Common use of Supply of the Active Ingredient Clause in Contracts

Supply of the Active Ingredient. (a) During the term of this Agreement, and subject to the other terms and conditions hereof, ASL shall supply and sell to Reliant and Reliant shall purchase from ASL all of Reliant’s requirements for the Active Ingredient pursuant to the terms of this Agreement. Notwithstanding the preceding sentence, Reliant’s obligation to purchase all of its requirements of API from ASL is contingent upon ASL’s ability to manufacture all Reliant’s requirements, receipt by Reliant of Regulatory Approval and is further subject to Reliant’s obligations to purchase minimum quantities of Active Ingredient from Novartis pursuant to that certain Supply Agreement by and between Reliant and Novartis dated January 10, 2003. (b) During the term of this Agreement and provided that Reliant complies with its purchase obligations set forth herein, ASL shall not supply or sell the Active Ingredient to any other purchaser in the Territory or outside the Territory for sale of any product containing the Active Ingredient inside the Territory without the prior written consent of Reliant (provided, however, that nothing herein shall affect ASL’s ability to manufacture products which are not the Active Ingredient). (c) ASL shall supply Reliant with Active Ingredient meeting the Specifications. All Active Ingredient supplied by ASL to Reliant hereunder shall be consistent with the DMF and NDA and produced in a facility and in a manner compliant with GMP and all other applicable laws, and shall not be adulterated or misbranded within the meaning of the Act and will have expiration dating of at least twenty four (24) months from the date of manufacture. Each shipment of Active Ingredient from ASL to Reliant shall be sampled and analyzed by ASL to determine if the shipment of Active Ingredient meets the Specifications. ASL shall deliver with each shipment of the Active Ingredient a certificate of analysis stating that the Active Ingredient meets the Specifications. ASL shall not relocate or otherwise transfer the site of manufacture of API without the express prior written approval of Reliant in the absence of a force majeure event or unremedied audit deficiencies under Section 2.3 below. Upon delivery to the Designated Facility, title to the Active Ingredient so delivered will be free and clear of any security interest or other encumbrance created by ASL.