Common use of Payments and Reporting Clause in Contracts

Payments and Reporting. In consideration of the license rights granted to Tanox under this Agreement, Tanox shall make the following payments to Biogen: 3.2 Tanox shall pay Biogen a royalty on NET SALES of LICENSED PRODUCT sold by Tanox, its AFFILIATES, SUBLICENSEES and DISTRIBUTOR(S) in the TERRITORY at the following rates: PORTION OF ANNUAL NET SALES ROYALTY RATE OFFSET (ARTICLE 3.3) ---------------- ------------ -------------------- * * * 3.3 If Tanox licenses PROTEIN DESIGN LABS PATENT(S) to make, have made, use, sell, offer for sale, or import LICENSED PRODUCT, then so long as a VALID CLAIM of a PROTEIN DESIGN LABS PATENT encompasses the LICENSED PRODUCT in the United States, the royalty otherwise payable to Biogen under Article 3.2 on sales in the respective countries in which there are such VALID CLAIMS shall be reduced by the amounts set forth in the above Table of Article 3.2 under the heading "Offset" determined by reference to the amount of annual NET SALES in such countries. 3.4 As further consideration of the rights granted to Tanox under this Agreement, Tanox shall make the following nonrefundable, noncreditable payments to Biogen upon the first achievement of each of the following milestones. MILESTONE PAYMENT --------- ------- Upon filing an IND or equivalent filing for first LICENSED PRODUCT * Commencement of Phase III Clinical Trial (or equivalent pivotal trial) of first LICENSED PRODUCT * Filing BLA/MAA or equivalent filing for first LICENSED PRODUCT * Regulatory approval anywhere in the TERRITORY of first LICENSED PRODUCT * 3.5 If, after executing this Agreement, Tanox becomes (a) an AFFILIATE of; or (b) merged with; or (c) acquired by: or (d) an acquirer of, a third party having an equal or greater number of employees than Biogen at the time of such AFFILIATE formation or merger or acquisition, then Tanox shall be obligated to make additional milestone payments in addition to those recited above in Article 3.

Payments and Reporting. (a) BMS shall furnish Cephalon, on a monthly basis within 40 days after the end of each month, a report setting forth: (i) the retail prescriptions for the Product in the Territory that were written or ordered by (x) Covered Physicians and (y) other health care professionals during such period, in each case, as determined by the National Prescriptions Audit Plus: Prescriber Specialty Report issued by IMS America; and (ii) the retail Covered Physician Prescriptions in clause 11(a)(i) above categorized by individual Covered Physician as sorted by Zip Code and Medical Education Number (ME#) as determined by the IMS X-Ponent Individual Prescriber database, provided, that Cephalon shall hold such information in confidence until made publicly available by IMS America and shall have executed such confidentiality agreement as may be requested by IMS America with respect to such disclosure of such information to it; and (iii) a summary report with an explanation of costs associated with Funded Activities. (b) In consideration addition to the reports provided under Section 11(a) above, BMS shall furnish Cephalon, within 60 days after each Agreement Payment Period, a report setting forth: (i) the calculation of Net Sales attributable to Covered Physicians in the Territory during such period; and (ii) the calculation of Cephalon's compensation under Section 10 with respect to such Net Sales attributable to Covered Physicians with respect to such period (and, in addition to a report for the third Agreement Payment Period, with respect to the entire Agreement Year). (c) BMS shall furnish Cephalon, as of the license rights granted to Tanox under Effective Date of this Agreement, Tanox shall make retail prescription data for the following payments to Biogen: 3.2 Tanox shall pay Biogen a royalty Product on NET SALES of LICENSED PRODUCT sold by Tanox, its AFFILIATES, SUBLICENSEES and DISTRIBUTOR(S) an individual Covered Physician basis for each month in the TERRITORY at preceding twelve (12) months sorted by Zip Code with the following rates: PORTION OF ANNUAL NET SALES ROYALTY RATE OFFSET (ARTICLE 3.3) ---------------- ------------ -------------------- * * * 3.3 If Tanox licenses PROTEIN DESIGN LABS PATENT(S) view to make, have made, use, sell, offer enabling Cephalon to determine the projected base level of sales for sale, or import LICENSED PRODUCT, then so long as a VALID CLAIM of a PROTEIN DESIGN LABS PATENT encompasses the LICENSED PRODUCT in the United States, the royalty otherwise payable to Biogen under Article 3.2 on each defined Cephalon sales in the respective countries in which there are such VALID CLAIMS shall be reduced by the amounts set forth in the above Table of Article 3.2 under the heading "Offset" determined by reference to the amount of annual NET SALES in such countriesrepresentative territory. 3.4 As further consideration of the rights granted to Tanox under this Agreement, Tanox shall make the following nonrefundable, noncreditable payments to Biogen upon the first achievement of each of the following milestones. MILESTONE PAYMENT --------- ------- Upon filing an IND or equivalent filing for first LICENSED PRODUCT * Commencement of Phase III Clinical Trial (or equivalent pivotal trial) of first LICENSED PRODUCT * Filing BLA/MAA or equivalent filing for first LICENSED PRODUCT * Regulatory approval anywhere in the TERRITORY of first LICENSED PRODUCT * 3.5 If, after executing this Agreement, Tanox becomes (a) an AFFILIATE of; or (b) merged with; or (c) acquired by: or (d) an acquirer of, The determination of Cephalon's compensation specified in the report shall be made in accordance with Section 10 hereof. (e) All payments to a third party having an equal or greater number under this Agreement shall be made by wire transfer in immediately available funds in legal currency of employees than Biogen at the time United States and shall be delivered to the account of such AFFILIATE formation party designated by it in writing from time to time. (f) The parties will maintain complete and accurate books and records in sufficient detail to enable verification of the detail call activity of Cephalon, the Net Sales attributable to Covered Physicians and the basis for calculating the compensation paid by BMS to Cephalon hereunder. Either party may demand an audit of the other party's relevant books and records in order to verify the other's reports on the aforesaid matters. Upon reasonable prior notice to the party to be audited, the independent public accountants of the other party shall have access to the relevant books and records of the party to be audited in order to conduct a review or merger audit thereof. Such access shall be available during normal business hours not more than once each calendar year during the Copromotion Term and only for a period until two years after the relevant period in question. The accountants shall be entitled to report its conclusions and calculations to the party requesting the audit, except that in no event shall the accountants disclose the names of customers of either party or acquisitionthe prices or terms of sale charged by BMS for the Product. The party requesting the audit shall bear the full cost of the performance of any such audit except as hereinafter set forth. If, as a result of any inspection of the books and records of BMS, it is shown that BMS' payments to Cephalon under this Agreement were less than the amount which should have been paid, then Tanox BMS shall make all payments required to be obligated made to make additional milestone payments in addition eliminate any discrepancy revealed by said inspection within 30 days after Cephalon's demand therefor. If, as a result of any inspection of the books and records of Cephalon, it is shown that BMS's reimbursements for costs associated with Funded Activities to those recited above in Article 3Cephalon under this Agreement were more than the amount which should have been paid, then Cephalon shall reimburse BMS for the discrepancy revealed by said inspection within 30 days after BMS's demand therefor.

Payments and Reporting. 4.1 In consideration of for the license rights granted to Tanox GTC hereunder: (a) On December 26, 2002 and on each anniversary of said date thereafter, GTC shall pay directly to Biogen, Inc. on behalf of PHARMING and GTC a non-refundable, annual fee of [*****]; and (b) GTC shall pay directly to Biogen, Inc. on behalf of PHARMING and GTC a royalty on the annual GTC Revenue based on the selling price per gram ("Price"), of GTC Product according to the schedule attached hereto as Appendix C, payable on a quarterly basis within thirty (30) days of the end of each calendar quarter. 4.2 GTC shall be entitled to credit the annual fee paid to Biogen, Inc. pursuant to Section 4.1(a) against the royalties payable to Biogen, Inc. pursuant to Section 4.1(b) for the same calendar year, but in no event shall any unused credit be carried over to another calendar year. 4.3 Together with each royalty payment due under this Article 4, GTC shall provide Biogen, Inc. with a signed written statement certifying, separately for each type of GTC Product and for each country, the sales volume and the Price of such GTC Product and the amount of any permitted credit or deduction. For this purpose, GTC shall maintain, and shall ensure that its ------------------------ * Confidential Treatment has been requested for the marked portion. sublicensees maintain, appropriate books of account and records of all sales for a period of two (2) years after each quarterly royalty payment. At PHARMING's request, GTC shall make such books of account and records available for inspection during normal business hours by independent public accountants appointed by PHARMING solely for the purpose of verification of the statements referred to above and under suitable confidentiality obligations. The cost of such audit shall be borne by PHARMING unless it is established by the audit that there has been an error which has caused Biogen, Inc. to receive payments less than it is due by five percent (5%) or more for the period under audit, in which case the cost of such audit shall be borne by GTC. 4.4 The amounts computed or specified under this Article 4 are the actual amounts to be received by Biogen, Inc. and shall not be reduced in any way, including but not limited to by any liabilities incurred by GTC or its sublicensees upon remittance to Biogen, Inc. of the payments due hereunder. In no event shall GTC owe PHARMING any amounts under this Agreement, Tanox it being understood that GTC shall make the following remit all payments directly to Biogen:, Inc. 3.2 Tanox 4.5 All payments made hereunder shall pay Biogen be paid in U.S. Dollars. Monetary conversion from the currency of a royalty on NET SALES of LICENSED PRODUCT sold by Tanox, its AFFILIATES, SUBLICENSEES and DISTRIBUTOR(S) in the TERRITORY foreign country into U.S. currency shall be made at the following rates: PORTION OF ANNUAL NET SALES ROYALTY RATE OFFSET (ARTICLE 3.3) ---------------- ------------ -------------------- * * * 3.3 If Tanox licenses PROTEIN DESIGN LABS PATENT(S) to make, have made, use, sell, offer exchange rate in force on the last business day of the period for salewhich the payments are being made as reported in THE WALL STREET JOURNAL, or import LICENSED PRODUCTon such other basis as mutually agreed upon by GTC and Biogen, then so long as a VALID CLAIM of a PROTEIN DESIGN LABS PATENT encompasses the LICENSED PRODUCT in the United States, the royalty otherwise payable to Biogen under Article 3.2 on sales in the respective countries in which there are such VALID CLAIMS shall be reduced by the amounts set forth in the above Table of Article 3.2 under the heading "Offset" determined by reference to the amount of annual NET SALES in such countries. 3.4 As further consideration of the rights granted to Tanox under this Agreement, Tanox shall make the following nonrefundable, noncreditable payments to Biogen upon the first achievement of each of the following milestones. MILESTONE PAYMENT --------- ------- Upon filing an IND or equivalent filing for first LICENSED PRODUCT * Commencement of Phase III Clinical Trial (or equivalent pivotal trial) of first LICENSED PRODUCT * Filing BLA/MAA or equivalent filing for first LICENSED PRODUCT * Regulatory approval anywhere in the TERRITORY of first LICENSED PRODUCT * 3.5 If, after executing this Agreement, Tanox becomes (a) an AFFILIATE of; or (b) merged with; or (c) acquired by: or (d) an acquirer of, a third party having an equal or greater number of employees than Biogen at the time of such AFFILIATE formation or merger or acquisition, then Tanox shall be obligated to make additional milestone payments in addition to those recited above in Article 3.Inc.