EXHIBIT 10.5
AMENDED AND RESTATED
DISTRIBUTION AND LICENSE
AGREEMENT
Dated as March 7, 2001
Amended and restated as of November 16, 2001
Between
PHARMION GMBH
and
INHOCO 2388 LIMITED
(to be renamed PENN T LIMITED)
AMENDED AND RESTATED DISTRIBUTION AND LICENSE AGREEMENT
This Distribution and License Agreement made and effective as of the
7th day of March, 2001 by and between Pharmion GmbH, a Swiss limited liability
company ("Pharmion"), and Penn Pharmaceuticals Ltd., a corporation organized
under the laws of England and Wales ("PPL") is amended and restated as of the
16th day of November 2001 by and between Pharmion and Inhoco 2388 Limited (to be
renamed Penn T Limited), a corporation organized under the laws of England and
Wales ("Penn").
WHEREAS PPL has assigned the benefit subject to the burden of this
Agreement to Penn Pharmaceutical Services Limited ("PPSL") and PPSL has assigned
the benefit subject to the burden of this Agreement to Inhoco 2387 Limited and
Inhoco 2387 Limited has assigned the benefit subject to the burden of this
Agreement to Penn.
WHEREAS Penn manufactures Thalidomide and currently supplies
Thalidomide on a "specials license" arrangement under the trademark
Sauramide(TM); and
WHEREAS, Pharmion has considerable knowledge in obtaining regulatory
approvals, distributing, promoting, detailing and marketing pharmaceutical
products throughout the world and has in place an experienced distribution,
marketing and selling organization to address key markets for sale of
Thalidomide; and
WHEREAS, Pharmion desires to obtain the exclusive right to distribute
Thalidomide manufactured by Penn throughout the Penn Territory (as hereinafter
defined); and
WHEREAS, Pharmion is willing to commit substantial financial resources,
as well as its regulatory development, distribution, marketing and selling
organization to filing and obtaining one or more produce license approvals in
various jurisdictions within the Penn Territory (as defined hereinafter) for one
or more indications for Thalidomide based upon existing and available clinical
data (including possible "orphan drug" indications) and to initiate additional
clinical studies for multiple indications;
WHEREAS, Penn believes that an exclusive distribution and licensing
arrangement with Pharmion regarding Sauramide(TM) would be desirable;
WHEREAS, Pharmion and Celgene Corporation ("Celgene") have entered into
a License Agreement, of even date hereto, pursuant to which Pharmion has
acquired a license to register, distribute, market, use and sell Celgene's
formulation of Thalidomide in a territory including all countries in the world
except the United States, Canada, Mexico, Japan, Korea, Taiwan and China;
WHEREAS, Penn currently manufactures Celgene's formulation of
Thalidomide and is prepared to manufacture such formulation for Pharmion;
WHEREAS, under its agreement with Pharmion, Celgene has agreed to
permit Penn to manufacture Celgene's formulation of Thalidomide for Pharmion;
and
WHEREAS, Penn and Pharmion desire to amend and restate the terms of the
Distribution and License Agreement as provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, Penn and Pharmion hereby agree that this
Distribution and License Agreement be amended and restated in its entirety as
follows:
Article I
DEFINITIONS
As used herein, the following terms shall have the meanings described
below:
"Affiliate" shall mean, with respect to any Person, any other
Person which, directly or indirectly, owns or controls, or is owned or
controlled by, or is under common control with, the specified Person.
For purposes of this definition, the term "control" (including, with
correlative meanings, the terms "controlling", "controlled by", and
"under common control with") as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management of that Person, whether through ownership
of voting securities, by means of contractual arrangements or
otherwise.
"Agreement" shall mean this Distribution and License
Agreement, as the same may be modified, amended or supplemented from
time to time.
"Approval Date" as to any country within the Territory shall
mean the first date upon which any of the Products are approved by the
appropriate health regulatory authority for sale by Pharmion or its
Affiliates or Subdistributors for any specific indication to
independent third parties in such country.
"Celgene Patent Rights" shall mean (i) the patent applications
namely patent application XXX/XX00/00000, Xxxxxxxxxx patent application
62486/94, New Zealand patent application 262076 and European patent
application 94909773; and (ii) any patents hereafter issued or patent
applications hereafter filed by or on behalf of Celgene or any of its
Affiliates in either case, necessary or useful for the registration,
manufacture, distribution, marketing or sale of any of the Products in
the Territory during the term of this Agreement.
"Celgene Product" shall mean formulations of Thalidomide using
the Celgene Technology and manufactured under the Celgene Patent
Rights.
"Celgene Technology" shall mean data, manufacturing know-how,
regulatory submissions and other intellectual property that is either
in the possession of Celgene as of the date hereof or developed by
Celgene during the term of the Pharmion Celgene Agreement in connection
with any additional regulatory approvals to market Products in the
United States (including without limitation STEPS and any clinical data
from pivotal studies relating to the Celgene Products as well as
additional clinical studies relating to the Celgene Products conducted
from time to time by Celgene or any of its Affiliates in
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either case, owned, controlled by, or licensed (with the right of
sub-license) to Celgene and that is necessary or useful to register,
manufacture, distribute, market or sell Celgene Products in the Celgene
Territory;
"Celgene Territory" shall mean all the countries of the world
except the United States, Canada, Mexico, Japan, Korea, Taiwan and
China provided that the exception of Taiwan may be eliminated upon
notice from Pharmion to Penn that Pharmion has obtained a licence from
Celgene with respect to Taiwan and the scope of the Celgene Territory
may be reduced in accordance with the provisions of Section 2.4.
"Confidential Information" shall mean information relating to
the business, products or services of a party to this Agreement which
is either non-public, confidential or proprietary in nature; provided,
however, that Confidential Information shall not include (i)
information which has come within the public domain through no fault or
action of the other party; (ii) information that was known to the other
party on prior to its disclosure hereunder or in connection with the
negotiation of this Agreement; or (iii) information which becomes
rightfully available to the other party on a non-confidential basis
from any third party, the disclosure of which to such other party does
not violate any contractual or legal obligation the third party has to
the first party with respect to such Confidential Information. Without
limiting the generality of the foregoing, Confidential Information
shall include: (x) information which relates to the Products and their
manufacture, sale or use, including financial statements, costs and
expense data, marketing and consumer data, production data, know-how,
trade secrets, secret processes and formulae, technical data and
reports including pharmacological, clinical, chemical, biochemical,
toxicological, pharmacokinetic, manufacturing and formulation data, or
any other information relating to the Products which is not generally
ascertainable from public or published information, regardless of
whether such information was provided pursuant to the terms of this
Agreement, by request of the other party or in any other manner; (y)
information developed or to be developed by a party to this Agreement,
its Affiliates, and/or clinicians, and all material and information
submitted to and/or filed with a governmental regulatory agency or any
other equivalent agency covering the Products; and (z) information
related to the Products contained in all documents submitted in
connection with regulatory submissions throughout the world covering
the Products.
"Contract Year" shall have the meaning set forth in Section
7.7
"Coordinating Committee" shall have the meaning set forth in
Section 8.1.
"Dedicated Containment Facility" shall mean a manufacturing
facility for the manufacture of Thalidomide initially located at Xxxx
00-00, Xxxxxxxxxxxx Xxxxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx, XX00 0XX.
"Effective Date" shall mean the date first written above.
"Future Net Sales" shall mean Penn's and its Affiliates
invoiced sales price of Penn Product billed to unaffiliated customers
in the future (if any) in accordance with the
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provisions of Section 13.3(c) hereof, less: (i) to the extent such
amounts are included in the invoiced sales price, charge-backs for
spoiled, damaged or out-dated product, (ii) quantity and other trade
discounts and early settlement discounts (where such discounts are
effectively non-discretionary and are given as a matter of course)
actually allowed and taken, (iii) transportation, insurance and
handling expenses to the extent chargeable to such sales, (iv) sales,
value-added and other direct taxes incurred, (v) customs duties and
surcharges and other governmental charges incurred in connection with
the exportation or importation of Penn Product, and (vi) legally
mandated rebates, if any
"Minimum Price" shall mean Penn's fully allocated cost of
manufacture of each of the Products, respectively.
"Minimum Royalty" shall mean the minimum royalty specified in
relation to each Contract Year in Exhibit A.
"Net Sales" shall mean Pharmion's and its Affiliates invoiced
sales price of Products billed to unaffiliated customers, less: (i) to
the extent such amounts are included in the invoiced sales price,
actual credited allowances and/or charge-backs for spoiled, damaged,
out-dated and returned product, (ii) quantity and other trade discounts
and early settlement discounts (where such discounts are effectively
non-discretionary and are given as a matter of course) actually allowed
and taken, (iii) transportation, insurance and handling expenses to the
extent chargeable to such sales, (iv) sales, value-added and other
direct taxes incurred, (v) customs duties and surcharges and other
governmental charges incurred in connection with the exportation or
importation of any Products, and (vi) legally mandated rebates, if any.
The parties acknowledge and agree that any part of Net Sales received
by Pharmion or an Affiliate of Pharmion that is computed in a currency
other than U.K. Pounds Sterling will be translated into U.K. Pounds
Sterling as follows: the exchange rate will be the average of: (1) the
rate applicable on the last day of the month prior to the month of
sale, and (2) the rate applicable on the last day of the month in which
the sale was made (each published in the New York edition of the Wall
Street Journal); provided that if between the date such sales were made
and the date the royalty with respect to such sales is payable pursuant
to Section 7.5 the exchange rates change to such a degree so as to
result in significant economic detriment to one of the parties, the
parties will mutually agree on an exchange rate to apply to such Net
Sales that allocates such detriment equally to both parties.
"Person" shall mean any individual, corporation, partnership,
limited liability company, business trust, business association,
governmental entity, governmental authority or other legal entity.
"Pharmion-Celgene Agreement" shall mean that certain License
Agreement, dated as of November 16, 2001, between Celgene, Pharmion and
Pharmion Corporation, as the same may be amended from time to time.
"Penn Product" shall mean Thalidomide, including Penn's
formulation of Thalidomide currently marketed under the tradename
Sauramide(TM), and any other formulation of Thalidomide other than the
formulation of Thalidomide manufactured for
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Celgene Corporation pursuant to that certain Manufacturing Agreement
dated December 1, 1995 (the "Celgene Agreement") or future formulations
of Thalidomide in development by Penn on behalf of Celgene.
"Penn Territory" shall mean all countries throughout the
world, with the exception of the United States and Canada, provided,
that the scope of the Penn Territory may be reduced in accordance with
the provisions of Section 2.4.
"Products" shall mean the Penn Product and/or the Celgene
Product. The term Products shall include, without limitation, finished
and packaged dosage units of the Products and formulated Products in
bulk.
"S.T.E.P.S" shall mean the System for Thalidomide Education
and Prescribing Safety of Celgene;
"Subdistributors" shall mean such sub-distributors or agents
as Pharmion appoints hereunder in accordance with Section 3.5.
"Target" shall mean the net sales figures identified in
relation to each year set out in Exhibit A.
"Territory" means the Celgene Territory and the Penn
Territory.
"Thalidomide" shall mean the drug commonly known as
thalidomide which is represented by the chemical name
2-(2,6-Dioxo-3-piperindinyl)-1H-isoindole-1,3(2H)-dione.
"Trademarks" has the meaning set forth in Section 2.2.
Article II
APPOINTMENT AND LICENSE GRANTS
Section 2.1 Appointment. Penn hereby appoints Pharmion as its exclusive
distributor to launch, detail, promote, advertise, distribute and sell the Penn
Product in every country in the Penn Territory during the term of this
Agreement. Except as otherwise provided in Section 7.1, such exclusivity shall
also extend fully to sales by Penn itself. Without limiting the foregoing,
during the term of this Agreement, Penn will not manufacture (or cause to be
manufactured) any formulation of Thalidomide for distribution or sale by any
Person other than Pharmion within the Penn Territory, provided that, Penn may
manufacture formulations of Thalidomide using the Celgene Technology for
distribution or sale by Celgene (or a distributor or licensee of Celgene) (i)
within Mexico, Japan, Korea, Taiwan and China and (ii) in those territories that
have reverted to Penn pursuant to Section 2.4.
Section 2.2 License. In furtherance of its position as Penn's exclusive
distributor, Penn hereby grants Pharmion an exclusive, royalty free, license
during the term of this Agreement to use Penn's Confidential Information and:
(i) the trademark Sauramide(TM) or such other xxxx(s) as Penn shall cause to be
registered for the Penn Product in the Penn Territory
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from time to time in connection with the promotion, advertising, distribution
and sale of the Penn Product and (ii) if Pharmion does not use trade marks of
Celgene licensed to Pharmion pursuant to the Pharmion-Celgene Agreement in
respect of the Celgene Product, such marks as Penn shall cause to be registered
for the Celgene Product in the Celgene Territory from time to time in connection
with the promotion, advertising, distribution and sale of the Celgene Product.
Collectively the trademarks of Penn referred to in sub-paragraphs (i)
and (ii) above shall hereinafter be referred to as "THE TRADEMARKS").
Section 2.3 Option on Additional Penn Territory. The Penn Territory
shall exclude the United States and Canada. Should Penn or any of its Affiliates
seek to distribute Thalidomide in the United States or Canada, other than
through Celgene pursuant to the Celgene Agreement, Penn agrees to first provide
Pharmion with an option to act as exclusive distributor of Thalidomide and
licensee of Penn's Trademarks in such regions, the terms of which will be
determined by good faith negotiations between the parties at that time.
Section 2.4 Reduction of Territory. On or prior to June 30, 2003,
Pharmion will send written notice to Penn setting forth a list of all of the
countries within the Penn Territory in which Pharmion will commercialize or seek
to commercialize a Penn Product and all the countries within the Celgene
Territory in which Pharmion will commercialize or seek to commercialize a
Celgene Product. Any countries within the world that are not so listed in such
notice shall, effective upon delivery of such notice, be removed from the
definition of the Territory, and from and after the date of delivery of such
notice, all rights to launch, detail, promote, advertise, distribute and sell
the Penn Product in the countries so removed shall revert fully to Penn.
Article III
ACCEPTANCE; MARKETING OBLIGATIONS
Section 3.1 Acceptance. Pharmion shall use all commercially reasonable
endeavors, consistent with applicable legal requirements, to maximize the
commercial potential of the Penn Product within the Penn Territory and the
Celgene Product in the Celgene Territory, each taken as a whole; provided that,
so long as the Pharmion-Celgene Agreement is in effect and Pharmion continues to
use commercially reasonable endeavors to maximize the commercial potential of
the Celgene Product within the Celgene Territory, Pharmion shall have no
obligation to commercialize the Penn Product.
Section 3.2 Promotion Standard. In launching, detailing, promoting,
advertising, distributing and selling the Products, Pharmion shall maintain and
adhere strictly to the therapeutic claims of the Penn Product as approved by the
health authorities in each country in the Penn Territory and the Celgene Product
in the Celgene Territory. All promotional materials prepared by Pharmion and all
promotional activities relating to the Penn Products sold by Pharmion shall
comply with all applicable laws and regulations of the health authorities in
each country in the Penn Territory and all promotional materials and activities
relating to the Celgene Products shall comply with all applicable laws and
regulations in each country in the Celgene Territory in which Pharmion sells the
Penn Products and Celgene Products respectively.
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Section 3.3 Pharmion's Authority/Responsibility. During the term of
this Agreement, except as otherwise expressly herein provided, Pharmion shall
have the right and responsibility to take such actions with respect to the
Products as would normally be done in accordance with accepted business
practices in the marketing of pharmaceutical products and legal requirements to
obtain and maintain the authorization and/or ability to market a pharmaceutical
product in the countries in the Territory and to market the Products within such
countries, including, without limitation, the following:
(a) conducting human clinical trials of the Products as Pharmion
determines are reasonable, necessary or desirable;
(b) making appropriate filings, as contemplated by Article IV, for
the registration of one or more indications for the
therapeutic use of the Products;
(c) marketing the Products in such regions, at such prices and on
such other terms and conditions as Pharmion determines are
reasonable, necessary or desirable;
(d) developing patient and physician educational programs as may
be required by the appropriate health regulatory authorities;
(e) responding to product and medical complaints relating to the
Products (as called for by Section 9.1 hereof, each party
shall promptly advise the other of any such complaints which
it receives from regulators, customers or patients in the
Territory);
(f) with the cooperation of Penn, handling all returns of the
Products;
(g) handling, in accordance with Section 9.2 hereof, all recalls
of the Products;
(h) communicating with any governmental agencies and satisfying
their requirements regarding the authorization and/or
continued authorization to market the Products in commercial
quantities in the Territory; and
(i) handling Product distribution, inventory and receivables;
provided that, so long as the Pharmion-Celgene Agreement is in effect and
Pharmion continues to use commercially reasonable endeavors to maximize the
commercial potential of the Celgene Product within the Celgene Territory,
Pharmion shall have no obligation to take any of the foregoing actions with
respect to the Penn Product
Section 3.4 Notice of Approval Dates. Pharmion shall notify Penn of the
Approval Date in each country within the Territory as soon as practicable after
its occurrence.
Section 3.5 Subdistributors. Pharmion may appoint one or more of its
Affiliates or one or more other Persons to act as a Subdistributor for the Penn
Product in the Penn Territory, provided that:
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(a) Penn has given its written approval in advance (such approval
not to be unreasonably withheld); and
(b) No such appointment will reduce the liability of Pharmion
under this agreement; and
(c) Pharmion shall be liable for the actions and omissions of any
Subdistributor as if the action or omission were Pharmion's
own.
Section 3.6 Sales for Export. Pharmion shall not actively export any
Penn Product from the Penn Territory nor Celgene Product from the Celgene
Territory. Correspondingly, Penn shall not actively export any Products into the
Territory except (a) to Pharmion and (b) to Celgene (or one of its
subdistributors or licensees) as provided in Section 2.1 with respect to (i)
Mexico, Japan, Korea, Taiwan and China and (ii) in those territories that have
reverted to Penn pursuant to Section 2.4.
Article IV
PRODUCT REGISTRATIONS
Section 4.1 Pharmion Registration Activities. Pharmion solely shall be
responsible for obtaining governmental registrations and other licenses and
permits necessary for the promotion, marketing, sale and distribution of the
Penn Product in each of the individual countries within the Penn Territory and
Celgene Product in each of the individual countries in the Celgene Territory
that Pharmion determines to market, sell or distribute the Products. Penn shall
provide Pharmion with such information and other material as Pharmion shall
reasonably request (or as the appropriate health regulatory authorities shall
require) in support of applications for Product registrations. All such
registrations, permits and licenses shall be obtained in the name of Pharmion or
one of its Affiliates or Subdistributors. Pharmion shall provide Penn with
copies of all correspondence and documentation in connection with obtaining such
registrations, licenses and permits reasonably necessary for Penn to comply with
its obligations and warranties contained in this Agreement. Pharmion shall be
responsible for the payment of all product registration fees.
Section 4.2 Regulatory Changes. Each party shall promptly advise the
other party of any known new instructions or specifications relating to the Penn
Product required by the health regulatory authorities of any country within the
Penn Territory and Celgene Product in the Celgene Territory, and the parties
shall confer with respect to the best mode of compliance with such new
requirements.
Article V
SUPPLY
Section 5.1 Exclusive Supply; Requirements. Penn will sell to Pharmion
and Pharmion will purchase from Penn all of Pharmion's requirements of the Penn
Product for sale in the Penn Territory and Celgene Product for sale in the
Celgene Territory, for conducting clinical trials and for such other purposes as
Pharmion shall require.
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Section 5.2 Penn's Supply Efforts. Penn shall use all commercially
reasonable endeavors to manufacture or otherwise supply sufficient quantities of
the Products to Pharmion to satisfy Pharmion's purchase requirements. Penn will
manufacture the Products at the Dedicated Containment Facility or such newer
facility as Penn may establish, provided that such newer facility shall have
regulatory compliance characteristics at least as favorable as the Dedicated
Containment Facility and is otherwise reasonably acceptable to Pharmion. Penn
will provide the Products to Pharmion in bulk with capsules either packaged in
individual blisters or in plastic containers, as Pharmion shall direct.
Section 5.3 Purchase Requirements. Pharmion shall during the term of
this Agreement provide regular three monthly rolling forecasts in writing of its
requirements of the Products for the period of twelve months ahead and any
revisions to those estimates, promptly after they are made. Any orders for
Products shall be delivered by Pharmion to Penn at least sixty (60) days before
the required date for delivery of such Products.
Section 5.4 Shipping Terms. Each shipment of the Products shall be
delivered to Pharmion FCA (Incoterms 2000) to a specified facility of Pharmion
or Pharmion's agent. Penn will cooperate with Pharmion and will arrange for
carriage of the Products to such destinations as Pharmion shall direct and for
insurance of the Products (in such amounts as Pharmion shall determine) in
connection therewith, all at Pharmion's sole cost and expense.
Section 5.5 Acceptance. Pharmion shall, within forty-five (45) days of
receipt of each shipment of Products by Pharmion or Pharmion's agent, notify
Penn in writing of any defect by reason of which Pharmion alleges that the
Products delivered fails to meet the specifications warranted by Penn as
provided in Section 11.1 hereof and which should be apparent on reasonable
inspection. If Pharmion notifies Penn of any defect in a shipment of Products,
Penn shall have the right, but not the obligation, to send one or more quality
control representatives to retest such Products in co-operation with quality
control representatives of Pharmion. Pharmion shall store all shipments of the
Products in accordance with storage specifications established by Penn. In the
event of a disagreement between Pharmion and Penn regarding the quality of one
or more shipments of Products, the parties shall submit samples of the shipment
in question to an independent testing laboratory (selected by mutual agreement
of Pharmion and Penn) to make a determination, which shall be binding upon the
parties, as to the compliance or lack of compliance of such shipment with the
specifications warranted by Penn. Penn shall promptly credit Pharmion for any
defective shipments. If Pharmion fails to give such a notice under this Section
5.5 then, except in respect of any defect which is not apparent on reasonable
inspection, the Products shall be conclusively presumed to meet the
specifications warranted by Penn as provided in Section 11.1 hereof, and
accordingly Pharmion shall be deemed to have accepted the delivery of the
Products in question.
Section 5.6 Pharmion Representative. Pharmion shall have the right to
access Penn's facilities on reasonable notice Section and during normal business
hours when Penn is manufacturing or packaging Products for Pharmion.
Section 5.7 Interruption of Supply. In case of any interruption of
supply by Penn, whether as a result of force majeure events or failure of Penn
for any reason to meet Pharmion's supply requirements, the parties will
cooperate to seek to provide Pharmion with an alternate
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source of supply (including seeking to validate an alternative manufacturing
source) for the period in which (or for the amount of Products that) Penn is
unable to supply Pharmion.
Section 5.8 Technical Agreement. Following the execution and delivery
of this Agreement, the parties will negotiate and enter into a "technical
agreement" pursuant to European Commission Directive 91/356/EEC of 12 June 1991,
article 12 relating to work contracted out in compliance with Good Manufacturing
Practice.
Section 5.9 Conflicting Terms. This Agreement sets forth the entire
understanding between the parties relating to the subject matter hereof and
shall govern all transactions between the parties contemplated hereby. Except
for terms relating only to: quantities, ship dates, packaging instructions and
delivery destinations, none of the terms and conditions contained on any
purchase order, invoice or similar document shall have any effect upon or change
the provisions of this Agreement unless signed by both parties and clearly
indicating that the parties intend to vary the terms hereof.
Section 5.10 PPSL to Manufacture and Supply. Pharmion acknowledges that
Penn may appoint as its agent and sub-contractor PPSL (or such other agent or
sub-contractor as shall be reasonably acceptable to Pharmion as Penn shall
notify to Pharmion in accordance with the terms of this Agreement) to
manufacture and sell Products to Pharmion and act on Penn's behalf in carrying
out all ancillary matters relating thereto. Penn shall be liable to Pharmion for
all the actions and omissions of PPSL or any such other agent or sub-contractor
as if the action or omission were Penn's own. Penn agrees not to terminate any
of the services provided to it under the Services Agreement, of even date
herewith, with PPSL unless, at such time, Penn is fully capable of assuming the
responsibility for such services, and then only upon no less than 30 days
advance notice to Pharmion.
Article VI
PRODUCT PRICING; PAYMENT
Section 6.1 Purchase Price.
(a) Except as provided in paragraph (b) below, Pharmion shall
purchase the Products from Penn at the Minimum Price. Such
pricing shall be subject to annual audit by Pharmion, and
adjustment, if appropriate, as provided in Section 15.3.
(b) During the period between the Effective Date and the second
anniversary of the Effective Date, the price for Products
purchased for the purpose of conducting clinical trials shall
equal fifty percent (50%) of the Minimum Price therefor. If
the aggregate amount of Products purchased at such a reduced
price is not reasonable in amount nor economically or
commercially viable for Penn to produce for Pharmion, Penn
shall be under no obligation to produce or sell the Products
at the reduced price.
Section 6.2 Invoicing; Payment. Penn shall invoice the Products for
each shipment at the then applicable price as specified in Section 6.1 above.
Pharmion shall pay Penn for each
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shipment of Products at the invoiced price within thirty (30) days from the date
of invoice for each shipment, which shall not be earlier than the date of
shipment.
Section 6.3 Currency. All prices for Products shall be quoted by Penn
to Pharmion, and payments by Pharmion to Penn under this Agreement shall be
made, in U.K. Pounds Sterling.
Article VII
ROYALTIES
Section 7.1 Penn Right to Continue Specials License Supply.
Notwithstanding the execution of this Agreement, Penn will have the right, and
will use its commercially reasonable efforts, to continue to supply Penn Product
under a specials license basis in each country in which it currently does so.
Penn will cease its supply of Penn Product under a specials license basis in a
particular country on such date as Pharmion has notified Penn pursuant to
Section 3.4 of the first Approval Date that would enable Pharmion to sell
Products in such country. Penn will keep true and complete records of all Penn
Product supplied under specials licenses as to each region or country in which
it is so supplied (including, without limitation, lists of Persons to whom the
Penn Product is supplied) and will make such records available to Pharmion.
Section 7.2 Royalty. Commencing on the first Approval Date, Pharmion
will pay Penn during the then remaining term of this Agreement a royalty,
payable on a quarterly basis, equal to (a) twenty-eight percent (28%) of Net
Sales of Products in the Territory during such calendar quarter, for the purpose
of calculating royalties payable hereunder, less (b) Pharmion's purchase price
of the units of Products sold during such calendar quarter (as charged to
Pharmion by Penn in accordance with Section 6.1 for purposes other than clinical
trials) based upon a "first-in/first-out" accounting of Pharmion's Products
inventory, subject always to Penn's right to receive Minimum Royalties as
provided in Section 7.7.
Section 7.3 Withholding Tax. Any tax which Pharmion is required to pay
or withhold from royalty payments to be made to Penn under this Agreement shall
be deducted from the amount otherwise due, provided that, in regard to any such
deduction, Pharmion shall give Penn such assistance as may be reasonably
necessary to enable or assist Penn to claim exemption therefrom or a reduction
thereof and shall provide Penn with an official tax certificate as soon as
possible.
Section 7.4 Invoices for Royalties. If required by Pharmion, Penn shall
submit a written invoice addressed to Pharmion for each royalty payment to be
made by Pharmion under this Agreement. Penn shall submit these written invoices
to Pharmion within a reasonable period following the request from Pharmion and
based upon the last quarterly royalty report from Pharmion provided to Penn in
accordance with Section 7.6.
Section 7.5 Royalty Calculation and Payment.
(a) Timing. Royalties shall be calculated and paid to Penn
quarterly, and shall be due as to Net Sales within any of the
United Kingdom, Germany or Australia forty-
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five (45) days following the end of each calendar quarter and
as to Net Sales elsewhere within ninety (90) days following
the end of each calendar quarter.
(b) Currency of Payment. Royalties shall be payable in U.K. Pounds
Sterling.
Section 7.6 Royalty Reports. After the first Approval Date occurring
hereunder and for the remainder of the term of this Agreement, Pharmion shall
submit quarterly payment reports to Penn within (45) days following the end of
each calendar quarter. Such reports shall include, but not be limited to:
(a) An accounting of Net Sales within the Territory during such
quarter on a country by country basis;
(b) An accounting of the purchase price of the units of Products
sold during such quarter; and .
(c) An accounting of Net Sales set out in clauses (a) and (b)
above (in U.K. Pounds Sterling) and the calculation of the
royalty amounts owing to Penn pursuant to this Article VII (in
U.K. Pounds Sterling), including, if applicable, the exchange
rates used in determining the amount of U.K. Pounds Sterling.
Section 7.7 Minimum Royalties. For each twelve month period commencing
with the first day of the calendar quarter which occurs immediately following
the first commercial sale of either of the Penn Product or the Celgene Product
in the fifth country anywhere within the Territory in which Pharmion sells the
Products (a "Contract Year"), if the sum of (x) the amounts paid to Penn
pursuant to Section 7.2(a) and (y) the amounts referred to in Section 7.2(b)
(paid by Pharmion as the purchase price for the relevant units) shall be less
than the Minimum Royalty for such Calendar Year set forth in Exhibit A, then
Pharmion shall make a lump sum payment to Penn in the amount equal to such
shortfall, with such lump sum payment to be made simultaneously with the
payments due to Penn under Section 7.2 in respect of the fourth quarter of such
Calendar Year.
Section 7.8 No Other Royalties. The royalties set out in this Article
VII are the only royalties payable by Pharmion to Penn in connection with the
exclusive distributor and purchase arrangements and licenses granted herein.
Article VIII
COORDINATING COMMITTEE
Section 8.1 Coordinating Committee. The parties shall establish a
committee ("Coordinating Committee") consisting of an equal number of
representatives from each party to act as a forum (i) to periodically review the
progress that has been made in the regulatory approval of the Products and the
marketing of the Products, (ii) to discuss the strategic and tactical plans for
marketing of the Penn Product in the Penn Territory and the Celgene Product in
the Celgene Territory the strategies and programs that should be developed to
maximize sales of the Products, and (iii) to discuss manufacturing and
production processes to minimize the cost of manufacturing of the Products. The
Coordinating Committee shall meet periodically as
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reasonably requested by either party, but in any event no less than
semi-annually within each calendar year of the term of this Agreement, at such
location or by such means as the parties shall agree.
Article IX
COMPLAINTS/RECALLS
Section 9.1 Complaints. To the extent that it has knowledge thereof,
each party shall promptly notify the other in writing of any defect in, or
condition of, the Products which may cause the Penn Product to violate the
applicable laws and regulations of any country in the Penn Territory and the
Celgene Product in the Celgene Territory where the Products are being sold by
Pharmion. Penn and Pharmion shall share with each other all data on complaints
respecting the Products, including, but not limited to, complaints or
information regarding performance or allegations or reports of any effects on a
patient from use of such Products, as soon as such data is available.
Section 9.2 Recall. In the event that either party has reason to
believe that one or more lots of Products should be recalled or withdrawn from
distribution, such party shall immediately notify the other party in writing.
Unless otherwise required by the relevant health regulatory authorities, Penn
will be consulted before Pharmion initiates any recall, but the decision as to
whether or not to initiate a recall of Products in any country in the Territory
shall be Pharmion's alone. Pharmion shall maintain adequate sales and service
records to enable it to carry out any Product recall and to conduct such recall.
If the recall is required because of a modification of the registrations,
permits or licenses for the Product or a failure of the Products to conform to
its specifications as provided to the health authorities in any specific country
in connection with the registration of the Products, Penn shall reimburse
Pharmion for the costs and expenses of such recall, and Penn shall promptly
elect to either replace recalled Products or credit or refund the purchase price
of recalled Products. If the recall is required because of a negligent act or
omission of Pharmion in handling, storage or distribution of the Products, then
such recall shall be conducted by Pharmion, with the cooperation of Penn, at
Pharmion's sole cost and expense and Pharmion shall not be entitled to any such
credits, replacements or refunds from Penn. If such recall is required because
of a joint act or omission, Pharmion, with the cooperation of Penn, shall
conduct the recall and the parties shall negotiate in good faith an appropriate
allocation of the costs and expense of such recall.
Section 9.3 Regulatory Records; Adverse Reactions. Each party shall be
responsible for maintaining such records and making such reports as may be
required in connection with any regulatory approval held by the party. Each
party shall promptly inform the other of all adverse drug experience reports and
other information relating to the safety or effectiveness of the Products which
come to its attention, in a form and within time periods necessary to permit
compliance with the law and regulations of each of the countries within the
Territory.
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Article X
PRODUCT IDENTIFICATION AND TRADEMARK
Section 10.1 Use of Trademarks.
(a) Pharmion undertakes that all Penn Products shall be clearly
and conspicuously marked in conformity with the following
principles unless otherwise required by the appropriate health
regulatory authorities or unless the parties otherwise agree
in writing:
(i) the general style of the marking shall conform with
that developed and adopted by Penn;
(ii) all uses of the Trademarks upon Penn Products and
their labeling and packaging shall be accompanied by
the words: UNDER LICENCE FROM PENN T LIMITED, UNITED
KINGDOM together with the symbol (R) where the
Trademarks are registered in the Territory for goods
of the same type as the Products or the symbol (TM)
where it is not so registered;
(iii) Penn shall be entitled, in its reasonable discretion
and at its sole expense, to require Pharmion to amend
the form of any marking on Penn Products and the use
of the Trademarks.
(b) Except with respect to the data submitted to health regulatory
authorities in accordance with Section 4.1 in connection with
obtaining or continuing authorizations for the Products,
Pharmion shall not make, give or supply any guarantee,
warranty or other undertaking as to the quality or other
attributes of Products that binds or purports to bind Penn
except as may be specifically authorized by Penn in this
Agreement or subsequently, in writing.
(c) Pharmion shall use the Trademarks only in the manner of a
trade xxxx and in connection with the marketing, sale or
description of the Penn Products and upon no other merchandise
and for no other purpose.
(d) The provisions of Section 10.1(a) and (c) shall apply to
Celgene Products where it has been agreed between the parties
pursuant to Section 2.2 that Celgene Products shall be sold by
Pharmion under any of the Trademarks.
(e) Pharmion shall in all respects co-operate fully with Penn at
Penn's expense during the term of this Agreement and
thereafter in protecting and maintaining Penn's exclusive
title to the Trademarks in the Territory and elsewhere and any
registrations thereof and shall give Penn all assistance and
execute all deeds and documents which may be necessary to
register the Trademarks and/or to record Pharmion as a
permitted or registered user thereof in any country forming
part of the Territory or elsewhere in the name of Penn or such
other name as it may select. Penn will, from time to time,
provide Pharmion with a list of all countries in which the
Trademarks are registered.
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(f) Pharmion shall neither during the term of this Agreement nor
thereafter except as herein provided use the Trademarks or any
colourable imitation thereof in any manner whatsoever
including (without limitation) use thereof as or within a
trade xxxx, trade name, company name, commercial name or title
of establishment.
Section 10.2 Ownership of Marks. Pharmion acknowledges that the
Trademarks are and shall remain the property of Penn, and Pharmion disclaims any
rights to such Trademarks other than the rights granted by this Agreement for
the term of this Agreement. Pharmion shall not use the Marks or any other Penn
trademark, trade or brand name for any purpose other than as provided in this
Agreement.
Article XI
WARRANTIES AND INDEMNIFICATION
Section 11.1 Manufacturing Warranty. Penn warrants that in respect of
Products manufactured by Penn (i) the Products shall be produced in accordance
with current good manufacturing practices of each country within the Territory
in which the Products are then being marketed or sold, (ii) when shipped to
Pharmion the Products shall not be adulterated or misbranded and (iii) the
Products shall be otherwise manufactured in accordance with written
manufacturing procedures and finished product specifications (including
packaging specifications) which will meet the requirements set forth in the
governmental approvals of the health regulatory authorities in the Territory. To
the extent permitted by law, Penn HEREBY DISCLAIMS ALL OTHER WARRANTIES
REGARDING THE PRODUCTS, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
Section 11.2 Corporate Authority, etc.. Each party warrants and
represents to the other (i) that it has the full right and authority to enter
into this Agreement, (ii) that all corporate action necessary to authorize the
execution and delivery of this Agreement by such party has been duly and
properly taken, (iii) that this Agreement constitutes a valid obligation of it,
legally binding on it and enforceable in accordance with its terms, subject to
applicable bankruptcy, insolvency, moratorium, reorganization or similar laws
from time to time in effect affecting creditor's rights generally, (iv) that it
is not under any obligation (contractual or otherwise) to any third party that
conflicts with or is inconsistent with the provisions of this Agreement or
impedes its ability to carry out its obligations under this Agreement and (v)
that it is not aware of any other impediment that would inhibit its ability to
perform its obligations under this Agreement.
Section 11.3 Pharmion Indemnification. With respect to Penn Product
sold by Pharmion in the Penn Territory and Celgene Product sold in the Celgene
Territory, Pharmion shall defend Penn, its agents, directors, officers and
employees at its cost and expense, and will indemnify and hold harmless Penn,
its agents, directors, officers, and employees from and against all claims,
demands, costs, losses, expenses or liabilities (collectively "Liabilities")
suffered or incurred by Penn arising from or in relation to the manufacture by
Penn of the Products for Pharmion or the use or consumption of the Products by
any person or otherwise in relation to Products or arising out of the
performance by Penn of the Agreement in whole or in
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part except to the extent that any such Liabilities are caused by or otherwise
due to a breach by Penn of the warranty set forth in Section 11.1 above and the
indemnity set out in Section 12.2.
Section 11.4 Penn Indemnification. Penn shall defend Pharmion, its
agents, directors, officers and employees at its cost and expense, and will
indemnify and hold harmless Pharmion, its agents, directors, officers and
employees, from and against any and all Liabilities arising out of a breach by
Penn of the warranty set forth in Section 11.1 above, including, but not limited
to, any actual or alleged injury, damage, death or other consequence occurring
to any person as a result, directly or indirectly, of the possession, use or
consumption of any Product manufactured by Penn, whether claimed by reason of
negligence, product defect or otherwise, and regardless of the form in which any
such claim is made.
Section 11.5 Indemnification Procedures.
(a) Promptly after the receipt by any party hereto of notice under
Section 11.3 or Section 11.4 of (A) any claim or (B) the
commencement of any action or proceeding, such party (the
"Aggrieved Party") will, if a claim with respect thereto is to
be made against any party obligated to provide indemnification
(the "Indemnifying Party") pursuant to such sections, give
such Indemnifying Party written notice of such claim or the
commencement of such action or proceeding and shall permit the
Indemnifying Party to assume the defense of any such claim or
any litigation resulting from such claim, and, upon such
assumption, shall cooperate fully with the Indemnifying Party
in the conduct of such defense. Failure by the Indemnifying
Party to notify the Aggrieved Party of its election to defend
any such action within a reasonable time, but in no event more
than fifteen days after notice thereof shall have been given
to the Indemnifying Party, shall be deemed a waiver by the
Indemnifying Party of its right to defend such action. If the
Indemnifying Party assumes the defense of any such claim or
litigation resulting therefrom, the obligations of the
Indemnifying Party as to such claim shall be limited to taking
all steps necessary in the defense or settlement of such claim
or litigation resulting therefrom and to holding the Aggrieved
Party harmless from and against any and all losses, damages
and liabilities caused by or arising out of any settlement
approved by the Indemnifying Party or any judgment in
connection with such claim or litigation resulting therefrom.
The Aggrieved Party may participate, at its expense, in the
defense of such claim or litigation provided that the
Indemnifying Party shall direct and control the defense of
such claim or litigation. The Indemnifying Party shall not, in
the defense of such claim or any litigation resulting
therefrom, consent to entry of any judgment, except with the
written consent of the Aggrieved Party, or enter into any
settlement, except with the written consent of the Aggrieved
Party, which does not include as an unconditional term thereof
the giving by the claimant or the plaintiff to the Aggrieved
Party of a release from all liability in respect of such claim
or litigation.
(b) If the Indemnifying Party shall not assume the defense of any
such claim or litigation resulting therefrom within a period
of 15 days from the date of issue of the claim, the Aggrieved
Party may defend against such claim or litigation in such
16
manner as it may deem appropriate and, unless the Indemnifying
Party shall deposit with the Aggrieved Party a sum equivalent
to the total amount demanded in such claim or litigation
within a period of 15 days from the date of issue of the
claim, or shall deliver to the Aggrieved Party a surety bond
in form and substance reasonably satisfactory to the Aggrieved
Party, the Aggrieved Party may settle such claim or litigation
on such terms as it may deem appropriate, and the Indemnifying
Party shall promptly reimburse the Aggrieved Party for the
amount of all reasonable expenses, legal or otherwise,
incurred by the Aggrieved Party in connection with the defense
against or settlement of such claims or litigation. If no
settlement of such claim or litigation is made, the
Indemnifying Party shall promptly reimburse the Aggrieved
Party for the amount of any judgment rendered with respect to
such claim or in such litigation and of all reasonable
expenses, legal or otherwise, incurred by the Aggrieved Party
in the defense against such claim or litigation.
Section 11.6 Insurance Coverage. Each party shall purchase and maintain
from insurance carriers reasonably acceptable to the other insurance at its own
expense to cover liabilities that it may incur in the testing, manufacture,
distribution, sale or use of the Products. Each party agrees to obtain, at
minimum unless otherwise agreed between the parties, Commercial General
Liability Insurance and Product Liability/Clinical Studies Liability, covering
not less than $1,000,000 per occurrence.
In the event that any such policies are on a claims made basis,
coverage shall be maintained for a period of at least five years after the
termination of this Agreement. Each party shall furnish to the other
certificates of insurance, evidencing such insurance and naming the other party
as an additional-insured.
Article XII
PATENT AND TRADEMARK INFRINGEMENT
Section 12.1 Patents Penn hereby notifies and Pharmion acknowledges
such notification by Penn of the existence of certain patent applications made
by Celgene Corporation in Australia, New Zealand and certain European countries
in relation to the Products and/or any aspect thereof. Penn gives no warranties
or representations and accepts no liability that the Products or manufacture,
use, sale of or other dealing in the Products by Pharmion shall not infringe the
rights of any third party. Pharmion hereby accepts that it shall be solely
responsible for any claims, demands, costs, losses, expenses or liability it
suffers arising out of any claim that the Products infringe the patents or
intellectual property or other rights of any third party. Pharmion shall
undertake at its own expense, the defense of any such action, suit or
proceedings and shall manage and control the defense of such action and its
settlement. Pharmion shall defend Penn, its agents, directors, officers, and
employees from and against all claims, demands, costs, losses, expenses or
liabilities suffered or incurred by Penn arising out of any claim that the
manufacture, use, sale of otherwise of the Products infringe the patent or any
other intellectual property or other rights of any third party.
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Section 12.2 Infringement of Trade Xxxx. In the event that a third
party at any time provides written notice of a claim to, or brings an action,
suit or proceeding against, Pharmion or any of its Affiliates, claiming
infringement of its trademark rights by virtue of the use by Pharmion of any of
the Trademarks, Pharmion shall promptly notify Penn of the claim or the
commencement of such action, suit or processing, enclosing a copy of the claims
and/or all papers served. Penn shall undertake, at its expense, the defense of
any such action, suit or proceeding and shall manage and control the defense of
such action and its settlement.
Article XIII
TERM AND TERMINATION
Section 13.1 Term. This Agreement shall commence on the Effective Date
and, except as provided below in this Article XIII, shall extend through the
tenth anniversary of the Approval Date in the United Kingdom (the "Initial
Term"). The term shall be extended thereafter for additional successive two-year
periods, unless and until either party notifies the other party, in writing, of
its intention to cancel such extension as of the end of the then current term;
provided, that, any such non-extension notice shall be given not less than 180
days prior to the end of the then current term. (The Initial Term and all such
successive periods, if any, shall collectively be known as the "term of this
Agreement")
Section 13.2 Termination Rights.
(a) Either party shall have the right to terminate this Agreement:
(i) upon sixty (60) days prior notice to the other in the
event that the other shall commit any material breach
of its obligations hereunder and shall fail to remedy
the same within forty-five (45) after being called
upon in writing to do so; or
(ii) to the extent permitted by law, upon notice to the
other in the event the other party becomes insolvent,
fails generally to pay its debts as they mature,
files a voluntary petition or any answer admitting
the material allegations of, or consents to, an
involuntary petition pursuant to or purporting to be
pursuant to any reorganization or insolvency law of
any jurisdiction, makes an assignment for the benefit
of creditors, or applies for or consents to the
appointment of a receiver or trustee of a substantial
party of its property; or
(iii) in respect of rights relating to the Celgene Product
only, on the expiration or earlier termination of the
Pharmion-Celgene Agreement.
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Section 13.3 Rights and Obligations Upon Termination.
(a) Upon any termination of this Agreement, Pharmion shall
promptly return to Penn or its designee or otherwise cause to
be transferred to Penn all Confidential Information of Penn,
and, except as otherwise required by applicable law or
regulation, shall at the election of Penn return to Penn or
destroy all documents and copy documents (in whatsoever media)
containing such Confidential Information and Pharmion shall
have no further rights to the Confidential Information.
Pharmion shall not after the termination of this Agreement use
in the Territory:
(i) except as provided in clause (e) below, any name or
xxxx confusingly similar to any Trademarks of Penn's
in connection with the sale of any product by
Pharmion; and
(ii) any of the Confidential Information of Penn.
(b) Notwithstanding clause (a) above, in the event this Agreement
is terminated by Pharmion pursuant to Section 13.2(a)(i) or
(ii), at Pharmion's request Penn will provide Pharmion with
(and Pharmion will be entitled to retain) all relevant
know-how and technical information to enable Pharmion to
manufacture the Penn Product or to enable another Person to
manufacture the Penn Product on Pharmion's behalf.
(c) Concurrent with the termination of this Agreement by Penn
pursuant to Section 13.2(a)(i) or (ii), Pharmion shall
transfer to Penn all governmental registrations and other
licenses and permits that Pharmion has obtained for the
promotion, marketing, sale and distribution of the Penn
Product in the Penn Territory, and other Confidential
Information in Pharmion's possession relating exclusively to
the promotion, marketing, sale and distribution of the Penn
Product in consideration for payment by Penn of a royalty of
5% on Future Net Sales for a period of three years from the
date of transfer under this clause. In the event of the
implementation of this clause (c), the provisions of Section
7.5, Section 7.6, Section 15.3 shall survive, mutadis
mutandis, to enable Pharmion to receive from Penn quarterly
royalty payments, royalty reports and audit rights.
(d) Termination of this Agreement in whole or in part shall not
relieve the parties of any amounts owing between them, nor
shall it relieve the parties of their obligations with respect
to the Products distributed hereunder, or with respect to
limiting disclosure and use of Confidential Information. Upon
termination of this Agreement: (i) as a result of Penn's
breach, Pharmion shall have the right either to sell its then
inventory of the Products for a period of three (3) months
following termination, or to return such inventory to Penn for
a price equal to the price paid to Penn therefor, and (ii) for
any reason other than Penn's breach, Penn shall have the right
to repurchase all or any portion of Pharmion's inventory of
Products, at Pharmion's landed cost thereof; and with respect
to any quantities not repurchased by Penn, Pharmion shall have
the right to sell Products, in the ordinary course of
business, for a period of three (3) months following
19
termination. The provisions of Article XI shall survive any
termination of this Agreement.
(e) Upon termination of this Agreement for any reason (other than
by Pharmion pursuant to Section 13.2(a)(i) or (ii)) Pharmion's
right to use the Trademarks shall cease and all rights in,
(insofar as these were granted to Pharmion under this
Agreement) and goodwill attaching to, the Trademarks and the
Penn Product shall revert back to Penn. Where pursuant to
Section 2.2 a trade xxxx of Penn is used in connection with
the promotion, advertising, distribution and sale of Celgene
Product, goodwill attaching to such Trademark and the Celgene
Product shall revert to Penn. Upon termination of this
Agreement by Pharmion pursuant to Section 13.2(a)(i) or (ii),
Pharmion shall be entitled to continue to use the Trademark
for a reasonable period of time following such termination
(not to exceed one (1) year) so as to enable Pharmion to
transition the Penn Product (and where applicable Celgene
Product) to a new tradename, and the provisions of Article X
shall survive for such transitional period. Following such
transitional period, Pharmion's right to use the Trademark
shall cease and all rights in, (insofar as these were granted
to Pharmion under this Agreement) and goodwill attaching to,
the Trademark and the Penn Product (and where applicable the
Celgene Product) shall revert back to Penn.
Article XIV
CONFIDENTIALITY
Section 14.1 Confidentiality. For a period of ten (10) years from the
Effective Date of this Agreement or five (5) years from the termination hereof,
whichever occurs later:
(a) each party shall refrain from the use of Confidential
Information furnished by the other party for any purpose
inconsistent with this Agreement; and
(b) each party shall treat Confidential Information provided that
such disclosure is furnished by the other party as if it were
its own proprietary information and shall not disclose it to
any third party other than its Affiliates or consultants
without the prior written consent of the other party who
furnished such information and subject to the same obligations
of Confidentiality as set out in this Agreement.
Clause (b) above shall not apply where such Confidential Information is
disclosed to comply with the requirements of any law, governmental
order (including a court order), regulation or Internal Revenue Service
request. Recipient shall notify and consult with the disclosing party
prior to such disclosure of information.
Section 14.2 Advertising and Publicity. Subject to Section 14.3 and
except for such disclosures as are deemed necessary in Penn's or Pharmion's, as
the case may be, reasonable judgment to comply with applicable law (such as, by
way of example but not limitation, the securities laws of the United States),
neither Penn nor Pharmion nor anyone acting on its behalf
20
will make any publicly disseminated oral or written disclosure relating or
referring to, or use any advertising or publicity which relates or makes
reference to, the other party, this Agreement or the terms hereof, without in
each case having received the other party's prior approval (which approval will
not be unreasonably withheld or delayed); each party will respond promptly to a
disclosure request, but in any event not later than forty-eight (48) hours from
receipt of such a request. The foregoing restriction shall not apply to any
information which is contained in any previously issued press release or other
disclosure that has been approved by the other party or that is otherwise
indicated on labels, packaging, brochures or similar promotional material
relating to the Products.
Section 14.3 Disclosure Required by Law. In the event that Penn or
Pharmion shall be required to make disclosure of the other's Confidential
Information as a result of the issuance of a court order or other government
process, the party subject to such requirement promptly, but in not event more
than forty-eight (48) hours after learning of such court order or other
government process, shall notify the other party and, at the other party's
expense, the party subject to such requirements shall: (a) take all reasonably
necessary steps requested by the other party to defend against the enforcement
of such court order or other government process, and, (b) permit the other party
to intervene and participate with counsel of its choice in any proceeding
relating to the enforcement thereof.
Article XV
MISCELLANEOUS
Section 15.1 Governing Law; Choice of Forum. The parties agree that
this Agreement shall be governed by and construed in accordance with the laws of
England and Wales.
Section 15.2 Independent Contractor. Pharmion will perform all of its
activities hereunder as an independent contractor, and nothing contained in this
Agreement shall be deemed to create any association, partnership, joint venture,
or relationship of principal and agent between the parties to this Agreement or
any of their respective Affiliates, or to provide either party with the right,
power or authority, whether express or implied, to create any such duty or
obligation on behalf of the other party. No employee or representative of a
party shall have any authority to bind or obligate the other party to this
Agreement for any sum or in any manner whatsoever, or to create or impose any
contractual or other liability on the other party without said party's
authorized written approval.
Section 15.3 Accounting Audits. Each party shall maintain books of
account relating to its payment obligations and reimbursement rights pursuant to
this Agreement, in the case of Pharmion, Net Sales, and in the case of Penn,
Penn's fully allocated cost of manufacturing the Products, all in accordance
with U.K. generally accepted accounting principals with appropriate controls to
insure that transactions are properly recorded. Each party shall have the right,
at its own expense, to have an independent certified public accountant of its
own selection, reasonably acceptable to the other, examine at a time reasonably
acceptable to the other, during normal business hours but not more than once
each calendar year, the relevant books and records of account of the other, to
determine whether appropriate accounting has been made under Section 6.1 and
Article VII hereof. Such independent certified accountant shall treat as
confidential and
21
shall not disclose to the party engaging such accountant any information other
than that which is relevant to the rights of the engaging party hereunder or the
performance by the other party of its obligations hereunder. In the event of a
dispute between the independent certified public accountants of Pharmion and
Penn with respect to any matter called for by this Agreement, the parties shall
select a third independent public accounting firm to arbitrate the dispute,
provided, that such firm shall have the authority only to select from among the
positions of the original two firms that position which it deems most accurate.
The fees of such third firm shall be borne by the party whose position is not
approved of by such arbitrator.
Section 15.4 Manufacturing Audits. Pharmion shall have the right to
conduct an audit of the Penn facility where the Products are being manufactured
at least annually or more frequently if any questions about the quality of the
Products are raised by either party or by a third party.
Section 15.5 Interest Due on Late Payments. If any amount payable by
Pharmion to Penn hereunder is not paid when due, then without limiting any other
rights which Penn may have as a result of such late payment, the amount unpaid
shall bear interest until paid at a rate per annum equal to the prime rate
published and as changed from time to time by Citibank, N.A. New York, New York
(as reported in The Wall Street Journal) plus two and one-half percent (2.5%),
with such interest to be paid on demand together with all costs incurred by Penn
to collect the amounts due hereunder, including but not limited to reasonable
attorneys fees and disbursements.
Section 15.6 Taxes. Each party shall bear all taxes imposed on it as a
result of the performance by such party under this Agreement including, but not
limited to, any sales tax, any tax on or measured by any payment required to be
made hereunder, any registration tax, or any tax imposed with respect to the
granting of licenses or other rights hereunder. The parties shall cooperate
fully with each other in obtaining and filing all requisite certificates and
documents with the appropriate authorities and shall take such further action as
may reasonably be necessary to avoid the deduction of any withholding or similar
taxes from any remittance of funds by Pharmion to Penn hereunder.
Section 15.7 Employees. Neither party shall have any responsibility for
the hiring, firing or compensation of the other party's employees or for any
employee benefits of the other party's employees.
Section 15.8 Assignment. This Agreement shall be binding upon, and
shall inure to the benefit of successors to a party hereto, but shall not
otherwise be assignable without the prior written consent of both parties,
except to the successor or assignee of all or substantially all of a party's
business relating to the licensed Product. In the event all or such part is
assigned or transferred, each party shall notify the other prior to such
assignment or transfer.
Section 15.9 Notices. Any notice required or permitted to be made or
given hereunder shall (except as otherwise expressly provided herein) be in
writing and shall be made or given to the other party by personal in-hand
delivery; by telecopier or telex communication; by first-class mail, postage
prepaid; or by air courier to the mailing or telecopier or telex numbers set
forth below:
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Pharmion GmbH
X/X Xxxx Xxxxxx Xxxxxxx
Xxxxxxxxxxxxxx. 0
0000 Xxxxx
Switzerland
With a copy to:
Pharmion Corporation
0000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Chief Executive Officer
Fax No.: (000) 000-0000
Inhoco 2388 Limited
Xxxxx 00-00 Xxxxxxxxxxxx Xxxxxxxxxx Xxxxxx
Xxxxxxxx
Xxxxx, XX00 0XX
Attention: Chief Executive Officer
Fax No.: x00(0) 0000 000000
or to such other address or telecopier or telex numbers as either party shall
designate by notice, similarly given, to the other party. Notices shall be
deemed to have been sufficiently made or given: (i) if by personal in-hand
delivery, or by facsimile with confirmed transmissions, when performed; (ii) if
mailed, ten (10) days after being deposited in the mail, postage prepaid; or
(iii) by air courier, three (3) days after delivery to the air courier company.
Section 15.10 Force Majeure. In the event that either party is
prevented from performing or is unable to perform any of its obligations under
this Agreement due to any act of God, fire, casualty, flood, war, strike,
lockout, failure of public utilities, injunction or any act, exercise, assertion
or requirement of governmental authority, including any governmental law, order
regulation permanently or temporarily prohibiting or reducing the level of
research, development or production work hereunder or the manufacture, use or
sale of Product, epidemic, destruction of production facilitates, riots,
insurrection, inability to procure or use materials, labor, equipment,
transportation or energy sufficient to meet experimentation or manufacturing
needs; or any other cause beyond the reasonable control of the party invoking
this Section 15.10 provided such party shall have used its best efforts to avoid
such occurrence; such party shall give notice to the other party in writing
promptly, and thereupon the affected party's performance shall be excused and
the time for performance shall be extended for the period of delay or inability
to perform due to such occurrence.
Section 15.11 Waiver. The waiver by either party of a breach or a
default of any provision of this Agreement by the other party shall not be
construed as a waiver of any succeeding breach of the same or any other
provision, nor shall and delay or omission on the part of either party to
exercise or avail itself of any right, power or privilege that it has or may
have hereunder operate as a waiver of any right, power or privilege by such
party.
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Section 15.12 Partial Invalidity. The parties to this Agreement desire
and intend that the terms and conditions of this Agreement be enforced to the
fullest extent permissible under the laws and public policies applied in each
jurisdiction where enforcement is sought. If any particular term or condition of
this Agreement is adjudicated , or becomes by operation of law, invalid or
unenforceable, this Agreement will be deemed amended to delete the portion which
is adjudicated, or which becomes by operation of law, invalid or unenforceable,
provided, however, that where possible, a particular term or condition will be
reduced to the extent necessary to permit the remainder of the particular term
or condition to be enforced, the deletion or reduction to apply only with
respect to the operation of the term or condition and the remainder of this
Agreement to remain in full force and effect. A deletion or reduction of any
term or condition will apply only with respect to the operation of that term or
condition in the particular jurisdiction in which such adjudication is made or
becomes by operation of law, invalid or unenforceable.
Section 15.13 Captions. All captions herein are for convenience only
and shall not be interpreted as having any substantive meaning.
Section 15.14 Integration. This Agreement constitutes the entire
agreement between the parties hereto relating to the subject matter hereof and
supersedes all prior communications and understandings, written or oral, with
respect to this subject. This Agreement may be amended only by means of an
instrument executed in writing by properly authorized representatives of Penn
and Pharmion.
Section 15.15 Counterparts; English language. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original but all of which together shall constitute one and the same instrument.
This Agreement is entered into in the English language. In the event of any
dispute concerning the construction or meaning of this Agreement, reference
shall be made only to this Agreement as written in English and not to any
translation hereof into any other language, and this English language version
shall be controlling for all purposes.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their authorized representatives, in duplicate on the dates written
herein below.
PHARMION GmbH
By /s/ Xxxxxxx X. Xxxxxxx
--------------------------
Date 11/16/01
INHOCO 2388 LIMITED
(to be renamed PENN T LIMITED)
By /s/ X.X. Xxxxxx
--------------------------
Date 16th November 2001
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