephone or video conference if requested by either Party in writing
to the other, PROVIDED that the Steering Committee shall meet in person at least
once per annum during the Research Term. Minutes of all meetings setting forth
decisions of the Steering Committee relative to the Research Collaboration Plan
shall be prepared by the host Party and circulated to both Parties within
fifteen (15) days after each meeting. The minutes shall not become official
until approved by both Parties (the Parties shall use Commercially Reasonable
Efforts to give approval within thirty (30) days of receipt of such minutes).
(c) STEERING COMMITTEE GOVERNANCE. The quorum for Steering Committee
meetings shall be four (4) members, provided that at least two (2) members from
each of NeoGenesis and Celltech are present. Each member of the Steering
Committee will have one vote and all decisions of the Steering Committee will be
by unanimous agreement. In the event that unanimity is not reached Celltech
shall have the final say on all issues relating to (i) the Research
Collaboration Plan as set forth in Exhibit A, (provided, that in the event and
to the extent that any disagreement concerns whether or not the budgeted FTE
funding for a particular period has been exhausted in accordance with the
provisions of this Agreement (including Exhibit B), such matter shall be
resolved in accordance with the procedure specified immediately below) and (ii)
the timing for filing and the contents of any patent applications that contain
or are based on any Celltech data or information. Any other disagreements at the
Steering Committee shall be resolved via good-faith discussions; PROVIDED, that
in the event of a disagreement that cannot be resolved within thirty (30) days
after the date on which the disagreement arose, the matter shall be referred to
designees selected by the Chief Executive Officer of each of Celltech and
NeoGenesis for resolution; PROVIDED, that such designees shall not be members of
the Steering Committee. Thereafter, if any such disagreement is not resolved
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15
within sixty (60) days, the matter shall be resolved using the procedure
specified in Section 13. l, where applicable.
ARTICLE V.
RESEARCH FUNDING
SECTION 5.1. RESEARCH COLLABORATION FUNDING.
(a) STOCK PURCHASE. As partial consideration for the Research
Collaboration activities under this Agreement, Celltech shall, contemporaneously
with this Agreement, execute a Stock Purchase Agreement with NeoGenesis for the
purchase of Ten Million US Dollars ($10,000,000.00) of NeoGenesis Series E
Convertible Preferred Stock at a price of Five and 97/100's US Dollars per
share.
(b) FTE FUNDING. As additional consideration for the activities
undertaken pursuant to this Agreement and subject to NeoGenesis' performance of
its obligations hereunder and under the Research Collaboration Plan, Celltech
shall fund FTEs at the rate of [*] per FTE per annum during the Research Term
according to the FTE schedule set forth below.
FTE SCHEDULE
QUARTERLY
PERIOD MINIMUM FTES TOTAL PAYMENT PAYMENTS
------ ------------ ------------- --------
Last 1/2 of 2001 [*] [*] [*]
2002 [*] [*] [*]
2003 [*] [*] [*]
2004 [*] [*] [*]
2005 [*] [*] [*]
TOTAL [*] $10,750,000.00
--------------
(c) QUARTERLY PAYMENTS. Invoicing and payment for FTEs shall be as set
forth on Exhibit B hereto.
ARTICLE VI.
MILESTONES AND ROYALTY PAYMENTS
SECTION 6.1. MILESTONES. In further consideration of the rights granted
by NeoGenesis to Celltech hereunder, Celltech shall pay NeoGenesis each of the
following milestone payments in respect of Licensed Product as specified in this
Section 6.1.
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(a) PHASE I. Within thirty (30) days following the date on which
Celltech first administers any Licensed Product to a human subject in a Phase I
Clinical Trial, Celltech shall pay NeoGenesis [*]. "Phase I Clinical Trial"
shall mean any clinical study in any Major Country which provides for the
initial trials of a Licensed Product for the primary purpose of making a
preliminary determination of safety of the Licensed Product for its intended use
in healthy individuals or patients to support its continued testing in similar
clinical trials prescribed by the relevant Regulatory Authority.
(b) PHASE III. Within thirty (30) days following the date on which
Celltech first administers any Licensed Product to a human subject in a Phase
III Clinical Trial on a Licensed Product, Celltech shall pay NeoGenesis [*].
"Phase III Clinical Trial" shall mean any clinical study in any Major Country of
a Licensed Product, the primary purpose of which is evaluating statistical
significance of the safety and efficacy of the Licensed Product in patients with
the disease target being studied as required by the relevant Regulatory
Authority to evaluate the overall benefit-risk relationship of the drug and to
provide an adequate basis for physician labeling.
(c) APPROVAL LETTER. Within thirty (30) days following the date on
which Celltech receives an Approval Letter covering a Licensed Product, Celltech
shall pay NeoGenesis [*]. "Approval Letter" shall mean a written communication
to Celltech from the FDA approving an NDA on a Licensed Product.
(d) MILESTONE FREQUENCY. Milestones identified in Section 6.1(a)-(c)
shall be due once for each Licensed Product meeting such milestone, but shall
not include improvements or derivatives thereof or new indications for the same
Licensed Product. On the date any one milestone with respect to any Licensed
Product is achieved, all lower numbered unachieved milestones shall be deemed to
have been achieved with respect to that Licensed Product; PROVIDED that with
respect to the milestone specified in Section 6.1(a), no payment of such
milestone amount shall be due upon the achievement of the milestone specified in
Section 6.1 (b) if Phase I Clinical Trials are not required but such milestone
shall be paid upon the achievement of the milestone specified in Section 6.1(c).
SECTION 6.2. ROYALTIES. In further consideration of the rights granted
by NeoGenesis to Celltech hereunder, Celltech shall pay NeoGenesis the following
royalties on a per annum basis commencing with the First Commercial Sale of
Licensed Product(s) by Celltech, its Affiliates or sublicensees in the
Territory:
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(a) NON-QSCD DISCOVERED COMPOUNDS. On all Licensed Products which were
not discovered using QSCD, Celltech shall pay royalties of [*] of Net Sales of
Licensed Product [*] per annum and [*] of Net Sales of Licensed Product [*] per
annum;
(b) QSCD DISCOVERED COMPOUNDS. On all Licensed Products which were
discovered using QSCD, as verified in writing by the Steering Committee prior to
the performance of such QSCD, Celltech shall pay royalties of [*] of Net Sales
of License Product [*] per annum and [*] of Net Sales of Licensed Product [*]
per annum.
(c) ROYALTY PAYMENTS AND TERM. Celltech shall pay to NeoGenesis the
above royalties no later than sixty (60) days following each Quarter commencing
with the First Commercial Sale of Licensed Product by Celltech, its Affiliates
or sublicensees in the Territory. Celltech shall make the royalty payments with
respect to each Licensed Product sold by Celltech, its Affiliates and
sublicensees on a country by country basis until the later of (1) expiration or
revocation or rejection or complete abandonment of the last to expire or to be
revoked or to be abandoned of any issued NeoGenesis patent right covering such
Licensed Product in the country in which the Licensed Product is manufactured or
sold or the issuance of a final decision, which is unappealed or unappealable,
of a court of competent jurisdiction or of an administrative agency having
authority over patents, that all patents covering such Licensed Product are
invalid, unpatentable or unenforceable, or (2) if no NeoGenesis patent right
exists in the relevant country covering the manufacture, use or sale of the
Licensed Product, until ten (10) years from the First Commercial Sale of such
Licensed Product in the relevant country. Upon expiration of such period,
Celltech's license under Section 2.2 shall be deemed to be fully paid and
Celltech shall be able to continue Commercialization of the relevant Licensed
Product in the relevant country(ies) without any further liability to
NeoGenesis.
(d) ROYALTY ADJUSTMENTS. The royalty rates set forth in this Section
6.2 are subject to reduction pursuant to Section 8.5(b)(iv), hereof.
SECTION 6.3. REMITTANCE.
(a) FUNDS/EXCHANGE RATE. All royalties and milestone payments required
under Section 6 shall be payable in full in the United States in United States
Dollars, regardless of the countries in which sales were made. For the purpose
of computing Net Sales for which a currency other than United States Dollars is
received, such currency shall be converted into United States Dollars at the
exchange rate for buying United States Dollars
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18
in effect on the close of business on the last business day of the Quarter by
Chase Bank,
New York,
New York.
(b) INTEREST. In the event that any undisputed payment due NeoGenesis
under this Agreement is not made when due, NeoGenesis may collect interest
calculated at an annual rate equal to one percent (1%) above the prime interest
rate as published on the close of business by Chase Bank,
New York,
New York on
the due date. Such payment when made shall be accompanied by all interest so
accrued.
SECTION 6.4. RECORDS. Beginning after the First Commercial Sale of
Licensed Product, on a Licensed Product by Licensed Product basis, Celltech, its
Affiliates and sublicenses shall keep and maintain for a period of at least two
(2) years from the date of each payment of royalties, records (prepared in
accordance with United States Generally Accepted Accounting Principles,
consistently applied) sufficient to determine the amounts of Net Sales and
payments due under Section 6.2. Within sixty (60) days following each Quarter in
which payments are due under Section 6.2, Celltech shall provide NeoGenesis with
a report including at least: (a) the quantities of Licensed Products that
Celltech, its Affiliate(s) and sublicensee(s) sold during the preceding quarter
in each country in which Licensed Products were sold; (b) the monetary amount,
in the national currency of such country, of such sales; (c) actual Net Sales,
by country; (d) the currency conversion rate used and U.S. dollar-equivalent of
such sales as calculated pursuant to 6.3(a); and (e) the total royalties so
computed and due NeoGenesis. Such reports shall be submitted to NeoGenesis
whether or not any sales of Licensed Product have been made during such period.
Upon delivery of the report due for the period ending December 31 of each year,
Celltech shall also report to NeoGenesis the aggregate royalties paid to
NeoGenesis for the entire preceding year.
SECTION 6.5. INSPECTION.
(a) AUDIT. Celltech and its Affiliates shall, and Celltech shall
provide in any agreements with its sublicensees that such sublicensees shall,
each make its records available for audit by an independent certified public
accountant selected by NeoGenesis and reasonably acceptable to Celltech, during
regular business hours at such place or places where such records are
customarily kept, upon reasonable notice from NeoGenesis, solely to verify the
accuracy of the reports and payments set forth in Section 6.4 hereof. Celltech
and its Affiliates shall only disclose such records relating to the accuracy of
the royalty payments to NeoGenesis. Such audit right shall not be exercised more
than once in any calendar year nor more than once with respect to sales of
Licensed Products in any given payment period.
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19
NeoGenesis agrees to hold all information learned from such audits as
Confidential Information, except to the extent necessary for NeoGenesis to
reveal such information in order to enforce its rights under this Agreement. Any
person or entity conducting such audit or inspection must agree in writing with
NeoGenesis to treat all records reviewed in the course of the audit or
inspection as the Confidential Information of Celltech under terms and
conditions no less restrictive than the terms contained in Article IX. The
results of each audit shall be binding on both Parties. The independent
accountant shall simultaneously supply both Celltech and NeoGenesis with a copy
of any report prepared as a result of such audit. NeoGenesis shall pay for such
inspections, except that in the event there is any upward adjustment in
aggregate royalties payable for any year shown by such inspection of more than
five percent (5%) of the amount paid, Celltech shall pay for such inspection.
(b) DISPUTES. All reports and payments not disputed as to correctness
by either Party within two (2) years after receipt thereof shall thereafter
conclusively be deemed correct.
SECTION 6.6. TAXES. Except for income taxes that may be assessed
against NeoGenesis, all taxes and charges that may be imposed by any government
taxing authority on the amounts paid by Celltech to NeoGenesis under this
Agreement shall be paid by Celltech for NeoGenesis' account. In the event
Celltech is required to pay the taxes or charges for the account of NeoGenesis,
and therefore withholds such taxes or charges from the amounts paid to
NeoGenesis under this Agreement, Celltech shall deliver to NeoGenesis true
copies of the receipts and/or returns covering all such payments and the
appropriate documentation which is necessary to obtain a tax credit, to the
extent such tax credit can be obtained, as determined by NeoGenesis. Each Party
shall provide assistance to the other Party in seeking any benefits available to
such Party with respect to government tax withholdings by any relevant law or
double tax treaty.
ARTICLE VII.
REGULATORY AND MARKETING OBLIGATIONS
SECTION 7.1. PRODUCT DEVELOPMENT. Celltech, at its sole expense, shall
be responsible for and shall use Commercially Reasonable Efforts with respect to
conducting the R&D Program related to Designated Compounds and Licensed Products
and for obtaining Regulatory Approvals for Licensed Products.
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SECTION 7.2. MANUFACTURE OF PRODUCT. Celltech, at its sole expense,
shall be responsible for and shall use Commercially Reasonable Efforts with
respect to the Manufacture of the Licensed Products in accordance with the
Regulatory Approvals, Applicable Laws, Good Laboratory Practices and Good
Manufacturing Practices.
SECTION 7.3. REGULATORY MATTERS. Celltech, at its sole expense, shall
be responsible for and shall use Commercially Reasonable Efforts with respect to
the preparation and filing with the appropriate Regulatory Authorities, of all
documents that are necessary to conduct clinical studies of Licensed Products
and Regulatory Approval applications that are necessary to market and sell
Licensed Products. Celltech shall notify NeoGenesis, in writing, that such
regulatory filing has been made.
SECTION 7.4. MARKETING AND SALE.
(a) RESPONSIBILITY. Celltech, at its sole expense, shall be responsible
for and shall use Commercially Reasonable Efforts with respect to the
Commercialization of Licensed Products in the Territory. Celltech shall be
solely responsible for establishing the price of each Licensed Product sold by
or on behalf of it pursuant to this Agreement.
(b) MARKING. Celltech, its Affiliates and sublicensees shall xxxx or
have marked all containers or packages of Licensed Product(s) that are the
subject of the License granted under Section 2.2 in accordance with the patent
marking laws of the jurisdiction in which such Licensed Product(s) are sold.
(c) THIRD PARTY LICENSES. Celltech shall be solely responsible, at its
sole discretion, for (a) obtaining any and all licenses from third parties
necessary or desirable to perform the R&D Program and/or to Commercialize any
Licensed Product and (b) except as otherwise provided in Section 6.2(d), any and
all consideration payable with respect to such licenses.
SECTION 7.5. PERIODIC REVIEW. Celltech and NeoGenesis shall meet, at
such times and places as are mutually agreed upon, for Celltech to provide
NeoGenesis with an update on the status of the progress of Celltech's
Commercialization of each Licensed Product; provided, however, that such
meetings shall occur no more than once per calendar year unless the parties
agree, in writing, to meet more often. Celltech and NeoGenesis shall each be
responsible for its own expenses incurred in connection with attending such
meetings.
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ARTICLE VIII.
RIGHTS IN TECHNOLOGY, PATENTS AND KNOW-HOW
SECTION 8.1. OWNERSHIP OF PROGRAM TECHNOLOGY. Subject to the terms of
this Agreement, the Parties ownership rights in Program Technology, regardless
of inventorship, are as follows:
(a) CELLTECH OWNED PROGRAM TECHNOLOGY. As between Celltech and
NeoGenesis, Celltech shall have and retain all right, title and interest in and
to any and all Program Technology solely related to Targets or the uses thereof,
Celltech cell-based or biochemical assays, Designated Compound(s) and Licensed
Product(s) and any method of manufacturing or using any Designated Compound(s)
or Licensed Product(s), and to the extent that any of the forgoing shall have
been invented by NeoGenesis employees or consultants (whether solely or jointly
with Celltech employees or consultants), NeoGenesis hereby assigns all right,
title and interest therein throughout the Territory and shall use Commercially
Reasonable Efforts to assign all right, title and interest therein; PROVIDED,
HOWEVER, that notwithstanding any provision of this Agreement (including the
Research Collaboration Plan) to the contrary, NeoGenesis shall not be required
to assign to Celltech all right title and interest in more than: (i) [*]
Designated Compounds when the optimization as set forth in paragraph 3(d) of the
Research Collaboration Plan is performed by Celltech and such Designated
Compounds are taken directly from the NeoMorph Screening Library or (ii) [*]
Designated Compounds when the optimization as set forth in paragraph 3(d) of the
Research Collaboration Plan is performed by NeoGenesis and such Designated
Compounds are taken from NeoMorph Focused Libraries. In the event that Celltech
undesignates any Designated Compound in and to whose right, title and interest
has been assigned by NeoGenesis under this Section 8.1 (a) using the procedure
specified in Paragraph 4(a) of the Research Collaboration Plan, Celltech shall,
upon written request by NeoGenesis, (i) return the Designated Compound to
NeoGenesis and (ii) assign all right title and interest in such Designated
Compound back to NeoGenesis, including any patents or patent applications (if
any) Controlled by Celltech or any Affiliate, provided such patents or patent
applications cover solely such undesignated Designated Compound. To the extent
that such patents or patent applications cover more than such Designated
Compound, Celltech shall grant an exclusive license to NeoGenesis for such
patents or patent applications to the extent they cover such Designated
Compound. In the event of an assignment of all right title and interest in such
undesignated Designated Compound, NeoGenesis shall reimburse Celltech for all
reasonable costs associated with filing, prosecuting or maintaining such patents
or patent applications. It is understood that Celltech shall be under
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no obligation to assign or license to NeoGenesis any Celltech Derivatives. Any
restrictions with respect to an undesignated Designated Compound shall expire
and NeoGenesis shall be permitted to use such undesignated Designated Compound
for any purpose not otherwise prohibited by this Agreement.
(b) NEOGENESIS OWNED PROGRAM TECHNOLOGY. As between NeoGenesis and
Celltech, NeoGenesis shall have and retain all right, title and interest in and
to any Preliminary Compound(s), Primary Active Compound(s), NeoMorph Focused
Libraries, QSCD Preliminary Compound(s), QSCD Primary Active Compound(s) and
NeoMorph Screening Library(s) unless and until they become Designated Compounds
and all Program Technology solely related to ALIS screening technology or QSCD.
(c) JOINTLY OWNED PROGRAM TECHNOLOGY. As between Celltech and
NeoGenesis, each Party shall own an undivided one-half interest in and title to
all Program Technology not specifically accounted for in Section 8.1 (a) and
(b).
SECTION 8.2. DISCLOSURE BY EMPLOYEES, AGENTS OR INDEPENDENT
CONTRACTORS. Celltech and NeoGenesis agree that, as to any employees, agents or
independent contractors of Celltech and NeoGenesis presently in their employ, or
who are hired or retained by either Party, to perform, manage performance of, or
participate in the research done pursuant to this Agreement, Celltech and
NeoGenesis shall ensure that such employees, agents and independent contractors
will promptly disclose and assign to the Party engaging them any and all rights
to inventions, developments or improvements (whether patentable or not),
conceived and/or reduced to practice during the course of their duties.
SECTION 8.3. PATENT PROSECUTION AND RELATED ACTIVITIES. Upon
notification by either Party of the existence of any Program Technology, the
Parties shall confer through the Steering Committee as to appropriate protection
for such Program Technology. In addition, subject to Section 4.1(c), the
Steering Committee shall determine the timing of all patent filings on all
Program Technology.
(a) NEOGENESIS OWNED PROGRAM TECHNOLOGY. NeoGenesis shall have the sole
right, but not the obligation, to prepare, file, prosecute, and maintain, at
NeoGenesis' sole expense, any Patent(s) on the Program Technology set forth in
Section 8.1(b) throughout the Territory. In the event that NeoGenesis elects not
to file for patent protection or elects not to prosecute or maintain a Patent(s)
on the Program Technology set forth in
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Section 8.1(b), it shall notify Celltech in writing of such decision and provide
Celltech a one (1) month period from receipt of such written notification in
which to respond to such notice before abandoning and/or discontinuing its
obligations to file, prosecute or maintain such Patent(s). Celltech shall have
the right, but not the obligation to assume the responsibility therefor, at its
own cost and expense. If Celltech responds within such one (1) month response
period that it wishes to file, prosecute or maintain such Patent(s), then
NeoGenesis shall promptly transfer and assign all right, title and interest in
and to such Patent(s) to Celltech and shall continue to file, prosecute and
maintain such Patent(s) until such transfer and assignment become effective.
Celltech shall reimburse NeoGenesis for all reasonable costs associated with
filing, prosecuting or maintaining such Patent(s). Upon such transfer and
assignment becoming effective, NeoGenesis shall reasonably assist Celltech in
the filing, prosecuting and maintaining such Patent(s).
(b) CELLTECH OWNED PROGRAM TECHNOLOGY. Celltech shall have the sole
right, but not the obligation, to prepare, file, prosecute, and maintain, at
Celltech's sole expense, any Patent(s) on the Program Technology set forth in
Section 8.1 (a) throughout the Territory. In the event that Celltech elects not
to prepare or file for patent protection or elects not to prosecute or maintain
a Patent(s) on Celltech Program Technology set forth in Section 8.1(a), it shall
notify NeoGenesis but shall have no obligation to continue with the filing,
preparing, prosecuting or maintaining any Patent(s).
(c) JOINTLY OWNED PROGRAM TECHNOLOGY. NeoGenesis shall have the sole
right, but not the obligation, to prepare, file, prosecute, and maintain, at
NeoGenesis' expense, any Patent(s) on Program Technology set forth in Section
8.1(c) throughout the Territory. NeoGenesis shall keep Celltech currently
advised as to the status of all Patent(s) with respect to the Program Technology
set forth in Section 8.1(c) and shall supply Celltech promptly with copies of
all patents, patent applications, substantive patent office actions, substantive
responses received or filed in connection with such applications. Celltech may
itself or through its attorney offer comments and suggestions with respect to
the matters that are the subject of this Section 8.3(c) and NeoGenesis agrees to
consider such comments and suggestions; PROVIDED that nothing herein shall
obligate NeoGenesis to adopt or follow such comments or suggestions. In the
event that NeoGenesis elects not to file for patent protection or elects not to
prosecute or maintain a Patent(s) on the Program Technology set forth in Section
8.1(c), it shall notify Celltech in writing of such decision and provide
Celltech a one (1) month period from receipt of such written notification in
which to respond to such notice before abandoning and/or discontinuing its
obligations to file, prosecute or maintain
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such Patent(s). Celltech shall have the right, but not the obligation to assume
the responsibility therefore, at its own cost and expense. If Celltech responds
within such one (1) month response period that it wishes to file, prosecute or
maintain such Patent(s), then NeoGenesis shall promptly transfer and assign all
right, title and interest in and to such Patent(s) to Celltech and shall
continue to file, prosecute and maintain such Patent(s) until such transfer and
assignment become effective. Celltech shall reimburse NeoGenesis for all
reasonable costs associated with filing, prosecuting or maintaining such
Patent(s) from date it notifies NeoGenesis it wishes to assume responsibility
for the patent(s) until the transfer and assignment becomes effective shall be
paid by Celltech. Upon such transfer and assignment becoming effective,
NeoGenesis shall reasonably assist Celltech in the filing, prosecuting and
maintaining of such Patent(s).
(d) COOPERATION. Each Party shall keep the Steering Committee informed
as to the status of patent matters set forth in this Section 8.3 during the
Research Term. To the extent necessary, and at the requesting Party's expense,
each Party shall use Commercially Reasonable Efforts to cooperate and assist the
other Party with the preparation, filing and prosecution of Patent(s).
SECTION 8.4. THIRD PARTY INFRINGEMENT.
(a) ENFORCEMENT. In the event that either Party becomes aware that any
NeoGenesis Technology, or Program Technology are infringed or misappropriated by
a Third Party or are subject to a declaratory judgment action, the Party
becoming aware of such event shall promptly notify the other Party. The Party
with the right to prepare, file, prosecute, and maintain a Patent(s) with
respect to such NeoGenesis Technology, or Program technology, as the case may
be, and which is then maintaining said Patent(s), in its sole discretion, shall
have the right and shall be solely responsible for pursuing any action for
infringement or misappropriation against Third Parties or defending any
declaratory judgment action relating thereto. To the extent that the Program
Technology being pursued is Program Technology as set forth in Section 8.1(c),
the Party not having the right to prepare, file, prosecute, and maintain a
Patent(s) with respect to such NeoGenesis Technology, or Program technology, as
the case may be, and which is not then actually maintaining said Patent(s) shall
have the option to participate in such action at its sole expense.
(b) FAILURE TO ENFORCE. If the Party with the right to pursue any
action for infringement or misappropriation against Third Parties or defending
any declaratory judgment action as set forth in Section 8.4(a)
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above fails to pursue or defend such action relating to Program Technology set
forth in Section 8.1 (c) within sixty (60) days written notice by the other
Party of its desire to proceed, then the other Party shall have the option to
pursue or defend such actions; PROVIDED, that such Party pays all costs and
expenses related to the same, and keeps the other Party reasonably informed of
its progress and provides copies of any documents related to such proceedings
and reasonable notice of all proceedings relating to same. A Party electing to
exercise its option to proceed under this Section 8.4(b) shall notify the other
Party of its decision to exercise its option as soon as possible.
(c) DIVISION OF RECOVERIES. Any recovery of damages received in
connection with a suit (including by way of settlement) under Section 8.4(a)
involving Program Technology set forth in Section 8.1 (a) or (b) shall be
retained by the Party that owns said Program Technology; PROVIDED that any
recovery of ordinary damages (including by way of settlement) based upon
infringement of Program Technology set forth in Section 8.1 (a) shall be deemed
to be Net Sales and Celltech shall pay NeoGenesis an amount calculated in
accordance with Section 6.2 to reimburse NeoGenesis for royalties due in respect
of lost sales of Licensed Products represented by such ordinary damages. Any
recovery of damages received in connection with a suit (including by way of
settlement) under Section 8.4(a) involving the Program Technology set forth in
Section 8.1 (c) brought by NeoGenesis or Celltech shall be retained by the Party
that conducted such suit. Any recovery of damages received in connection with a
suit (including by way of settlement) jointly brought by NeoGenesis and Celltech
(other than the assistance that each party is required to provide to the
litigating party pursuant to Section 8.4(d) and for which it has been
reimbursed) shall be used first to reimburse the Parties, on a pro-rata basis,
for all expenses actually incurred in such suit, and any remainder shall divided
equally between Celltech and NeoGenesis after payment by Celltech of any
obligations it may have to any sublicensee in relation to any recovery.
(d) COOPERATION. In any claim, suit or proceeding under Section 8.4
which either Party may become involved, the other Party shall, at the request
and expense of the Party initiating or defending the claim, suit or proceeding,
cooperate and assist such Party in all reasonable respects, including having its
employees testify when requested and making available relevant records, papers,
information, specimens and the like.
SECTION 8.5. INFRINGEMENT CLAIMS BY THIRD PARTIES.
(a) THIRD PARTY CLAIMS. If the making, having made, using, distributing
for sale, promoting, marketing, offering for sale, selling, having
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sold, importing or exporting of any Licensed Products results in an assertion or
a claim against a Party of infringement or misappropriation of any Third Party's
intellectual property right ("Third Party Claim"), the Party first having notice
of a Third Party Claim shall promptly notify the other Party in writing
specifying in reasonable detail the alleged grounds or basis for the Third Party
Claim.
(b) RESPONSE TO THIRD PARTY CLAIMS. In the event of a Third Party
Claim, the Parties agree to respond to and/or defend against the Third Party
Claim as follows:
(i) Each Party shall use Commercially Reasonable Efforts in
responding to and defending against such Third Party Claim, and will render such
reasonable assistance as the other Party may request, at the requesting Party's
expense, in defending such Third Party Claim.
(ii) Neither Party shall settle any Third Party Claim in a
manner that is prejudicial to either Party without the other Party's prior
written consent.
(iii) Each Party shall be responsible for its own fees and
costs of attorneys and consultants, together with court costs, incurred in
defending against the Third Party Claim.
(iv) If Celltech, by court order, settlement or other
agreement entered into in good faith, is required to pay royalties and/or
damages to any Third Parties in connection with the disposition of a Third Party
Claim to avoid infringement by any Licensed Product of such Third Party
patent(s), then Celltech shall be entitled, beginning from the date Celltech
commences payment to any such Third Parties, to reduce the royalties payable to
NeoGenesis by [*] of the amount of any such royalties and/or damages payable to
such Third Parties; provided that: (1) such infringement is on a Licensed
Product provided that such infringement is primarily related to the
pharmaceutically active ingredient of the Licensed Product and (2) such
deductions reduce by no more than [*] the royalties otherwise due NeoGenesis
under Section 6.2 with respect to such Licensed Product.
ARTICLE IX.
CONFIDENTIALITY
SECTION 9.1. CONFIDENTIALITY. As used in this Agreement, the term
"Confidential Information" shall mean any and all non-public, proprietary or
otherwise confidential information pertaining to or developed under this
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Agreement furnished to either Party ("Receiving Party") by or on behalf of the
other Party ("Disclosing Party"). Such Confidential Information includes, but is
not limited to, trade secrets, know-how, inventions, formulations, compositions,
technical data or specifications, testing methods, business or financial
information, research and development activities, product and marketing plans
and customer and supplier information together with all portions of analysis,
studies and other documents prepared by or for the benefit of a Party.
SECTION 9.2. OBLIGATIONS OF CONFIDENTIALITY. The Receiving Party shall:
(a) maintain all Confidential Information in strict confidence, except that the
Receiving Party may disclose or permit the disclosure of any Confidential
Information to its directors, officers, employees, consultants and advisors who
are obligated to maintain the confidential nature of such Confidential
Information and who need to know such Confidential Information to perform this
Agreement; (b) use all Confidential Information solely for purposes of
performing its obligations or exercising its rights under this Agreement; and
(c) reproduce the Confidential Information only to the extent necessary to
perform this Agreement, with all such reproductions being considered
Confidential Information.
SECTION 9.3. LEGAL DISCLOSURE. The obligations of the Receiving Party
under Section 9.2 hereof shall not apply to the extent that the Receiving Party
can demonstrate by competent written documentation that certain Confidential
Information; (a) was in the public domain prior to the time of its disclosure
under this Agreement; (b) entered the public domain after the time of its
disclosure under this Agreement through means other than an unauthorized
disclosure resulting from an act or omission by the Receiving Party; (c) was
independently developed or discovered by the Receiving Party prior to the time
of its disclosure under this Agreement, as evidenced by the Receiving Party's
records; (d) is or was disclosed to the Receiving Party at any time, whether
prior to or after the time of its disclosure under this Agreement, by third
Party having no fiduciary relationship with the Disclosing Party and having no
obligation of confidentiality with respect to such Confidential Information.
Nothing herein shall prevent the Receiving Party from disclosing all or part of
the Confidential Information as necessary pursuant to the lawful requirement of
a governmental agency or when disclosure is required by operation of law;
PROVIDED that prior to any such disclosure, the Receiving Party shall use
reasonable efforts to: (i) promptly notify the Disclosing Party in writing of
such requirement to disclose; and (ii) cooperate fully with the Disclosing Party
in protecting against any such disclosure or obtaining a protective order. A
Party's Confidential Information shall not be deemed to be within
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any of the foregoing exceptions merely because it is embraced by general
disclosures within such exceptions, nor shall a Party's Confidential Information
be deemed to be within any of the foregoing exceptions merely because individual
items are in such exceptions.
SECTION 9.4. OWNERSHIP OF INFORMATION. Except as provided in this
Agreement with respect to ownership of Program Technology, the Receiving Party
agrees that the Disclosing Party (or any Third Party entrusting its own
Confidential Information to the Disclosing Party) is and shall remain the
exclusive owner of the Confidential Information disclosed by the Disclosing
Party and all patent, copyright, trademark, trade secret, and other intellectual
property rights in, or arising from, such Confidential Information. No option,
license, or conveyance of such rights to the Receiving Party is granted or
implied under this Agreement unless expressly set forth herein. If any such
rights are to be granted to the Receiving Party outside of this Agreement, such
grant shall be expressly set forth in a separate written instrument.
SECTION 9.5. EXPIRATION OR TERMINATION. Upon the expiration or
termination, by either Party, of this Agreement, the Receiving Party shall
return to the Disclosing Party all originals, copies, and summaries of
documents, materials, and other tangible manifestations of Confidential
Information owned by the Disclosing Party and in the possession or control of
the Receiving Party, except to the extent the Receiving Party has the right to
continue to use such information pursuant to Section 12.3. The obligation of
confidentiality set forth in this Article IX shall remain in effect for a period
of ten (10) years after such termination or expiration hereof. Each Party may
keep one (1) copy of such Confidential Information in its legal files to monitor
any continuing obligations under this Agreement.
SECTION 9.6. PUBLICITY. Except as is necessary to comply with
applicable laws and regulations or to enforce their respective rights under this
Agreement, or to a Party's legal or financial advisors, and except as otherwise
agreed to by the Parties in writing, the Parties shall: keep the material terms
of this Agreement confidential, agree upon the text and the exact timing of an
initial public announcement relating to the transactions contemplated by this
Agreement as soon as practicable after the Effective Date (such agreement not to
be unreasonably withheld or delayed) and agree on the text and the timing of any
subsequent public announcements regarding this Agreement or the transactions
contemplated herein.
SECTION 9.7. PUBLICATION. Celltech and NeoGenesis shall not publish, in
any form, the other Party's Confidential Information. However,
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each Party acknowledges the importance of publication and that a Party may
desire to publicize results from the Research Collaboration at seminars,
meetings, conferences, and in peer reviewed journals. A Party shall have the
right to publish the results from the Research Collaboration, PROVIDED ALWAYS,
that prior to submission for publication or presentation of any results based on
the Research Collaboration, the publishing Party shall provide the other Party
thirty (30) days to review and comment upon the manuscript or other material for
such publication. If requested in writing during the aforementioned review
period of thirty (30) days, by the reviewing Party, the publishing Party shall,
at the sole discretion of the reviewing Party either, (i) delay publication for
an additional ninety (90) days to allow for filing of a patent application; or
(ii) preclude publication in the event the reviewing Party believes the
publication contains Confidential Information of such other party. In such event
of an objection to publication based upon Section 9.7(ii), the publishing Party
shall modify or delete the Confidential Information before the reviewing Party
is obligated to grant approval to publish the modified publication. If the
reviewing Party does not request in writing that the publishing Party delay the
publication under Section 9.7(i) or (ii) during the aforementioned review period
of thirty (30) days, then the publishing Party may publish the results of the
Research Collaboration accordingly.
ARTICLE X.
REPRESENTATIONS AND WARRANTIES
SECTION 10.1. NEOGENESIS REPRESENTATIONS AND WARRANTIES. NeoGenesis
represents and warrants to Celltech as follows:
(a) ORGANIZATION. NeoGenesis is a corporation duly organized, validly
existing and in good standing under the laws Delaware, and has all requisite
corporate power and authority to carry on its business as now conducted and as
proposed to be conducted. NeoGenesis is duly qualified to transact business and
is in good standing in each jurisdiction in which the failure so to qualify
would have a material adverse effect on its business or properties.
(b) AUTHORITY. All corporate action on the part of NeoGenesis, its
officers, directors and stockholders necessary for the authorization, execution
and delivery of this Agreement has been taken or will be taken prior to or as of
the Effective Date. NeoGenesis has the requisite corporate power to enter into
this Agreement and carry out and perform its obligations under the terms of this
Agreement. This Agreement has been duly authorized, executed
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and delivered by NeoGenesis and, upon due execution and delivery by Celltech,
this Agreement will be a legal, valid and binding agreement of NeoGenesis
enforceable against NeoGenesis in accordance with its terms, except as limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws of general
application affecting creditors' rights generally or as limited by laws relating
to the availability of specific performance, injunctive relief or other
equitable remedies.
(c) GOVERNMENTAL CONSENTS. To the best of NeoGenesis' knowledge, no
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state, local or provincial
governmental authority on the part of NeoGenesis is required in connection with
the consummation of the transactions contemplated by this Agreement.
(d) NO CONFLICT WITH OTHER AGREEMENTS. The execution, delivery and
performance of this Agreement will not result in any violation of, be in
conflict with, or constitute a default under, with or without the passage of
time or the giving of notice: (a) any provision of NeoGenesis' Certificate of
Incorporation or Bylaws as either are currently in effect; (b) any provision of
any judgment, decree or order to which NeoGenesis is a party or by which it is
bound; (c) any material contract, obligation or commitment to which NeoGenesis
is a party or by which it is bound; or (d) to NeoGenesis' knowledge, any
statute, rule or governmental regulation applicable to NeoGenesis.
(e) PATENT INFRINGEMENT. As of the Effective Date, (i) there are no
pending or, to the best of NeoGenesis' knowledge, threatened actions, suits or
claims against it with respect to any NeoGenesis Technology, and (ii) NeoGenesis
is not aware of any patents owned or controlled by a Third Party that would be
infringed by the activities of NeoGenesis contemplated under the Research
Collaboration Plan.
(f) DEBARRED. NeoGenesis certifies that it is not debarred under 21 USC
335(a) or (b) of the Federal Food, Drug, and Cosmetic Act and that it has not
used and will not use in any capacity the services of any Person debarred under
such laws with respect to services to be performed under the Agreement.
(g) DISCLAIMER. EXCEPT FOR THE WARRANTIES EXPRESSLY MADE BY NEOGENESIS
IN SECTION 10.1(a)-(f), NEOGENESIS MAKES NO OTHER REPRESENTATION OR WARRANTY,
EITHER EXPRESS OR IMPLIED (WHETHER WRITTEN OR ORAL), INCLUDING, WITHOUT
LIMITATION ANY WARRANTY AGAINST INFRINGEMENT OF ANY
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THIRD PARTY PATENT OR OTHER INTELLECTUAL PROPERTY RIGHTS, ANY WARRANTY OF
MERCHANTABILITY OR ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE WITH RESPECT
TO THE NEOMORPH SCREENING LIBRARY, THE NEOMORPH FOCUSED LIBRARIES, QSCD, THE
PRELIMINARY COMPOUNDS, THE PRIMARY ACTIVE COMPOUNDS, THE DESIGNATED COMPOUNDS,
THE LICENSED PRODUCTS, THE NEOGENESIS TECHNOLOGY, THE SCOPE, VALIDITY OR
ENFORCEABILITY OF ANY NEOGENESIS PATENT RIGHTS OR NEOGENESIS' OBLIGATIONS UNDER
THIS AGREEMENT. THE REPRESENTATIONS AND WARRANTIES OF NEOGENESIS EXTEND ONLY TO
CELLTECH AND ITS AFFILIATES. NEOGENESIS SHALL NOT BE LIABLE FOR ANY CLAIM OR
DEMAND AGAINST CELLTECH BY A THIRD PARTY, EXCEPT TO THE EXTENT PROVIDED IN
SECTIONS 11.1-11.2.
SECTION 10.2. CELLTECH REPRESENTATIONS AND WARRANTIES.
(a) ORGANIZATION. Celltech is a corporation duly organized, validly
existing and in good standing under the laws of England, and has all requisite
corporate power and authority to carry on their business as now conducted and as
proposed to be conducted. Celltech is duly qualified to transact business and is
in good standing in each jurisdiction in which the failure so to qualify would
have a material adverse effect on its business or properties.
(b) AUTHORITY. All corporate action on the part of Celltech, its
officers, directors and stockholders necessary for the authorization, execution
and delivery of this Agreement has been taken or will be taken prior to or as of
the Effective Date. Celltech has the requisite corporate power to enter into
this Agreement and carry out and perform its obligations under the terms of this
Agreement. This Agreement has been duly authorized, executed and delivered by
Celltech and, upon due execution and delivery by NeoGenesis, this Agreement will
be a legal, valid and binding agreement of the Celltech enforceable against
Celltech in accordance with its terms, except as limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws of general application
affecting creditors' rights generally or as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies.
(c) GOVERNMENTAL CONSENTS. To the best of Celltech's knowledge, no
consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state, local or provincial
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governmental authority on the part of Celltech is required in connection with
the consummation of the transactions contemplated by this Agreement.
(d) NO CONFLICT WITH OTHER AGREEMENTS. The execution, delivery and
performance of this Agreement will not result in any violation of, be in
conflict with, or constitute a default under, with or without the passage of
time or the giving of notice: (a) any provision of Celltech's Certificate of
Incorporation or Bylaws as either are currently in effect; (b) any provision of
any judgment, decree or order to which Celltech is a party or by which it is
bound; (c) any material contract, obligation or commitment to which Celltech is
a party or by which it is bound; or (d) to Celltech's knowledge, any statute,
rule or governmental regulation applicable to Celltech.
(e) DISCLAIMER. EXCEPT FOR THE WARRANTIES EXPRESSLY MADE BY CELLTECH IN
SECTION 10.2(a)-(d), CELLTECH MAKES NO OTHER REPRESENTATION OR WARRANTY, EITHER
EXPRESS OR IMPLIED (WHETHER WRITTEN OR ORAL), INCLUDING, WITHOUT LIMITATION ANY
WARRANTY AGAINST INFRINGEMENT OF ANY THIRD PARTY PATENT OR OTHER INTELLECTUAL
PROPERTY RIGHTS, ANY WARRANTY OF MERCHANTABILITY OR ANY WARRANTY OF FITNESS FOR
A PARTICULAR PURPOSE WITH RESPECT TO THE APPROVED TARGETS, THE CELLTECH
TECHNOLOGY, THE SCOPE, VALIDITY OR ENFORCEABILITY OF ANY CELLTECH PATENT OR
CELLTECH'S OBLIGATIONS UNDER THIS AGREEMENT. THE REPRESENTATIONS AND WARRANTIES
OF CELLTECH EXTEND ONLY TO NEOGENESIS AND ITS AFFILIATES. CELLTECH SHALL NOT BE
LIABLE FOR ANY CLAIM OR DEMAND AGAINST NEOGENESIS BY A THIRD PARTY, EXCEPT TO
THE EXTENT PROVIDED IN SECTIONS 11.1 AND 11.2.
ARTICLE XI.
INDEMNIFICATION
SECTION 11.1. LIMITATION OF LIABILITY. EXCEPT FOR INFRINGEMENT OF THE
OTHER PARTY'S INTELLECTUAL PROPERTY RIGHTS OR BREACH OF CONFIDENTIALITY
OBLIGATIONS UNDER ARTICLE 9 AND EXCEPT AS OTHERWISE PROVIDED IN SECTIONS
11.1-11.2 WITH RESPECT TO THIRD PARTY CLAIMS, IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER FOR LOST PROFITS OR SAVINGS OR FOR ANY INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES IN CONNECTION WITH THIS
AGREEMENT OR THE TRANSACTIONS
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CONTEMPLATED BY THIS AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY.
SECTION 11.2. INFRINGEMENT INDEMNIFICATION.
(a) NEOGENESIS. Subject to the provisions of Section 11.3 and
notwithstanding Section 10.1(g), NeoGenesis shall defend, indemnify and hold
harmless Celltech, its subsidiaries, parent corporations, Affiliates, officers,
directors, independent contractors, partners, members, employees, agents,
successors and assigns (collectively, "Celltech Indemnified Parties") from and
against any claim, suit, demand, loss, damage, expense (including reasonable
attorney's fees of indemnitee(s) and those that may be asserted by a Third
Party) or liability imposed upon them by any Third Party and arising from a
Third Party claim that (i) use of NeoGenesis Technology or (ii) practice of any
NeoGenesis Patents by Celltech in accordance with the terms of this Agreement
violates or infringes the intellectual property rights of any Third Party.
NeoGenesis shall have no liability or obligation to Celltech under this Section
11.1 (a) in the event and to the extent that the alleged infringement is caused
by (1) modifications, alterations, combinations or enhancements of the
Designated Compounds not created by NeoGenesis, or (2) willful misconduct or
negligent acts or omissions of Celltech or its Affiliates, or its or their
respective employees, officers, directors or agents.
(b) CELLTECH. Subject to the provisions of Section 11.3 and
notwithstanding Section 10.2(e), Celltech shall defend, indemnify and hold
harmless NeoGenesis, its subsidiaries, parent corporations, Affiliates,
officers, directors, independent contractors, partners, shareholders, employees,
agents, successors and assigns (collectively, "NeoGenesis Indemnified Parties")
from and against any losses imposed upon them by any Third Party and arising
from a Third Party claim that (i) the use of the Celltech Technology, or (ii)
the practice of any Celltech Patents by NeoGenesis in accordance with the terms
of this Agreement violates or infringes the intellectual property rights of any
Third Party. Celltech shall have no obligation or liability to NeoGenesis under
this Section 11.1(b) in the event and to the extent that the alleged
infringement (1) is covered by Section 11.1 (a) or (2) results from willful
misconduct or negligent acts or omissions of NeoGenesis or its Affiliates, or
its or their respective employees, officers, directors or agents.
SECTION 11.3. OTHER CLAIMS.
(a) NEOGENESIS. NeoGenesis will indemnify and be liable to the Celltech
Indemnified Party(s), for any losses suffered by Celltech Indemnified
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Party(s) arising from or related to: (i) any material breach of the NeoGenesis'
representations and warranties under this Agreement; (ii) any negligence or
intentional misconduct by NeoGenesis (or its employees, agents or
representatives) in performing its obligations under this Agreement, including
the performance of the Research Collaboration Plan; or (iii) the breach of its
obligations hereunder. The foregoing shall not apply in the event and to the
extent that a court of competent jurisdiction determines that such losses arose
as a result of any Celltech Indemnified Party's negligence, intentional
misconduct or breach of this Agreement.
(b) CELLTECH. Celltech will indemnify and be liable to the NeoGenesis
Indemnified Party(s) for any losses suffered by a NeoGenesis Indemnified
Party(s) arising from: (i) any material breach of Celltech's representations and
warranties under this Agreement; (ii) any negligence or intentional misconduct
by Celltech (or its employees, agents or representatives) or by an Affiliate,
licensee, sublicensee, distributor or agent of Celltech in performing its
obligations under this Agreement, including the performance of the R&D Program;
or (iii) the labeling, packaging, package insert, other materials or promotional
claims with respect to any Licensed Product or the testing, Manufacturing,
Commercialization, use or other disposition of any Licensed Product by Celltech
or by an Affiliate, licensee, sublicensee, distributor or agent of Celltech. The
foregoing shall not apply in the event and to the extent that a court of
competent jurisdiction determines that such losses arose as a result of any
NeoGenesis Indemnified Party's negligence, intentional misconduct or breach of
this Agreement.
SECTION 11.4. PROCEDURE. To receive the benefit of indemnification
under Sections 11. 1 or 11.2, the Indemnified Party must (a) promptly notify the
Party from whom indemnification is sought (the "Indemnifying Party") in writing
of a claim or suit; PROVIDED, that failure to give such notice shall not relieve
Indemnifying Party of its indemnification obligations except where, and solely
to the extent that, such failure actually and materially prejudices the rights
of Indemnifying Party); (b) provide reasonable cooperation (at the Indemnifying
Party's expense); and (c) with respect to claims under Section 11.1, tender to
the Indemnifying Party (and its insurer) full authority to defend or settle the
claim or suit; PROVIDED that no settlement requiring any admission by the
Indemnified Party or that imposes any obligation on the Indemnified Party shall
be made without the Indemnified Party's prior written consent. Neither Party has
any obligation to indemnify the other Party under Section 11.1 in connection
with any settlement made without the Indemnifying Party's written consent. The
Indemnified Party has the right to participate at its own expense in the claim
or suit and in selecting counsel therefor. The Indemnified Party shall cooperate
with Indemnifying Party
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(and its insurer), as reasonably requested, at Indemnifying Party's cost and
expense.
ARTICLE XII.
TERM AND TERMINATION
SECTION 12.1. TERM. This Agreement shall take effect on the Effective
Date and shall remain in effect until the later of (A) the expiration of the
Research Term or (B) if any compound is designated as a Designated Compound or
becomes a Licensed Product, then until (i) the later of the expiration of the
last to expire of the patents embodied in or related to such Licensed Products,
or (ii) the obligation to pay royalties hereunder expires due to the failure of
any patent to issue in respect of such Licensed Product or the expiration, lapse
of all patents covering such Licensed Product or the issuance of a final
decision, which is unappealed or unappealable, of a court of competent
jurisdiction or of an administrative agency having authority over patents, that
all patents covering such Licensed Product are invalid, unpatentable or
unenforceable, unless sooner terminated in accordance with Section 12.2,
collectively the ("Term").
SECTION 12.2. TERMINATION.
(a) MATERIAL BREACH. Subject to Section 11.2 and 12.3(c), either Party
may terminate this Agreement and the rights granted hereunder with sixty (60)
days notice to the other Party if the other Party commits a material breach
hereof unless the breach is cured within the sixty (60) day notice period. In
addition, NeoGenesis may suspend work pursuant to the Research Collaboration
Plan with notice to Celltech if Celltech fails to pay NeoGenesis any amount due
NeoGenesis under this Agreement.
(b) BANKRUPTCY OR RECEIVERSHIP OF A PARTY. Either Party may terminate
this Agreement and the rights granted hereunder with upon the filing or
institution of bankruptcy, reorganization, liquidation or receivership
proceedings, or upon an assignment of a substantial portion of the assets for
the benefit of creditors by the other Party; PROVIDED, HOWEVER, in the case of
any involuntary bankruptcy proceeding such right to terminate shall only become
effective if the other Party consents to the involuntary bankruptcy or such
proceeding is not dismissed within ninety (90) days after the filing thereof.
(c) TERMINATION BY CELLTECH. Upon the conclusion of the Lock Up Period,
Celltech may terminate this Agreement upon ninety (90) days written notice to
NeoGenesis.
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SECTION 12.3. EFFECT OF TERMINATION.
(a) TERMINATION ACTIVITIES. Upon termination (including expiration) of
this Agreement as permitted herein: (i) NeoGenesis will terminate all tasks in
process at the date of termination in an orderly manner, as soon as practical
and in accordance with a schedule agreed to by Celltech and NeoGenesis; (ii)
NeoGenesis shall deliver to Celltech all materials developed through the
termination of this Agreement; (iii) Celltech shall pay NeoGenesis any monies
due and owing NeoGenesis up to the termination date, for services actually
performed, PROVIDED, such fee shall not exceed the total FTE funding specified
in Section 5.1(b) of this Agreement (unless Celltech has requested additional
work for which a separate fee has been agreed to by the parties); (iv)
NeoGenesis shall destroy all NeoMorph Focused Libraries developed for Celltech;
and (v) within thirty (30) days following termination (including expiration) of
this Agreement, NeoGenesis shall deliver to Celltech a reasonably-detailed
written report describing the results of the research performed up to the date
of such termination. In addition, if Celltech terminates this Agreement in
accordance with Section 12.2(c), Celltech shall pay NeoGenesis as liquidated
damages an amount equal to the aggregate budgeted FTE fee for the 90-day period
following the date Celltech delivers notice of termination pursuant to Section
12.2(c) to the extent such funding has not already been received by NeoGenesis
as of the date Celltech delivers such termination notice to reimburse NeoGenesis
for non-cancelable commitments with respect to NeoGenesis staff allocated to the
performance of the Research Collaboration.
(b) RETURN OF CONFIDENTIAL INFORMATION. Except as provided in Section
9.5, upon termination (including expiration) of this Agreement as permitted
herein, each Party shall return to the other Party or certify in writing to the
other Party that it has destroyed all documents and other tangible items it or
its employees or agents have received or created pertaining, referring or
relating to the Confidential Information of the other Party.
(c) RIGHTS UPON TERMINATION. The licenses and assignments granted by
NeoGenesis under Section 2.2 and 8.1(a) shall survive any expiration or
termination of the Research Collaboration Plan or Research Term or this
Agreement with respect to any Designated Compound or Licensed Product and
Celltech shall continue to have the right to develop, have developed, make, have
made, use, distribute for sale, promote, market, offer for sale, have sold,
import, export and sell Licensed Products relating to such Designated Compounds;
subject to payment to NeoGenesis of milestone fees and royalties as required by
Section 6.1 and 6.2 and compliance with
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Sections 6.3 - 6.6. In the event the license granted to Celltech under Section
2.2 terminates for any reason, each of Celltech's sublicensees at such time
shall continue to have the rights and license set forth in their sublicense
agreements, PROVIDED such sublicensee agrees in writing that NeoGenesis is
entitled to enforce all relevant provisions directly against such sublicensee.
(d) NO RELEASE OF MATURED OBLIGATION. Nothing herein shall be construed
to release either Party of any obligation which matured prior to the effective
date of any termination, or shall be deemed a waiver of any rights under Section
11.2. Except as otherwise provided herein, neither party shall be liable to the
other party for any compensation or damages by reason of termination of this
Agreement in accordance with this Section12.
SECTION 12.4 SURVIVAL. In addition to those provisions which survive
upon a breach by a Party hereto, Articles I, VI, IX, X, XI, XIII, Section 8.1
and Section 8.5 shall survive any termination or expiration of this Agreement;
provided, that Article VI shall not survive expiration of this Agreement with
respect to any Licensed Product upon the expiration of the last to expire of the
patents embodied in or related to such Licensed Product.
ARTICLE XIII.
GENERAL PROVISIONS
SECTION 13.1. ISSUE RESOLUTION. The Parties shall use their best
efforts to resolve any controversy or dispute that arises under or relates to
this Agreement through good faith discussions.
(a) NOTIFICATION OF DISPUTE. In the event of a controversy or dispute,
the Parties shall initiate dispute discussions using the following procedure:
Either Party shall notify the other Party of the nature of the controversy or
dispute (a "Dispute Notice"). Representatives of the Parties shall meet within
thirty (30) days after the date that the non-sending Party receives the Dispute
Notice to attempt to reach an agreement about the nature of the dispute and a
resolution of the dispute. If they are unable to resolve the dispute within
thirty (30) days, and they do not agree to extend the time period for resolving
the dispute, or if the terms and conditions of the resolution or settlement of
the dispute are breached, the dispute shall be resolved by arbitration pursuant
to the provisions of Section 13.1(b)-(e). Pending resolution of any dispute
covered by this Section 13.1, both Parties will continue their performance under
this Agreement including, without limitation, the payment of all amounts due to
the other Party that are not in dispute.
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(b) LIMITATIONS. Except in the case of a dispute related to the
ownership, validity or enforceability of intellectual property rights of a
Party, any claim, dispute, or controversy arising out of or relating to this
Agreement that is not resolved in accordance with the provisions of Section
13.1(a) within the time period specified in Section 13.1(a) will be submitted by
the Parties to arbitration in accordance with the terms of Section 13.1(b)-(d).
Any dispute related to the ownership, validity or enforceability of intellectual
property rights of a Party or any action following termination for cause due to
a material breach hereof, may be brought in a court of competent jurisdiction in
the country where such rights arise.
(c) ARBITRATION RULES. Any arbitration shall be conducted pursuant to
the International Arbitration Rules of the American Arbitration Association
("AAA"), under the rules then in effect for the AAA, as such rules may be
modified by this Agreement or by agreement of the Parties. Any such arbitration
shall be conducted in
New York City by one arbitrator. Each Party irrevocably
and unconditionally (i) consents to the jurisdiction of any such proceeding; and
(ii) knowingly and voluntarily waives its rights to have disputes tried and
adjudicated by a judge and jury except as otherwise expressly provided herein.
The Parties will cooperate with each other in causing the arbitration to be held
in as efficient and expeditious a manner as practicable. The Parties will
attempt to agree upon a mutually acceptable arbitrator within thirty (30) days
of receipt of the notice of intent to arbitrate such arbitrator shall have
fifteen (15) years legal standing with experience in such matters. If the
Parties are unable to agree upon a single arbitrator within such thirty (30) day
period or any extension of time which is mutually agreed upon, three (3)
arbitrators shall be used, one selected by each Party within ten (10) days after
the conclusion of the thirty (30) day period and a third selected by the first
two within ten (10) days thereafter. Unless the Parties agree otherwise, they
shall be limited in their discovery to directly relevant documents. Responses or
objections to a document request shall be served twenty (20) days after receipt
of the request. The arbitrator(s) shall resolve any discovery disputes. Nothing
herein shall prevent the Parties from settling any dispute at any time by mutual
agreement of the Parties.
(d) APPLICABLE LAW. The arbitrator(s) shall apply the substantive laws
of
New York when construing this Agreement and attempting to resolve any dispute
relating to the transactions contemplated by this Agreement, without regard for
any choice or conflict of laws rule or principle that would result in the
application of the substantive law of any other jurisdiction. The arbitration
shall be of each Party's individual claims only, and no claim of any Third Party
shall be subject to arbitration in such proceeding. Except as otherwise required
by law, the Parties and the arbitrator(s) shall maintain as
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confidential all information or documents obtained during the arbitration
process, including the resolution of the dispute.
(e) RESTRICTIONS ON DAMAGES. The arbitrator(s) shall not have the
authority to award exemplary or punitive damages, and the Parties expressly
waive any claimed right to such damages. The arbitrator(s) shall have the
authority to award actual money damages (with interest on unpaid amounts from
the date due) and may grant equitable relief as is just and provided by the AAA
Rules, in each case except as specifically provided to the contrary herein, the
costs and expenses of the arbitration, but not the costs and expenses of the
Parties, shall be shared equally by the Parties. Any award rendered by the
arbitrator(s) shall be final and binding upon the Parties. Judgment upon the
award may be entered in any court of competent jurisdiction. If a Party fails to
proceed with arbitration, unsuccessfully challenges the arbitration award, or
fails to comply with the arbitration award, the other Party is entitled to
costs, including reasonable attorneys' fees, for having to compel arbitration or
defend or enforce the award.
SECTION 13.2. GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the internal, substantive laws of the
New York to
the exclusion of any choice or conflict of laws rule or provision that would
result in the application of the substantive law of any other jurisdiction.
Notwithstanding the foregoing, the laws of the applicable jurisdiction in the
Territory shall be used for purposes of governing and construing Section 10.1(e)
of this Agreement.
SECTION 13.3. AMENDMENT AND WAIVER. No provision of or right under this
Agreement shall be deemed to have been waived by any act or acquiescence on the
part of either Party, its agents or employees, but only by an instrument in
writing signed by an authorized officer of each Party. No waiver by either Party
of any breach of this Agreement by the other Party shall be effective as to any
other breach, whether of the same or any other term or condition and whether
occurring before or after the date of such waiver.
SECTION 13.4. INDEPENDENT CONTRACTORS. Each Party represents that it is
acting on its own behalf as an independent contractor and is not acting as an
agent for or on behalf of any Third Party. This Agreement and the relations
hereby established by and between Celltech and NeoGenesis do not constitute a
partnership, joint venture, franchise, agency or contract of employment. Neither
Party is granted, and neither Party shall exercise, the right or authority to
assume or create any obligation or responsibility on behalf of or in the name of
the other Party or its Affiliates. NeoGenesis shall
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40
be solely responsible for compensating all its personnel and for payment of all
related FICA, workers' compensation, unemployment and withholding taxes.
Celltech shall not provide NeoGenesis personnel with any benefits, including but
not limited to compensation for insurance premiums, paid sick leave or
retirement benefits.
SECTION 13.5. ASSIGNMENT. Neither Party may assign this Agreement or
any of its rights and obligations under this Agreement without the prior written
consent of the other Party; PROVIDED, that either Party may assign this
Agreement to (a) any Person to which such Party transfers all or substantially
all of its assets or with which such Party is consolidated or merged; (b) any
Person that owns a majority of the voting stock of such Party; or (c) a single
Person of which such Party owns a majority of the voting stock; PROVIDED,
FURTHER, that in each instance the assignee expressly assumes all obligations
imposed on the assigning Party by this Agreement in writing and the other Party
is notified in advance of such assignment. Notwithstanding the foregoing,
Celltech shall have the right to assign its rights to Designated Compounds and
Licensed Products without the consent of NeoGenesis PROVIDED that any such
assignee expressly assumes all obligations imposed on Celltech by this Agreement
and agrees in writing that NeoGenesis shall have the right to enforce the terms
of this Agreement directly against such assignee.
SECTION 13.6. SUCCESSORS AND ASSIGNS. This Agreement shall bind and
inure to the benefit of the Parties hereto and their respective successors and
permitted assigns.
SECTION 13.7. NOTICES. Unless otherwise provided herein, any notice,
report, payment or document to be given by one Party to the other shall be in
writing and shall be deemed given when delivered personally or sent by an
internationally recognized overnight courier (such notice sent by courier to be
effective one business day after it is deposited with such courier), or sent by
telefax (such notice sent by telefax to be effective when sent, if confirmed by
overnight courier as aforesaid) to the address set forth on the signature page
to this Agreement or to such other address as any Party may designate as to
itself by written notice to the other Party.
SECTION 13.8. SEVERABILITY. In the event any provision of this
Agreement shall for any reason be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other term or provision hereof. The Parties agree that they will negotiate
in good faith or will permit a court or arbitrator to replace any provision
hereof so held invalid, illegal or unenforceable with a valid provision which is
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as similar as possible in substance to the invalid, illegal or unenforceable
provision.
SECTION 13.9. CAPTIONS. Captions of the sections and subsections of
this Agreement are for reference purposes only and do not constitute terms or
conditions of this Agreement and shall not limit or affect the meaning or
construction of the terms and conditions hereof.
SECTION 13.10. WORD MEANINGS. Words such as herein, hereinafter, hereof
and hereunder refer to this Agreement as a whole and not merely to a section or
paragraph in which such words appear, unless the context otherwise requires. The
singular shall include the plural, and each masculine, feminine and neuter
reference shall include and refer also to the others, unless the context
otherwise requires.
SECTION 13.11. ENTIRE AGREEMENT. The terms and provisions contained in
this Agreement (including any Attachments or Exhibits) and the Stock Purchase
Agreement (including any Attachments and Exhibits) constitute the entire
understanding of the Parties with respect to the transactions and matters
contemplated by the Parties and supersede all previous communications,
representations, agreements and understandings relating to the subject matter
hereof. No representations, inducements, promises or agreements, whether oral or
otherwise, between the Parties not contained in this Agreement or the Stock
Purchase Agreement shall be of any force or effect. No agreement or
understanding extending this Agreement or varying its terms (including any
inconsistent terms in any purchase order, acknowledgment or similar form) shall
be binding upon either Party unless it is in a writing specifically referring to
this Agreement and signed by a duly authorized representative of the applicable
Party.
SECTION 13.12. RULES OF CONSTRUCTION. The Parties agree that they have
participated equally in the formation of this Agreement and that the language
and terms of this Agreement shall not be construed against either Party by
reason of the extent to which such Party or its professional advisors
participated in the preparation of this Agreement.
SECTION 13.13. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. In making proof of this
Agreement, it shall not be necessary to produce or account for more than one
such counterpart.
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SECTION 13.14. FORCE MAJEURE. Except as otherwise provided in this
Agreement, in the event that a delay or failure of a Party to comply with any
obligation, other than a payment obligation, created by this Agreement is caused
by a Force Majeure condition, that obligation shall be suspended during the
continuance of the Force Majeure condition.
SECTION 13.15. FURTHER ASSURANCES. Each Party covenants and agrees
that, subsequent to the execution and delivery of this Agreement and without any
additional consideration, it will execute and deliver any further legal
instruments and perform any acts which are or may become reasonably necessary to
effectuate the purposes of this Agreement.
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IN WITNESS WHEREOF the Parties have caused this Agreement to be
executed on their behalf by their duly authorized representatives intending it
to take effect as an instrument under seal as of the Effective Date.
NEOGENESIS DRUG DISCOVERY, INC. CELLTECH R & D LIMITED
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxxxx X. Xxx
------------------------------------------ -----------------------------------
Xxxxx X. Xxxxxxx, Chief Executive Officer Xxxxxxx X. Xxx, Research Director
NOTICE ADDRESS: NOTICE ADDRESS:
NeoGenesis Drug Discovery, Inc. Celltech R & D Limited
000 Xxxxxxxx Xxxxx Attention: Xxxxx Xxxxxxxxxx
Xxxxxxxxx, XX 00000 000 Xxxx Xxxx
XXX Xxxxxx, Xxxxxxxxx, XXX 0XX
Phone: 000.000.0000 England
Fax: 000.000.0000 Phone: +44 (1753) 534655
Fax: +44 (1753)447859
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EXHIBIT A
RESEARCH COLLABORATION PLAN
1. SELECTION OF TARGETS. Targets shall enter the Research Collaboration
in accordance with the following
procedures:
(a) INITIAL TARGET ELECTION. Celltech and NeoGenesis agree that the
following are the initial Approved Targets each of which is a Proprietary
Target: [*]. The approval date for the initial [*] Approved Targets shall be the
Effective Date for purposes of determining the period of Approved Target
Exclusivity Period. The Steering Committee shall establish a schedule for
delivery of the protein for the [*] Approved Targets to NeoGenesis during the
Lock Up Period. Celltech may, in its sole discretion, replace any of the initial
[*] Approved Targets for any other Target that meets the Target Guidelines.
(b) REMAINING TARGET ELECTION. After the initial Target election, as
set forth in paragraph 1(a) above, during the Research Term, Celltech shall
provide NeoGenesis with written notice of each additional Target. NeoGenesis
shall notify Celltech in writing within [*] of such notice whether the Target is
approved as eligible for entry into the Research Collaboration based on the
Target Guidelines. All Targets approved by NeoGenesis for entry into the
Research Collaboration shall become Approved Targets. If NeoGenesis fails to
respond to Celltech's written notice for Target approval within [*], that Target
shall be deemed an Approved Target. The Steering Committee shall establish a
schedule for delivery of Approved Targets to NeoGenesis based on the time
necessary to prepare and validate the Approved Target, not to exceed [*].
(c) TARGET EXCLUSIVITY. NeoGenesis shall not screen an Approved Target
for a Third Party during the Approved Target Exclusivity Period. Additionally,
NeoGenesis shall not notify any Third Party that an Approved Target's Approved
Target Exclusivity Period has ended unless said Third Party makes a written
inquiry about that specific Approved Target after expiry of the Approved Target
Exclusivity Period.
2. SCREENING.
(a) PROVIDING TARGET. In accordance with timelines established for each
Approved Target by the Steering Committee, Celltech shall provide to NeoGenesis
between [*] of Approved Target, as determined by the Steering Committee. The
Approved Target shall be delivered via common carrier, CIP
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to the port of entry agreed by both parties for deliveries from Celltech
facilities outside the United States and FOB Celltech's Seattle facility for
deliveries from such facility.
(b) ESTABLISHING AN SOP. Upon receipt of the Approved Target protein,
NeoGenesis shall perform control experiments on each Approved Target to
determine specific characteristics for screening the Approved Target with the
ALIS method. These experiments shall be used to establish an SOP for a each
Approved Target. Additionally, upon recommendation by the Steering Committee and
to the extent that Celltech has known ligands to an Approved Target, NeoGenesis
shall perform follow up control experiments to validate the retention of binding
activity of the Approved Target.
(c) SCREENING OF TARGET. NeoGenesis shall utilize the above developed
SOP for each Approved Target to perform its ALIS method to screen the NeoMorph
Screening Library for compounds having a minimum level of affinity to each
Approved Target. The minimum level of affinity shall be determined by the
Steering Committee on an Approved Target by Approved Target basis. Each compound
meeting the minimum level of affinity shall be referred to as a "Preliminary
Compound".
(d) MASKING OF PRELIMINARY COMPOUNDS. Upon identification of any
Preliminary Compound(s), NeoGenesis shall Mask such Preliminary Compound(s) from
the NeoMorph Screening Library during the Preliminary Compound Exclusivity
Period.
3. IDENTIFICATION OF PRIMARY ACTIVE COMPOUNDS.
(a) PRELIMINARY COMPOUND DELIVERY. NeoGenesis shall provide Celltech
with [*] of each of the Preliminary Compounds. The Preliminary Compounds shall
be delivered via common carrier, CIP to the port of entry agreed by both Parties
for deliveries to Celltech facilities outside the United States and FOB
NeoGenesis' Cambridge facility for deliveries to Celltech facilities within the
United States.
(b) ACTIVITY. Celltech shall assay each Preliminary Compound to
identify those having functional biological activity in a cell-based or
biochemical assay against an Approved Target. Celltech shall inform NeoGenesis
through the Steering Committee of any Preliminary Compound that demonstrates
functional biological activity in a cell-based or biochemical assay against an
Approved Target. Any Preliminary Compound that demonstrates functional
biological activity in a cell-based or biochemical
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assay against an Approved Target shall be deemed a Primary Active Compound.
(c) MASKING OF PRIMARY ACTIVE COMPOUNDS. Upon designation of any
Primary Active Compound, NeoGenesis shall Mask such Primary Active Compound(s)
from the NeoMorph Screening Library during the Primary Active Compound
Exclusivity Period.
(d) OPTIMIZATION. The Steering Committee shall determine whether
Celltech or NeoGenesis shall undertake the process of optimization of each
Primary Active Compound. When the Steering Committee appoints Celltech to
perform the optimization, Celltech shall keep the Steering Committee reasonably
informed of the progress of the optimization progress. When the Steering
Committee appoints NeoGenesis to undertake the optimization activities,
NeoGenesis shall synthesize discrete compound(s) based upon each Primary Active
Compound to form NeoMorph Focused Libraries. NeoGenesis shall screen the
compounds in these NeoMorph Focused Libraries according to the ALIS method to
identify additional Preliminary Compounds. NeoGenesis shall continue the
optimization until additional Preliminary Compounds are identified with an
affinity as established by the Steering Committee. Thereafter, NeoGenesis shall
provide Celltech with [*] of each of these Preliminary Compounds. These
Preliminary Compounds shall be delivered via common carrier, CIP to the port of
entry agreed by both parties for deliveries to Celltech facilities outside the
United States and FOB NeoGenesis' Cambridge facility for deliveries to Celltech
facilities within the United States. As above, Celltech shall assay each
Preliminary Compound identified during the optimization to identify those having
functional activity against an Approved Target. Celltech shall inform NeoGenesis
through the Steering Committee of any Preliminary Compound that demonstrates
functional activity against an Approved Target. Any Preliminary Compound that
demonstrates functional activity against an Approved Target shall be deemed a
Primary Active Compound.
(e) QSCD. The Steering Committee may recommend that any Approved Target
undergo QSCD. QSCD shall determine compounds that may have an affinity to an
Approved Target. These compounds shall be deemed QSCD Preliminary Compounds.
NeoGenesis shall synthesize the QSCD Preliminary Compounds. If needed, the QSCD
Preliminary Compounds shall be shipped at NeoGenesis' expense to Celltech. The
QSCD Preliminary Compounds will be tested for activity as set forth in paragraph
3(b) above. Those QSCD Preliminary Compounds that demonstrate activity shall be
deemed QSCD Primary Active Compounds. Any recommendation that an
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Approved Target undergo QSCD must be made by the Steering Committee and recorded
in the minutes as set forth in Section 4.1(b) (i) prior to the date NeoGenesis
commences screening of such Approved Target, (ii) after NeoGenesis completes an
initial screening of such Approved Target against [*] Compounds in the NeoMorph
Screening Library and before NeoGenesis completes the initial screening of such
Approved Target against the NeoMorph Screening Library or (iii) upon the
conclusion of initial screening of such Approved Target against the entire
NeoMorph Screening Library. NeoGenesis will provide the Steering Committee with
notice of the number of Preliminary Compounds it identifies against [*]
compounds within the NeoMorph Screening Library when it completes the initial
screening for such Approved target against [*] compounds.
(f) CHEMICAL STRUCTURE AND SYNTHETIC PROTOCOLS. For each Approved
Target the Steering Committee has directed NeoGenesis to optimize, NeoGenesis
shall provide Celltech with a report that outlines the chemical structure and
synthetic protocols for each Preliminary Compound and QSCD Preliminary Compound.
This information shall be provided as soon as reasonably possible after the
identification of the Preliminary Compound or QSCD Preliminary Compounds. For
each Approved Target the Steering Committee has directed Celltech to optimize,
NeoGenesis shall provide Celltech with a report that outlines the chemical
structure and synthetic protocols for each Primary Active Compound and QSCD
Primary Active Compound. This information shall be provided as soon as
reasonably possible after notification by Celltech of the Primary Active
Compound or QSCD Primary Active Compound.
(g) NEOMORPH FOCUSED LIBRARIES. NeoGenesis agrees that NeoMorph Focused
Libraries shall never be utilized to screen any Third Party targets. Upon the
conclusion of the Research Term or as earlier elected by the Steering Committee
all NeoMorph Focused Libraries shall be destroyed. Promptly thereafter, such
destruction shall be certified to Celltech in writing. It is understood and
agreed that the use of the NeoGenesis NeoMorph Screening Library may result in
the independent generation of results or data similar to the results or data
generated in the course of the Research Collaboration and that the use of such
independently generated results or data shall not constitute a breach of
NeoGenesis obligations under this paragraph 3(g); PROVIDED FURTHER that the
obligations of NeoGenesis to not make any Designated Compound available to
NeoGenesis or any third party in NeoGenesis' compound libraries, including the
NeoMorph Screening Library shall operate independently of the foregoing
exception.
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4. DESIGNATING COMPOUNDS.
(a) DESIGNATION. Celltech shall designate, at its sole discretion, and
by notice in writing to NeoGenesis, those Preliminary Compounds, Primary Active
Compounds, QSCD Preliminary Compounds and QSCD Primary Active Compounds, as
applicable, it wishes to become Designated Compounds with respect to each
Approved Target. Celltech shall make such designation within [*] following the
delivery by NeoGenesis of such Preliminary Compounds or QSCD Preliminary
Compounds. The number of compounds that may become Designated Compounds shall be
limited as follows: (1) Celltech may designate [*] compounds as Designated
Compounds when the optimization as set forth in 3(d) above is performed by
Celltech and such compounds are taken directly from the NeoMorph Screening
Library and (2) Celltech may designate [*] compounds as Designated Compounds
when the optimization as set forth in 3(d) above is performed by NeoGenesis and
such compounds are taken from NeoMorph Focused Libraries. Celltech shall have
the right to undesignate Designated Compounds, by written notice to NeoGenesis,
it considers unsuitable for further development. When a compound is
undesignated, Celltech shall have the right to replace that compound with a new
Designated Compound to the extent that such replacement compound is available to
become a Designated Compound. Celltech may only replace a total of [*]
Designated Compounds in the aggregate.
(b) FURTHER OPTIMIZATION. Upon the recommendation of the Steering
Committee, NeoGenesis shall perform additional optimization to obtain compounds
related to the Designated Compounds that have improved affinity.
5. REPORTS.
(a) NeoGenesis shall keep and maintain adequate written records
containing laboratory data generated in the course of performing the Research
Collaboration Plan to enable it to furnish complete and accurate information to
Celltech. This information shall be available to Celltech via a secure internet
connection, the details of which shall be worked out by each Party's IT
department within thirty (30) days of the Effective Date. The internet
connection shall be supervised by the Steering Committee. These records shall be
the basis for any reports which NeoGenesis shall provide to Celltech. These
reports shall be reasonably detailed describing the results of the Research
Collaboration Plan.
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(b) Within thirty (30) days of the completion of the procedures
outlined in the Research Collaboration Plan on each Approved Target, NeoGenesis
shall provide to Celltech a Final Report for such Approved Target. The Final
Report shall set forth in reasonable detail the results of the procedures
outlined in the Research Collaboration Plan.
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SEPARATELY WITH THE COMMISSION.
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EXHIBIT B
FTE INVOICE AND PAYMENT
Celltech shall pay NeoGenesis in advance for the FTE funding under Section 5.1
(c) in Quarterly payments as set forth on the FTE schedule under Section 5.1(b);
PROVIDED, that the initial installment will be paid within thirty (30) days of
the Effective Date. NeoGenesis will provide Celltech on a Quarterly basis within
thirty (30) days following each Quarter, commencing September 30, 2001, a
written report setting forth the FTE amounts expended by NeoGenesis and research
work undertaken in connection with the Research Collaboration Plan for the most
recently ended quarter, certified by the Chief Financial Officer (or equivalent
financial and accounting officer) of NeoGenesis to be correct to the best of
NeoGenesis' knowledge and information.
NeoGenesis shall monitor expenditures, in accordance with its corporate
policies, to ensure that the funds provided by Celltech are spent in accordance
with this Agreement. NeoGenesis shall keep and maintain adequate books and
records to furnish complete and accurate information to Celltech regarding
calculation of the FTE amounts expended by NeoGenesis on the Research
Collaboration according to the provisions of this Agreement. During the Research
Term and for two (2) years following the expiration of the Research Term,
NeoGenesis shall permit Celltech to examine such books and records during normal
business hours, upon thirty (30) days notice to NeoGenesis. Upon the expiration
of the two (2) year period, the calculation of the amounts expended on each year
of the Program shall be binding and conclusive upon the parties and NeoGenesis
shall be released from any further accountability with respect to the Research
Program.
If in any quarterly funding period, actual expenditures by NeoGenesis with
respect to FTEs exceed the amount budgeted for the period, the overrun will be
carried forward for the next period and paid for from the next payment(s);
PROVIDED, that Celltech payment obligations for any year of the Research
Collaboration shall not exceed the budgeted amount for such year UNLESS Celltech
has agreed to fund additional FTE work beyond that budgeted for such year by
means of a written amendment to such budget approved in writing by the parties.
If in any period actual expenditures are less than the amount budgeted for the
period, the underrun may be applied to the FTE expenses of the subsequent
periods by NeoGenesis but shall not reduce the amount due NeoGenesis from
Celltech for the subsequent period(s).
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