EXHIBIT 10.13
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
MANUFACTURING AGREEMENT
This MANUFACTURING AGREEMENT (this "AGREEMENT") dated as of the first day
of January, 2008 (the "EFFECTIVE DATE"), is made by and between BOEHRINGER
INGELHEIM XXXXXX, INC. ("BIRI"), a Delaware corporation (as successor in
interest to XXXXXX LABORATORIES, INC.), and XANODYNE PHARMACEUTICALS, INC.
("XANODYNE"), a Delaware corporation (as successor in interest to AAIPHARMA,
INC. and ELAN PHARMA INTERNATIONAL LIMITED).
WHEREAS, subject to the terms and conditions set forth in this Agreement,
XANODYNE wishes to have BIRI manufacture and supply for XANODYNE certain
palliative care pharmaceutical products; and
WHEREAS, subject to the terms and conditions set forth in this Agreement,
BIRI wishes to manufacture and supply such palliative care pharmaceutical
products for XANODYNE.
NOW THEREFORE, in consideration of the premises and the undertakings of the
parties hereinafter set forth, the parties agree as follows.
SECTION 1. DEFINITIONS
1.1 "AFFILIATE" shall mean, with respect to any PERSON, any PERSON that,
directly or indirectly, controls, is controlled by or is under common control
with such PERSON. A PERSON shall be regarded as in control of another PERSON if
it owns or controls, directly or indirectly, (a) in the case of corporate
entities at least fifty percent (50%) (or the maximum ownership interest
permitted by law) of the equity securities in the subject entity entitled to
vote in the election of directors, and (b) in the case of any entity that is not
a corporation, at least fifty percent (50%) (or the maximum ownership interest
permitted by law) of the equity securities or other ownership interests with the
power to direct the management and policies of such subject entity or entitled
to elect the corresponding management authority, provided, however, that the
term "AFFILIATE" shall not include subsidiaries or other entities in which a
PARTY or its AFFILIATES owns a majority of the ordinary voting power necessary
to elect a majority of the board of directors or other governing board, but is
restricted from electing such majority by contract or otherwise, until such time
as such restrictions are no longer in effect.
1.2 "BATCH" shall mean the quantity of each PRODUCT as either a tablet,
capsule or liquid set forth on Attachment A hereof.
1.3 "CLAIMANT" shall have the meaning set forth in Section 12.3 hereof.
1.4 "COA" shall have the meaning set forth in Section 4.1 hereof.
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1.5 "CONFIDENTIAL INFORMATION" shall have the meaning set forth in Section
9.2 hereof
1.6 "COST" shall mean BIRI's fully burdened costs (including all costs for
[**]) for each PRODUCT, and, solely in the case of [**] costs, allocated for
each PRODUCT consistent with BIRI' s past practices.
1.7 "DEA" shall mean the United States Drug Enforcement Administration.
1.8 "DELIVERY DATE" means the date for the delivery of a PRODUCTS shipment,
as stated in the applicable purchase order plus or minus three calendar days for
such shipment.
1.9 "ENVIRONMENTAL CLAIM" shall mean any claim, investigation or notice
(written or oral) by any PERSON alleging potential liability (including, without
limitation, potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damages, property damages,
personal injuries or fatalities, or penalties) arising out of, based on or
resulting from (a) the presence, release or threatened release into the
environment of, or human exposure to, any MATERIAL OF ENVIRONMENTAL CONCERN at
any location, whether or not owned or operated by BIRI or its AFFILIATES or (b)
activities or conditions forming the basis of any violation, or alleged
violation of, or liability or alleged liability under, any ENVIRONMENT AL LAW.
1.10 "ENVIRONMENTAL LAWS" shall mean all applicable federal, state and
local laws, statutes, rules, regulations, ordinances (including any amendments
thereto), including but not limited to the Comprehensive Environmental Response,
Compensation and Liability Act ("CERCLA"), 42 U.S.C. Section 9601 et seq., and
the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq., the
Federal Water Pollution Control Act, 33 U.S.C. Section 1251 et seq., the Clean
Air Act, 42 U.S.C. Section 1857 et seq., and the Toxic Substances Control Act,
15 U.S.C. Section 2601 et seq., orders, decrees, plans, codes, judgments,
injunctions, notice or demand letters, prohibitions, obligations, schedules,
timetables, standards, conditions or requirements issued, entered, approved or
promulgated thereunder, relating to pollution or protection of human health or
the environment, including laws relating to emissions, discharges, releases or
threatened releases of MATERIALS OF ENVIRONMENTAL CONCERN in, into, onto or upon
the environment (including, without limitation, ambient air, surface water,
ground water, or land) or otherwise relating to the manufacture, processing,
distribution, use, treatment, collection, accumulation, storage, disposal,
transport, or handling of MATERIALS OF ENVIRONMENTAL CONCERN.
1.11 "EPA" shall mean the United States Environmental Protection Agency.
1.12 "EXISTING INVENTORY" shall have the meaning set forth in Section 6.1.
1.13 "FDA" shall mean the United States Food and Drug Administration.
1.14 "GOOD MANUFACTURING PRACTICES" (cGMPs) shall mean current good
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manufacturing practices required by the FDA for the manufacture of each of the
PRODUCTS as set forth under 21 CFR 210 and 211 and cGMPs as otherwise
articulated by the FDA in formal written guidance.
1.15 "GOVERNMENTAL AGENCY" shall mean any United States federal or state
government authority, agency, commission or other instrumentality that has
jurisdiction over the manufacture, marketing, use, sale or distribution of any
of the PRODUCTS and includes, but is not limited to, the FDA, EPA and DEA.
1.16 "GRANDFATHERED PRODUCTS" shall mean those PRODUCTS [**] that are
manufactured by BIRI for XANODYNE and are identified in Attachment A
1.17 "INDEMNI'TOR" shall have the meaning set forth in Section 12.3 hereof.
1.18 "LABELING" shall mean the "label," as defined in Section 20l(m) of the
Federal Food, Drug, and Cosmetic Act, 21 U.S.C. Section 321(m), and the package
inserts accompanying each of the PRODUCTS, and any other written, printed, or
graphic materials accompanying the PRODUCTS, including, but not limited to,
patient instructions or patient medication guides.
1.19 "MANUFACTURING SERVICES" shall mean, with respect to each PRODUCT, the
manufacture, processing and testing (including, without limitation, testing in
accordance with Section 4.1 hereof) of such PRODUCT and the packaging, filling
and LABELING of such PRODUCT in finished dosage form for commercial sale in the
United States in accordance with this Agreement.
1.20 "MANUFACTURING TECHNOLOGIES" shall mean (a) all ACQUIRED ASSETS and
(b) other technologies, proprietary rights and know-how owned by XANODYNE or its
AFFILIATES or to which XANODYNE or its AFFILIATES otherwise have rights which
are necessary for the performance of the MANUFACTURING SERVICES, including, but
not limited to, all manufacturing and packaging processes, trade secrets,
technical information, manufacturing formulae, manufacturing directions,
manufacturing specifications, manufacturing validation, component
specifications, test methods, stability data, validation data of analytical
methods and know-how necessary for the performance of the MANUFACTURING SERVICES
in accordance with the SPECIFICATIONS and other requirements of this AGREEMENT.
1.21 "MARKETING AUTHORIZATION" shall mean the approval to market each of
the PRODUCTS from the FDA, whether as a result of a New Drug Application
(including all supplements and amendments thereto), the Drug Efficacy Study
Implementation ("DESI") program or as a pre-1938 drug having been generally
recognized as being safe.
1.22 "MASTER CONTROL DOCUMENT" shall mean the batch specific documentation
used by BIRI in the production of product for XANODYNE.
1.23 "MATERIAL ADVERSE EFFECT" shall mean any event, change, circumstance
or effect that is or reasonably could be expected to be (a) materially adverse
to the business, assets, operations, results of operations or financial
condition of a PARTY, or any of the PRODUCTS, other than any event, change,
circumstance or effect relating (i) to the economy in general, or (ii) in
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general to the pharmaceutical industry or palliative care medication business,
provided that neither the PARTY nor any PRODUCT is not materially
disproportionately affected as compared to other PERSONS engaged in such
industry or business by such event, change, circumstance or effect; or (b)
materially adverse to the ability of a PARTY to perform any of its material
obligations under this AGREEMENT.
1.24 "MATERIALS OF ENVIRONMENTAL CONCERN" shall mean all chemicals,
pollutants, contaminants, wastes, toxic substances, petroleum, petroleum
products and hazardous substances (as defined in Section 101(14) of CERCLA, 42
U.S.C. Section 9601(14)), or solid or hazardous wastes as now defined under any
ENVIRONMENTAL LAWS.
1.25 "PARTIES" shall mean BIRI and XANODYNE.
1.26 "PARTY" shall mean each of BIRI and XANODYNE.
1.27 "PERSON" shall mean a natural person, a corporation, a partnership, a
limited liability company, an association, a trust, a joint venture or any other
entity or organization, including a GOVERNMENTAL AGENCY.
1.28 "PLANT" means the premises of BIRI situated at 0000 Xxxxxx Xxxx
Xxxxxxxx, Xxxx 00000 or such other FDA approved facility of Manufacturer
approved by Xanodyne for the purpose of MANUFACTURING SERVICES hereunder.
1.29 "PRODUCT FORMULATION" shall mean each dosage form of a PRODUCT (but
not each packaging presentation of a PRODUCT). For example, Oramorph SR TAB 100
mg (1 x 25 blisters) and Oramorph SR TAB 100 mg (100 count bottles) would be the
same PRODUCT FORMULATION while Oramorph SR TAB 100 mg (1 x 25 blisters) and
Oramorph SR TAB 60 mg (1 x 25 blisters) would be different PRODUCT FORMULATIONS.
1.30 "PRODUCTS" shall mean the palliative care pharmaceutical PRODUCTS
identified in Attachment A
1.31 "RAW MATERIALS" means, in relation to the PRODUCTS, the Active
Ingredient(s), excipients and packaging materials used in the MANUFACTURING
SERVICES thereof.
1.32 "SPECIFICATIONS" shall mean the specifications for the composition of
each of the PRODUCTS and the performance of the MANUFACTURING SERVICES with
respect to each of the PRODUCTS and the related raw materials, components,
methods and stability protocols and procedures as set forth in (a) the MARKETING
AUTHORIZATIONS, and (b) the MASTER CONTROL DOCUMENTS utilized by BIRI as of the
EFFECTIVE DATE, as may be amended pursuant to Section 3.2 hereof from time to
time.
1.33 "TECHNICAL AGREEMENT" shall have the meaning set forth in Section 3.7.
1.34 "TRADEMARK AGREEMENT" shall mean that certain Trademark Agreement by
and between the PARTIES (or their AFFILIATES) dated as of the date hereof.
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1.35 "TRANSACTION DOCUMENTS" shall mean the INTERIM DISTRIBUTION SERVICES
AGREEMENT, the INTERIM REGULATORY SERVICES AGREEMENT, the TRADEMARK AGREEMENT
and the ASSET PURCHASE AGREEMENT.
1.36 "UNIT PRICE" means the Price of a Unit identified in Attachment B and
established pursuant to Section 6.
SECTION 2. GRANT OF LICENSE
XANODYNE hereby grants to BIRI a non-exclusive license during the term of
this AGREEMENT to use and otherwise practice the MANUFACTURING TECHNOLOGIES
solely for the purposes of fulfilling its obligations under this AGREEMENT. The
license granted in this Section 2 shall terminate automatically and without
further action by XANODYNE or BIRI upon the expiration or earlier termination of
this AGREEMENT in accordance with Section 10 hereof.
SECTION 3. MANUFACTURE
3.1 Manufacture of Products.
(a) In accordance with the terms of this Agreement, BIRI shall perform
the MANUFACTURING SERVICES with respect to each PRODUCT, XANODYNE shall order
and purchase each of the PRODUCTS in finished dosage form from BIRI, and BIRI
shall sell and deliver such purchased PRODUCTS to XANODYNE. Subject to the terms
and conditions contained herein, BIRI shall perform the MANUFACTURING SERVICES
in accordance with: (i) the SPECIFICATIONS for each of the PRODUCTS; (ii) all
regulations now in place or hereafter established by the FDA (including, but not
limited to, GOOD MANUFACTURING PRACTICES, and 21 C.F.R. Part 11), DEA or any
other GOVERNMENTAL AGENCY that are applicable to the performance of
MANUFACTURING SERVICES with respect to the applicable PRODUCT; and (iii) all
material requirements of other federal, state or local laws and regulations
applicable to the performance of MANUFACTURING SERVICES with respect to the
applicable PRODUCT.
(b) BIRI shall be responsible for (i) obtaining all materials,
ingredients and components required to manufacture each of the PRODUCTS in
accordance with the SPECIFICATIONS; and (ii) supplying all other equipment,
materials and personnel necessary for the performance of the MANUFACTURING
SERVICES and delivery of the PRODUCTS in finished package form to XANODYNE. BIRI
shall maintain in its inventory such quantity of materials, ingredients and
components necessary for BIRI to perform its obligations hereunder in reliance
on Xanodyne's most recently submitted forecast pursuant to Section 5.5.
(c) BIRI shall perform the MANUFACTURING SERVICES at its PLANT in
Columbus, Ohio.
(d) BIRI shall ensure that, at the time of delivery of the PRODUCTS to
a common carrier for shipment to XANODYNE: (a) the PRODUCTS shall conform to the
SPECIFICATIONS; (b) the PRODUCTS shall, subject to XANODYNE's timely provision
of compliant and accurate LABELING and artwork, not be adulterated or misbranded
under applicable laws; and (c) the
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PRODUCTS shall have a remaining shelf life of not less than [**] months on
products with a [**] month expiry and [**] months on products with a [**] month
expiry unless mutually agreed upon by both parties in advance of shipment.
3.2 Changes to Specifications. Either of the PARTIES hereunder shall have
the right to request changes to the SPECIFICATIONS; provided, however, that no
such change shall be implemented unless: (a) the other PARTY gives its prior
written consent to any such changes, which consent shall not be unreasonably
withheld, conditioned or delayed, (b) the PARTIES agree in writing concerning
the implementation date of any such change, and (c) in the event any such change
increases or decreases or is reasonably likely to increase or decrease BIRI'S
COSTS in connection with the performance of the MANUFACTURING SERVICES, the
PARTIES agree in writing upon an equitable adjustment in the payment therefore.
In addition, in the event any change in the SPECIFICATIONS is requested or
required by any GOVERNMENTAL AGENCY, including the FDA, the PARTIES shall meet
and discuss the implications of such change, the costs associated therewith, the
capacity required to implement such change, and the timeframe in which such
change could be implemented. If XANODYNE desires to have BIRI implement such
change and so notifies BIRI in writing, BIRI shall promptly either implement
such change or, in the event BIRI believes the implementation of such change
would be commercially impractical, notify XANODYNE of its decision not to
implement such change. BIRI shall not unreasonably refuse to implement any
change and shall implement all changes that are not commercially impractical
subject to [**]. Prior to implementing any change in the SPECIFICATIONS, the
PARTIES shall agree in writing upon an equitable adjustment in the payments to
BIRI to reflect any increased or decreased COSTS incurred by BIRI as a result of
the implementation of such change. Commencing on the date any change in the
SPECIFICATIONS is implemented, the payments to BIRI shall be adjusted as agreed
in writing, and inventories of PRODUCTS, ingredients, packaging and LABELING
components, and other in process work maintained by BIRI in accordance with
Section 3.1(b) hereof which cannot be used by BIRI as the result of such change
in the SPECIFICATIONS shall be identified by BIRI and purchased by XANODYNE from
BIRI at BIRI'S COST therefore (including any costs associated with shipping
and/or disposing of such materials in accordance with XANODYNE's instructions).
If any change to the SPECIFICATIONS requires FDA or other GOVERNMENTAL AGENCY
approval, such change shall not be implemented until such change has been so
approved. Notwithstanding the foregoing, the COST shall not be increased as a
result of any change, alteration or modification in the event such change,
alteration or modification is related generally to the PLANT or other products
manufactured by BIRI in the PLANT, with the exception of any mandated regulatory
changes required by a Governmental Agency.
3.3 Monitoring of Manufacturing Activities. XANODYNE shall be permitted,
but not obligated, to reasonably monitor all aspects of BIRI'S activities at
BIRI's facilities under this AGREEMENT, provided, however that XANODYNE may only
inspect BIRI's facilities used in the performance of this AGREEMENT, and all
such inspections shall occur at reasonable time intervals, upon reasonable prior
notice and during regular business hours and without unreasonable disruption to
BIRI'S business. BIRI shall make all records regarding its performance under
this AGREEMENT reasonably available for inspection by XANODYNE.
3.4 Notifications Concerning Manufacturing Matters.
(a) BIRI shall (i) promptly, notify XANODYNE of any problems or
unusual
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production situations which have, or are reasonably likely to have, a MATERIAL
ADVERSE EFFECT on BIRI'S ability to perform the MANUFACTURING SERVICES in
accordance with this Agreement or deliver the PRODUCTS to XANODYNE in a timely
manner; and (ii) shall notify XANODYNE of such other matters relating to the
MANUFACTURING SERVICES as required in the TECHNICAL AGREEMENT in accordance with
the terms of the TECHNICAL AGREEMENT.
(b) In the event BIRI is unable to manufacture or have manufactured
and deliver PRODUCTS in sufficient quantities to satisfy XANODYNE's forecasted
requirements, due to any cause, BIRI shall promptly inform XANODYNE of the
expected duration of its inability to manufacture or have manufactured
sufficient quantities of PRODUCTS and shall keep XANODYNE informed on a timely
basis of developments during any such period of time.
(c) BIRI shall notify and, if applicable, provide copies of any
notices or communications to, XANODYNE of any FDA or other GOVERNMENTAL AGENCY
inspection, investigation or other inquiry, or other material governmental
notice or communication, relating to the manufacture of any PRODUCT or to any
facility at which any PRODUCT is manufactured, supplied, processed, tested,
packaged, labeled or shipped, including, but not limited to, any FDA Form 483 or
Warning Letter, promptly within no more than [**] business days after BIRI
becomes aware of such inspection, investigation, inquiry, notice or
communication and shall promptly thereafter provide to XANODYNE a written
summary of all findings and corrective actions(s) taken or planned by BIRI,
including any written responses from BIRI to the FDA or other GOVERNMENTAL
AGENCY.
3.5 Compliance with Applicable Laws. BIRI shall comply with all GOOD
MANUFACTURING PRACTICES and other FDA laws and regulations, DEA laws and
regulations and all material requirements of other applicable laws in carrying
out its duties and obligations under this AGREEMENT, including, without
limitation, maintaining in full force and effect all necessary registrations,
licenses, permits and other authorizations (other than the MARKETING
AUTHORIZATIONS), obtaining any necessary procurement quotas, and filing any
necessary XXXXX reports and other DEA forms, including, without limitation, DEA
Form 222. Notwithstanding the foregoing or any other provision of this Agreement
requiring compliance with laws and/or regulations, the PARTIES acknowledge that
BIRI is currently manufacturing and selling certain PRODUCTS pursuant to
MARKETING AUTHORIZATIONS other than New Drug Applications, and agree that BIRI's
continued manufacture and sale of PRODUCTS in substantially the same manner
pursuant to such MARKETING AUTHORIZATIONS shall not be deemed to be a breach of
this AGREEMENT as a consequence of the absence of an approved New Drug
Application for any such PRODUCT.
3.6 Subcontractors. BIRI may, with XANODYNE's prior written consent, which
consent shall not be unreasonably withheld, conditioned or delayed, subcontract
all or any part of the performance of the MANUFACTURING SERVICES with respect to
all or any of the PRODUCTS, provided that BIRI shall at all times remain
primarily responsible for the performance of its obligations hereunder and that
BIRI shall cause any such subcontractor to agree in writing to be bound by
confidentiality terms substantially similar to those set forth in Section 9
hereof. The PARTIES acknowledge that cost is one of the factors that XANODYNE
may reasonably consider when determining whether to consent to the use of a
particular subcontractor.
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3.7 Technical Agreement. The technical agreement between the PARTIES is
attached hereto as Attachment C and incorporated herein by reference. In the
event of any conflict or inconsistency between the terms of this AGREEMENT and
the terms of such TECHNICAL AGREEMENT, the terms of this AGREEMENT shall govern
the relationship between the PARTIES.
SECTION 4. TESTING; RECEIPT OF PRODUCTS; ACCEPTANCE
4.1 Testing: Certificate of Analysis. BIRI shall test, or have tested, each
BATCH of the finished PRODUCTS using the analytical testing methodologies which
are set forth in the SPECIFICATIONS. BIRI shall furnish XANODYNE with a
Certificate of Analysis ("COA") for each BATCH of the PRODUCTS on or before the
date on which such PRODUCTS are delivered to XANODYNE. BIRI shall retain records
pertaining to all such testing as required by law.
4.2 Rejection/Acceptance Procedures: Non-Conforming Products.
(a) XANODYNE shall be entitled to reject any portion or all of any
shipment of PRODUCTS (or any component thereof) that, at the time of transfer
from BIRI to a common carrier, (i) fails to comply with any of the
SPECIFICATIONS with respect to a particular PRODUCT, (ii) is not suitable for
sale due to (A) the failure to manufacture such PRODUCT in accordance with GOOD
MANUFACTURING PRACTICES or (B) the failure to comply with other FDA laws and
regulations, DEA laws and regulations or material requirements of other
applicable laws (all such PRODUCTS, "NONCONFORMING PRODUCTS", and any of such
events, a "NONCONFORMITY"); provided that XANODYNE notifies BIRI within [**]
days after receipt of the shipment that XANODYNE is rejecting such shipment. If
no such notice is provided by XANODYNE, then XANODYNE shall be deemed to have
accepted the shipment regardless of whether XANODYNE has actually performed any
testing on such PRODUCTS. Notwithstanding the foregoing, in the event XANODYNE
determines after acceptance of a PRODUCT that such PRODUCT is a NONCONFORMING
PRODUCT due to a NONCONFORMITY that was not, and should not reasonably have
been, discovered upon reasonable diligent examination and testing by XANODYNE
upon receipt or otherwise known by XANODYNE, XANODYNE may subsequently revoke
its acceptance of such NONCONFORMING PRODUCTS upon confirmation of such
NONCONFORMITY, provided that it has given to BIRI written notice of its
discovery of the NONCONFORMITY within [**] days after XANODYNE discovers or
should reasonably have discovered such NONCONFORMITY and promptly proceeded to
diligently investigate such NONCONFORMITY and notify BIRI of the results
thereof. Any notification by' XANODYNE to BIRI of NONCONFORMING PRODUCTS shall
indicate the SPECIFICATIONS or other applicable laws or regulations claimed to
be unmet and any pertinent analysis performed by XANODYNE in making this
conclusion.
(b) BIRI shall notify XANODYNE as promptly as reasonably possible, but
in any event within [**] days after receipt of XANODYNE's notice of rejection or
revocation of acceptance, whether it accepts or disputes XANODYNE's assertions
that certain PRODUCTS are NONCONFORMING PRODUCTS.
(c) Whether or not BIRI accepts XANODYNE'S assertion that certain
PRODUCTS
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are NONCONFORMING PRODUCTS, BIRI shall with reasonable promptness replace all
such NONCONFORMING PRODUCTS with PRODUCTS that comply with the SPECIFICATIONS
and were manufactured in accordance with all GOOD MANUFACTURING PRACTICES, other
FDA laws and regulations, DEA laws and regulations and material requirements of
other applicable laws (such PRODUCTS, "REPLACEMENT PRODUCTS"), and XANODYNE
shall pay the total amount originally invoiced in connection with the original
shipment of PRODUCTS within [**] days after receipt of such invoice. Such
payment shall be in addition to any amounts payable to BIRI pursuant to Section
4.2(g).
(d) If BIRI accepts XANODYNE'S assertion that certain PRODUCTS are
NONCONFORMING PRODUCTS, the REPLACEMENT PRODUCTS for such NONCONFORMING PRODUCTS
shall be provided at no cost to XANODYNE. In such circumstances, BIRI shall bear
freight, tax, and insurance costs incurred by XANODYNE in transporting such
replacement PRODUCTS to XANODYNE or its designee at the location to which the
original PRODUCTS were shipped.
(e) If BIRI disputes XANODYNE'S assertion that certain PRODUCTS are
NONCONFORMING PRODUCTS, then at either PARTY'S request an independent testing
laboratory or other appropriately credentialed expert of recognized repute,
mutually agreeable to the PARTIES and subject to confidentiality provisions set
forth in Section 9 below, shall analyze a sample of the allegedly NONCONFORMING
PRODUCTS as necessary to determine whether the rejected PRODUCTS are
NONCONFORMING PRODUCTS. The laboratory or expert shall use such procedures and
tests as such laboratory or expert may consider necessary or appropriate to
reach a conclusion. Both PARTIES agree to cooperate with the independent
laboratory's or expert's reasonable requests for assistance in connection with
its analysis hereunder. Both PARTIES shall be bound by the laboratory's or
expert's results of analysis, which, absent manifest error, shall be deemed
final as to any dispute over NONCONFORMITY. The costs incurred by the laboratory
or expert shall be borne by the losing PARTY, or if the laboratory or expert
cannot place the fault noticed and complained about, then the PARTIES shall
share equally the expenses in connection with such laboratory or expert.
(f) If the independent laboratory or expert determines, or if BIRI
acknowledges the same in writing, that such PRODUCTS were NONCONFORMING
PRODUCTS, then XANODYNE shall have no obligation to reimburse BIRI for the
REPLACEMENT PRODUCTS, except that XANODYNE shall reimburse BIRI to the extent
that the NONCONFORMITY was caused by XANODYNE rather than by BIRI's performance
of the MANUFACTURING SERVICES.
(g) If the independent laboratory or expert determines, or if XANODYNE
acknowledges the same in writing, that such PRODUCTS were not NONCONFORMING
PRODUCTS, then BIRI shall provide an invoice to XANODYNE as of the earlier of
such determination or acknowledgement, which invoices shall set forth: (i) the
purchase price for the REPLACEMENT PRODUCTS as of the date such REPLACEMENT
PRODUCTS were shipped to XANODYNE; together with (ii) all freight, tax, and
insurance costs incurred in transporting such REPLACEMENT PRODUCTS to XANODYNE
or its designee. Such purchase price for the REPLACEMENT PRODUCTS shall be in
addition to the purchase price for the original shipment of the allegedly
NONCONFORMING PRODUCTS. XANODYNE shall pay such invoice within [**]days after
receipt thereof.
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(h) NONCONFORMING PRODUCTS shall, upon mutual agreement by BIRI and
XANODYNE and at BIRI's sole expense, either (i) be returned to BIRI within a
reasonable period of time and relabeled or reworked as permitted in the
MARKETING AUTHORIZATIONS and SPECIFICATIONS, if permitted by the FDA or (ii)
destroyed. Any return and/or destruction of NONCONFORMING PRODUCTS shall be in
accordance with applicable DEA regulations and other federal, state or local
laws and regulations related to the return and/or destruction of controlled
substances.
SECTION 5. QUANTITY; ORDER PROCEDURE
5.1 Purchase and Sale. Subject to the terms and conditions set forth
herein, BIRI shall manufacture and sell to XANODYNE, and XANODYNE shall purchase
from BIRI, such orders for the PRODUCTS as shall be placed from time to time by
XANODYNE on its own behalf and/or on behalf of its distributors during the term
of this AGREEMENT.
5.2 Purchase Orders. XANODYNE shall order PRODUCTS on its standard purchase
order forms (each, a "PURCHASE ORDER") submitted electronically via email to the
BIRI production site in Columbus, OH and also to the BI Service Center in
Ridgefield, CT. no less than [**] months prior to any DELIVERY DATE. In the
event XANODYNE fails to deliver to BIRI a forecast within [**] days of the first
business day of a calendar month then the firm order shall be deemed to be the
forecasted amount for such period in the immediately preceding forecast supplied
by XANODYNE to BIRI. (e.g. Month [**] from the previous months [**]-month
rolling forecast shall become binding due to the aforementioned [**] month
lead-time). Subject to the other terms and conditions of this AGREEMENT, BIRI
shall supply, begin manufacture and sell the PRODUCTS to XANODYNE in the
quantities specified in XANODYNE's PURCHASE ORDER on the DELIVERY DATES
therefore, provided, however that under no circumstances may such PURCHASE
ORDERS for any PRODUCT, individually or collectively, exceed the DEA quotas for
BIRI's manufacture of such PRODUCT. BIRI shall properly request quota based on
the most recent forecast received from XANODYNE in accordance with timelines and
procedures outlined by the Drug Enforcement Administration (DEA). The only
function of the PURCHASE ORDER is to set forth the quantities of PRODUCTS
desired by package size, the quantity of PRODUCTS ordered, the DELIVERY DATE and
the destination of the PRODUCTS. All other terms and conditions set forth in
such PURCHASE ORDERS shall be of no force or effect. XANODYNE agrees to purchase
the PRODUCTS and request delivery thereof in production BATCH quantities or
multiples thereof as defined by BIRI in attachment A.
5.3 Acknowledgments; Confirmations. In addition, within [**] calendar days
following receipt of a PURCHASE ORDER, BIRI shall notify XANODYNE in the event
that: (a) that the PURCHASE ORDER is rejected for noncompliance with the
requirements of this AGREEMENT; or (b) that the PURCHASE ORDER exceeds the
FORECAST, in which case, BIRI shall notify XANODYNE whether it is willing to
supply the PRODUCTS in excess of the FORECAST requested (provided that BIRI
agrees to use commercially reasonable efforts to supply PRODUCTS in excess of
the FORECAST). XANODYNE shall negotiate in good faith any changes in delivery
dates proposed by BIRI. Any changes in the PURCHASE ORDER must be agreed to in
writing by XANODYNE to be binding. Any determination of whether quantities in
excess of the FORECAST shall be manufactured by BIRI must be specifically agreed
to in writing by BIRI to be binding. Once
10
PURCHASE ORDERS have been confirmed by both parties the details of those
PURCHASE ORDERS are to be listed and updated monthly by the BI Service Center in
the "XANODYNE Purchase Orders by Month Report".
5.4 Purchase Requirements. Attached hereto as Attachment D, which is based
on an initial [**] calendar month rolling forecast of purchases of each of the
PRODUCTS, including desired delivery dates (the "INITIAL FORECAST"). XANODYNE
agrees to purchase, at a minimum, the total dollar amount as specified in
Attachment D, for the year 2008 (Total of $[**] according to sales prices
indicated on Attachment B) and 2009 (Total of $[**] according to sales prices
indicated on Attachment B) respectively during the term of this AGREEMENT. In
the event XANODYNE fails to purchase the minimum dollar amount set forth in the
attached forecast in any [**] month period, within [**] days thereafter,
XANODYNE shall pay to BIRI a sum equal to the difference between the total price
that XANODYNE would have been required to pay hereunder and the total price
actually paid by XANODYNE during such period. XANODYNE'S obligation to purchase
the foregoing minimum dollar amount shall be suspended during any period in
which XANODYNE's inability to purchase such minimum dollar amount is
attributable to the fault of BIRI or due to an event of force majeure, which in
each case continues for at least [**] days.
5.5 Forecasts. XANODYNE shall submit to BIRI a new [**] calendar month
rolling forecast of purchases of each of the PRODUCTS, on or before the first
business day of each calendar month thereafter during the term of this
AGREEMENT. XANODYNE will exercise reasonable efforts to level load its
production requirements in recognition of BIRI's finite capacity and the lead
times necessary for production. BIRI will exercise commercially reasonable
efforts to ship any quantities which are in excess of the forecasted quantities,
within [**] months of receipt of a PURCHASE ORDER. XANODYNE shall not submit
orders for PRODUCTS which shall require production by BIRI after the expiration
date of this Agreement. In the event XANODYNE fails to deliver to BIRI a
forecast within [**] days of the first business day of a calendar month then the
firm order shall be deemed to be the forecasted amount for such period in the
immediately preceding forecast supplied by XANODYNE to BIRI. (e.g. the
forecasted amounts from Month [**] of the previous months [**]-month rolling
forecast shall become binding due to the aforementioned three month lead-time
requirement).
SECTION 6. PAYMENT TERMS: SHIPPING
6.1 Purchase of On-Hand Inventory of PRODUCTS. Subject to the terms of this
AGREEMENT, BIRI agrees to sell, and XANODYNE agrees to purchase, the amount of
BIRI's inventory of the PRODUCTS, that meet the shelf life requirements as
detailed in Section 3.1(d), above, existing as of the EFFECTIVE DATE (the
"EXISTING INVENTORY") at the prices set forth in Attachment B. All quantities of
PRODUCTS provided as part of such EXISTING INVENTORY shall be credited toward
fulfillment of the PURCHASE ORDERS issued hereunder for such PRODUCTS and the
minimum purchase requirements as detailed in Section 5.4 without further action
or payment by either PARTY.
6.2 UNIT PRICE of Products. BIRI agrees to sell, and XANODYNE agrees to
purchase, pursuant to the PURCHASE ORDERS the PRODUCTS manufactured by BIRI
pursuant to this Agreement at the UNIT PRICE set forth in Attachment B as such
prices may be adjusted from time to time in accordance with this Agreement.
11
6.3 Shipping. BIRI shall ship each order of PRODUCTS, F.O.B. the BIRI
manufacturing facility in Columbus, Ohio, or its warehouse in Nevada to XANODYNE
or its designee at the location specified, as instructed by XANODYNE in the
applicable PURCHASE ORDER. Freight and insurance shall be charged to and paid by
XANODYNE, and BIRI shall use reasonable efforts to assist XANODYNE in arranging
any desired insurance. Title shall pass to XANODYNE, and the risk of loss, delay
or damage in transit shall be with XANODYNE, from and after delivery to the
designated carrier. BIRI shall package each PRODUCT for shipment in accordance
with its customary practices therefore, unless otherwise specified by XANODYNE,
in which event, any extra costs reasonably incurred by BIRI on account of any
changes requested by XANODYNE shall be reimbursed by XANODYNE.
6.4 Invoices; Payments. All PRODUCTS shall be invoiced by BIRI to XANODYNE
upon shipment thereof, unless XANODYNE requests in writing that BIRI hold such
shipment beyond the delivery date, in which case BIRI shall be entitled to
invoice XANODYNE as of the delivery date provided that BIRI is ready to ship
such PRODUCTS as of such date. Payments for amounts invoiced by BIRI shall be
due and payable to BIRI on or before the [**] day after the date of such
invoice. All payments by XANODYNE to BIRI shall be by wire transfer of
immediately available funds to the bank account(s) designated by BIRI.
6.5 Quantitative Variations. Each PARTY shall notify the other PARTY in
writing of any quantitative deficiencies or over delivery in any shipment of any
PRODUCT, which deficiencies or over delivery the notifying PARTY believes to
have existed prior to transfer from BIRI to a common carrier, within [**] days
after receipt of such shipment by XANODYNE. The PARTIES shall investigate such
deficiency or over delivery and, if the PARTIES agree that such deficiency or
over delivery existed prior to transfer from BIRI to the common carrier, BIRI
shall issue an amended invoice for such shipment to XANODYNE crediting XANODYNE
for any deficiency or invoicing XANODYNE for any over delivery, as the case may
be. In the event that a PARTY disputes the other PARTY's determination of any
quantitative deficiency or over delivery or the fault therefore, the PARTIES
shall attempt to resolve such dispute in good faith. If the PARTIES'
investigation indicates that any quantitative deficiency is the result of theft
or significant loss of product, XANODYNE shall provide written notification of
the theft or loss to the local DEA field office by filing a DEA Form 106, as
appropriate.
6.6 Variations in BATCH size. The PARTIES acknowledge that the quantities
of PRODUCT in any given BATCH may vary from the amounts set forth on Attachment
A. In the event the quantity of PRODUCTS in any BATCH delivered to XANODYNE
varies by more than ten percent ([**]%) from the quantities set forth on
Attachment A, the PARTIES shall mutually agree on how the variance shall be
addressed.
6.7 Pricing Adjustments. Subject to any price adjustments resulting from a
change in SPECIFICATIONS pursuant to Section 3.2 which may be reflected as of
the implementation of such change, the prices set forth in Attachment B shall
remain in effect for twelve (12) months from and after the EFFECTIVE DATE and
thereafter, BIRI shall adjust the prices no more than [**] each twelve (12)
month period in accordance with the following: (a) the prices shall be adjusted
to reflect any increase or decrease in BIRI'S COSTS for materials and (b) BIRI
may increase the portion of the price attributable to overhead and labor,
provided, however, that the increase in the portion
12
attributable to overhead and labor in any period shall not exceed the percentage
increase (if any) in the Pharmaceutical Producer Price Index during the
preceding twelve (12) month period. The "Pharmaceutical Producer Price Index"
shall mean the Producer Price Index (PPI All Industries) for "Pharmaceutical
preparations, prescriptions" for the then current year (or the most recent
period for which it is available) published by the United States Bureau of Labor
Statistics and currently available at xxxx://xxxxx.xxx.xxxxxxxxxxx.xxx.
Notwithstanding the foregoing, in the event there is a price increase of [**]
percent ([**]%) or more in the cost to BIRI for the active ingredient of any of
the PRODUCTS, BIRI may immediately increase the prices for such PRODUCTS, upon
written notice thereof to XANODYNE and the exhaustion of BIRI's inventories of
such active ingredient, and BIRI shall supply reasonable supporting
documentation to XANODYNE detailing such price increase. BIRI shall use
commercially reasonable efforts to mitigate the effects of any such price
increases in the costs for an active ingredient.
6.8 Pricing Audits. Subject to the confidentiality provisions of Section 9,
during the term of this Agreement and for a period of [**] after its termination
or cancellation, XANODYNE shall have the right to have an independent certified
public accounting firm to which BIRI has no reasonable objection, examine the
relevant books and records of BIRI for the previous [**] at the place where such
records are customarily kept, for the purpose of verifying the accuracy of
BIRI's calculation of COSTS. The full cost of such audit shall be paid by
XANODYNE, unless such audit discloses an overpayment of more than [**] percent
([**]%) or [**] dollars ($[**]), whichever is larger from BIRI'S calculation of
COST, in which case BIRI shall bear the full cost of the audit. In the event
that BIRI disputes the results of XANODYNE'S audit, the PARTIES shall attempt to
resolve such dispute in good faith. Any amounts that are determined or agreed to
be due and owing by one PARTY to the other shall be promptly paid.
6.9 Taxes. If XANODYNE is required to deduct or withhold for or on account
of any tax required by applicable laws or regulations, XANODYNE shall (a) pay to
the relevant authorities the full amount required to be deducted or withheld,
(b) forward to BIRI an official receipt (or certified copy) or other
documentation reasonably acceptable to BIRI evidencing payment to such
authorities. Promptly after the EFFECTIVE DATE, XANODYNE shall furnish to BIRI a
valid blanket state resale exemption certificate.
SECTION 7. LABELS AND LABELING
7.1 Labeling. XANODYNE shall specify the trade name, trade dress, trademark
and the name of the distributor, if any, which will appear on the LABELING.
XANODYNE will also specify the exact wording which is to appear on the LABELING
as provided in Section 7.2 below. No LABELING shall be used by BIRI which has
not first been approved by XANODYNE in writing; provided, however, that once
particular LABELING has been approved by XANODYNE, BIRI may continue to use such
LABELING, unless otherwise notified in writing by XANODYNE, without obtaining
any additional prior approval. XANODYNE shall ensure that all LABELING for the
PRODUCTS is accurate, non-infringing and in compliance with all laws and
regulations applicable to the LABELING of the PRODUCTS and shall make any
modifications to such LABELING as may be required by applicable laws and
regulations from time to time.
7.2 Artwork for LABELING. XANODYNE, at [**], shall provide to BIRI
camera-ready artwork for the LABELING. Any changes or revisions to such artwork
shall be at [**].
13
SECTION 8. REGULATORY MATTERS
8.1 Adverse Experience Reports and Product Complaints. BIRI shall promptly
submit to XANODYNE all adverse drug experience information and customer
complaints brought to the attention of BIRI in respect of any of the PRODUCTS,
as well as any material events and matters concerning or affecting the safety or
efficacy of any of the PRODUCTS. In addition, BIRI shall, at its own cost and
expense, and consistent with its past practices, use commercially reasonab1e
efforts to assist XANODYNE in connection with the investigation of and response
to any adverse drug experience or complaint to the extent such experience or
complaint relates to the MANUFACTURING SERVICES. XANODYNE shall be solely
responsible for all required reporting of adverse experiences for the PRODUCTS.
XANODYNE shall notify BIRI promptly of any serious and unexpected adverse events
that XANODYNE reasonably believes may be related to the MANUFACTURING SERVICES.
8.2 Recalls. The decision to initiate a recall, market withdrawal or other
corrective action (collectively, a "Recall") shall be made by Xanodyne in its
sole discretion. Xanodyne shall bear the cost of all Recalls of Product, and
BIRI shall reimburse XANODYNE on a monthly basis for all of its reasonable
direct out of pocket costs and expenses, including notification, shipping and
handling charges and amounts refunded or credited to customers incurred in
respect of any RECALLS relating to the PRODUCTS deemed to be necessary by
XANODYNE in XANODYNE's commercially reasonable judgment, to the extent that such
RECALL results from or arises out of (i) any breach of any representation,
warranty or covenant contained in this AGREEMENT by BIRI or (ii) any other
wrongful or negligent act or omission by BIRI in connection with the performance
of its obligations hereunder. XANODYNE shall reasonably consult with BIRI and
take into consideration BIRI's reasonable recommendations regarding such
RECALLS; except XANODYNE shall not be required to consult with BIRI in advance
to the extent exigent circumstances preclude prior consultation. In addition,
XANODYNE shall use commercially reasonable efforts to mitigate the costs and
expenses associated with any such RECALL.
8.3 DEA Quotas.
(a) BIRI shall file timely requests for renewal of DEA manufacturing,
procurement and production quotas for the PRODUCTS based on the quantities
ordered and forecasted by XANODYNE in accordance with this AGREEMENT.
(b) In addition, BIRI shall, upon the reasonable request of XANODYNE, use
reasonable efforts to assist XANODYNE in obtaining from the DEA manufacturing,
procurement and/or production quotas for the manufacture of the PRODUCTS by or
on behalf of XANODYNE during the [**] month period following the termination of
this AGREEMENT.
8.4 FDA Filing for GRANDFATHERED PRODUCTS. XANODYNE must [**]. On a product
by product basis XANDOYNE will [**], or at Xanodyne's option [**]. If FDA
requires [**], then [**]. [**].
8.5 Product / Production Changes and Optimizations. BIRI shall, upon
reasonable request, provide XANODYNE with cost estimates for any new product,
process, product optimization or
14
changes, including but not limited to shelf-life extension, production equipment
modification, current product changes or new product launches or development
that are desired by XANODYNE or required by BIRI, FDA or any other government or
regulatory agency. BIRI will not undertake any requested production changes or
product optimizations without either a Purchase Order or a signed Statement of
Work from XANODYNE.
SECTION 9. CONFIDENTIALITY
9.1 Confidentiality. Each PARTY acknowledges that it may receive
CONFIDENTIAL INFORMATION of the other PARTY in the performance of this
AGREEMENT. Each PARTY shall use commercially reasonable efforts to safeguard and
to hold such CONFIDENTIAL INFORMATION received by it from the other PARTY in
confidence, and shall limit disclosure of the furnishing PARTY's CONFIDENTIAL
INFORMATION to those employees and consultants of the receiving PARTY and its
AFFILIATES who are bound by a written obligation of confidentiality to the
receiving PARTY that is consistent the terms of this section 9. Each PARTY shall
not, directly or indirectly, disclose, publish or use for the benefit of any
third party or itself, except in carrying out its duties hereunder, any
CONFIDENTIAL INFORMATION of the other PARTY, without first having obtained the
furnishing PARTY's written consent to such disclosure or use.
9.2 Definition of "Confidential Information". For the purposes of this
Section 9, "CONFIDENTIAL INFORMATION" means the terms of this Agreement and any
information, technical data or know-how relating to the disclosing party's
ideas, products, technology, customers, markets, developments, inventions,
clinical data, efficacy and safety data, adverse event information, formulas,
methods and processes, specifications, pricing information (including discounts,
rebates and other price adjustments) and other terms and conditions of sales,
customer information, business plans, and all other intellectual property
disclosed to the receiving PARTY by the disclosing PARTY, whether patentable or
not, whether communicated orally, or in writing, in graphic or electromagnetic
form or otherwise. This restriction shall not apply to any information within
the following categories:
(a) information that is independently developed by employees, agents,
or independent contractors of the receiving PARTY or its AFFILIATES without
reference to or reliance upon the information furnished by the disclosing PARTY,
as evidenced by written records or other competent proof;
(b) information disclosed to the receiving PARTY or its AFFILIATES by
a third party that has a right to make such disclosure; or
(c) any other information that becomes part of the public domain
through no fault or negligence of the receiving PARTY.
9.3 Permitted Disclosures. The receiving PARTY shall also be entitled to
disclose the other PARTY's CONFIDENTIAL INFORMATION that is required to be
disclosed in compliance with applicable laws or regulations or by order of any
governmental body or a court of competent jurisdiction provided, that the PARTY
required to disclose such information shall use commercially reasonable efforts
to obtain confidential treatment of such information by the agency or court or
other
15
disclosee, and shall provide the other PARTY with a copy of the proposed
disclosure in sufficient time to allow reasonable opportunity to comment
thereon.
9.4 Survival. The obligations of each PARTY under this Section 9 shall
remain in full force and effect for ten (10) years following termination or
expiration of this Agreement.
SECTION 10. TERM/TERMINATION
10.1 Term. This AGREEMENT shall commence on the EFFECTIVE DATE and continue
for a period not to exceed two (2) years from the EFFECTIVE DATE.
10.2 Termination.
(a) This AGREEMENT may be terminated by XANODYNE with respect to any
PRODUCTS at any time without cause upon the giving of BIRI at least nine (9)
months prior written notice.
(b) Either PARTY may terminate this AGREEMENT for material breach or
default if such material breach or default is not cured within sixty (60) days
after the giving of written notice by the other PARTY specifying such breach or
default, or, in the case of any default of any payment obligation, such default
is not cured within fifteen (15) days after the receipt of written notice by the
other PARTY specifying such payment default. Waiver by either PARTY of a single
default or a succession of defaults shall not deprive such PARTY of any right to
terminate this AGREEMENT arising by reason of subsequent default.
(c) If either XANODYNE or BIRI shall commence as debtor to any
proceedings under any bankruptcy, insolvency, reorganization, readjustment of
debt, dissolution or liquidation law or statute of the federal government or any
state government or any subdivision of either now or hereafter in effect; or if
any such proceedings shall be commenced against either PARTY, or any trustee or
receiver in respect of either PARTY shall be appointed in any such proceedings,
and any such PARTY shall by any act or failure to act indicate approval of, or
consent to or acquiescence in such proceedings or in the appointment of any such
trustee or receiver, or if any such proceedings brought against either PARTY
shall be approved by any court or shall remain undismissed for sixty (60) days;
or if any warrant of attachment shall be issued against all, or substantially
all, of the assets of either PARTY and shall not be released within sixty (60)
days after its levy, then, in any such case, such other PARTY not involved in
such proceedings, other than a creditor, shall have the option to terminate this
AGREEMENT by written notice and upon the giving of such notice this Agreement
shall immediately terminate.
10.3 Procedures Upon Termination.
(a) Purchase of RAW MATERIALS On-Hand. In the event this AGREEMENT is
terminated pursuant to Section 10.2, BIRI shall invoice to XANODYNE, and
XANODYNE shall pay, an amount equal to the cost of all RAW MATERIALS, in BIRI's
possession or in transit to BIRI as
16
of such date of expiration or termination, provided that BIRI demonstrates that
such RAW MATERIALS (i) were purchased in reasonable quantities in reliance on
XANODYNE's most recently submitted forecast pursuant to Section 5.4 and (ii) are
in compliance with all relevant Specifications and otherwise fit for commercial
use; provided, however, that BIRI agrees to offset the amount due from XANODYNE
pursuant to this Section 10.3 by the Acquisition Cost of any Raw Materials which
BIRI may use for production of other products during the six months immediately
following the date of such termination. BIRI shall return, transfer or dispose
of Active Ingredient(s) as reasonably requested by XANODYNE. All reasonable
expenses related to return transfer or disposal of RAW MATERIALS shall be paid
by XANODYNE.
(b) Purchase of PRODUCT. Upon the expiration or termination of this
AGREEMENT by either PARTY, for any reason other than BIRI's breach, XANODYNE
shall purchase from BIRI all remaining PRODUCTS manufactured in accordance with
Article 3 and 5 of this Agreement, at the prices then in effect.
(c) Accrued Obligations: Survival. Termination of this AGREEMENT for
any reason shall not relieve the PARTIES of any obligation accruing prior
thereto and shall be without prejudice to the rights and remedies of either
PARTY with respect to any antecedent breach of the provisions of this AGREEMENT.
Without limiting the generality of the foregoing, no termination of this
Agreement shall serve to terminate the obligations of the PARTIES hereto under
Sections 1, 8.1, 8.2, 8.3(b), 9, 10.3, 11, 12 and 14, and such Sections shall
survive the termination or expiration of this AGREEMENT.
(d) Return of Confidential Information and Materials. On the
termination or expiration of this AGREEMENT, for any reason, XANODYNE and BIRI
each shall return to the other all CONFIDENTIAL INFORMATION which it or its
AFFILIATES or any of its or their respective designees, officers, directors or
employees possess or control that belongs to the other, except that each may
retain a copy solely for record-keeping purposes.
10.4 Transfer of MANUFACTURING TECHNOLOGIES and Transition of MANUFACTURING
SERVICES. During the term of this Agreement (upon XANODYNE's request) and
following the expiration or termination of this AGREEMENT, BIRI shall provide
reasonable assistance to XANODYNE, as mutually agreed upon, at XANODYNE'S
expense, in transferring to XANODYNE the MANUFACTURING TECHNOLOGIES and other
records and materials relating to the MANUFACTURING SERVICES in BIRI's
possession and transitioning the MANUFACTURING SERVICES to XANODYNE.
SECTION 11. REPRESENTATIONS AND WARRANTIES
11.1 Representations of BIRI. BIRI represents and warrants to XANODYNE as
follows:
(a) BIRI is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. BIRI has the requisite
corporate power and authority to own, operate and lease the properties that it
purports to own, operate or lease and to carry on its business as it is now
being conducted and is duly licensed or qualified as a foreign corporation in
each domestic or foreign jurisdiction in which the nature of the business
conducted by it or the character or the location of the properties owned or
leased by it makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified would not, individually or in the
17
aggregate, reasonably be expected to have a MATERIAL ADVERSE EFFECT.
(b) The execution, delivery and performance by BIRI of this AGREEMENT
and the consummation of the transactions contemplated hereby are within BIRI's
corporate powers and have been duly authorized by all necessary corporate action
on the part of BIRI. This AGREEMENT is a legal, valid and binding obligation of
BIRI, enforceable against BIRI in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
reorganization, or similar laws from time to time in effect which affect the
enforcement creditors' rights generally and by legal and equitable limitations
on the availability of specific performance and other equitable remedies against
BIRI.
(c) The execution, delivery and performance by BIRI of this AGREEMENT
do not and will not (i) contravene or conflict with the Certificate of
Incorporation or Bylaws of BIRI, (ii) contravene or conflict with or constitute
a violation of any applicable federal or state law, rule or other regulation,
(iii) contravene or conflict with or constitute a violation of any writ,
judgment, decree, injunction or similar order of any GOVERNMENTAL AGENCY binding
upon BIRI, or (iv) contravene or conflict with or constitute a breach or default
under any contract or agreement binding upon BIRI. The execution, delivery and
performance by BIRI of this AGREEMENT and the consummation by BIRI of the
transactions contemplated hereby and thereby will not require any notice to,
declarations or filing with, or the consent, waiver, approval, or authorization
of, any GOVERNMENTAL AGENCY or other PERSON.
(d) EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT OR ANY OF THE
TRANSACTION DOCUMENTS, (i) BIRI MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND
WHATEVER OR AS BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND (ii) BIRI
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES, INCLUDING
WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, WARRANTY OF FITNESS FOR A
PARTICULAR PURPOSE, NONINFRINGEMENT, OR PROFITABILITY.
11.2 Representations of XANODYNE. XANODYNE represents and warrants to BIRI
as follows:
(a) XANODYNE is a private company duly organized. XANODYNE has the
requisite corporate power and authority to own, operate and lease the properties
that it purports to own, operate or lease and to carryon its business as it is
now being conducted and is duly licensed or qualified as a foreign corporation
in each domestic or foreign jurisdiction in which the nature of the business
conducted by it or the character or the location of the properties owned or
leased by it makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified would not, individually or in the
aggregate, reasonably be expected to have a MATERIAL ADVERSE EFFECT.
(b) The execution, delivery and performance by XANODYNE of this
AGREEMENT and the consummation of the transactions contemplated hereby are
within XANODYNE's corporate powers and have been duly authorized by all
necessary corporate action on the part of XANODYNE. This AGREEMENT is a legal,
valid and binding obligation of XANODYNE, enforceable against XANODYNE in
accordance with its terms, except as such
18
enforceability may be limited by applicable bankruptcy, insolvency, moratorium,
reorganization, or similar laws from time to time in effect which affect the
enforcement creditors' rights generally and by legal and equitable limitations
on the availability of specific performance and other equitable remedies against
XANODYNE.
(c) The execution, delivery and performance by XANODYNE of this
AGREEMENT do not and will not (i) contravene or conflict with the applicable
organization documents of XANODYNE, (ii) contravene or conflict with or
constitute a violation of any applicable federal or state law, rule or other
regulation, (iii) contravene or conflict with or constitute a violation of any
writ, judgment, decree, injunction or similar order of any GOVERNMENTAL AGENCY
binding upon XANODYNE, or (iv) contravene or conflict with or constitute a
breach or default under any contract or agreement binding upon XANODYNE. The
execution, delivery and performance by XANODYNE of this AGREEMENT and the
consummation by XANODYNE of the transactions contemplated hereby and thereby
will not require any notice to, declarations or filing with, or the consent,
waiver, approval, or authorization of, any GOVERNMENTAL AGENCY or other PERSON.
(d) EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT OR ANY OF THE
TRANSACTION DOCUMENTS, XANODYNE MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND
WHATEVER OR AS BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, AND XANODYNE
SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES, INCLUDING
WITHOUT LIMITATION, ANY WARRANTY OF MERCHANT ABILITY OR WARRANTY OF FITNESS FOR
A PARTICULAR PURPOSE.
11.3 Debarment. BIRI and XANODYNE represent and warrant to each other that
it is not debarred and has not and will not knowingly use in any capacity the
services of any person debarred under subsections 306 (a) or (b) of the Generic
Drug Enforcement Act of 1992. If at any time this representation and warranty is
no longer accurate, BIRI or XANODYNE, as the case may be, shall immediately
notify the other of such fact.
SECTION 12. INDEMNITY: INSURANCE: LIMITATIONS ON LIABILITY
12.1 Indemnification by XANODYNE. XANODYNE shall defend, indemnify and hold
harmless BIRI and each of its AFFILIATES and their respective directors,
officers, employees and agents from and against any and all claims, demands,
suits or proceedings for damages, costs (including reasonable attorney's fees),
expenses and loss (collectively, "LOSS") incurred by BIRI to the extent arising
out of or resulting from (a) any breach of any representation, warranty or
covenant contained in this AGREEMENT by XANODYNE; or (b) any other wrongful or
negligent act or omission by XANODYNE in connection with the performance of its
obligations hereunder.
12.2 Indemnification by BIRI. BIRI shall defend, indemnify and hold
harmless XANODYNE and each of its AFFILIATES and their respective directors,
officers, employees and agents from and against any and all LOSS incurred by
XANODYNE to the extent arising out of or resulting from (a) any breach of any
representation, warranty or covenant contained in this AGREEMENT by BIRI (or its
permitted subcontractors), or (b) any other wrongful or negligent act or
omission by BIRI (or its permitted subcontractors) in connection with the
performance of its obligations hereunder; PROVIDED, HOWEVER, THAT THE MAXIMUM
LIABILITY OF BIRI
19
PURSUANT TO THIS AGREEMENT SHALL NOT EXCEED TWENTY MILLION U.S. DOLLARS
($20,000,000).
12.3 Indemnification Procedures.
(a) In the event of any claim under Sections 12.1 or 12.2 hereof, the
PARTY claiming the right to indemnity (the "CLAIMANT") shall promptly notify the
indemnifying PARTY (the "INDEMNITOR") in writing of such claim. The notice shall
describe such claim in reasonable detail.
(b) INDEMNITOR shall have twenty (20) days after receipt of such
notice to decide whether it will undertake, conduct and control, through counsel
of its own choosing and at its own expense, the settlement or defense of the
tendered claim; provided, however, that CLAIMANT shall have the right to consent
to such counsel, which consent shall not be unreasonably conditioned, withheld
or delayed. Notwithstanding anything in this AGREEMENT, CLAIMANT shall have the
right to employ its own counsel at its own expense if CLAIMANT deems such action
necessary or advisable to fully protect its interests.
(c) INDEMNITOR shall not settle or compromise any action, or consent
to the entry of any judgment in any tendered claim, without the written consent
of CLAIMANT, which shall not be unreasonably conditioned, withheld or delayed.
INDEMNITOR's obligation to defend and indemnify CLAIMANT shall survive any
settlement, compromise or judgment that does not include as an unconditional
term thereof the delivery by the underlying claimant or plaintiff to CLAIMANT of
a duly executed written release of CLAIMANT from all liability in respect to
such action, which release shall be reasonably satisfactory in form and
substance to CLAIMANT's counsel.
(d) In the event INDEMNITOR does not notify CLAIMANT in writing within
twenty (20) days after receipt of notice of the tendered claim it elects to
undertake its defense, CLAIMANT shall have the right to contest, settle or
compromise such claim, but shall not thereby waive any right to indemnity from
INDEMNITOR for such claim.
(e) CLAIMANT and INDEMNITOR shall cooperate fully in the defense of
any claim for which indemnity is sought pursuant to this AGREEMENT, including
providing each other with reasonable access to their employees during regular
business hours (including as witnesses) and other reasonably necessary
information. CLAIMANT shall be reimbursed for any out-of-pocket expenses
resulting from such cooperation.
12.4 Insurance.
(a) Both PARTIES shall procure and maintain at their own expense and
for their own benefit, product liability coverage with respect to the Products
of no less the $[**] per occurrence and in the aggregate. The scope of the U.S.
Products Liability coverage is to be similar to standard ISO Forms (e.g. ISO
Forms CG 0001 01 96 or CG 00 02 01 96). If the insurance to be provided is in
the form of ISO Form CG 00 02 01 96, the policy shall contain an extended
reporting period of at least two (2) years; any retroactive date under said
policy shall be no later than the EFFECTIVE DATE of the AGREEMENT. In either
case, the insurance required herein shall be maintained for a period of not less
than five (5) years after the expiration of this AGREEMENT. Furthermore, both
20
PARTIES agree to give due notice to the other during the period stated of any
such material change that may affect the continuation of such coverage.
(b) Upon request, no more often than on an annual basis, both PARTIES
shall furnish the other with a certificate(s) from the insurance carrier(s)
(having a minimum AM Best rating of A-) showing the coverage's set forth above.
The insurance will contain an ordinary deductible and may be cancelled or
altered only after thirty (30) days written notice is given to the other PARTY.
12.5 LIMITATION ON LIABILITY. NEITHER PARTY WILL BE LIABLE TO THE OTHER
PARTY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES,
INCLUDING, BUT NOT LIMITED TO, LOSS OF REVENUE OR ANTICIPATED PROFITS OR LOST
BUSINESS (COLLECTIVELY, "DISCLAIMED DAMAGES") (EVEN IF THAT PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES), ARLSING FROM BREACH OF THIS
AGREEMENT, OR ARISING FROM ANY OTHER PROVISION OF THIS AGREEMENT; PROVIDED,
THAT, EACH PARTY WILL REMAIN LIABLE TO THE OTHER PARTY TO THE EXTENT ANY
DISCLAIMED DAMAGES ARE CLAIMED BY A THIRD PARTY AND ARE SUBJECT TO
INDEMNIFICATION PURSUANT TO SECTION 12.1 OR 12.2
SECTION 13. ENVIRONMENTAL MATTERS
13.1 BIRI is and will remain in compliance with all ENVIRONMENTAL LAWS
applicable to the performance of the MANUFACTURING SERVICES, except where any
failure to do so would not be reasonably likely to have a MATERIAL ADVERSE
EFFECT.
13.2 BIRI will promptly notify XANODYNE of any pending or overtly
threatened ENVIRONMENTAL CLAIM, which ENVIRONMENTAL CLAIM could have a MATERIAL
ADVERSE EFFECT.
SECTION 14. GENERAL TERMS
14.1 Governing Law. This AGREEMENT shall be governed and construed in
accordance with the laws of the State of Ohio excluding any choice of law rules
which may direct the application of the law of another state.
14.2 Public Announcements. Neither BIRI nor XANODYNE (nor any of their
respective AFFILIATES) shall issue any press release or make any public
announcement with respect to this AGREEMENT and the transactions contemplated
hereby without obtaining the prior written consent of the other PARTY, except as
may be required by applicable law upon the advice of counsel and only if the
disclosing PARTY provides the non-disclosing PARTY with a reasonable opportunity
to first review the release or other public announcement.
14.3 Force Majeure. No liability shall result from any delay in
performance, or failure to perform, in whole or in part, if and to the extent
caused by occurrences beyond the reasonable control of the PARTY affected (a
"FORCE MAJEURE EVENT"), including, but not 1imited to, acts of God,
21
fire, flood, accident, riot, war, terrorism, sabotage, strike, labor trouble or
shortage or embargo. The PARTY suffering such occurrence shall promptly notify
the other P ARTY as soon as practicable of such inability and the period for
which such inability is expected to continue, and any time for performance
hereunder shall be extended by the actual time of delay caused by the
occurrence; provided, that the PARTY suffering such occurrence uses reasonable
efforts to mitigate. If any such circumstances affect only a part of BIRI's
capacity to perform, BIRI shall have the right to allocate production and
deliveries on a pro-rata basis among all of its third party customers (excluding
any internal or affiliated divisions, departments and companies) based on their
previous purchases made during the shorter of (a) the twelve (12) month period
immediately preceding such FORCE MAJEURE EVENT and (b) the period commencing on
the EFFECTIVE DATE and ending on the date of such FORCE MAJEURE EVENT.
Quantities affected by this Section may, at the option of either PARTY, be
eliminated from the AGREEMENT without liability, but the AGREEMENT shall remain
otherwise unaffected.
14.4 Waiver. No delay on the part of BIRI or XANODYNE in exercising any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall
any waiver on the part of either BIRI or XANODYNE of any right, power or
privilege hereunder operate as a waiver of any other right, power or privilege
hereunder, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or privilege hereunder. Any provision of this
AGREEMENT may be waived if, and only if, such waiver is in writing and signed by
the PARTY against whom the waiver is to be effective.
14.5 Captions. All section titles or captions contained in this AGREEMENT
and in any Attachment annexed hereto are for convenience only, shall not be
deemed a part of this AGREEMENT and shall not affect the meaning or
interpretation of this AGREEMENT.
14.6 Independent Contractors. The PARTIES are and will remain at all times
independent contractors, and no agency, partnership, joint venture or employment
relationship exists between them.
14.7 Limitations on Assignment. This AGREEMENT may not be assigned by
either of the PARTIES without the prior written consent of the other, which
consent shall not be unreasonably withheld, except that XANODYNE may assign its
rights and obligations hereunder (or any part thereof), without BIRI's consent,
to any AFFILIATE of XANODYNE, provided that any of the obligations assigned to
such AFFILIATE that are covered by the XANODYNE Parent Guaranty.
14.8 Severability. If any provision of this AGREEMENT is held to be
illegal, invalid or unenforceable under any present or future law, and if the
rights or obligations of any PARTY hereto under this AGREEMENT will not be
materially and adversely affected thereby, (a) such provision will be fully
severable, (b) this AGREEMENT will be construed and enforced as if such illegal,
invalid or unenforceable provision had never compromised a part hereof, (c) the
remaining provisions of this AGREEMENT will remain in full force and effect and
will not be affected by the illegal, invalid or unenforceable provision or by
its severance herefrom, and (d) in lieu of such illegal, invalid or
unenforceable provision, there will be added automatically as a part of this
AGREEMENT a legal, valid and enforceable provision as similar to terms to such
illegal, invalid or unenforceable provision as may be possible and reasonably
acceptable to the PARTIES herein.
22
14.9 Construction. As used in this AGREEMENT, the masculine shall include
the feminine and neuter, the singular shall include the plural and the plural
shall include the singular, as the context may require. This AGREEMENT shall be
deemed to have been drafted by both BIRI and XANODYNE and shall not be construed
against either PARTY as the draftsperson hereof.
14.10 Counterparts. This AGREEMENT may be executed in any number of
counterparts, each of which shall be deemed an original but all or which
together shall constitute a single instrument.
14.11 Notices. All notices or other communications required or permitted to
be given hereunder shall be in writing and shall be deemed to have been duly
given if delivered by hand, prepaid telex, cable, telegram or facsimile and
confirmed in writing, or mailed first class, postage prepaid, by registered or
certified mail, return receipt requested (mailed notices and notices sent by
telex, cable or telegram shall be deemed to have been given on the date
received) as follows:
IF TO BIRI, AS FOLLOWS:
BI Xxxxxx, Inc.
0000 Xxxxxx Xxxx
XX Xxx 00000
Xxxxxxxx, XX 00000-0000
Attn: President
Fax: (000) 000-0000
with a copy to:
BI Xxxxxx, Inc.
0000 Xxxxxx Xxxx
XX Xxx 00000
Xxxxxxxx, XX 00000-0000
Attn: General Counsel
Fax: (000) 000-0000
IF TO XANODYNE, AS FOLLOWS:
Xanodyne Pharmaceutical, Inc.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000-0000
Attn: President
Fax: (000) 000-0000
with a copy to:
Xanodyne Pharmaceutical, Inc.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000-0000
Attn: General Counsel
Fax: (000) 000-0000
23
or in any case to such other address or addresses as hereafter shall be
furnished as provided in this section 14.11 by any PARTY hereto to the other
PARTY.
14.12 Further Assurances. Each PARTY hereto agrees, upon the reasonable
request of the other PARTY hereto, and at the expense of the requesting PARTY,
to make, execute and deliver any or all documents or instruments of any kind or
character, and to perform all such other actions, that may be necessary or
proper and reasonable to effectuate, confirm, perform or carry out the terms and
provisions of this AGREEMENT.
14.13 Entire Agreement. This AGREEMENT and the TRANSACTION DOCUMENTS
constitute the entire agreement between the PARTIES with respect to the subject
matter hereof and supersedes all prior agreements, understanding and
negotiations, both written and oral, between the PARTIES with respect to the
subject matter of this AGREEMENT and the TRANSACTION DOCUMENTS.
IN WITNESS WHEREOF, the PARTIES have executed this AGREEMENT on the
day and year first above written.
XANODYNE PHARMACEUTICALS, INC. BOEHRINGER INGELHEIM XXXXXX, INC.
By: By:
--------------------------------- ------------------------------------
Name: Name:
------------------------------- ----------------------------------
Its: Its:
-------------------------------- -----------------------------------
24
ATTACHMENT A
APPROXIMATE
Xanodyne Item # Product TABLET BATCH SIZE TABLET YIELD
--------------- ------- ----------------- ------------
106647954010 Oramorph SR Tablets 15mg - Bottle of 100 [**] [**]
106647954025 Oramorph SR Tablets, 15mg - 4X25RN/ Box of 100 [**] [**]
106647954110 Oramorph SR Tablets, 30mg - Bottle of 100 [**] [**]
106647954125 Oramorph SR Tablets, 30mg - 4X25RN/ Box of 100 [**] [**]
106647954210 Oramorph SR Tablets, 60mg - Bottle of 100 [**] [**]
106647954225 Oramorph SR Tablets, 60mg - 1X25RN/ Box of 100 [**] [**]
106647954310 Oramorph SR Tablets, 100mg - Bottle of 100 [**] [**]
106647954325 Oramorph SR Tablets, 100mg - 1X25RN/ Box of 100 [**] [**]
106647958010 Roxicodone Tablets 5mg - Bottle of 100*** [**] [**]
106647958025 Roxicodone Tablets 5mg - 4X25RN/ Box of 100*** [**] [**]
106647958110 Roxicodone Tablets 15mg - Bottle of 100 [**] [**]
106647958210 Roxicodone Tablets 30mg - Bottle of 100 [**] [**]
APPROX.
Xanodyne Item # Product BOTTLE BATCH SIZE BOTTLE YIELD
--------------- -------- ----------------- ------------
106647958350 Roxicodone Oral Solution, 5mg/ 5mL - 500mL Bottle *** [**] [**]
106647958305 Roxicodone Oral Solution, 5mg/ 5mL - 40X 5mL Cup *** [**] [**]
106647958403 Roxicodone Intensol Oral Solution, 20mg/mL - 30mL Bottle *** [**] [**]
*** Denotes Grandfathered Products as defined in the AGREEMENT
25
ATTACHMENT B
Bulk Item # Xanodyne Item # Product UNIT COST
----------- --------------- -------- ---------
2479000 106647954010 Oramorph SR Tablets, 15mg - Bottle of 100 [**]
2479000 106647954025 Oramorph SR Tablets, 15mg - 4X25RN/ Box of 100 [**]
2479100 106647954110 Oramorph SR Tablets, 30mg - Bottle of 100 [**]
2479100 106647954125 Oramorph SR Tablets, 30mg - 4X25RN/ Box of 100 [**]
2479200 106647954210 Oramorph SR Tablets, 60mg - Bottle of 100 [**]
2479200 106647954225 Oramorph SR Tablets, 60mg - 1X25RN/ Box of 100 [**]
2479300 106647954310 Oramorph SR Tablets, 100mg - Bottle of 100 [**]
2479300 106647954325 Oramorph SR Tablets, 100mg - 1X25RN/ Box of 100 [**]
2368200 106647958350 Roxicodone Oral Solution, 5mg/ 5mL - 500mL Bottle [**]
2368200 106647958305 Roxicodone Oral Solution, 5mg/ 5mL - 40X 5mL Cup [**]
2368300 106647958403 Roxicodone Intensol Oral Solution, 20mg/mL - 30mL Bottle [**]
2465700 106647958010 Roxicodone Tablets 5mg - Bottle of 100 [**]
2465700 106647958025 Roxicodone Tablets 5mg - 4X 25RN/ Box of 100 [**]
5465800 106647958110 Roxicodone Tablets 15mg - Bottle of 100 [**]
2466500 106647958210 Roxicodone Tablets 30mg - Bottle of 100 [**]
26
ATTACHMENT C
TECHNICAL AGREEEMENT
27
QUALITY AGREEMENT
BETWEEN
XANODYNE PHARMACEUTICALS INC.
AND
BOEHRINGER INGELHEIM XXXXXX INC.
1
QUALITY AGREEMENT
REVISION HISTORY:
Effective
REVISION # Date Summary of Changes
---------- --------- ------------------
1 12.31.2007 INITIAL DOCUMENT.
2
QUALITY AGREEMENT
CONTENTS
1. PARTIES
2. QUALITY AGREEMENT
3. ADMINISTRATIVE INFORMATION
4. PRODUCTS
5. DURATION OF AGREEMENT
6. CONFIDENTIALITY
7. MANUFACTURE
7.1 Premises
7.2 Product Specification and Master Production Records
7.3 GMP Guidelines
7.4 Master Production Record Approval
7.5 Production
7.6 Methodology
7.7 Standard Operating Procedure
7.8 Dates of Manufacture and Expiration
7.9 Manufacturing and Equipment Data
8. QUALITY ASSURANCE
8.1 Laboratory Control of Materials
8.2 In-Process and Finished Product Testing
8.3 Release Procedures
8.4 Documentation
8.5 Sampling
8.6 Stability
8.7 Deviations and Investigations
8.8 Rejection of Product
8.9 Regulatory Inspection
8.10 Regulatory Actions at Xanodyne
8.11 Right to Audit
8.12 Product Complaints, Recall
9. CHANGE MANAGEMENT
10. PRODUCT PROCESS VALIDATION
10.1 Process
10.2 Cleaning Validation
10.3 Equipment, Computer, Facility, and Utilities Qualification
10.4 Laboratory Qualifications
11. ANNUAL PRODUCT REVIEW, DRUG LISTING, AND ANNUAL REPORTS
11.1 Annual Product Review
11.2 Drug Listing
11.3 Annual Reports
12. STORAGE
APPROVAL OF QUALITY AGREEMENT
ATTACHMENT I
ATTACHMENT II
ATTACHMENT III
3
1 PARTIES
This Quality Agreement is effective as of January 1, 2008 by and between
Xanodyne Pharmaceuticals, Inc., a Delaware Corporation having corporate
offices at Xxx Xxxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000-0000 (hereinafter
referred to as "Xanodyne") and Boehringer Ingelheim Xxxxxx, Inc. 0000
Xxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 (herein after referred to as "BIRI").
2 QUALITY AGREEMENT
2.1 This Agreement supplements and is hereby incorporated by reference
into, that certain Manufacturing Agreement between the Parties dated
January 1, 2008 the "Manufacturing Agreement" for each of the
Products to which this Agreement relates.
2.2 This agreement defines certain roles and responsibilities of BIRI
for services or materials supplied to Xanodyne or Affiliates, for
commercial distribution or clinical trial use to ensure compliance
with applicable cGMPs. This Agreement is supplemental to and
constitutes a part of the Manufacturing Agreement. The provisions of
this Agreement are intended to be supplemental to and not in
derogation from the terms of the Manufacturing Agreement and
provisions contained herein shall be treated as supplemental to the
Manufacturing Agreement and in particular but without limitation in
relation to the application, compliance, verification and
implementation of cGMP. To the extent any terms set forth in this
Agreement conflict with the terms of the Manufacturing Agreement,
the terms of the Manufacturing Agreement shall control. Defined
terms used in this Agreement shall have the meaning set forth in
Appendix I or as otherwise defined herein.
3 ADMINISTRATIVE INFORMATION
Contact names will be provided from both sites for key functional areas.
Contact names are provided in Attachment II and may be updated as needed
upon written notice of a Party.
4 PRODUCTS
A Product list is provided in Attachment I.
5 DURATION OF AGREEMENT
This Agreement shall commence on execution by both Parties and subject to
the following provisions of this clause shall expire or terminate on the
expiry or termination of that Manufacturing Agreement. Any section of this
Agreement which has a predefined retention, survival or maintenance
period, for example raw data storage, product complaints and sample
retention, shall survive the termination of this Agreement for the period
defined in the appropriate section. This Agreement cannot be modified
except with the written approval of both Parties. Specifications and
Master Batch Records may be modified with written authorization from
designated Quality representatives of both companies.
6 CONFIDENTIALITY
Confidential Information shall be governed by the terms of the applicable
Manufacturing Agreement.
4
7 MANUFACTURE
7.1 Premises
BIRI will manufacture the Products at the facility and will not use
or transfer at a later date any of the Manufacturing operations for
the Product(s) to Third Parties or other sites without the prior
written agreement of Xanodyne Corporate Quality Assurance.
7.2 Product Specification and Master Production Records
7.2.1 BIRI will Manufacture the Product(s) in accordance with the
most recent approved version of the Specifications and Master
Batch Record (formula, in-process and release specifications,
methods, shelf life, and regulatory requirements) as supplied
or approved by Xanodyne.
7.2.2 BIRI will select approved suppliers using quality and
purchasing evaluations. Xanodyne Corporate Quality Assurance
must approve suppliers. Any change from approved suppliers
must follow the change management guidelines set by this
quality agreement.
7.2.2.1 Raw Material Specification
BIRI will test Raw Materials to the full
Specification unless a supplier Certificate of
Analysis ("COA") is available from an approved
supplier, in which case, reduced testing may be
employed. However, full testing should be performed
on [**] per year minimum.
7.2.2.2 Label Component Specifications
BIRI will use only labels and labeling approved in
compliance with standards and Specifications.
7.2.2.3 Packaging Component Specifications
BIRI will obtain from approved suppliers as defined
in the appropriate Regulatory documentation and
test-packaging components to the full Specification
unless a supplier COA is available from an approved
supplier, in which case reduced testing may be
employed. Packaging Specifications must be provided
or approved by Xanodyne Corporate Quality Assurance.
7.3 GMP Guidelines
Any applicable product license or pharmacopoeia requirements
applicable to the Manufacture of Product(s) shall be complied with
in addition to cGMP and Specifications.
7.4 Master Production Record Approval
5
BIRI may transcribe the information (i.e. formulation, filling work
order, packaging work order) into its own format and must obtain
written approval from Xanodyne Corporate Quality Assurance for
changes to a master document version before Manufacturing.
7.5 Production
The Products will be manufactured in accordance with the
manufacturing and packaging procedures set forth in the
Specifications and Master Batch Records and additional internal BIRI
site procedures.
7.6 Methodology
BIRI will test using the approved methodology listed in the current
Specification.
7.7 Standard Operating Procedures
BIRI is responsible for maintaining any Standard Operating
Procedures (SOPs) required to make the Product in accordance with
cGMPs and as described in the NDA or compendial documentation as
well as any other regulatory requirements.
7.8 Dates of Manufacture and Expiration
7.8.1 Date of Manufacture
BIRI will determine the date of manufacture based upon the
current applicable BIRI SOP.
7.8.2 Expiration Date
BIRI will calculate expiration dates for Batches to be
manufactured based upon expiration dating standards
determined by approved Stability data.
7.9 Manufacturing and Equipment Data
BIRI is responsible for safe keeping and retention of records of
machine usage (previous product produced in non-dedicated
machinery), cleaning, any maintenance/calibration performed, Raw
Material batch numbers and certification, in-process results and
parameters, test results and shall perform all functions in
accordance with legal and regulatory requirements and all Applicable
Laws.
8 QUALITY ASSURANCE AND CONTROL
8.1 Laboratory Control of Materials
8.1.1 Any Specifications, standards, sampling plans, test
procedures, and other laboratory control mechanisms,
including changes to documents listed, should be drafted by
BIRI and reviewed and approved by Xanodyne Corporate Quality
Assurance. This applies to changes which are deemed critical
by BIRI and Xanodyne. Compendial changes do not apply.
6
8.1.2 BIRI is responsible for investigating any laboratory out of
specification (OOS) results as per BIRI procedures. Each OOS
investigation must be reviewed and approved by BIRI Quality
and must evaluate if the failure has jeopardized the safety,
efficacy or quality of the Product. Xanodyne Corporate
Quality Assurance must be notified within [**] working days
of a confirmed OOS value and BIRI must forward the completed
package to Xanodyne Corporate Quality Assurance upon
conclusion of the investigation. The investigation process
should be completed in a timely manner with a target of [**]
days.
8.1.3 Any reference standards that are supplied by Xanodyne or
Xanodyne's Affiliates must be accompanied by a COA listing
the expiration date and any correction factors that need to
be applied.
8.2 In-Process and Finished Product Testing
8.2.1 Raw Materials and packaging components
8.2.1.1 BIRI will ensure that all materials used are in
compliance with the compendial and/or approved
Methods and Specifications.
8.2.1.2 BIRI will perform all in-process and finished
Product testing using the Specifications, finished
Product attribute Acceptable Quality Level ("AQL"),
and Methods of analysis approved by Xanodyne's
Corporate Quality Assurance and other applicable
licenses.
8.3 Release Procedures
8.3.1 Product
BIRI is responsible for ensuring that the Product has been made
according to cGMPs, as well as the Specifications and procedures
documented in the Master Batch Record.
8.3.2 Certificate of Compliance/Analysis
BIRI Quality will provide a Certificate of Compliance and
Certificate of Analysis confirming that the Product has been
manufactured, packaged and tested in accordance with cGMP and
Applicable Laws and meets the requirements of the Master Batch
Record and Specifications including a statement that any deviations
identified during the manufacturing process have been satisfactorily
closed. Examples of these documents are included in Appendix III.
7
8.3.3 Xanodyne Receipts
Release of Products to the market or for use in clinical studies
will be undertaken by Xanodyne Corporate Quality Assurance based on
Xanodyne's internal procedures and the documentation provided by
BIRI.
8.4 Documentation
8.4.1 Requests for Full Documentation
BIRI will supply Xanodyne or its Affiliates with any
completed Manufacturing, packaging, testing, or stability
data within [**] working days of request.
8.4.2 BIRI will retain, at minimum, batch production records,
quality control testing records, all records of shipments of
the Product from BIRI, and other documentation relating to
the Product for the time periods required by Applicable Laws
with respect to the Product plus [**]. BIRI shall make such
records and data available for review by Xanodyne at BIRI
Plant upon at least [**] days' prior written notice from
Xanodyne.
8.5 Retain Sampling
8.5.1 Retain Samples - Raw Materials
BIRI will retain samples of active ingredient for at least
[**] [**] beyond the expiry period of the Products in which
used. The amount of sample retained will be [**] the quantity
required to carry out all of the tests required to determine
if the material meets its Specifications.
8.5.2 Retain Samples - Products
BIRI will retain samples of the Products for at least [**]
[**] beyond the expiry period. The amount of sample retained
will be [**] the quantity required to carry out all of the
tests required to determine if the material meets its
Specifications.
8.6 Stability
8.6.1 Routine/Commercial Stability Program
8.6.1.1 BIRI is responsible for routine stability testing.
8.6.1.2 BIRI will be responsible for performing non routine
stability testing required to support the Products.
Xanodyne will establish the protocols and BIRI will
develop, execute and write reports for the protocol
when requested by Xanodyne.
8
8.6.2 Stability Failures
Any confirmed Out of Specification result which arises as a
result of or during any of the stability programs will be
communicated in writing within [**]to Xanodyne Corporate
Quality Assurance.
8.7 Deviations and Investigations
8.7.1 Deviations
Any deviation from the process during Manufacture must be
investigated and documented in the batch records, justified
and approved by BIRI's Quality Assurance and be included in
the documentation package.
8.7.2 Failure Investigations and Out Of Specification (OOS) Results
BIRI is responsible for investigating any test result or
in-process test that fails to meet Specification per internal
procedures. Each investigation will be reviewed and approved
by BIRI Quality Assurance. The investigation must evaluate if
the failure has impacted the safety, efficacy or quality of
the Product. Xanodyne must be notified in writing within [**]
working days of a confirmed OOS value and BIRI must forward
the completed package to Xanodyne Corporate Quality Assurance
upon conclusion of the investigation.
8.7.3 BIRI will notify Xanodyne Corporate Quality Assurance
forthwith if any problems are discovered that may impact
Product Batch(s) previously shipped to Xanodyne identifying
the Batches in question.
8.7.4 Some deviations/failures may require that additional testing,
stability, or validation be conducted. This work will be
performed as agreed by both Parties.
8.8 Rejection of Product
BIRI will notify Xanodyne Corporate Quality Assurance in writing of
any Batch rejected by BIRI. This communication shall be accompanied
by a completed investigation with regard to the failure.
8.9 Regulatory Inspections
Xanodyne's Vice President or Director of Corporate Quality Assurance
will be promptly notified of any inspections by a Regulatory
Authority related to Xanodyne Products. BIRI will discuss with
Xanodyne prior to making any commitment concerning Xanodyne Products
to a Regulatory Authority.
9
8.10 Regulatory Actions at Xanodyne
Xanodyne or its Affiliates will notify BIRI of any regulatory
actions on the Products that may impact BIRI. Additionally, Xanodyne
will immediately forward any regulatory correspondence concerning
the Manufacture of the Products to BIRI.
8.10.1 Correspondence: Each Party shall promptly notify the other
Party of, and shall provide the other Party with copies of,
any correspondence and other documentation received or
prepared by the notifying Party in connection with any of the
following events:
8.10.1.1 Receipt of a 483 Observation Letter or "Warning
Letter" from the FDA in connection with the
Manufacture, packaging, testing, storage or security
of the Product.
8.10.1.2 Any field alert, recall, market withdrawal or
correction of any Batch of the Product.
8.11 Right to Audit
Xanodyne or Xanodyne Affiliate representatives will be escorted at
all times by BIRI personnel. Upon reasonable prior notice of [**]
weeks, BIRI shall permit Xanodyne to audit any facilities used by
BIRI in the performance of its obligations under this Quality
Agreement. Within [**] of the audit, Xanodyne will provide BIRI with
copy of the findings of the inspection. BIRI must respond to the
findings within [**] [**] of the date of receipt. If additional time
is required to complete the response, BIRI must notify Xanodyne in
writing.
8.12 Product Complaints, Recall, Adverse Events
8.12.1 Product Complaints
Xanodyne Corporate Quality Assurance shall maintain complaint
files with respect to the Product (s) in accordance with
cGMP's. Xanodyne Corporate Quality Assurance is responsible
for receiving and initially investigating any complaints and
will notify BIRI of any complaint that may impact the Product
quality. BIRI will investigate any Product complaints and
provide a report to Xanodyne within [**] days. Xanodyne shall
have responsibility for reporting all complaints relating to
the Product to the FDA and any other Regulatory Authority,
including, but not limited to, complaints relating to the
Manufacture of the Product as well as adverse events.
8.12.2 Product Recall
Xanodyne Corporate Quality Assurance is responsible for
instituting a Product Recall. Xanodyne will notify BIRI of
any Recall of product listed in appendix 1. BIRI and Xanodyne
will discuss the Recall prior to initiation. BIRI will work
with Xanodyne and Xanodyne's Affiliates to investigate cause
of the Recall. BIRI will provide a rapid initial response,
periodic updates of the progress of the investigation and a
report upon completion. BIRI will promptly notify Xanodyne's
Corporate Quality Assurance of any procedures and practices
that have been implicated in a recall investigation which
impact the manufacture of Xanodyne's products.
10
9 CHANGE MANAGEMENT
Product specific Master Batch Records, Methods and Specifications will be
approved by both Xanodyne's Corporate Quality Assurance Department and
BIRI Quality Department prior to implementation. This applies to changes
which are deemed critical by BIRI and Xanodyne. Compendial changes do not
apply. All required regulatory approvals will be obtained prior to
implementation. Variations to established production procedures may be
initiated by either Party, but must be agreed to in writing by the
authorized members of the Quality Assurance Departments of both Parties
before implementation. The release status of the Product produced under a
variation will be decided as part of the variation approval process.
Quality Assurance Departments of BIRI or Xanodyne will have the right to
assign a final disposition of "rejected" to the batch should they conclude
that such action is appropriate.
10 PRODUCT AND PROCESS VALIDATION
10.1 Process
BIRI is responsible for ensuring that any validation of a
manufacturing process is executed. BIRI will not use any validation
protocol or issue a report unless Xanodyne technical personnel and
Xanodyne Quality Assurance have first approved them. Xanodyne will
approve or reject all protocols and validation reports within [**]
working days of receipt.
10.2 Cleaning Validation
BIRI is responsible for ensuring that adequate cleaning is carried
out between batches of different products to prevent contamination.
BIRI is responsible for having approved cleaning procedures for
Product(s)
10.3 Equipment, Computer, Facility, and Utilities Qualification
BIRI is responsible for the safe and efficient working of all
equipment, computer, utility, and facility qualification activities
associated with the Products, including maintenance.
10.4 Laboratory Qualifications
10.4.1 BIRI is responsible for ensuring that all laboratories are
compliant with cGMPs with regard to systems and equipment
qualifications.
10.4.2 BIRI is responsible for maintaining appropriate cGMP (GLP)
documentation procedures in the laboratories (i.e. notebooks,
logbooks, sample receipt, sample tracking, SOPs, etc).
10.4.3 BIRI will only use appropriately qualified and/or validated
methodology associated with the testing of the Products
11
11 ANNUAL PRODUCT REVIEW, DRUG LISTING, AND ANNUAL REPORTS
11.1 Annual Product Review
BIRI will perform an annual product review on the Products and will
issue a report to Xanodyne no later than [**] months after the
conclusion of an annual manufacturing cycle. This review will be
conducted in accordance with accepted industry practice, 21CFR211.180
(e) and any other Applicable Laws.
11.2 Drug Listing
BIRI is responsible for drug listing as the Manufacturer of the
Product(s) while Xanodyne is responsible for drug listing as the
distributor of the Product(s). Xanodyne will provide BIRI copies of
all Product labeling including package insert, NDA number, name and
address of NDA holder, and NDC code which includes labeler code,
product code, and packaging code.
11.3 Annual Reports, IND Updates or Other Regulatory Filings
Xanodyne is responsible for preparing any Annual Report, IND update or
other regulatory filing as required by Applicable Laws, including 21
CFR 314.7 (g)(3), 314.81 (b)(2), and/or 601.12 (d), (f)(3).
12 STORAGE
BIRI will ensure that during storage of the Product(s) that there is no
possibility of deterioration, interference, theft, Product contamination or
admixture with any other materials. Xanodyne Corporate Quality Assurance
will provide details of any labeling requirements and container sealing and
integrity requirements.
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APPROVAL OF THIS QUALITY AGREEMENT
TITLE NAME SIGNATURE DATE
----------------------------- ----------------------- -------------------- ---------
BIRI - XXXXXX XXXXXX /s/ XXXXXX XXXXXX 1/16/2008
Director, Quality Service
BIRI XXXXXXX XXXXX /s/ XXXXXXX XXXXX 1/16/2008
Manager Quality Assurance
TITLE NAME SIGNATURE DATE
----------------------------- ----------------------- -------------------- ---------
Xanodyne Pharmaceuticals Inc. G. XXXXX XXXXX /s/ G. XXXXX XXXXX 1/23/2008
Director Quality Assurance
XXXXXXX X. STAMP /s/ XXXXXXX X. STAMP 01-22-08
CHIEF FINANCIAL OFFICER
13
DEFINITIONS
1. ANNUAL REPORT means a regulatory update to a New Drug Application
(NDA) or Abbreviated New Drug Application (ANDA) submitted to the
FDA (or other such agency). Typically minor changes to such
applications are submitted pursuant to 21 CFR 314.70(d).
2. "API" shall mean the active pharmaceutical ingredient (API), in
bulk form ready to be used for Manufacture into the Product.
3. "APR" shall mean an Annual Product Review (APR for evaluation of
the quality standards for each Finished Product according to
21CFR211.180(e)
4. BOEHRINGER INGELHEIM XXXXXX INC. will be abbreviated to BIRI.
5. "DEVIATION" A deviation is defined as any anomalous event that
may occur during the processing of a Batch that is a departure
from Specifications, approved procedures or validated processes.
6. "FINISHED PRODUCT" shall mean Product and Samples in a final
labeled and packaged form suitable for distribution to the
market.
7. " "CGMP" shall mean the current Good Manufacturing Practices in
accordance with:
- (i) the regulatory requirements promulgated by the FDA under
the United States' Federal Food, Drug and Cosmetic Act, as
amended, Code of Federal Regulations Title 21 Section 210
et.seq; and/or
- (ii) Other comparable regulatory standards, in each case
including those procedures expressed or implied in the
regulatory documents with respect to the Product provided to
regulatory authorities and as applicable to the Manufacture
of Product, as such regulations are in effect at the time of
Manufacturing Product.
8. "MANUFACTURE" of the Product shall mean the receipt of materials,
production, packaging, labelling, quality control, quality
assurance, release and storage of the Product.
9. "MANUFACTURING AGREEMENT" shall mean the Manufacturing Agreement
between BIRI and Xanodyne for the Product DATED AS OF JANUARY 1,
2008.
10. "MASTER BATCH RECORDS" mean the approved formulation,
manufacturing/packaging instructions, and controls whereby a
Batch of Product is manufactured. Master Batch Records must be
written per cGMPs for all clinical, registration, stability, and
commercial manufacturing processes and may
14
be issued repeatedly of the manufacture of the same Batch of
Product.
11. "METHODS" means approved analytical testing procedures for Raw
Materials, intermediates and final Product.
12. "NDA" means New Drug Application or non-US equivalent thereof
applicable to or referencing of the Active Ingredient to be
supplied hereunder relating to the Xanodyne formulation of the
finished dose Product and any supplements to such NDA as may be
filed during the term hereof.
13. "NDC" means National Drug Code.
14. "OOS", shall mean out-of-specification; i.e. a result of
analytical methods which is not within the specifications
15. "PRODUCT" see attachment I.
16. PRODUCT COMPLAINT" shall mean any written, verbal, or electronic
expression of dissatisfaction regarding Product including, but
not limited to, actual or suspected product tampering,
contamination, mislabeling, or wrong ingredients.
17. "SAMPLE" shall mean retention sample
18. "SPECIFICATIONS" shall mean the specifications for manufacturing,
testing, stability, labeling and packaging the Product.
15
ATTACHMENT I
LIST OF PRODUCTS
Products
Roxicodone Oral Solution 5mg per 5mL
Roxicodone Intensol 20mg per mL
Roxanol Oral Solution
Roxicodone Tablets 5mg
Roxicodone Tablets 15mg
Roxicodone Tablets 30mg
Oramorph SR Tablets 15mg
Oramorph SR Tablets 30mg
Oramorph SR Tablets 60mg
Oramorph SR Tablets 100mg
16
ATTACHMENT II
PERSONNEL KEY CONTACT LISTING
FUNCTION INDIVIDUAL PHONE FAX / E-MAIL ADDRESS
-------------------------- ---------- ----- ------------ -------
BOEHRINGER INGELHEIM XXXXXX INC.
QUALITY RESPONSIBILITIES
QA, PRODUCT RELEASE [**] [**] [**] [**]
QA, SUPPLIER QUALITY [**] [**] [**] [**]
QA, ADVISING AND [**] [**] [**] [**]
INVESTIGATIONS
QA, CONTRACT PRODUCTS AND [**] [**] [**] [**]
COMPLAINTS
COMPLAINT SAMPLES AND [**] [**] [**] [**]
INVESTIGATION
REGULATORY COMPLIANCE RESPONSIBILITIES
REGULATORY COMPLIANCE [**] [**] [**] [**]
PRODUCTION TECHNOLOGY RESPONSIBILITIES
PRODUCTION TECHNOLOGY [**] [**] [**] [**]
17
ATTACHMENT II
PERSONNEL KEY CONTACT LISTING
(CONTINUED)
FUNCTION INDIVIDUAL PHONE E-MAIL ADDRESS
-------------------------- ---------- ----- ------------ -------
XANODYNE PHARMACEUTICALS INC
QUALITY RESPONSIBILITIES
QA, PRODUCT RELEASE [**] [**] [**] Xxx Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
QA, ADVISING AND [**] [**] [**] Xxx Xxxxxxxxxx Xxxxx
XXXXXXXXXXXXXX Xxxxxxx, XX 00000
QA, SUPPLIER QUALITY [**] [**] [**] Xxx Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
COMPLAINT SAMPLES AND [**] [**] [**] Xxx Xxxxxxxxxx Xxxxx
XXXXXXXXXXXXX Xxxxxxx, XX 00000
18
ATTACNMENT III
The release documentation for all Batches will include a Certificate of Analysis
(COA) and a Certificate of Conformance (COC).
See attached for examples of these documents.
19
CERTIFICATE OF COMPLIANCE
Product Name:
______________________________________ Quality Assurance
Xxxxxx Pkg Lot No.: TELEPHONE 000-000-0000
______________________________________ TELEFAX 000-000-0000
Xxxxxx Pkg Material No.:
______________________________________
Package Yield:
______________________________________
Package Expiration Date:
______________________________________
First Mfg Process Step:
______________________________________
The Manufacturing and/or Packaging Documentation for the above
mentioned product have been reviewed for completeness, accuracy
and compliance to cGMP's. All documentation has been found to be
in compliance with the requirements of the manufacturing and/or
packaging specifications.
This lot has been tested to the requirements of the Quality BIRI
Standard and the Certificate of Analysis is attached. X.X. XXX 00000
XXXXXXXX, XXXX 00000-0000
Copy of the coded primary labeling is attached.
Unusual occurrences, deviations, variances, investigations, when
applicable, are attached.
All lot documentation is available upon request.
Signature
___________________________________________
Xxxx Xxxxxxxx-Xxxx
Documentation Specialist, Quality Assurance
Date
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ATTACHMENT D XANODYNE INITIAL 24 MONTH FORECASTS - 2008 & 2009 MINIMUM DOLLAR
COMMITMENTS
For the Year 2008, Xanodyne agrees to purchase, at a minimum, the dollar amount
of Products totaling $[**]
For the Year 2009, Xanodyne agrees to purchase, at a minimum, the dollar amount
of Products totaling $[**].
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