LICENSE AGREEMENT
This
License Agreement (“Agreement”) is made as of this
3rd day of September, 2009 (the “Effective Date”), by and
between Cleveland BioLabs, Inc., a Delaware corporation with its principal place
of business at 00 Xxxx Xxxxxx Xxxxxxx, XX 00000, X.X.X. (“Licensor”) and Zhejiang Hisun
Pharmaceutical Co., Ltd., a corporation organized under laws of People’s
Republic of China, with its principal office at 00 Xxxxxx Xxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxx Xxxx Xxxxxxxx Xxxxxxxx (“Licensee”).
WITNESSETH
WHEREAS,
Licensor is the assignee of certain patent applications (“Patents,” as more fully
defined below) related to Licensor’s drug candidate Protectan CBLB612 as
developed by Licensor;
WHEREAS,
Licensee wishes to obtain, and Licensor wishes to grant to Licensee and its
Affiliates (as defined below), an exclusive license in the Territory (as defined
below) under the Patents for the development and commercialization of Licensed
Products for the Field (as defined below); and
WHEREAS,
Licensee and Licensor acknowledge that there is substantial additional
formulation and clinical work to be done in order to successfully develop and
commercialize the Licensed Products.
NOW
THEREFORE, in consideration of the mutual obligations and promises as set forth
herein, the parties do hereby agree as follows:
1. Definitions.
As used in this Agreement, the following terms have the following respective
meanings:
“Affiliate” means any
corporation, company, partnership, joint venture and/or firm that controls, is
controlled by, or is under common control of either party hereto. For purposes
of this definition, control shall mean direct or indirect ownership of more than
fifty percent (50%) of the stock or participating shares entitled to vote for
the election of directors (but only as long as such ownership
exists).
“Agreement” has the meaning
ascribed to such term in the preamble.
“Confidential Information”
means any and all information or data relating to any Licensed Product(s) which
a party (“Discloser”)
directly or indirectly discloses to the other party (“Receiver”), its employees or
representatives, or is conceived or reduced to practice during the Term by
Discloser or its agents, whether in writing, orally or by observation, including
all scientific, clinical, technical, commercial, financial and business
information and Know-How, and other information or data which are considered
confidential in nature by Discloser. The Confidential Information of Licensee
shall also include: (i) the fact that Licensee intends to develop, use or market
any particular product, process or system; and (ii) all information concerning
the business, products, marketing efforts, technology or finances of Licensee
within the Territory. However, Confidential Information shall not
include information or any portion thereof which:
(a) is
known to Receiver at the time of disclosure and documented by written records
made prior to the date of this Agreement;
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(b) is
subsequently disclosed to Receiver without any obligations of confidence by an
unaffiliated third person who has not obtained it directly or indirectly from
Discloser and who has the right to make such disclosure;
(c) becomes
published or otherwise part of the public domain;
(d) is
independently developed by or for Receiver by person(s) having no knowledge of
or access to such information and without breach of any confidentiality
obligation as evidenced by its written records; or
(e) is
required to be disclosed by legal, regulatory, statutory or governmental process
or authorities, provided in each case Receiver promptly informs Discloser and
uses its best efforts to limit the disclosure and to maintain confidentiality to
the maximum extent possible and permits Discloser to attempt by appropriate
legal means to limit such disclosure.
The
contents of the Exhibits to this Agreement shall constitute Confidential
Information.
“Confidentiality Procedures”
has the meaning ascribed to such term in Section 8.3 of this
Agreement.
“Deductions” has the meaning
ascribed to such term in the definition of “Net Sale” in this Section
1.
“Discloser” has the meaning
ascribed to such term in the definition of “Confidential Information” in this
Section
1.
“Dispute” has the meaning
ascribed to such term in Section
14.3.
“Effective Date” has the
meaning ascribed to such term in the preamble.
“Field” means all human
therapeutic, prophylactic, and diagnostic uses of Licensed Products for cancer
and other diseases.
“Improvement” means any
addition, development, modification, enhancement and adaptation that directly
relates to or is used directly in connection with the Patents or a Licensed
Product. Ownership of Improvements shall be as set forth in Section
5.4.
“including” and its variants
mean including without limitation.
“Indemnitees” has the meaning
ascribed to such term in Section
7.1.
“Know-How” means any
proprietary technology, information, methods of use, processes techniques or
ideas or inventions (other than the Patents) owned, possessed or used by
Licensor as of the Effective Date and during the Term of this Agreement that is
directly related to or used in connection with the Technology, including all
trade secrets and any other technical information relating to the development,
use or sale of Licensed Products.
“Liabilities” has the meaning
ascribed to such term in Section
7.1.
“Licensed Product” means any
material, product, kit, service, process, procedure that (i) is covered by at
least one Valid Claim, or (ii) contains any of the chemical compounds set forth
in Exhibit A
attached hereto and incorporated herein by reference, or (iii) whose
manufacture, use, offer for sale or sale would constitute, but for the license
granted herein, an infringement of any Valid Claim.
“Licensee” has the meaning
ascribed to such term in the preamble.
“Licensee Improvement” has the
meaning ascribed to such term in Section
5.4(a).
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“Licensor” has the meaning
ascribed to such term in the preamble.
“Licensor Improvement” has the
meaning ascribed to such term in Section
5.4(b).
“Net Sales” means the gross
invoice price for the sale, license, sublicense, or other transfer (whether by
Licensee, any Affiliate, or sublicensee) of Licensed Products to unrelated
current and future third parties, including pharmaceutical wholesalers,
pharmacies, hospitals, or dispensing physicians, less any of the following
charges or expenses (“Deductions”):
(a) credits
or allowances actually given or made for rejection, recall or return of
previously sold Licensed Products;
(b) any
reasonable freight, postage, transportation, insurance, tax, or government
charge, duty or assessment (including any tax such as a value added or similar
tax or charge) levied on the sale, transportation or delivery of Licensed
Products when included on the invoice or other written document for such
transaction and paid by the transferee of the Licensed Product and collectable
by Licensee, its Affiliate or sub-licensee; and
(c) Licensee’s
actual costs incurred in its conduct of pre-clinical studies, clinical studies
and preparation for manufacturing, such costs not to exceed eight million
dollars ($8,000,000).
Net Sales
shall not include reasonable quantities delivered solely for research purposes,
clinical trials, or as samples or promotions.
“New Drug Approval” means the
approval issued to Licensee or any Affiliate or sublicensee of Licensee by the
competent Regulatory Authority in the Territory approving the manufacture and
commercial sale of a Licensed Product(s) by Licensee or any Affiliate or
sublicensee of Licensee within the Territory.
“New Drug Production” means
such time as Licensee or any Affiliate or sublicensee of Licensee has or is
ready under the applicable law of the Territory to produce a Licensed Product
for commercial sale, license, or use.
“New Drug Protection Licensed
Period” means a five (5)-year period of time as permitted by the
Regulatory Authority of the PRC in which no drug competitive with a Licensed
Product can be sold in the PRC.
“Patents” means the patent
applications, any patents issuing therefrom and patents listed in Exhibit B hereto and
any and all substitutions, extensions, additions, reissues, re-examinations,
renewals, divisionals, continuations, continuations-in-part whose subject matter
is claimed in the parent application, or supplementary protection certificates
owned by or licensed to (with the right to sublicense) Licensor during the Term
directly relating to the Licensed Products or any Improvements.
“Receiver” has the meaning
ascribed to such term in the definition of “Confidential Information” in this
Section
1.
“Regulatory Approval” means
all governmental approvals and authorizations necessary for the manufacture and
commercial sale of each Licensed Product in the Territory or part thereof,
including marketing authorization, pricing approval and pricing reimbursement,
as applicable.
“Regulatory Authority” means
the State Food and Drug Administration of the People’s Republic of China or any
successor entity as well as the Ministry of Commerce of the People’s Republic of
China and its local counterparts in the Territory and any other appropriate
governmental agency under which a registration, license, permit or other
authorization is required to carryout the intent of this Agreement.
“Report” has the meaning
ascribed to such term in Section 3.1 of this
Agreement.
“Security Measures” has the
meaning ascribed to such term in Section 8.3 of this
Agreement.
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“Technology” means the Patents
and Know-How.
“Term” means the period
commencing on the Effective Date and terminating as set forth in Article 9
below.
“Territory” means the People’s
Republic of China, Taiwan, Hong Kong and Macau.
“Trademark” means any
trademark or service xxxx registered or otherwise used by Licensor, including,
but not limited to, Licensor’s business name, the Protectan CBLB612 name and
xxxx and all variations thereof.
“Valid Claim” means a claim
of: (i) an issued patent included in the Patents which has not been declared
invalid in a final, unappealable decision of a court of appropriate
jurisdiction, or (ii) a pending patent application included in the Patents which
is being diligently prosecuted by or on behalf of Licensor and has not been
formally terminated or abandoned without issuance of a patent.
“Work Plan” means each
“Commercialization Plan” specific to each Licensed Product setting forth the
plan to develop, obtain regulatory approval and sell such Licensed Product as
attached hereto as Exhibit C and as
updated from time to time pursuant to Section
5.1(b).
2.
License.
2.1 License Grant. Subject to the terms of
this Agreement, Licensor hereby grants to Licensee, and Licensee accepts, for
itself and its Affiliates, an exclusive, sublicensable, royalty-bearing right
and license under the Technology to: (i) develop, make, have made, use, offer
for sell, sell, and have sold Licensed Products and Improvements thereto,
including co-promotion and co-marketing; and (ii) apply for and obtain
Regulatory Approvals, all as may be required to manufacture and commercialize
Licensed Products for the Field in the Territory. It is understood
that any issued Patents will be subject to the license rights granted in this
Section
2.
3.
Consideration.
3.1 Royalty Payments.
(a) Licensee
shall pay to Licensor a royalty on Net Sales of ten percent (10%) for the Term.
Notwithstanding the foregoing, in the event that no Patent issues in the
Territory, Licensee shall pay to Licensor a royalty on Net Sales of five percent
(5%). If at any time a Patent does issue in the Territory the royalties
payable by Licensee shall automatically increase to ten percent (10%) of Net
Sales occurring on or after the date that the Patent issues.
(b) Licensee
and its Affiliates, shall keep complete and accurate records containing all
information required for the computation and verification of the royalties to be
paid hereunder.
(c) Within
twenty (20) days after each calendar quarter beginning on the date of the first
Net Sale, Licensee shall deliver to Licensor a written report of Net Sales of
the Licensed Product for such calendar quarter and a calculation of the
royalties due to Licensor. Such statement of account (“Report”) shall show the
applicable Net Sales, broken down on a Licensed-Product-by-Licensed-Product
basis and shall itemize allowed Deductions. The Report delivered by
January 20 of each year shall also show a summary for the previous year. Payment
of royalties due shall accompany each Report. If no royalties are
due, the Report shall so state and the reasons therefor.
(d) All
royalties due shall be paid in United States Dollars. All royalties
due shall be converted (for the purposes of calculation and payment) into
equivalent United States funds at the exchange rate published by The Wall Street Journal (New
York edition) nearest to the last business day of the reporting
period.
(e) Payment
of royalties shall be subject to any restrictions imposed by the local
government. If foreign exchange is not freely available, Licensor has
the option to accept payment in the currency of the country from which royalties
are due. If a withholding or other tax is imposed on a royalty payment due, the
amount of royalty payable shall be the amount due less the amount of such tax
actually paid, Licensee shall cooperate with Licensor, including by filing any
necessary papers, to allow Licensor to recover any such withheld royalty
pursuant to any tax treaty or other method.
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(f) Licensee
shall, upon fifteen (15) days’ written request of Licensor, permit an
independent public accountant selected by Licensor to have access during
ordinary business hours to examine such records as may be necessary to determine
either the accuracy of any Report or the sufficiency of any royalty payment made
under this Agreement.
3.2 Product Development
Payments. As
partial consideration for the license grant, as set forth in Section 2.1, by
Licensor to Licensee of Know-How that is developed after the Effective Date by
Licensor, Licensee shall pay to Licensor the following amounts for the purpose
of further development of the Protectan technology:
(a) $1,000,000.00
within thirty (30) days from the Effective Date.
(b) $650,000.00
within ninety (90) days following the payment made pursuant to Section
3.2(a).
3.3 Payment Term. If
any payment due hereunder is not paid when due, such payment shall be subject to
a late charge from the date due until paid calculated at the rate of one percent
(1.0%) per month. All payments due hereunder shall be paid in United
States Dollars and shall be paid via money transfer of readily available funds
to such account or accounts as Licensor shall specify from time to
time.
3.4 Exceptions. The
Patents and Know-How have not been contained in the list of prohibited and
restricted imported technologies of the People’s Republic of
China. However, as provided in Articles 16, 17, and 18 of the Foreign
Trade Law of the People’s Republic of China, if the Patents and Know-How
are prohibited from being imported and this Agreement risks becoming invalid,
the parties shall immediately take all actions, including filing documents
required to withdraw any of the applications filed with the Regulatory
Authority. If the technology and products and processes underlying
the licensed Patents and Know-How may not be imported, Licensor shall assist
Licensee to take the actions necessary to allow such importation and Licensee,
at its option and in good faith, may terminate the Agreement.
4.
Information.
4.1 Conveyance of
Information. Promptly after receipt of the payment set forth
in Section
3.2(a) Licensor shall disclose to Licensee the complete text of, and all
other information in its possession or control directly related to all Patent,
including but not limited to, to the extent such information is available, 1)
All related Published papers and Patents of CBLB 612; 2) CBLB 612 lipoprotein
synthesis route(in detail) including all the process and scale up of isolation,
purification and lipid modification etc; 3) Physicochemical properties and
Pre-formulation; 4) Mechanism of Action; 5) In vitro and In vivo efficacy
studies( mice and monkey) Including comparative studies with other marketing
drugs( AMD 3100, C-GSF); 6) ADME studies; 7) Safety and Toxicology assessment;
8) Summary. Within thirty (30) days after the date Licensee is awarded the New
Drug Production status by the Regulatory Authority, Licensor shall convey to
Licensee manufacturing technology and current US clinical data and related
Know-How in Licensor’s possession directly related to the Licensed Products.
Each party shall provide a written report (each such report a “Status Report”) setting forth
the results of any tests, including clinical data, conducted by such party to
the other party (i) on a quarterly basis beginning on January 1, 2010, and (ii)
upon the other party’s reasonable request. Each Status Report shall
set forth the results of any tests, including clinical data, collected by the
reporting party for the interim time period beginning on the date of the prior
Status Report.
4.2 Assistance. Commencing on the
Effective Date, Licensor has the exclusive right to assist Licensee in
connection with Licensee’s submission to the Regulatory Authority to the extent
related to the Licensed Products or Technology. Licensor will use commercially
reasonable efforts to provide Licensee information and documents in Licensor’s
possession and control (including any certificates regarding Licensor’s legal
status) and such other assistance as reasonably required by Licensee for
regulatory purposes in connection with this Agreement; provided, that in no
event shall Licensor be obligated to incur expenses as a result of providing
such assistance and Licensor shall be reimbursed for actual employee time and
costs incurred by Licensor at the rates set forth in Exhibit D. The rates
set forth on Exhibit
D shall be updated by Licensor on a yearly
basis. Notwithstanding the foregoing, Licensee shall be provided at
least one time on-site assistance, free of charge (except travel
expenses).
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4.3 Consulting Services and Future
Assistance.
(a) Consulting
Services. Commencing on the Effective Date and in addition to
the assistance provided by Licensor pursuant to Section 4.3, in
connection with Licensee’s development of the Technology, Licensor shall provide
to Licensee such consulting services as the parties may be mutually agreed to
from time to time. The scope of all such consulting services to be
provided by Licensor shall be evidenced by one or more work orders, which shall
be agreed to by both parties prior to the commencement of such consulting
services. Licensor shall provide such consultation services at the rates set
forth in Exhibit
D.
(b) Future
Assistance. Licensor agrees to provide such future assistance
and technical support as Licensee may reasonably request in connection with
Licensee’s development, scale up and commercialization of Licensed Product.
Licensor shall provide such future assistance and technical support at the rates
set forth in Exhibit
D.
4.4 Expenses.
(a) Licensee
shall reimburse Licensor for all travel and other expenses incurred in
connection with the performance of services by Licensor pursuant to Section 4.2 or Section
4.3. To the extent any travel for the performance of services
pursuant to Section
4.2 or Section
4.3 requires travel in excess of six (6) hours, Licensee agrees to
reimburse Licensor for the cost of business class accommodations for such
travel.
(b) To
the extent Licensor requests Licensee to consult with or provide other services
to Licensor, Licensor shall reimburse Licensee for all travel and other expenses
incurred in connection with the performance of services by Licensee. To the
extent any travel for the performance of services requires travel in excess of
six (6) hours, Licensor agrees to reimburse Licensee for the cost of business
class accommodations for such travel.
4.5 Payment
Terms. Licensor shall invoice Licensee for all services
rendered and expenses incurred pursuant to Sections 4.2, 4.3 and 4.4 on a monthly
basis. Licensee shall pay such invoice(s) within thirty (30) days of
Licensee’s receipt of such invoice(s). The payment terms set forth in
Section 3.3
shall apply to all payments made pursuant to this Article
4.
5.
Commercialization;
Ownership; Improvements; Future Performance.
5.1 Commercialization.
(a) Licensee
shall use its best efforts to develop and commercialize the Licensed Products in
the Territory, including obtaining the New Drug Approvals, marketing, and
entering into any co-marketing, distribution and/or co-promotion
arrangements. Within thirty (30) days from the Effective Date,
Licensee shall submit a reasonably satisfactory Work Plan to Licensor setting
forth its plan to commercialize the Licensed Products with reasonable timelines.
Licensee shall have sole responsibility for implementing the Work Plan at its
own expense. The Work Plan shall be attached hereto as Exhibit C, and shall
be amended from time to time pursuant to Section
5.1(b).
(b) Representatives
of Licensor and Licensee shall meet for informational purposes at least on a
semi-annual basis to review the progress of the Work Plan. Licensee
shall provide an updated Work Plan to Licensor after each such informational
meeting.
5.2 Manufacturing. Licensee
and its Affiliates have sole responsibility for manufacturing Licensed Products
or having Licensed Products manufactured for it by a third party manufacturer in
the Territory and the Field approved by Licensor in its sole
discretion. Licensee will manufacture the Licensed Products according
to the specifications set forth in Exhibit A-1. The
Exhibit A-1
shall be amended from time to time by Licensee in its sole
discretion.
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5.3 Ownership. Licensor
shall remain the owner of the Patents and Know-How.
5.4 Improvements.
(a) Licensee
Improvements. All Improvements and related intellectual
property that come into existence during the Term, including any clinical data
and documentation, and which relate to or are derived from work done by or for
Licensee or any Affiliate or sublicensee of Licensee without any contribution by
Licensor or any of its Affiliates, contractors, or agents (each, a “Licensee Improvement”), shall
be deemed the property of Licensee and shall be free from the interference of
Licensor. Licensee, on behalf of itself and any applicable Affiliate
or sublicensee, hereby grants Licensor an irrevocable, non-exclusive,
sublicensable, fully paid license in all areas of the world outside of the
Territory to develop, make, have made, use, offer for sale, sell and have sold
the Licensee Improvements.
(b) Licensor
Improvements. All Improvements and related intellectual
property that come into existence during the Term, including any clinical data
and documentation, and which relate to or are derived from work done by or for
Licensor or any Affiliate or sublicensee of Licensor without any contribution by
Licensee or any of its Affiliates, contractors, or agents (each, a “Licensor Improvement”), shall
be deemed the property of Licensor and shall be free from the interference of
Licensee. Licensor, on behalf of itself and any applicable Affiliate
hereby grants Licensee an exclusive, sublicensable, fully paid license in the
Territory to develop, make, have made, use, offer for sale, sell and have sold
the Licensor Improvements.
(c) Joint
Improvements/Inventions. All Improvements, inventions,
know-how and related intellectual property that come into existence during the
Term, including any clinical data and documentation, which relate to or are
derived from work done by or for Licensee or any Affiliate or sublicensee jointly with Licensor
(i.e., with a contribution by Licensor or any of its respective Affiliates,
contractors, or agents) shall be deemed the joint property of Licensor and
Licensee, both Licensor and Licensee can use it free.
5.5 Clinical
Data. Licensee, on behalf of itself and any applicable
Affiliate or sublicensee, hereby grants to Licensor an irrevocable,
non-exclusive right to use the clinical data related to the Technology owned by
Licensee in connection with obtaining FDA or other similar government approvals
of current or future products. Licensor, on behalf of itself and any applicable
Affiliate or any third party licensed by licensor, hereby grants to
Licensee an irrevocable, non-exclusive right to use the clinical data related to
the Technology owned by Licensor in connection with obtaining Regulatory
Authority approvals of current or future products.
5.6 Site Inspection and
Monitoring. Upon the delivery of five (5) days’ prior written
notice, Licensor shall have the right to visit the facilities of Licensee for
the purposes of meeting with Licensee’s representatives, and inspecting the
clinical trials, research and development efforts, and sales and distribution of
the Licensed Products.
5.7 Right to Negotiate. If at any time during
the one (1) year period after the first commercial sale of any Licensed Product
Licensee: (i) believes it has achieved significant progress and results in its
commercialization of Licensed Products and a return to Licensor, and (ii)
desires to negotiate for the right to expand its license rights granted
hereunder beyond the Territory, Licensee shall so inform Licensor, and the
parties will negotiate in good faith for up to thirty (30) days thereafter about
such expansion.
6.
Representations
and Warranties.
6.1 Representations and Warranties of
Licensor. Licensor represents and
warrants that it is duly organized, validly existing and in good standing under
the laws of the state of Delaware; that it has full corporate power and
authority to enter into and deliver this Agreement and to carry out its
provisions; that there are no outstanding agreements, assignments or
encumbrances in existence that are inconsistent with the provisions of this
Agreement; that it is the lawful owner or licensee of the Technology and
therefore has the right to grant the rights granted by it herein; that the
compound descriptions related to the Technology and provided to Licensee are the
same as those compound descriptions used by Licensor in its own research
activities; that to Licensor’s knowledge the Patent and Know-How has actual
effect; and; that it has not licensed and will not license the Patent and
Know-How to any third party in the Territory.
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6.2 Representations and Warranties of
Licensee. Licensee represents and
warrants that it is duly organized, validly existing and in good standing under
the laws of People’s Republic of China; that it has full corporate power and
authority to enter into and deliver this Agreement and to carry out its
provisions; that there are no outstanding agreements, assignments or
encumbrances in existence that are inconsistent with the provisions of this
Agreement; that it is duly authorized to execute and deliver this Agreement and
to perform its obligations hereunder; and that the execution, delivery, and
performance of this Agreement by it does not require the consent, approval, or
authorization of (except that this Agreement is required under the Law of the
People’s Republic of China to be registered with the Ministry of Commerce of the
People’s Republic of China or its local counterpart) any governmental agency or
Regulatory Authority.
7.
Indemnification.
7.1 Indemnification by
Licensee.
Licensee shall indemnify and hold Licensor and its Affiliates, directors,
officers, employees and agents (collectively, “Indemnitees”) harmless from
and against any and all liabilities, actions, suits, claims, demands,
prosecutions, damages, costs, expenses or money judgments finally awarded
(including reasonable legal fees, whether incurred as the result of a third
party claim or a claim to enforce this provision) (collectively, “Liabilities”) incurred by or
instituted or rendered against any Indemnitee arising out of or in connection
with: (i) any act or omission of Licensee, any of its Affiliates, or any
sublicensee (including any direct or indirect exercise of Licensee’s rights
hereunder) or Licensee's material breach of this Agreement, except to the extent
such third party claims arise out of the gross negligence or willful misconduct
of an Indemnitee and provided that Licensor gives Licensee notice in writing of
any such claim or lawsuit within thirty (30) days of the date Indemnitee is
first notified in writing of such claim or lawsuit, provided, however, that the
failure of Indemnitee to give such prompt written notice shall not affect the
liability of Licensee, except to the extent that the rights of Licensee to
defend itself or to cure or mitigate any Liabilities are actually prejudiced
thereby. In any such claim or lawsuit:
(a) Licensor
will cooperate in the defense by providing access to witnesses and evidence
available to it. Licensor has the right to participate, at its expense, in any
defense to the extent that in its reasonable judgment Licensor may be prejudiced
by Licensee's sole defense thereof;
(b) With
respect to this Agreement, Licensor shall not settle, offer to settle or admit
liability in any claim or suit in which Licensor intends to seek indemnification
by Licensee without the written consent of a duly authorized officer of
Licensee;
(c) Licensee
shall not settle or otherwise compromise any such lawsuit or claim without the
prior written consent of Licensor if such settlement or compromise would require
any monetary compensation from, or adversely affect any interest or right of,
any Indemnitee; and
(d) Licensee
shall use the rights licensed hereunder from Licensor in accordance with terms
and conditions hereof. If Licensee is accused of infringement by a third
party, Licensee shall notify Licensor immediately, and, at Licensor’s expense,
Licensor shall cooperate with Licensee to remove the obstacles.
7.2 Indemnification by
Licensor.
Licensor shall indemnify and hold Licensee and its Affiliates, directors,
officers, employees and agents (collectively, “Indemnitees”) harmless from
and against any and all liabilities, actions, suits, claims, demands,
prosecutions, damages, costs, expenses or money judgments finally awarded
(including reasonable legal fees, whether incurred as the result of a third
party claim or a claim to enforce this provision) (collectively, “Liabilities”) incurred by or
instituted or rendered against any Indemnitee arising out of or in connection
with: (i) any act or omission of Licensor, any of its Affiliates or Licensor's
material breach of this Agreement, except to the extent such third party claims
arise out of the gross negligence or willful misconduct of an Indemnitee and
provided that Licensee gives Licensor notice in writing of any such claim or
lawsuit within thirty (30) days of the date Indemnitee is first notified in
writing of such claim or lawsuit, provided, however, that the failure of
Indemnitee to give such prompt written notice shall not affect the liability of
Licensor, except to the extent that the rights of Licensor to defend itself or
to cure or mitigate any Liabilities are actually prejudiced
thereby.
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7.3 Reportable Occurrences. Each party shall advise
the other promptly of any occurrence which is reported or reportable by it to
any Regulatory Authority relating in any way to the subject matter of this
Agreement, including any Licensed Product(s).
7.4 Limitation. EXCEPT
FOR THE EXPRESS WARRANTIES IN THIS ARTICLE 7,
NEITHER PARTY MAKES, AND EACH PARTY SPECIFICALLY DISCLAIMS, ANY WARRANTIES,
EXPRESS OR IMPLIED, IN FACT OR BY OPERATION OF LAW, STATUTORY OR OTHERWISE,
INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, EFFICACY, AND NON-INFRINGEMENT. EXCEPT FOR VIOLATIONS OF ARTICLE 8
AND AMOUNTS FINALLY AWARDED FOR INDEMNIFICATION FOR THIRD PARTY CLAIMS UNDER
THIS SECTION 7,
NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY OR TO ANY THIRD PARTY FOR ANY
SPECIAL, CONSEQUENTIAL, EXEMPLARY OR INCIDENTAL DAMAGES (INCLUDING LOST OR
ANTICIPATED PROFITS RELATING TO THE SAME) ARISING FROM ANY CLAIM RELATING TO
THIS AGREEMENT, WHETHER SUCH CLAIM IS BASED ON CONTRACT, TORT (INCLUDING
NEGLIGENCE) OR OTHERWISE, EVEN IF AN AUTHORIZED REPRESENTATIVE OF SUCH PARTY IS
ADVISED OF THE POSSIBILITY OR LIKELIHOOD OF SAME.
8.
Confidentiality
and Non-Disclosure.
8.1 Nondisclosure. Receiver shall not use
or disclose any Confidential Information without the prior written consent of
Discloser. This obligation will continue for a period of five (5) years after
termination of this Agreement or expiration of the Term, whichever is
earlier.
8.2 Confidentiality. Receiver shall restrict
dissemination of Confidential Information to those of its employees, directors,
professional advisors, contractors, agents and sublicensees (if any) who have an
actual need to know, have a legal obligation to protect the confidentiality of
such Confidential Information, and in the case of Licensee as Receiver, have
completed the training required by Section 8.4. All
Confidential Information shall remain the sole property of Discloser and
Receiver shall obtain no right of any kind to the Confidential Information
disclosed, except as granted under this Agreement.
8.3 Confidentiality and Security
Procedures. Receiver shall prepare and deliver a certificate
to Discloser prior to Receiver obtaining any Confidential Information from
Discloser, executed by its officer under penalty of perjury, setting forth the
confidentiality procedures (“Confidentiality Procedures”)
and security measures (“Security Measures”) Receiver
will take to protect the Confidential Information.
(a) Confidentiality
Procedures shall include the following: (i) limiting the dissemination of
Confidential Information to those on a need-to-know basis, (ii) using
proprietary marking on all Confidential Information in tangible form; (iii) use
of contractual protections with employees, contractors, agents, and sublicensees
(if any) and other third parties; (iv) obtaining acknowledgements from employees
that they understand certain information is confidential and may not be
disclosed; (vi) using computer passwords and lock-out devices; and (vi) storing
Confidential Information in secure areas on Receiver’s computer
network.
(b) Security
Measures shall include the following: (i) locks on all doors to the
facility; (ii) use of badges for employees; (iii) exclusion of the general
public from the facility; (iv) shredding of sensitive documents; and (v)
exclusion of visitors from areas where Confidential Information is
kept.
8.4 Training of
Employees. Within thirty (30) days from the Effective Date,
Licensee shall conduct a training session for all employees to educate such
employees on the need to keep Confidential Information secret.
8.5 Restriction Exemption. Nothing contained in
this Article 8
shall be construed to restrict Receiver from using or disclosing Confidential
Information solely to the extent and solely as required: (a) for regulatory, tax
or customs reasons; (b) for audit purposes; (c) by court order or other
governmental order or request; or (d) to perform acts permitted by this
Agreement, including (i) disclosure by Receiver to third parties undertaking
feasibility and evaluation studies, clinical trials and the like on behalf of
Receiver, so long as such third parties are under a legal obligation to Receiver
to protect the confidentiality of such Confidential Information, or (ii)
disclosure by Receiver in connection with the marketing and commercial sale of
Licensed Products, to the extent required by law.
9
9.
Term and
Termination.
9.1 Term. Unless otherwise
terminated under this Section 9, this
Agreement shall continue in effect for a period of twenty (20) years, except
that the license rights with respect to any patent within the Patents shall
expire on the expiration date of such patent.
9.2 Termination For
Breach.
(a) Either
party may terminate this Agreement by giving the other party prior written
notice of not less than thirty (30) days in the case of a monetary breach and of
not less than ninety (90) days if the other party commits a non-monetary
material breach of this Agreement, and such party fails to cure such breach
during such thirty (30) or ninety (90) day period, as applicable.
(b) In
the case of a non-monetary breach, the cure period may be extended for such
longer period as may reasonably be necessary, in the non-breaching party’s sole
judgment, if cure is not reasonably possible within the initial ninety (90) day
period, provided the breaching party continues its diligent efforts to cure such
breach. No such cancellation and termination shall release the breaching party
from any obligations hereunder incurred prior thereto. The breaching
party should pay the other party such party’s actual damages. If this
Agreement is terminated for Licensee's material breach, Licensor shall be
entitled to all funds previously paid by Licensee, together with all studies,
information, data, and Improvements generated by Licensee in whole or in part in
connection with this Agreement. Licensee shall immediately cease
using the Patents and Know-How and shall immediately cease selling, licensing or
transferring the Licensed Products. The parties acknowledge that a violation of
this provision would cause irreparable harm to Licensor for which an award of
damages may be inadequate compensation. Accordingly, Licensor may
enjoin Licensee from any and all acts in violation of this provision or its
intellectual property rights and Licensee hereby consents to the entry of an
injunction by any court of competent jurisdiction enjoining any breach or
threatened breach of such provision or Licensor’s intellectual property rights,
in addition to any other relief Licensor may be entitled to. If this
Agreement is terminated for Licensor's material breach, (i) Licensee shall not
be liable for payments not yet due and payable under Article 3 hereof,
(ii) Licensor shall return all payment which Licensee has paid, provided that in
no event shall Licensor’s liability under this Agreement exceed the total amount
of all payments actually received by Licensor from Licensee, and (iii) Licensee
shall be entitled to hold all studies, information, data, and Improvements
presented by Licensor in whole or in part in connection with this
Agreement.
9.3 Termination Due to Cease of Business
Operations.
(a) Licensor
may terminate this Agreement on thirty (30) days’ notice if Licensee suspends or
unreasonably delays development of Licensed Products, ceases to conduct
business, dissolves, or has a receiver or administrator appointed over its
business or all of its assets, or is, or becomes, bankrupt. For
purposes of this Agreement, suspending or unreasonably delaying development of
the Licensed Products shall include: (i) terminating or withdrawing any
application for New Drug Approval with a Regulatory Authority, (ii) termination
of any principal manager, director or other Licensor’s executive responsible for
any Licensed Product without replacing the individual within thirty (30) days;
and (iii) terminating or substantially reducing funding for the development of
Licensed Products.
9.4 Return/Destroy Information Upon
Termination. If this Agreement is
terminated under Section 3.1(e), Section 9.2, Section 9.3 or Section 13, subject
to the other terms of this Agreement, Licensee shall within five (5) days return
to Licensor (or destroy if Licensor requests) all information, data (including
clinical data) relating to the Patents or any Licensed Products.
9.5 Termination
of this Agreement shall be without prejudice to any rights of either party
against the other which may have accrued up to the date such termination becomes
effective.
10
9.6 All
obligations and causes of action accruing to either party under this Agreement
shall survive expiration or termination of this Agreement for any
reason.
10. Infringement
of Patents.
10.1 Infringement by Third Party.
In the event of an
actual or suspected infringement of a Patent by a third party, the following
shall apply:
(a) Notice. Each
party shall give the other written notice if one of them becomes aware of any
infringement by a third party of any Patent. Upon notice of any such
infringement, the parties shall promptly consult with one another with a view
toward reaching agreement on a course of action to be pursued.
(b) Licensee’s Right to Bring
Infringement Action. If a third party
infringes any Patent in the Territory, Licensee has the first right, but not the
obligation, to institute and prosecute an action or proceeding to xxxxx such
infringement and to resolve such matter by settlement or otherwise.
(i) Licensee
shall notify Licensor of its intention to bring an action or proceeding prior to
filing the same and in sufficient time to allow Licensor the opportunity to
discuss with Licensee the choice of counsel for such matter. Licensee shall keep
Licensor timely informed of material developments in the prosecution or
settlement of such action or proceeding. Licensee shall be responsible for all
fees and expenses of any action or proceeding against infringers which Licensee
initiates. Licensor shall cooperate fully at Licensee’s expense by joining as a
party plaintiff if reasonably requested to do so by Licensee or if required to
do so by law to maintain such action or proceeding and by executing and making
available such documents as Licensee may reasonably request. Licensor may be
represented by counsel in any such legal proceedings, at Licensor's own
expense. In any such action or proceeding Licensee shall not settle
or otherwise compromise right or interest of Licensor in any Patent, e.g., agree
to reduce the scope of any Valid Claim, without the prior written consent of
Licensor.
(ii) If
Licensee elects not to exercise such first right, Licensor shall have
the right, at its discretion, to institute and prosecute an action or proceeding
to xxxxx such infringement and to resolve such matter by settlement or
otherwise. Licensee shall cooperate fully by joining as a party plaintiff if
reasonably requested to do so by Licensor or if required to do so by law to
maintain such action and by executing and making available such documents as
Licensor may reasonably request. Licensee may be represented by counsel in any
such action, at its own expense.
(c) Licensee’s Use of
Proceeds. All amounts of every kind and nature recovered from
an action or proceeding of infringement brought by Licensee shall be used first
to reimburse each party, on a pro rata basis, for its documented and actual
costs of expenses in such effort, including attorneys' fees, expert fees and all
other related expenses, and the balance shall thereafter be considered Net Sales
under this Agreement and subject to royalty payments under Section
3.
(d) Licensor's Use of
Proceeds. All amounts of every kind and nature recovered from
an action or proceeding of infringement brought by Licensor shall be used first
to reimburse each party, on a pro rata basis, for its documented and actual
costs of expenses in such effort, including attorneys' fees, expert fees and all
other related expenses, and the balance shall belong to Licensor.
10.2 Infringement of Third Party
Rights.
(a) If
Licensor, its Affiliates, Licensee, its Affiliates, sublicensees, distributors
or other customers are sued or threatened with suit in the Territory by a third
party alleging infringement of patents or other intellectual property rights
that are alleged to cover the manufacture, use, sale, offer for sale, import,
export or distribution of one or more Licensed Products, Licensor or Licensee,
whichever is relevant, will promptly notify the other in writing and provide a
copy of the lawsuit or claim. Licensor shall control the defense and at its
expense in any such claim or suit, subject to the following paragraph (b). If
Licensee is required to pay a royalty or other amount to a third party to be
permitted to manufacture, use, sell, import, export or distribute one or more
Licensed Products in the Territory as a result of a final judgment or
settlement, the amounts due pursuant to such royalty shall be deductible by
Licensee from the royalties payable and accruing to Licensor; however, total
deductions may not exceed fifty percent (50%) of royalties otherwise
due.
11
(b) Licensee
shall fully cooperate with Licensor in the defense of any such action at
Licensor’s expense. Licensee has the right to settle any such suit, including
the right to grant one or more sublicenses, with Licensor’s prior written
approval, which approval shall not unreasonably be withheld, provided that
Licensor shall not have the right to surrender, limit, or adversely affect any
rights to the Patents or to the Know-How.
11. Patent
Prosecution and Maintenance; Patent Costs; Patent Term
Extension.
11.1 Prosecution and
Maintenance. Licensor shall be solely responsible for the
preparation, filing, prosecution and maintenance of the Patents in Licensor's
name, including oppositions and interferences. Licensor and Licensee shall
consult and cooperate with each other, and Licensor shall keep Licensee
reasonably informed with respect to the prosecution and maintenance of the
Patents hereunder. As requested from time to time by Licensee,
Licensor will provide Licensee with copies of all material documents received or
prepared by Licensor in the prosecution and maintenance of the
Patents.
11.2 Patent Extensions. Licensor shall be
solely responsible for deciding whether to obtain patent term extensions under
the provisions of 35 USC Section 156 for any U.S. Patent and for non-U.S.
Patents under similar provisions of law of other countries involving a Licensed
Product that has obtained Regulatory Approval.
11.3 Patent Costs. Licensor shall
notify Licensee each time a Patent is available to be nationalized in the
Territory. Within twenty (20) business days of Licensee’s receipt of
such notice, Licensee shall reply to Licensor in writing stating which countries
within the Territory Licensee agrees to nationalize such Patent
in. Licensee shall reimburse Licensor for costs incurred after the
Effective Date of nationalizing and maintaining the Patents in Hong Kong, Taiwan
and Macau. Licensor shall invoice Licensee for all such costs as such
costs are incurred. Licensee shall pay such invoice(s) within thirty
(30) days of Licensee’s receipt of such invoice(s). The payment terms
set forth in Section
3.3 shall apply to all payments made pursuant to this Section
11.3. If any payment due pursuant to this Section 3.3 is not
paid within six (6)-months of the date on which Licensee received the first
invoice for such cost, the license granted pursuant to Section 2.1 shall
automatically terminate with respect to Patent(s) and the country(ies) to which
the late payment relates.
12. Trademark. Licensee may use the
Trademark in connection with any marketing, advertising and promotional material
approved in writing by Licensor prior to use by Licensor. The
Trademark shall be owned by Licensor, and Licensee has no claims or rights in or
to the Trademark. In the event Licensee intends to use the Trademark, the
parties shall work together to engage a qualified trademark agent, at Licensee’s
expense to register the Trademark in the People’s Republic of China and carry
out other activities related to the registration and protection of the Trademark
in the Territory. Upon expiration or
termination of this Agreement for any reason, Licensee will immediately cease
all use of the Trademark and shall cause any sublicensee or Affiliate of
Licensee using the Trademark to immediately cease all use of the Trademark and,
at Licensee’s election, either destroy or deliver to Licensor all materials in
Licensee’s control or possession which bear such Trademark. All
goodwill and other rights accruing from any use of the Trademark belong to
Licensor, and Licensee shall take all actions requested by Licensor to ensure
such rights are maintained and preserved for Licensor. Licensee shall
not take any action, including attempting to register any xxxx or commercial
symbol which might be considered confusingly similar to the Trademark, or which
shall decrease the scope of or otherwise affect Licensor’s rights in the
Trademark. This Section 12 shall
survive any termination or expiration of this Agreement. The
foregoing shall not prevent Licensee from adopting a new trademark for the
Licensed Products, but such new trademark shall not be confusingly similar to
the Trademark or otherwise decrease the scope of or otherwise affect Licensor’s
rights in such Trademark.
13. Quality
Control. To
continue to use the Trademark, all Licensed Products shall be of at least
standard quality and shall meet or exceed any and all governmental and industry
standards, regulations, guidelines regarding such products. Licensor has the
right to inspect any manufacturing facility and/or Licensed Product at any time
upon five (5) business days’ notice for compliance with this Section 13. Licensee
will present and promote the Licensed Products fairly and in compliance with all
federal, state and local laws, regulations and ordinances in the
Territory.
12
14. Miscellaneous.
14.1
Force
Majeure. If
the performance by a party of any of its obligations under this Agreement shall
be prevented by circumstances beyond its reasonable control that could not have
been avoided by the exercise of reasonable diligence, then such party shall be
excused from the performance of that obligation for the duration of the event.
The affected party shall promptly notify the other party in writing should such
circumstances arise, give an indication of the likely extent and duration
thereof, and shall use commercially reasonable efforts to resume performance of
its obligations as soon as practicable. However, nor force majeure event shall
reduce or delay the obligation of timely payment.
14.2 Notices. Any notice required to
be given or made under this Agreement by one of the parties to the other shall
be deemed to have been given upon: (a) receipt if sent by certified or
registered mail, postage prepaid, return receipt requested; (b) delivery if sent
by a courier service that confirms delivery in writing; (c) the date of personal
delivery; or (d) the date sent by facsimile, with a confirmation copy sent via
international courier, in each case to the address indicated below, or to such
other address as the addressee has last furnished in writing to the addressor in
compliance with this Section
14.2.
If to
Licensor:
Cleveland BioLabs, Inc.
Attn:
Xxxxxxx Xxxxxxxx, Ph.D., President and CEO
00 Xxxx
Xxxxxx
Xxxxxxx,
XX 00000
Fax: x0
(000) 000-0000
Phone: x0
(000) 000-0000
Email:
Xxxxxxx@xxxxxxxx.xxx
If to
Licensee:
Zhejiang
Hisun Pharmaceutical Co., Ltd.
Attn:
Bai Hua, President and CEO
00
Xxxxxx Xxxx Xxxxxxxxx Xxxxxxx Xxxxxxxx
Fax:
0000-000-00000000
Phone:
0000-000-00000000
Email:
xxxxxx@xxxxxxxxxx.xxx
14.3 Adjudication of
Disputes.
(a) Governing
Law/Jurisdiction. The agreement shall be governed by and
interpreted in accordance with the substantive laws of Singapore. Courts within
Singapore will have jurisdiction over all disputes between the parties arising
out of or relating to this Agreement. The parties consent to and agree to submit
to the jurisdiction of such courts. Each of the parties waives, and
agrees not to assert in any such dispute, to the fullest extent permitted by
applicable law, any claim that: (a) such party is not personally subject to the
jurisdiction of such courts; (b) such party and such party’s property is immune
from any legal process issued by such courts; or (c) any litigation commenced in
such courts is brought in an inconvenient forum.
(b) Negotiation. In the event of any
controversy or claim arising out or relating to this Agreement, including those
concerning its validity, existence, interpretation, execution or
rescission/termination (a “Dispute”), the parties shall
first attempt to settle it amicably by negotiation.
(c) Hague
Convention. The parties hereby consent to service of process
in any Dispute that is in accordance with the Hague Convention on the Service
Abroad of Judicial and Extrajudicial Documents in Civil or Commercial
Matters. Notwithstanding the foregoing, Discloser has the
unrestricted right at any time to seek a court injunction or similar relief
prohibiting Receiver from making unauthorized disclosure or use of Discloser’s
Confidential Information. The prevailing party in any dispute shall be entitled
to recover its reasonable attorneys fees and costs.
13
14.4 Entire
Agreement. This Agreement and the attached Exhibits contain
the entire understanding of the parties with respect to the subject matter
hereof. All express or implied agreements and understandings, either oral or
written, heretofore made are expressly merged in and made a part of this
Agreement. This Agreement may be amended, or any term hereof modified, only by a
written instrument duly executed by the parties hereto.
14.5 Counterparts. This
Agreement may be executed in two or more counterparts, any of which may be
executed and delivered via facsimile or other electronic delivery, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
14.6 Severability/Headings. If
any provision of this Agreement is deemed unenforceable, the remainder of the
Agreement will not be affected and, if appropriate, the parties will attempt to
replace the unenforceable provision with a new provision that, to the extent
possible, reflects the parties’ original intent. The captions and headings used
in this Agreement are for reference only and are not to be construed in any way
as terms or used to interpret the provisions of this Agreement.
14.7 Assignment. Neither
party may without written approval of the other assign this Agreement or
transfer its interest or any part thereof under this Agreement to any third
party except that (i) either party may assign this Agreement without consent to
a third party that acquires all or substantially all of the business to which
this Agreement pertains, or, (ii) either party may assign this Agreement in
whole or part to any Affiliate or sublicensee of that party and the assigning
party shall and hereby guarantees the performance by such Affiliates and
sublicensees.
14.8 Independent
Contractor. It is understood that both parties hereto are
independent contractors and engage in the operation of their own respective
businesses and neither party hereto is to be considered the agent of the other
party for any purpose whatsoever and neither party has any authority to enter
into any contract or assume any obligation for the other party or to make any
warranty or representation on behalf of the other party. Each party shall be
fully responsible for its own employees, servants and agents, and the employees,
servants and agents of one party shall not be deemed to be employees, servants
and agents of the other party for any purpose whatsoever.
14.9 Publicity. Within two (2) days
following the Effective Date both parties shall agree to and approve a form of
press release or other public announcement concerning the execution of this
Agreement to be released by both Licensor and
Licensee.
14.10 Expenses. Each party shall bear
its own expenses in connection with the preparation and negotiation of this
Agreement.
14.11 Licensee Clinical Studies and New
Drug Administrative Protection. Licensee's clinical
trials and New Drug Administrative Protection application will be managed with
the help of the People’s Republic of China’s National Engineering Research
Center for the Development of New Drugs.
14
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by
their duly authorized representatives.
Cleveland
BioLabs,
Inc.
|
By:
|
/s/
Xxxxxxx Xxxxxxxx
|
|
Name:
Xxxxxxx Xxxxxxxx, Ph.D.
|
|
|
Title:
President and CEO
|
|
Zhejiang
Hisun Pharmaceutical Co.,
Ltd.:
|
/s/
Bai Hua
|
|
|
Title:
President and CEO
|
|
EXHIBIT
A
CHEMICAL
STRUCTURE OF LICENSED PRODUCT
To
be provided in accordance with Section
4.1.
EXHIBIT
A-1
LICENSED
PRODUCT SPECIFICATIONS
To
be provided in accordance with Section
4.1.
EXHIBIT
B
PATENTS
|
Application Name
|
Priority Date
|
Application # / country ID
|
Country
|
Status
|
||||
|
Methods
of Protecting Against Apoptosis Using Lipopeptides
|
June
13, 2005
|
200680029336.4
|
China
|
pending
|
||||
|
Methods
of Protecting Against Apoptosis Using Lipopeptides
|
June
13, 2005
|
09100988.5
|
Hong
Kong
|
pending
|
||||
|
Method
of Increasing Hematopoietic Stem Cells1
|
January
9, 2007
|
PCT/US2008/50644
|
PCT
|
pending
|
EXHIBIT
C
WORK
PLAN
[To
be provided by Licensee within thirty (30) days of the Effective
Date.]
EXHIBIT
D
LICENSOR
CONSULTING RATES
|
Title
|
Hourly
Rate (USD)
|
|||
|
CSO, Inventor
|
$ | 225 | ||
|
CEO
|
$ | 220 | ||
|
COO
|
$ | 200 | ||
|
CMO
|
$ | 200 | ||
|
Project
Leader - CBLB612
|
$ | 190 | ||
|
Sr.
Toxicologist
|
$ | 150 | ||
|
Sr.
VP - Drug Development
|
$ | 150 | ||
|
Director
of Chemistry
|
$ | 140 | ||
|
Director
of CMC
|
$ | 140 | ||
|
Director
of Regulatory Affairs*
|
$ | 275 | ||
*
Consultant Rate
