Common use of PRODUCT FORECASTS AND ORDERS Clause in Contracts

PRODUCT FORECASTS AND ORDERS. 10.1 Within [***] of the Effective Date, and thereafter on a [***] basis until the date on which the Purchaser files the first Regulatory Approval Application, the Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a non-binding rolling projection of the Purchaser’s expected volume requirements for Commercial API and Commercial Products for at least the following [***] (the “Volume Projection”). For the avoidance of doubt, the Volume Projection is not a Forecast Schedule and the Purchaser shall not be required to provide any further Volume Projection with effect from the date on which the Purchaser files the first Regulatory Approval Application. 10.2 On the first day of the month following the filing of the first Regulatory Approval Application, and thereafter on the first day of each subsequent month during the Term (or on such other date or at such frequency, as the Parties may agree in writing), the Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a rolling forecast schedule of volume requirements for: (A) Commercial API; and (B) Commercial Products on a SKU-by-SKU basis, in each case, for at least the following [***] or such shorter period as may then remain under the Term (the “Forecast Schedule”). The Forecast Schedule shall show estimates of required Product quantities (by SKU in the case of Commercial Products, which SKUs shall differentiate Commercial Products with regard to packaging configuration, labelling and strength) on a [***]. Notwithstanding the foregoing, the Parties understand and agree that, in order to facilitate a successful commercial launch of Launch Products in each CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. Relevant Launch Market, certain adjustments or deviations to the forecasting and ordering mechanisms set forth in this Agreement may be necessary or useful and, to that end, the Parties shall cooperate in good faith to facilitate such flexibility, as set forth in additional detail in Clause 10.12. 10.3 The quantity requirements shown: (A) in the first [***] in respect of Commercial API; and (B) in the first [***] in respect of Commercial Product, of the Forecast Schedule (the “Firm Zone”) will constitute a binding commitment on the part of the Purchaser to purchase such specified quantities of such Products. 10.4 The Purchaser shall deliver purchase orders or equivalent documentation, corresponding to the Commercial API and Commercial Product volumes shown in each month of the Firm Zone to GSK on a [***]. Each purchase order shall, as applicable, unless otherwise agreed between the Parties: (A) comprise of quantities equivalent to the applicable MOQ (or to for that MOQ plus one or more applicable IOQs). If GSK does (in its discretion) accept a purchase order for a quantity of Product that is not equivalent to the applicable MOQ (or to the MOQ plus one or more IOQs), the Purchaser shall remain liable under Clause 19 (Write Offs) for [***]; and (B) specify the quantities of Product ordered (by SKU and by country, and required Delivery date, which shall: (i) in respect of Commercial Product, not be less than the applicable Lead Time (as set forth on Schedule 1) from the date of the relevant purchase order; and (ii) in respect of Commercial API, not be less than [***] from the date of the relevant purchase order. 10.5 Purchase orders issued by the Purchaser under Clause 10.4 shall be delivered either electronically or by such other means, and to such location or contact person or system, as GSK shall specify in writing. GSK or the Nominated Manufacturer shall respond to each such purchase order received from the Purchaser within [***] of receipt. Provided that the quantity requirements for any purchase order comply with the restrictions set forth in Clause 10.4 and subject to Clause 10.6, GSK shall accept the purchase order (each such order then becoming a “Firm Order”) and its response shall include confirmation of the quantity and the date for Delivery. If GSK does not respond to any purchase order received within such [***] period, then such purchase order shall be deemed to be accepted. 10.6 In the event that discussion is required regarding the timing of Manufacture and Delivery of any Firm Order (or any adjustment to the quantities set forth in the Firm Order), including if the quantities of Commercial API in the Firm Zone exceed the quantities shown API shown in the Forecast Schedule for the period corresponding to the Lead Time for Commercial API, the CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. relevant planning personnel from both Parties will use reasonable endeavours to agree and confirm any necessary changes to the Firm Order concerned and to the Forecast Schedule. Notwithstanding the foregoing, GSK shall have no obligation to agree to any production schedule or Delivery timetable which would exceed GSK’s (or the Nominated Manufacturer’s) anticipated capacity or otherwise present an unreasonable interference with GSK’s (or the Nominated Manufacturer’s) other operations, including any current operational processes (including shift patterns), or allocation of manufacturing capacity (having regard, among other things, to the applicable Lead Time). 10.7 GSK shall use Commercially Reasonable Efforts during Working Hours to satisfy any changes in quantity, Delivery phasing or Delivery dates requested by the Purchaser in respect of a Firm Order or any additional order, provided that: (A) the Purchaser shall [***] in the event it is able to meet such change; and (B) without prejudice to Clause 10.7(A), if the Purchaser wishes to reduce the quantities of Product in any Firm Order and GSK (or the Nominated Manufacturer) agrees to such reduction, the Purchaser shall in any event [***]. 10.8 It is understood that, subject to Clause 10.9 and without prejudice to Clause 19 (Write Offs), the remaining [***] in respect of Commercial Product, and [***] in respect of Commercial API, of each Forecast Schedule (i.e., the period after the applicable Firm Zone) constitutes an estimate of the future Product requirement of the Purchaser and does not comprise a specific purchase requirement or a commitment by the Purchaser to purchase such Product (except as otherwise provided in this Agreement). It is further understood that each such Forecast Schedule does not constitute a commitment by GSK to Manufacture or supply such Product. 10.9 The quantity requirements shown: (A) in the subsequent [***] following the Firm Zone in respect of Commercial API; and (B) in the subsequent [***] following the Firm Zone in respect of Commercial Product; of the Forecast Schedule (the “Capacity Reservation Period”) will constitute an estimate of future Product requirements of the Purchaser for which they require capacity to be reserved at the Manufacturing Site. Notwithstanding that the Purchaser is not obliged to purchase an amount of Product equivalent to the Capacity Reservation Period, if in a Calendar Year the Purchaser purchases less than the volume shown in the Capacity Reservation Period, an additional fee (the “Unused Capacity Fee”) shall become due and payable by the Purchaser for that Calendar Year. The Unused Capacity Fee shall be equal to [***] had the quantity of Products forecast during the Capacity Reservation Period but not subsequently ordered (the “Missing Products”) actually been Manufactured and purchased during that Calendar Year, provided that: (i) the Unused Capacity Fee shall be [***] (whether for GSK or its Affiliates or for any Third Party); and CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. (ii) GSK shall use Commercially Reasonable Efforts to reduce, avoid or otherwise mitigate any such Unused Capacity Fee by so reallocating capacity at the Manufacturing Site as far as practicable. Any Unused Capacity Fee payable under this Clause 10.9 will be invoiced by GSK to the Purchaser after the end of the Calendar Year (such invoice to be paid by the Purchaser in accordance with Clause 13 (Invoice and Payment)). 10.10 For the avoidance of doubt, no Unused Capacity Fee shall be payable pursuant to Clause 10.9 in respect of Missing Products that are Commercial Products for which the Purchaser is required to pay the sum specified in Clause 4.5.

Appears in 2 contracts

Samples: Commercial Manufacturing and Supply Agreement (Roivant Sciences Ltd.), Commercial Manufacturing and Supply Agreement (Dermavant Sciences LTD)

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PRODUCT FORECASTS AND ORDERS. 10.1 Within [***] of the Effective Date, and thereafter on a [***] basis until the date on which the Purchaser files the first Regulatory Approval Application, the 9.1 The Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a non-binding rolling projection of Manufacturer, on the Purchaser’s expected volume requirements for Commercial API and Commercial Products for at least the following [***] (the “Volume Projection”). For the avoidance of doubt, the Volume Projection is not a Forecast Schedule and the Purchaser shall not be required to provide any further Volume Projection with effect from the date on which the Purchaser files the first Regulatory Approval Application. 10.2 On the first day of the month following the filing of the first Regulatory Approval Application, and thereafter on the first day of each subsequent month during the Term (or on such other date or at such frequency, as the Parties may agree in writing), the Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a rolling forecast schedule of volume requirements for: (A) Commercial API; and (B) Commercial Products on a SKU-by-SKU basis, in for each case, Clinical Product and Clinical Placebo for at least the following [***] or such shorter period as may then remain under the Term (the “Forecast Schedule”). The Forecast Schedule shall show estimates of required Product quantities (by SKU in the case of Commercial Products, which SKUs shall differentiate Commercial Products with regard to packaging configuration, labelling and strength) on a [***]] basis for the Firm Zone and thereafter on a [***] basis. Notwithstanding the foregoingWithout prejudice to Clause 2.8, the Parties understand first such Forecast Schedule shall be provided to GSK on the Effective Date. 9.2 The quantity requirements shown for Clinical Product and agree that, Clinical Placebo in order the [***] of the Forecast Schedule (the “Firm Zone”) will constitute a binding commitment on the part of the Purchaser to facilitate a successful commercial launch purchase such specified quantities of Launch Products in each such Products. CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. Relevant Launch Market, certain adjustments or deviations to the forecasting and ordering mechanisms set forth in this Agreement may be necessary or useful and, to that end, the Parties shall cooperate in good faith to facilitate such flexibility, as set forth in additional detail in Clause 10.12. 10.3 The quantity requirements shown: (A) in the first [***] in respect of Commercial API; and (B) in the first [***] in respect of Commercial Product, of the Forecast Schedule (the “Firm Zone”) will constitute a binding commitment on the part of the Purchaser to purchase such specified quantities of such Products. 10.4 9.3 The Purchaser shall deliver purchase orders or equivalent documentation, corresponding to the Commercial API Clinical Product and Commercial Product Clinical Placebo volumes shown in each month [***] of the Firm Zone to GSK on a [***]] basis. Each purchase order shall, as applicable, unless otherwise agreed between the Parties: (A) comprise of quantities equivalent to the applicable MOQ (or to a multiple thereof, each as set forth on Schedule 1) for each Product covered by that MOQ plus one or more applicable IOQs)purchase order. If GSK does (in its discretion) accept a purchase order for a quantity of Product that is not equivalent to the applicable MOQ (or to the MOQ plus one or more IOQsa multiple thereof), the Purchaser shall remain liable under Clause 19 18 (Write Offs) for [***]; and (B) specify the quantities of Product ordered (by SKU and by country), and required Delivery datedate for despatch to the Third Party responsible for undertaking analytical testing of that Product, which shall: (i) in respect of Commercial Product, not shall be no less than the applicable Lead Time (as set forth on Schedule 1) from the date of the relevant purchase order; and . Unless expressly agreed otherwise between the Parties or as otherwise set forth on Schedule 1, (iii) in respect no New Clinical Product or New Clinical Placebo shall have a Lead Time of Commercial API, not be less than [***] from the date and (ii) no New Clinical API shall have a Lead Time of the relevant purchase orderless than [***]. 10.5 9.4 Purchase orders issued by the Purchaser under Clause 10.4 9.3 shall be delivered either electronically or by such other means, and to such location or contact person or system, as GSK shall specify in writing. GSK or the Nominated Manufacturer shall respond to each such purchase order received from the Purchaser within [***] of receipt. Provided that the quantity requirements for any purchase order comply with the restrictions set forth in Clause 10.4 9.3 and subject to Clause 10.69.5, GSK shall accept the purchase order (each such order then becoming a “Firm Order”) and its response shall include confirmation of the quantity and the date for Delivery. If GSK does not respond to any purchase order received within such [***] period, then such purchase order shall be deemed to be accepted. 10.6 9.5 In the event that discussion is required regarding the timing of Manufacture and Delivery of any Firm Order (or any adjustment to the quantities set forth in the Firm Order), including if the quantities of Commercial API in the Firm Zone exceed the quantities shown API shown in the Forecast Schedule for the period corresponding to the Lead Time for Commercial API, the CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. relevant planning personnel from both Parties will use reasonable endeavours to agree and confirm any necessary changes to the Firm Order concerned and to the Forecast Schedule. Notwithstanding the foregoing, GSK shall have no obligation to agree to any production schedule or Delivery timetable which would exceed GSK’s (or the Nominated Manufacturer’s) anticipated capacity or otherwise present an unreasonable interference with GSK’s (or the Nominated Manufacturer’s) other operations, including any current operational processes (including shift patterns), or allocation of manufacturing capacity (having regard, among other things, to the applicable Lead Time)capacity. 10.7 9.6 GSK shall use Commercially Reasonable Efforts during Working Hours to satisfy any changes in quantity, Delivery phasing or Delivery dates requested by the Purchaser in respect of a Firm Order or any additional order, provided that: (A) the Purchaser shall [***] in the event it is able to meet such change; and (B) without prejudice to Clause 10.7(A9.6(A), if the Purchaser wishes to reduce the quantities of Product in any Firm Order and GSK (or the Nominated Manufacturer) agrees to such reduction, the Purchaser shall in any event [***] CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. [***]. 10.8 9.7 It is understood that, subject to Clause 10.9 and that without prejudice to Clause 19 18 (Write Offs), the remaining [***] in respect of Commercial Product, and [***] in respect of Commercial API, of each Forecast Schedule (i.e., the period after the applicable Firm Zone) constitutes an estimate of the future Product requirement of the Purchaser and does not comprise a specific purchase requirement or a commitment by the Purchaser to purchase such Product (except as otherwise provided in this Agreement). It is further understood that each such Forecast Schedule does not constitute a commitment by GSK to Manufacture or supply such Product. 10.9 9.8 Each Party shall notify the other in writing with the name of a technical manager who will be responsible for dealing with all day-to-day operational matters relevant to this Agreement. Unless otherwise agreed between the Parties, the technical managers and other appropriate representatives from each Party shall endeavour to meet no less than once every Calendar Quarter to discuss the forecasts delivered by Purchaser pursuant to this Agreement and other matters relevant to the Manufacture and supply of Products under this Agreement. The quantity requirements shown:Purchaser shall provide to GSK at such meetings all readily available and appropriate data relating to the Products or the Purchaser’s prospective demands and trends for the Products. 9.9 The provisions of this Clause 9 (AProduct Forecasts and Orders) are subject to the provisions of Clause 24 (Capacity Constraints) in the subsequent [***] following the Firm Zone in respect of Commercial API; and (B) in the subsequent [***] following the Firm Zone in respect of Commercial Product; of the Forecast Schedule (the “Capacity Reservation Period”) will constitute event that an estimate of future Product requirements of the Purchaser for which they require capacity to be reserved at the Manufacturing Site. Notwithstanding that the Purchaser is not obliged to purchase an amount of Product equivalent to the Capacity Reservation Period, if in a Calendar Year the Purchaser purchases less than the volume shown in the Capacity Reservation Period, an additional fee (the “Unused Capacity Fee”) shall become due and payable by the Purchaser for that Calendar Year. The Unused Capacity Fee shall be equal to [***] had the quantity of Products forecast during the Capacity Reservation Period but not subsequently ordered (the “Missing Products”) actually been Manufactured and purchased during that Calendar Year, provided that: (i) the Unused Capacity Fee shall be [***] (whether for GSK or its Affiliates or for any Third Party); and CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. (ii) GSK shall use Commercially Reasonable Efforts to reduce, avoid or otherwise mitigate any such Unused Capacity Fee by so reallocating capacity at the Manufacturing Site as far as practicable. Any Unused Capacity Fee payable under this Clause 10.9 will be invoiced by GSK to the Purchaser after the end of the Calendar Year (such invoice to be paid by the Purchaser in accordance with Clause 13 (Invoice and Payment)). 10.10 For the avoidance of doubt, no Unused Capacity Fee shall be payable pursuant to Clause 10.9 in respect of Missing Products that are Commercial Products for which the Purchaser Allocation is required to pay the sum specified in Clause 4.5be made.

Appears in 2 contracts

Samples: Clinical Manufacturing and Supply Agreement (Roivant Sciences Ltd.), Clinical Manufacturing and Supply Agreement (Dermavant Sciences LTD)

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PRODUCT FORECASTS AND ORDERS. 10.1 Within [***] of the Effective Date, and thereafter on a [***] basis until the date on which the Purchaser files the first Regulatory Approval Application, the 9.1 The Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a non-binding rolling projection of Manufacturer, on the Purchaser’s expected volume requirements for Commercial API and Commercial Products for at least the following [***] (the “Volume Projection”). For the avoidance of doubt, the Volume Projection is not a Forecast Schedule and the Purchaser shall not be required to provide any further Volume Projection with effect from the date on which the Purchaser files the first Regulatory Approval Application. 10.2 On the first day of the month following the filing of the first Regulatory Approval Application, and thereafter on the first day of each subsequent month during the Term (or on such other date or at such frequency, as the Parties may agree in writing), the Purchaser shall provide to GSK or (if GSK so directs) the Nominated Manufacturer a rolling forecast schedule of volume requirements for: (A) Commercial API; and (B) Commercial Products on a SKU-by-SKU basis, in for each case, Clinical Product and Clinical Placebo for at least the following [***] or such shorter period as may then remain under the Term (the “Forecast Schedule”). The Forecast Schedule shall show estimates of required Product quantities (by SKU in the case of Commercial Products, which SKUs shall differentiate Commercial Products with regard to packaging configuration, labelling and strength) on a [***]. Notwithstanding ] basis for the foregoing, the Parties understand Firm Zone and agree that, in order to facilitate thereafter on a successful commercial launch of Launch Products in each CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. Relevant Launch Market, certain adjustments or deviations to the forecasting and ordering mechanisms set forth in this Agreement may be necessary or useful and, to that end, the Parties shall cooperate in good faith to facilitate such flexibility, as set forth in additional detail in Clause 10.12. 10.3 The quantity requirements shown: (A) in the first [***] in respect of Commercial API; andbasis. Without prejudice to Clause 2.8, the first such Forecast Schedule shall be provided to GSK on the Effective Date. (B) 9.2 The quantity requirements shown for Clinical Product and Clinical Placebo in the first [***] in respect of Commercial Product, of the Forecast Schedule (the “Firm Zone”) will constitute a binding commitment on the part of the Purchaser to purchase such specified quantities of such Products. [***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, IS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED. 10.4 9.3 The Purchaser shall deliver purchase orders or equivalent documentation, corresponding to the Commercial API Clinical Product and Commercial Product Clinical Placebo volumes shown in each month [***] of the Firm Zone to GSK on a [***]] basis. Each purchase order shall, as applicable, unless otherwise agreed between the Parties: (A) comprise of quantities equivalent to the applicable MOQ (or to a multiple thereof, each as set forth on Schedule 1) for each Product covered by that MOQ plus one or more applicable IOQs)purchase order. If GSK does (in its discretion) accept a purchase order for a quantity of Product that is not equivalent to the applicable MOQ (or to the MOQ plus one or more IOQsa multiple thereof), the Purchaser shall remain liable under Clause 19 18 (Write Offs) for [***]; and (B) specify the quantities of Product ordered (by SKU and by country), and required Delivery datedate for despatch to the Third Party responsible for undertaking analytical testing of that Product, which shall: (i) in respect of Commercial Product, not shall be no less than the applicable Lead Time (as set forth on Schedule 1) from the date of the relevant purchase order; and . Unless expressly agreed otherwise between the Parties or as otherwise set forth on Schedule 1, (iii) in respect no New Clinical Product or New Clinical Placebo shall have a Lead Time of Commercial API, not be less than [***] from the date and (ii) no New Clinical API shall have a Lead Time of the relevant purchase orderless than [***]. 10.5 9.4 Purchase orders issued by the Purchaser under Clause 10.4 9.3 shall be delivered either electronically or by such other means, and to such location or contact person or system, as GSK shall specify in writing. GSK or the Nominated Manufacturer shall respond to each such purchase order received from the Purchaser within [***] of receipt. Provided that the quantity requirements for any purchase order comply with the restrictions set forth in Clause 10.4 9.3 and subject to Clause 10.69.5, GSK shall accept the purchase order (each such order then becoming a “Firm Order”) and its response shall include confirmation of the quantity and the date for Delivery. If GSK does not respond to any purchase order received within such [***] period, then such purchase order shall be deemed to be accepted. 10.6 9.5 In the event that discussion is required regarding the timing of Manufacture and Delivery of any Firm Order (or any adjustment to the quantities set forth in the Firm Order), including if the quantities of Commercial API in the Firm Zone exceed the quantities shown API shown in the Forecast Schedule for the period corresponding to the Lead Time for Commercial API, the CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. relevant planning personnel from both Parties will use reasonable endeavours to agree and confirm any necessary changes to the Firm Order concerned and to the Forecast Schedule. Notwithstanding the foregoing, GSK shall have no obligation to agree to any production schedule or Delivery timetable which would exceed GSK’s (or the Nominated Manufacturer’s) anticipated capacity or otherwise present an unreasonable interference with GSK’s (or the Nominated Manufacturer’s) other operations, including any current operational processes (including shift patterns), or allocation of manufacturing capacity (having regard, among other things, to the applicable Lead Time)capacity. 10.7 9.6 GSK shall use Commercially Reasonable Efforts during Working Hours to satisfy any changes in quantity, Delivery phasing or Delivery dates requested by the Purchaser in respect of a Firm Order or any additional order, provided that: (A) the Purchaser shall [***] in the event it is able to meet such change; and (B) without prejudice to Clause 10.7(A9.6(A), if the Purchaser wishes to reduce the quantities of Product in any Firm Order and GSK (or the Nominated Manufacturer) agrees to such reduction, the Purchaser shall in any event [***] [***] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, IS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED. [***]. 10.8 9.7 It is understood that, subject to Clause 10.9 and that without prejudice to Clause 19 18 (Write Offs), the remaining [***] in respect of Commercial Product, and [***] in respect of Commercial API, of each Forecast Schedule (i.e., the period after the applicable Firm Zone) constitutes an estimate of the future Product requirement of the Purchaser and does not comprise a specific purchase requirement or a commitment by the Purchaser to purchase such Product (except as otherwise provided in this Agreement). It is further understood that each such Forecast Schedule does not constitute a commitment by GSK to Manufacture or supply such Product. 10.9 9.8 Each Party shall notify the other in writing with the name of a technical manager who will be responsible for dealing with all day-to-day operational matters relevant to this Agreement. Unless otherwise agreed between the Parties, the technical managers and other appropriate representatives from each Party shall endeavour to meet no less than once every Calendar Quarter to discuss the forecasts delivered by Purchaser pursuant to this Agreement and other matters relevant to the Manufacture and supply of Products under this Agreement. The quantity requirements shown:Purchaser shall provide to GSK at such meetings all readily available and appropriate data relating to the Products or the Purchaser’s prospective demands and trends for the Products. 9.9 The provisions of this Clause 9 (AProduct Forecasts and Orders) are subject to the provisions of Clause 24 (Capacity Constraints) in the subsequent [***] following the Firm Zone in respect of Commercial API; and (B) in the subsequent [***] following the Firm Zone in respect of Commercial Product; of the Forecast Schedule (the “Capacity Reservation Period”) will constitute event that an estimate of future Product requirements of the Purchaser for which they require capacity to be reserved at the Manufacturing Site. Notwithstanding that the Purchaser is not obliged to purchase an amount of Product equivalent to the Capacity Reservation Period, if in a Calendar Year the Purchaser purchases less than the volume shown in the Capacity Reservation Period, an additional fee (the “Unused Capacity Fee”) shall become due and payable by the Purchaser for that Calendar Year. The Unused Capacity Fee shall be equal to [***] had the quantity of Products forecast during the Capacity Reservation Period but not subsequently ordered (the “Missing Products”) actually been Manufactured and purchased during that Calendar Year, provided that: (i) the Unused Capacity Fee shall be [***] (whether for GSK or its Affiliates or for any Third Party); and CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY [***], HAS BEEN OMITTED BECAUSE DERMAVANT SCIENCES LTD. HAS DETERMINED THE INFORMATION (I) IS NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO DERMAVANT SCIENCES LTD. IF PUBLICLY DISCLOSED. (ii) GSK shall use Commercially Reasonable Efforts to reduce, avoid or otherwise mitigate any such Unused Capacity Fee by so reallocating capacity at the Manufacturing Site as far as practicable. Any Unused Capacity Fee payable under this Clause 10.9 will be invoiced by GSK to the Purchaser after the end of the Calendar Year (such invoice to be paid by the Purchaser in accordance with Clause 13 (Invoice and Payment)). 10.10 For the avoidance of doubt, no Unused Capacity Fee shall be payable pursuant to Clause 10.9 in respect of Missing Products that are Commercial Products for which the Purchaser Allocation is required to pay the sum specified in Clause 4.5be made.

Appears in 1 contract

Samples: Clinical Manufacturing and Supply Agreement (Dermavant Sciences LTD)

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