Non-Conforming Batches. If a Batch of Product, whether an individual Batch or part of a sequence of Batches in the case of process validation Batches fails to conform to the Specifications or was not manufactured in compliance with Applicable Laws, the Process, or the Quality Agreement, then Lonza will, at Kolltan’s sole option:
(a) refund [**] the Price and expenses paid by Kolltan for such Batch, and the [**] used in the manufacture of such Batch(es); or
(b) at [**], including the [**] and used in the manufacture of such Batch(es), produce a new Batch of Product as soon as reasonably possible, that conforms to the Specifications and is manufactured in compliance with the Applicable Laws, Process and Quality Agreement; or
(c) Reprocess the Product, [**], so that the Batch can be deemed to have been manufactured in compliance with the Applicable Laws, Process and Quality Agreement, and to conform to Specifications; or
(d) If the Batch was part of a sequence of Batches as in the case of validation Batches, determine jointly with Kolltan the root cause for such non-conformance. If the non-conformance results in one or more of the Batches in a sequence being unusable for commercial sale, clinical use or other development use, and if the root cause was due to Lonza’s Fault, Lonza will either (i) [**] for the unusable portion sequence of Batch(es), including the [**] used in the manufacture of such Batch(es); or (ii) at [**], including the [**], and used in the manufacture of such Batch(es), replace the unusable sequence of Batch(es) of Product as soon as reasonably possible. For the avoidance of doubt, if any of the Batch(es) in the sequence are usable for commercial sale, clinical use or other development use, then Lonza would only be liable of the non-usable Batch(es).
Non-Conforming Batches a) Fujifilm shall [**] ensure that it will only deliver Batches to Sponsor that (i) are Manufactured in accordance with, and meet the requirements of, this Agreement, the Quality Agreement (including the Specifications) and Applicable Laws (including cGMPs) [**].
b) The following provisions shall apply if it is ascertained by either Party that a Batch is a Non-Conforming Batch during disposition of a Batch or as a result of Sponsor’s review of the applicable Batch Packet [**]:
i. If Fujifilm is the first to discover the non-conformity, Fujifilm shall [**] provide written notice of same, including an explanation of the non-conformity, to Sponsor within [**] from discovery, but not to exceed [**] from discovery. If Sponsor is the first to discover the non-conformity, Sponsor shall [**] provide written notice, including an explanation of the non-conformity, to Fujifilm within [**] from discovery, but not to exceed [**] from Sponsor’s receipt of Batch, or in the case of [**] from Sponsor’s receipt of the Batch.
ii. The Non-Conforming Batch shall not be delivered to Sponsor if it is still located at the GMP Facility as of the date of Fujifilm’s issuance or receipt (as applicable) of the notice of non-conformity.
iii. If Sponsor has provided the notice of a Non-Conforming Batch to Fujifilm, within [**] of receiving such notice, Fujifilm shall investigate the presence and source of defect following the Fujifilm complaint procedure and notify Sponsor in writing as to whether Fujifilm agrees or disagrees in good faith with Sponsor’s determination of the existence or cause of the non-conformity and the reasons therefor. [**].
Non-Conforming Batches. Purchaser will have the right to inspect and determine whether each Batch conforms to the applicable Product Requirements. During the [***] period after delivery of each Batch or after Release of Batch, whichever occurs later, Purchaser may reject any Batch that does not conform to the applicable Product Requirements by providing written notice thereof to Supplier; provided, however, that with respect to any Batch that includes a Latent Defect, such [***] period shall not commence until Purchaser discovers or otherwise becomes aware of such Latent Defect but provided, further, that such notice must be given before the expiration of the initial shelf-life of the any such Batch prior to any re-testing period. Any claim by Purchaser that the Batch does not meet the applicable Product Requirements must be made in writing to Supplier within such applicable [***] (the “Non-Conformance Claim”). Upon Purchaser’s timely notification to Supplier of Purchaser’s rejection of a Batch, [***] shall reasonably cooperate with each other to [***] investigate, confirm and analyze whether or not the rejected Batch meets the applicable Product Requirements and the root cause of non-conforming Batch in accordance with the applicable Quality Agreement within [***] of Supplier’s receipt of the Non-Conformance Claim (the “Investigation Period”). Upon Supplier’s written request, if applicable, Purchaser shall deliver to Supplier samples of the rejected Batch for Supplier’s evaluation. If, subject to Section 6.8 (Non-Conformance Disputes), the Parties agree that the rejected Batch is in non-conformance and [***] (“Supplier Responsibility”), [***] will be entitled to [***] with respect to such Batch.
