Common use of Conduct of Research Clause in Contracts

Conduct of Research. The Research Program is directed to: (i) the Research by Company of Cue Biologics up to Proof of Mechanism for each of the Initial Indications; and, subject to Section 2.2.2; (ii) the further Research and/or Development by Merck of Proposed Product Candidates. Subject to Section 2.2.4, Merck may, in its sole discretion, elect [****] Product Candidates for use by Merck and its Related Parties in efforts to Research, Develop, Manufacture and Commercialize Compounds and Products. 2.2.1 Until the expiration of the Research Program Term, Company and Merck each shall proceed diligently with the work set out in the Research Program by using their respective reasonable good faith efforts to allocate sufficient time, effort, equipment and facilities to the Research Program and to use personnel with sufficient skills and experience as are required to accomplish the Research Program in accordance with the terms of this Agreement and Schedule 2.1 as may be revised from time to time pursuant to Section 2.1. 2.2.2 Upon the generation of data supporting achievement of Proof of Mechanism for each Cue Biologic, Company shall present such information along with the identity of the Cue Biologic to the Joint Steering Committee. Following a determination by the Joint Steering Committee that such Cue Biologic has achieved Proof of Mechanism as reflected in the meeting minutes of the Joint Steering Committee, such Cue Biologic shall constitute a Proposed Product Candidate. Merck shall thereafter perform the Research and/or Development activities assigned under the Research Program for the Proposed Product Candidate. Company shall have responsibility for supply of such Proposed Product Candidate. 2.2.3 Upon achievement of Proof of Concept for one or more Proposed Product Candidates, Merck shall provide written notice to Company that such one or more Proposed Product Candidates have achieved Proof of Concept. 2.2.4 Following written notice to Company of the achievement of Proof of Concept for a Proposed Product Candidate, Merck shall conduct an internal review to determine in its sole discretion whether it wishes to elect the Proposed Product Candidate as a Product Candidate. Merck shall then request through the Joint Steering Committee a meeting with Company to discuss and mutually agree upon a technology transfer strategy to provide for the continued supply and Manufacturing of Product Candidates for IND Enabling Studies. Following Merck’s request for a meeting pursuant to this Section 2.2.4 and mutual agreement on the technology transfer strategy, Merck may elect in its sole discretion to designate a Proposed Product Candidate as a Product Candidate and provide written notice to Company informing them of such election. Parties shall thereafter work to execute on the mutually-agreed upon technology transfer strategy. Merck shall be entitled to utilize the services of its Affiliates and Third Parties to perform its Research Program activities, provided that all such Affiliates and Third Parties are bound or agree to be bound by confidentiality and non-use obligations no less stringent than that contained in this Agreement. Company shall be entitled to utilize the service of Third Parties to perform its Research Program activities only upon Merck’s prior written consent or as specifically set forth in Schedule 2.1. Notwithstanding the foregoing, each Party shall remain at all times fully liable for its respective responsibilities under the Research Program.