Execution Copy
CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR PORTIONS OF THIS DOCUMENT.
CONFIDENTIAL PROVISIONS HAVE BEEN OBSCURED.
PRODUCT DEVELOPMENT AND COMMERCIALIZATION AGREEMENT (together with all exhibits
and schedules, the "Agreement"), made as of this 21st day of June, 2005 (the
"Effective Date"), by and between ELITE LABORATORIES, INC., a Delaware
corporation having its principal place of business at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, XX 00000 XXX, and ELITE PHARMACEUTICALS, INC., a Delaware
corporation, having its principal place of business at 000 Xxxxxx Xxxxxx,
Xxxxxxxxx, XX 00000 XX (jointly and severally "ELITE") and IntelliPharmaCeutics
Corp., a Nova Scotia corporation, having its principal place of business at 00
Xxxxxxxxx Xxxx, Xxxxxxx Xxxxxxx, Xxxxxx X0X 0X0 ("IPC", and together with ELITE,
the "Parties" and each individually, a "Party").
RECITALS:
WHEREAS, IPC and ELITE specialize in the development and commercialization
of time release and other technologies for pharmaceutical providers;
WHEREAS, IPC is the owner of Know-How (as defined below) and other
proprietary technology relative to the Product (as defined below);
WHEREAS, ELITE and IPC desire to work together to develop, commercialize
and license for manufacture and sale, the Product;
WHEREAS, the Parties desire to set forth herein their respective
agreements with respect to the Product.
NOW, THEREFORE, in consideration of the recitals and the covenants and
conditions herein contained, ELITE and IPC agree as follows:
1. DEFINITIONS
The following terms as used in this Agreement shall have the meanings set
forth in this Article:
1.1. "Affiliate" shall mean, as to either Party, any Person which
owns or controls or which is owned or controlled by or the common control with
such Party to the extent of at least fifty percent (50%) of the equity or voting
power of the owned or controlled entity.
1.2. "ANDA" shall have the meaning set forth in Section 3.2(b).
1.3. "CFR" shall mean the Code of Federal Regulations, as may be
amended from time to time.
1.4. "Confidential Information" shall mean any information
pertaining to the Product or the Study from time to time communicated by or on
behalf of either Party or the other or developed pursuant to the Study,
including, without limitation, trade secrets, Know-How, pricing, costs,
suppliers, Licensees, customer information, patent rights, scientific,
technical, commercial and medical product development, product formulations and
technical specifications including, but not limited to the Product, methods of
analysis and testing, manufacturing methods, processes and production, batch
records, contractual arrangements, results, discoveries and inventions,
procedures and forms, and all information related to the Studies including
without limitation, the Protocol, whether of a written, oral or visual nature.
1.5. "Commercialization", "Commercializing", or "Commercialize"
shall mean all activities relating to manufacture, promotion, distribution,
marketing and sale of the Product in the Territory.
1.6. "Committee" shall have the meaning set forth in Section 2.1
hereof.
1.7. "CRO" shall have the meaning set forth in Section 3.2(f)
hereof.
1.8. "Development Plan" shall mean the Product Development Activity
Schedule annexed hereto as Exhibit A.
1.9. "FDA" shall mean the U.S. Food and Drug Administration.
1.10. "IPC Intellectual Property Rights" shall have the meaning set
forth in Section 5.2 hereof.
1.11. "Know-How" shall mean all technology, data, information,
formulations, technical specifications, processes and methods necessary or
useful in the manufacturing, production, testing or registration of drug
products, including but not limited to, the Product.
1.12. "Licensee" shall mean any Person that holds a license approved
by the Parties and granted by the Parties to Commercialize the Product in the
Territory pursuant to a License Agreement.
1.13. "Lien" shall mean any lien, pledge, mortgage, security
interest, claim, lease, charge, option, right of first refusal or first offer,
easement, transfer restriction, voting requirement or any other encumbrance,
restriction or limitation.
1.14. "License Agreement" shall have the meaning set forth in
Section 6.1 hereof.
1.15. "Marketing Authorization" shall mean the final approval of all
regulatory authorities necessary to market the Product in the Territory,
including as applicable pricing
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and reimbursement approval and all other approvals required in the Territory
for the marketing, distribution and sale of the Product in the normal course of
business.
1.16. "Person" shall mean any individual, partnership,
limited-liability company, corporation, joint venture, trust, association or any
other entity, domestic or foreign.
1.17. "Product" shall mean [ ] generic [( )] delayed
release capsules, [ ], or either of these.
1.18. "Protocol" shall mean the protocol developed by IPC in
connection with the Studies to be conducted for, and as agreed to by, the
Parties.
1.19. "Regulatory Filing" shall have the meaning set forth in
Section 3.2(h) hereof.
1.20. "Representative" shall have the meaning set forth in Section
2.1 hereof.
1.21. "Studies" shall mean the clinical trials needed to qualify the
Product for an ANDA.
1.22. "Territory" shall mean the United States and its territories,
Canada and Mexico.
2. DEVELOPMENT AND COMMERCIALIZATION COMMITTEES
2.1. DEVELOPMENT COMMITTEE Within ten (10) days after the Effective
Date, ELITE and IPC shall establish a Development Committee (the "D-Committee")
comprised of not less than two, and not more than three, persons
("Representatives") selected by each Party. ELITE and IPC shall each designate
an equal number of Representatives to the D-Committee, with each Party having
the right to increase the number of Representatives at any time to the maximum
of three upon written notice to the other Party; provided, however, in any
event, IPC and ELITE shall retain an equal number of Representatives on the
Committee and equal voting rights. The D-Committee shall carry out the duties
set forth below in Section 2.4.
2.2. The first meeting of the D-Committee shall be held within
fifteen (15) days from the Effective Date, at which time the procedures of the
D-Committee may be established. Thereafter, the D-Committee shall meet on such
schedule as deemed appropriate by the Representatives, but not less frequently
than each calendar quarter, with any one Representative being empowered to call
a meeting of the D-Committee upon at least five (5) days' notice (which notice
shall include a detailed description of all matters to come before the
D-Committee at such meeting for consideration or action).
2.3. At meetings, each Party shall have the right to provide
information for consideration and the D-Committee shall consider all such input.
All decisions by the D-Committee shall be made by unanimous vote of its
Representatives. For greater certainty, a vote is unanimous if, and only if, all
of the Parties' Representatives in actual attendance at any such
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meeting, irrespective of the Party they represent, vote for the same outcome of
any decision to be taken. A quorum required for any action by the D-Committee
shall consist of at least one ELITE Representative and one IPC Representative.
Participation at a meeting may be in person, by telephone conference call or by
video conference, so long as all participants can hear and be heard by one
another at all times throughout the meeting. If the meeting is in person, it
shall be held alternately at ELITE's and IPC's offices, unless otherwise agreed
by the Representatives. All Representatives serving on the D-Committee not in
attendance shall be notified in writing immediately of any action taken or
approved by the D-Committee.
2.4. The duties of the D-Committee shall be to:
(1) keep the Parties apprised of any development issues with respect
to the Product and effect a plan of action to resolve same;
(2) monitor the performance and progress of the Development Plan;
(3) such other matters relating to sub-paragraphs (1)and (2) above
as may be necessary or appropriate to consider.
2.5. If the D-Committee cannot resolve any dispute within its
purview after fifteen (15) days or such other period as may be agreed by the
D-Committee, the dispute will be referred to a designated senior officer of each
of ELITE and IPC, and thereafter, in the event of continued deadlock, will be
resolved pursuant to the deadlock provisions set forth in Section 14.
2.6. COMMERCIALIZATION COMMITTEE At such time as the D-Committee so
recommends, ELITE and IPC shall establish a Commercialization Committee (the
"C-Committee") comprised of not less than two, and not more than three,
Representatives selected by each Party. ELITE and IPC shall each designate an
equal number of Representatives to the C-Committee, with each Party having the
right to increase the number of Representatives at any time to the maximum of
three upon written notice to the other Party; provided, however, in any event,
IPC and ELITE shall retain an equal number of Representatives on the C-Committee
and equal voting rights. The C-Committee shall carry out the duties set forth
below in Section 2.9.
2.7. The first meeting of the C-Committee shall be held within
fifteen (15) days from the date of recommendation for its establishment by the
D-Committee, at which time the procedures of the C-Committee may be established.
Thereafter, the C-Committee shall meet on such schedule as deemed appropriate by
the Representatives, but not less frequently than each calendar quarter, with
any one Representative being empowered to call a meeting of the C-Committee upon
at least five (5) days' notice (which notice shall include a detailed
description of all matters to come before the C-Committee at such meeting for
consideration or action). Nothing herein precludes any Representative for either
the D-Committee or the C-Committee from being a Representative of the other or
both committees. Where practical, the D-Committee and the C-Committee will hold
their meetings concurrently.
2.8. At meetings, each Party shall have the right to provide
information for consideration and the C-Committee shall consider all such input.
All decisions by the C-
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Committee shall be made by unanimous vote of its Representatives. For greater
certainty, a vote is unanimous if, and only if, all of the Parties'
Representatives in actual attendance at any such meeting, irrespective of the
Party they represent, vote for the same outcome of any decision to be taken. A
quorum required for any action by the C-Committee shall consist of at least one
ELITE Representative and one IPC Representative. Participation at a meeting may
be in person, by telephone conference call or by video conference, so long as
all participants can hear and be heard by one another at all times throughout
the meeting. If the meeting is in person, it shall be held alternately at
ELITE's and IPC's offices, unless otherwise agreed by the Representatives. All
Representatives of the C-Committee not in attendance shall be notified in
writing immediately of any action taken or approved by the C-Committee.
2.9. The duties of the C- Committee shall be to:
(1) pursue and consider license agreements for the Commercialization
of the Product in the Territory, or in any part thereof, with any potential
Licensee suggested for consideration by either Elite or IPC. The criteria which
the C-Committee shall take into account in the consideration of any such license
agreements shall include, but are not limited to, the maximization of market
penetration and revenues for the Product in the Territory, or in any part
thereof; and
(2) such other matters relating to paragraph (1) above as may be
necessary or appropriate to consider.
2.10. If the C-Committee cannot resolve any dispute within its
purview after fifteen (15) days or such other period as may be agreed by the
C-Committee, the dispute will be referred to a designated senior officer of each
of ELITE and IPC, and thereafter, in the event of continued deadlock, will be
resolved pursuant to the deadlock provisions set forth in Section 14.
3. RESPONSIBILITIES OF THE PARTIES
3.1. The Development Plan, with milestones listed, setting out the
specific responsibilities of each of ELITE and IPC that will be required in
order to complete development of the Product, and to secure regulatory approval
necessary to the manufacture and sale of the Product in the Territory, is
annexed hereto as Exhibit A. Each of the Parties agrees to use reasonable
efforts to perform each of the milestone activities required to be performed by
such Party on or before the dates required for performance of such activity
under the Development Plan. Subject to all the terms and conditions of this
Agreement, including but not limited to the provisions of Section 5, and in
order to achieve the milestones set forth in the Development Plan, IPC and ELITE
hereby agree to conduct and carry out the activities set forth in Section 3.2,
in the case of IPC and in Section 3.3, in the case of Elite.
3.2. IPC hereby represents and warrants that it has completed, or
agrees that it will complete in accordance with the Development Plan, certain
matters as follows:
(a) IPC has developed and validated all pharmaceutical analytical
methods necessary and sufficient for the analysis of the drug substance,
impurities, and degradation
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products, including stability indicating methods, and has prepared or will
prepare all necessary written documentation and reports in relation to these
methods;
(b) IPC has developed formulations and processes for the manufacture
of the Product as required for pilot clinical studies. IPC will transfer the
technology in relation to the formulations and the processes to the Elite
facility during the scale-up process at the Elite facility, and will make such
adjustments and optimizations of such formulations and processes during such
scale-up and during the pivotal clinical studies phase of the development
program, with a view to filing an Abbreviated New Drug Application ("ANDA") with
the FDA with respect to the Product;
(c) IPC has managed and overseen the design and the conduct of
successful pilot clinical studies on the Product;
(d) IPC will transfer pharmaceutical analytical methods and
operating procedures relating to the Product to the ELITE facility, and will
provide all reasonable technical and documentary assistance in the transfer and
revalidation process of such methods;
(e) IPC will provide on-site assistance and sufficient information
to designated ELITE personnel to allow ELITE personnel to scale up the process
developed by IPC and to manufacture Product batches for the additional pilot
studies, if any, and the pivotal clinical studies at the ELITE facility. IPC
personnel will be present at the Elite facility and, the Parties agree, will
take an active role in the manufacture of such product batches;
(f) IPC (together with ELITE) will manage and oversee the design and
the conduct of additional pilot clinical studies, if any, and pivotal clinical
studies for the Products, such studies to be done at the facilities of such
third party contract research organization ("CRO") as may be acceptable to both
IPC and ELITE;
(g) IPC will prepare and file, in the name of IPC, such patent
application(s) on the Product as may be possible, based on IPC's intellectual
property, and take all appropriate steps to receive a grant of such patent(s)
and maintain such patent(s) if granted; and
(h) IPC shall be responsible for the preparation of all regulatory
filings (which shall be filed in IPC's sole name), including all clinical
investigational new drug applications in connection with the applications for
regulatory approval for the Product in each jurisdiction of the Territory (each
a "Regulatory Filing"), all as required under applicable laws of the Territory.
3.3. ELITE hereby agrees that it will complete in accordance with
the Development Plan, certain matters as follows
(a) ELITE will conduct all work reasonably necessary for the
transfer of fully validated pharmaceutical analytical methods (and
implementation thereof) and operating procedures transferred from IPC to the
ELITE facility for the manufacture and release of Product batches for the
Studies;
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(b) ELITE will manufacture the Product batches for the Studies at
its premises (whereas, commercial manufacturing shall be as set forth in Section
6.2);
(c) ELITE will be responsible for conducting the CMC (chemistry,
manufacturing and controls) activities including production, quality controls,
and stability studies with respect to the Product (with input from IPC, if
necessary);
(d) ELITE (together with IPC) will manage and oversee the design and
the conduct of additional pilot clinical studies, if any, and the pivotal
clinical studies for the Product, such studies to be done at the facilities of
such third party CRO as may be acceptable to both Parties;
(e) ELITE will oversee the packaging and labeling of the Product at
a mutually agreed upon packaging facility for the purpose of the pivotal
clinical studies and the stability studies;
(f) ELITE will provide to IPC, for the purposes of regulatory
filing, all necessary documentation and reports in respect of the manufacture,
release and packaging of the Product batches for the pivotal clinical studies
and stability studies; and
(g) ELITE will provide to IPC, for the purposes of regulatory
filing, all other reasonably necessary data, results, documents and documentary
support.
3.4. The Parties shall jointly take the following actions:
(a) The Parties shall agree, as required, as to the identity of the
Party best able to prepare any aspect of any regulatory filing, and each Party
will co-operate with the other to provide such assistance as may be requested or
necessary to complete such regulatory filing at the earliest opportunity.
3.5. Costs of Performing Hereunder.
(a) IPC alone will bear the costs for its areas of responsibilities
as set forth in Section 3.2 and ELITE alone will bear the costs for its areas of
responsibilities as set forth in Section 3.3;
(b) IPC and ELITE will share [ ] the following costs:
(i) the CRO and other third party costs of all clinical
studies (including pilot studies already completed or to be conducted after the
date hereof), all pivotal studies and all bio-analytics as may reasonably be
required; and
(ii) the cost of all regulatory filing fees for the regulatory
applications to the FDA or to such other regulatory authorities to whom
applications are made.
(c) It is the intention of the Parties that a commercial Licensee or
Licensees should bear all litigation costs in relation to regulatory filing or
defense of the Product arising
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after filing with regulatory authorities. To the extent that such costs, as may
arise after the date of this Agreement and before or after filing, are not borne
by such Licensee(s), ELITE and IPC will share [ ] in the costs of such
legal defense of the Product and/or defense against any litigation against the
Parties in respect of the Product.
3.6. Standard of Performance. The Parties must use reasonable,
timely efforts to fulfill their respective obligations set forth in this Section
3 hereof and elsewhere in this Agreement to pursue the development and
Commercialization of the Products in accordance with the estimated timetables as
set forth in the Development Plan. A Party's failure to fulfill its obligations
shall provide the other Party with the right to terminate this Agreement in
accordance with the provisions of Section 13 hereof.
3.7. Cooperation. Each Party shall use reasonable efforts to
cooperate with the other Party in connection with the preparation of each
regulatory filing relating to the Product. ELITE shall have the right to review
and comment upon any and all prepared applications and filings prior to
submission to the relevant governmental authorities. ELITE shall manufacture
bio-batches as required for submission purposes.
4. CLINICAL STUDIES
4.1. IPC and ELITE shall jointly determine the identity of, and
thereafter engage, a reputable third party to conduct the clinical studies for
the Product in accordance with the Development Plan (the "Studies") and such
third party shall be contractually bound to fulfill its obligations to conduct
such Studies in accordance with 21 CFR Section 312.52 and all applicable laws.
Each of IPC and ELITE agrees that, during the Term (and any Renewal Term),
except for the Studies contemplated hereunder, neither it nor any of its
Affiliates will conduct clinical studies for any other generic version of
[ ], whether for itself or any third party.
4.2. ELITE and IPC shall each have the right to discontinue the
Studies at any time prior to completion of such Studies upon 3 days' prior
written notice to the other Party, if ELITE or IPC, as the case may be,
reasonably believes that any serious adverse clinical event may arise.
5. PATENT PROSECUTION, MAINTENANCE AND DEFENSE; OWNERSHIP OF
INTELLECTUAL PROPERTY
5.1. Patents. During the Term (including all Renewal Terms), IPC
shall have the sole and exclusive right to file and obligation to maintain all
patent rights relating to the Product throughout the Territory and shall,
subject to the provisions set forth herein, use reasonable efforts to file
patent applications to protect the Product.
5.2. Intellectual Property. All IPC proprietary information,
Know-How, materials, methods and technology related to the Products including
without limitation, manufacturing information and any related patent
applications and patents owned or controlled by IPC to the extent they cover the
Products or any such information, know-how, materials or technology as applied
to the Product ("IPC Intellectual Property Rights") are and shall, in all
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events, be the sole and exclusive property of IPC. ELITE and IPC shall take such
actions, and execute and deliver such documents, as may be reasonably requested
from time to time by IPC at IPC's expense, to perfect the IPC Intellectual
Property Rights.
5.3. Identification of IPC Technology. At such time as the Product
is commercialized, the Parties agree, as between themselves, that the Product
packaging shall be marked with wording indicating IPC technology (such as, for
example, [ ]) subject to the consent of each Licensee.
6. COMMERCIALIZATION OF PRODUCT
6.1. License. As promptly as is practicable, the C-Committee shall
consider and, where appropriate, approve one or more Licensees suggested by
ELITE or IPC for the Commercialization of the Product in the Territory, such
C-Committee approval not to be unreasonably withheld by the Representatives. IPC
and ELITE shall jointly negotiate in good faith with such Licensee(s) upon
standard industry terms for an exclusive license for Licensee's
Commercialization of the Product in all or a portion of the Territory ("License
Agreement"), the terms of which License Agreement shall be approved by a
unanimous decision of the C-Committee, such approval not to be unreasonably
withheld by the Representatives. The main criterion for the grant of such
Licenses shall be the maximization of the commercial success of the Product in
the marketplace for any market in the Territory.
6.2. Commercial Manufacture. The Parties agree that the Product will
be manufactured by such Person, and at such location, that maximizes the
commercial success of the Product in the marketplace for any market in the
Territory. Nothing herein precludes either IPC or ELITE from bidding to become
such manufacturer for any market, provided only that the issue of selection of a
manufacturing entity should not delay the entry of the Product into that market.
6.3. Royalties and Other Proceeds.
(a) Subject to Section 6.3(b) below, during the Term of this
Agreement (including all Renewal Terms), all license fees from each Licensee
(including, without limitation, milestones, royalties, fees and other
consideration paid by any Licensee) and all other profits from the sale of the
Product (including sale proceeds and other consideration) shall be divided by
the Parties as follows: [ ] to IPC and [ ] to ELITE. Each License
Agreement shall provide that all fees payable by each Licensee shall be paid to
the Parties directly. If the Product is sold to a third party in accordance with
the mutual agreement of the Parties, the proceeds of the sale shall be divided
on a [ ] basis as provided above.
(b) To the extent any litigation costs shall have been [ ]
shared by the Parties in accordance with the provisions of Sections 3.5(c), 7.2
or 7.3, all amounts payable under Section 6.3(a) above shall first be divided
between the Parties on a [ ] basis until such time as such [ ]
shared litigation costs have been fully recovered by the Parties, and thereafter
shall be divided between the Parties on a [ ] basis in accordance with
Section 6.3(a) above. The provisions of this Section 6.3(b) do not apply where
any costs or
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expenses are the sole obligation of one of the Parties. For purposes of this
Section 6.3(b), "litigation costs" shall include all litigation costs relating
to the Product, including products liability litigation, patent or other
intellectual property litigation, and litigation in relation to the regulatory
approval of the Product.
7. INDEMNIFICATION
7.1. Indemnification Obligations of the Parties.
(a) Each Party shall indemnify, defend and hold harmless the other
Party and its Affiliates from and against any and all losses, costs, expenses,
liabilities, claims, actions, damages, personal injury, or loss of life,
including without limitation, reasonable attorney's fees (collectively,
"Losses"), arising directly from such Party's (i) negligent acts or omissions or
willful misconduct, (ii) any breach of any representation or warranty provided
by such Party to the other Party hereunder, and/or (iii) any violation of the
terms of this Agreement.
(b) NOTWITHSTANDING ANY PROVISION TO THE CONTRARY CONTAINED IN THIS
AGREEMENT, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ASSUME
LIABILITY TO A LICENSEE FOR ANY CONSEQUENTIAL, INCIDENTAL, OR PUNITIVE DAMAGES
(INCLUDING LOSS OF PROFITS, LOSS OF ENTERPRISE, AND LOSS OF OPPORTUNITY),
REGARDLESS OF WHETHER FOR BREACH OF WARRANTY, CONTRACT, TORT (INCLUDING
NEGLIGENCE), STRICT LIABILITY OR OTHERWISE, EVEN IF ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.
7.2. Infringement
(a) Infringement Opinion. [ ]
(b) Infringement Claims. ELITE and IPC shall jointly investigate and
defend any and all claims, actions and proceedings resulting from an assertion
against ELITE or IPC (or a Licensee if ELITE and IPC have agreed to indemnify
such Licensee) that the Product infringes upon a third party's intellectual
property rights ("Infringement Claim"). Subject to claims ELITE may assert due
to a breach of representation or warrant by IPC under Section 9 hereof, ELITE
and IPC shall share [ ] in the cost and expenses of the defense. ELITE
and IPC shall be entitled to share [ ] all amounts awarded, if any, in
connection with any such enforcement proceeding.
7.3. Enforcement Proceedings. ELITE and IPC may jointly bring
enforcement proceeding against any third party if ELITE and IPC determine
jointly that a third-Party is likely materially infringing upon the rights of
ELITE, IPC or a Licensee in the Product. If such enforcement proceedings are
brought jointly, the Parties will share [ ] in all costs or proceeds of
such litigation, including without limitation all awards of damages and
settlement proceeds. Subject to any agreement with any Licensee as may be
licensed for the commercialization of the Product, either Party may in its sole
discretion, decline to participate in
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such enforcement proceeding as Complainant, in which case the other Party may
proceed with the litigation, bearing all costs and receiving all proceeds of
such litigation.
7.4 Responsibility for Litigation. For the avoidance of doubt, it is
the intention of the Parties that a commercialization partner or Licensee shall
bear the primary responsibility for all products liability litigation, patent or
other intellectual property litigation, or litigation in relation to the
regulatory approval of the Product. To the extent that such litigation expenses
are not borne by such commercialization partner or Licensee, or to the extent
that either Party is required by operation of law to take part in such
litigation in any way, it is the intention of the Parties that all costs and
proceeds of such litigation are to be borne [ ] by the Parties. Subject
to any circumstance under which a Party declines to participate in any
enforcement proceeding as provided in Section 7.3 above, IPC and ELITE shall
jointly have control of any such litigation, including as regards choice of
counsel and settlement terms.
8. INSURANCE
8.1. Each Party agrees to maintain in force, during the Term and for
a period of 24 months thereafter, product liability insurance coverage in
minimum limits of [ ] per claim and [ ] per occurrence. Prior to
commercialization, those limits shall be reduced to [ ] per claim and
[ ] per occurrence. Each Party shall instruct its insurance carrier to
notify the other Party of any change, modification or cancellation of insurance
thirty (30) days prior to such change, modification or cancellation taking
effect.
9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTIES
9.1. IPC represents and warrants to ELITE, as of the Effective Date,
as follows:
(a) IPC has the legal right and full corporate power and
authority to enter into this Agreement and to perform the same;
(b) the Agreement constitutes valid and binding obligations of
IPC, enforceable against IPC in accordance with its terms, except as limited by
applicable bankruptcy, insolvency, reorganization and other laws of general
application affecting the enforcement of creditors' rights generally, and except
as enforcement of rights to indemnity and contribution hereunder may be limited
by principles of public policy;
(c) IPC has taken all corporate action required by it to
authorize it to enter into and to perform the Agreement;
(d) IPC has the right to disclose Know-How (and other IPC
Intellectual Property Rights) to ELITE as well as all other information as is
necessary for ELITE to perform its obligations hereunder;
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(e) there are no infringement proceedings pending, or, to
IPC's knowledge, threatened, against IPC in connection with the Product or the
IPC Intellectual Property Rights;
(f) IPC has good title to all IPC Intellectual Property
Rights, free and clear of all Liens;
(g) IPC has not received any notice of infringement of, or
conflict with, any license, patent, copyright, trademark, service xxxx or other
intellectual property right of any other Person and, to the knowledge of IPC,
there is no infringement or unauthorized use by any Person of any of the IPC
Intellectual Property Rights.
(h) there are no agreements between IPC and any third party
that conflict with this Agreement; and
(i) no consent or approval of any third party, court or
governmental agency is required in connection with the execution and performance
of this Agreement by IPC.
9.2. In respect of the Studies, IPC:
(a) shall, together with ELITE, supervise the conduct of the
Studies in accordance with the terms hereof, to ensure that such CRO as is
selected to carry out the Studies is contractually bound to do so, and does so,
including by way of a transfer in writing under 21 CFR 312.52, in accordance
with the Protocol, generally accepted standards of good clinical practice and
all applicable local, state and Federal laws and regulations governing the
performance of clinical investigations, including without limitation,
regulations governing the protection of human subjects (e.g., 21 C.F.R. Part 50)
and Institutional Review Boards (e.g., 21 C.F.R. Part 58), and regulations
governing the conduct of clinical trials (21 C.F.R. Part 312), and financial
disclosure by clinical investigators (21 C.F.R. Part 54), and privacy of
protected health information (45 C.F.R. Parts 160 and 164);
(b) represents to ELITE that its employees and agents are not
currently debarred by the FDA pursuant to 21 U.S.C. Section 335(a) or involved
in any investigation or proceedings which could lead to debarment;
(c) does not and will not knowingly use, in the performance of
its obligations hereunder, the services of any debarred entity or individual, or
of any individual that has been convicted of a felony or who is currently under
investigation for such conviction;
(d) all laboratory, scientific, technical and/or other data
submitted to ELITE or any regulatory health authority relating to the Study
shall be, to the best of its knowledge at the time of such submission, complete,
true, accurate and correct and shall not contain any knowingly false
information, misrepresentation and/or omission;
(e) shall, with notification to ELITE, ensure that a transfer
in writing under 21 CFR 312.52 is provided to any CRO for the Studies, which CRO
shall then be
12
responsible for the identification, documentation, and monitoring of adverse
events in Patients in accordance with 21 C.F.R. Section 312.32 and 21 C.F.R.
Section 314.80, the Protocol and as otherwise required under all applicable
laws, rules and regulations, and shall promptly report all such adverse events
in subjects to ELITE;
(f) will keep ELITE advised of any results of the Study via a
written report;
(g) shall, ensure that a transfer in writing under 21 CFR
312.52 is provided to any CRO for the Studies, which CRO shall then be
responsible to perform record keeping and reporting obligations in accordance
with 21 C.F.R. 312.62(b), 21 C.F.R. 312.57(c) and 21 C.F.R. 312.62(c); and
(h) each Party will notify the other of any deficiencies and
other issues or inquiries presented by the FDA or other regulatory agency with
respect to the Study and provide any assistance requested by the other to
satisfactorily respond to the FDA or such other regulatory agency.
IPC MAKES NO OTHER WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, EXCEPT THOSE
EXPRESSLY MADE HEREIN. IPC SPECIFICALLY DISCLAIMS ALL OTHER WARRANTIES, EXPRESS
OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY,
NON-INFRINGEMENT, OR FITNESS FOR A PARTICULAR PURPOSE.
9.3. If a Federal, state or local government or regulatory authority
conducts, or gives notice to IPC of its intent to conduct, an inspection of the
ELITE facility or takes any other regulatory action with respect to the conduct
of the Studies, then IPC shall promptly give ELITE notice both by telephone and
facsimile and supply all information pertinent thereto, and ELITE shall have an
obligation, to be present at any such inspection of its facilities.
9.4 If a Federal, state or local government or regulatory authority
conducts, or gives notice to IPC of its intent to conduct, an inspection of the
facilities where the Studies are being conducted, or takes any other regulatory
action with respect to the conduct of the Studies, then IPC shall promptly give
ELITE notice both by telephone and facsimile and supply all information
pertinent thereto, and ELITE shall have the right, but not the obligation, to be
present at any such inspection of the facilities where the Studies are being
conducted.
9.5. ELITE represents and warrants to IPC, as of the Effective Date,
as follows:
(a) ELITE has the legal right and full corporate power and
authority to enter into this Agreement and to perform the same;
(b) the Agreement constitutes valid and binding obligations of
ELITE, enforceable against ELITE in accordance with its terms, except as limited
by applicable
13
bankruptcy, insolvency, reorganization and other laws of general application
affecting the enforcement of creditors' rights generally, and except as
enforcement of rights to indemnity and contribution hereunder may be limited by
principles of public policy;
(c) ELITE has taken or will have taken all corporate action
required by it to authorize it to enter into and to perform the Agreement;
(d) there are no agreements between ELITE and any third party
that conflict with this Agreement; and
(e) no consent or approval of any third party, court or
governmental agency is required in connection with the execution and performance
of this Agreement by ELITE
9.6. In respect of the manufacture and release of the pivotal
clinical batches and the Studies, ELITE:
(a) will manufacture all materials according to generally
accepted good manufacturing practices and good laboratory practices in
accordance with all pertinent state and federal laws and regulations, including,
without limitation, in accordance with 21 CFR Section 210 and Section 211;
(b) represents to IPC that it is not enjoined from
manufacturing nor is ELITE currently sanctioned by the FDA pursuant to any
issued 483 inspection reports;
(c) represents to IPC that its employees and agents are not
and have not been debarred by the FDA pursuant to 21 USC Section 335(a) or
involved in any investigation or proceeding which could lead to debarment;
(d) does not and will not knowingly use, in the performance of
its obligations hereunder, the services of any debarred entity or individual, or
of any individual that has been convicted of a felony or who is currently under
investigation for such conviction;
(e) represents that all laboratory, scientific, technical or
commercial information that is submitted by ELITE to IPC or to any regulatory
health authority relating to the product should be complete, true, accurate and
correct, to the best of its knowledge at the time of such submission, and shall
not contain any knowingly false information, misrepresentation and/or omission;
(f) will perform all necessary record keeping as required
under applicable federal and state laws regarding the manufacture of the
Product, environmental impact of the manufacturing and all potential or adverse
product defects;
ELITE MAKES NO OTHER WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, EXCEPT THOSE
EXPRESSLY MADE HEREIN. ELITE SPECIFICALLY DISCLAIMS ALL OTHER WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING, WITHOUT
14
LIMITATION, ANY WARRANTY OF MERCHANTABILITY, NON-INFRINGEMENT, OR FITNESS FOR A
PARTICULAR PURPOSE.
9.7. If a Federal, State or local government or regulatory authority
conducts or gives notice of an inspection of the facilities of ELITE, ELITE will
promptly inform IPC and IPC shall have the right, but not the obligation to be
present to any such inspection or regulatory action. ELITE will provide all
records and correspondence regarding such action within five (5) business days
of a request from IPC.
10. OBLIGATION OF CONFIDENTIALITY
10.1 The Parties are party to a Confidentiality Agreement, dated as
of July 14, 2003, the term of which is hereby extended to co-incide with the
term of the obligations of confidentiality herein set out, pursuant to which
each Party agreed to maintain confidentiality with respect to certain
information to be disclosed by the other Party (the "Existing CDA"). In addition
to the obligations set forth in the CDA, all Confidential Information disclosed
by a Party ("Disclosing Party") shall be treated by the other Party ("Receiving
Party") as confidential and shall not be disclosed or revealed to any third
party, and shall be used solely in connection with the performance of this
Agreement, and such Confidential Information shall not be used in whole or in
part by either Party, whether alone or in co-operation with any other person, to
formulate, develop, manufacture or commercialize any other drug product;
provided, however, that Confidential Information shall not include information
that the Receiving Party can document as having been:
(a) public knowledge prior to the disclosure, or which hereafter
becomes public knowledge through no fault of the Receiving Party;
(b) lawfully in the Receiving Party's possession prior to the time
of disclosure by Disclosing Party;
(c) received, after the time of disclosure, from a third party not
under a similar obligation of confidentiality to Disclosing Party; or
(d) independently developed by Receiving Party's employees without
access to Disclosing Party's Confidential Information or knowledge of the
Development Agreement.
10.2. The Receiving Party shall take all such precautions as it
normally takes with its own Confidential Information, but in no event less than
reasonable precautions, to prevent improper disclosure; provided, however, that
Confidential Information may be disclosed within the limits required (A) to
obtain any authorization from the FDA or any other United States or foreign
governmental or regulatory agency or, with the prior written consent of the
Disclosing Party; (B) to be disclosed pursuant to (i) any order of any court
having jurisdiction and power to order such information to be released or made
public; or (ii) any lawful action of a governmental or regulatory agency.
15
10.3. In addition to and without limiting any other remedies
available to a Disclosing Party at law or in equity, the Disclosing Party shall
also be entitled to seek immediate injunctive relief in any court to restrain
any breach or threatened breach of a Receiving Party and to enforce the
provisions of this Section 10. Each Party acknowledges and agrees that there may
be no adequate remedy at law or in equity for any such breach or threatened
breach and, in the event that any proceeding is brought seeking injunctive
relief, the Receiving Party shall not use as a defense thereto that there is an
adequate remedy at law.
10.4. The Receiving Party may disclose Confidential Information of
the Disclosing Party to the Receiving Party's employees, consultants, licensees,
agents, prospective licensees and subcontractors on a need-to-know basis;
provided that in the case of Confidential Information of IPC, such consultants,
licensees, agents, prospective licensees and subcontractors are named by ELITE,
and approved by IPC as to the timing and extent of such disclosure, in advance
of such disclosure; provided, however, that (i) any such disclosure shall be
pursuant to a written confidentiality agreement with terms at least as
restrictive as those specified herein; and (ii) any violation of this Agreement
by such persons shall be deemed a breach by the Receiving Party. Any of the
persons mentioned above who are provided with access to Confidential Information
shall be informed by the Receiving Party of the Receiving Party's obligations
hereunder.
10.5. The confidentiality obligations of each Party under this
Section 10 shall survive the expiration or earlier termination of this
Agreement, howsoever terminated.
10.6. The Parties shall cooperate and agree upon any public
statement concerning the existence, subject matter or any term of this Agreement
by or on behalf of any Party prior to any issuance, dissemination or release.
Subject to Section 10, neither Party may issue, disseminate or release any such
public statement without the prior written approval of the other Parties, which
consent shall not be unreasonably withheld or delayed.
11. TERM AND TERMINATION
11.1. Subject to Section 11.2 hereof, the term of the Agreement
shall be the greater of (i) a fifteen (15) year period from the date the Product
is first commercially sold in the Territory to a third party, or (ii) the life
of applicable patent(s), if any, whichever is longer (the "Term"). This
Agreement shall automatically renew for 3-year renewal periods (each a "Renewal
Term") unless terminated by either Party by providing the other Party with
twelve (12) months written notice prior to any renewal period.
11.2. This Agreement may be terminated by a Party prior to the end
of the Term (or any applicable Renewal Term):
(a) by mutual agreement of the Parties; or
(b) upon breach of this Agreement by the other Party
(including, without limitation, the failure to timely perform in a reasonable
manner any obligation identified on the Development Plan), and the failure of
such breaching Party to cure such breach with thirty
16
(30) days of receipt of written notice to the breaching Party of such breach
(other than in the case of a failure to obtain a satisfactory 'freedom to
operate' pursuant to Section 7.2(a) in which case there shall be no opportunity
to cure such breach).
11.3. Effect of Termination. Termination of this Agreement for any
reason shall be without prejudice to:
(a) ELITE's and IPC's right to receive all amounts accrued and
unpaid under Section 6 up to the date of such termination;
(b) any provisions clearly meant to survive termination or
expiration of this Agreement, including without limitation representations,
warranties, indemnification and confidentiality obligations as well as Sections
1, 7, 8, 9, 10, 11, 12, 14 and 16 and solely in the case of Section 11.5,
Section 6.3, shall remain in full force and effect; and
(c) any other remedies which either Party may then or
thereafter have hereunder or otherwise.
11.4. Subject to Section 11.5, the Parties agree that upon
termination of this Agreement, all rights in the Product, the formulation or
formulations of the Product, the methods and processes applicable to the
Product, clinical data and documentation associated with Product testing, and
regulatory documentation in relation to applications for approval to market the
Product, remain with or revert to IPC, which may then use each or all of them
for its own purposes in its sole discretion.
11.5. Upon the termination of this Agreement as a result of the
breach by IPC of any provision of this Agreement (other than pursuant to Section
7.2(a) hereof) and the failure of IPC to cure such breach within thirty (30)
days of receipt of written notice by ELITE to IPC of such breach, ELITE shall
continue to receive a [ ] share of all license fees and other
consideration resulting from the licensing of rights to, or sale of, the Product
in accordance with Section 6.3 hereof.
12. NOTICES
12.1. Any notice provided for herein shall be in writing and is
effective upon receipt: (i) when delivered by hand with proof of delivery; (ii)
when sent by facsimile with fax confirmation, provided same is sent all by
regular mail within forty-eight (48) hours; (iii) three (3) days following
deposit for mailing by first class registered or certified mail, return receipt
requested; one day following deposit for mail with an overnight carrier; or (iv)
when received by the addressee, by delivery service (return receipt requested).
Notices shall be delivered to the addresses set forth below:
17
If to ELITE: 000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
Attention: Chief Executive Officer
Facsimile: (000) 000-0000
If to IPC:
00 Xxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxx,
Xxxxxx X0X 0X0
Attention: Chief Executive Officer
Facsimile: (000)-000-0000
13. AGREEMENT TO PERFORM NECESSARY ACTS
Each Party to this Agreement agrees to perform any further acts and
execute and deliver any documents that may be reasonably necessary to carry out
the provisions of this Agreement.
14. DISPUTE RESOLUTION
14.1. Should any dispute or difference arise between ELITE and IPC
or the Committee during the Term of this Agreement, then either Party may
forthwith give notice to the other Party that it wishes such dispute or
difference to be referred to a designated senior officer of each of ELITE and
IPC.
14.2. If designated senior officers of each of ELITE and IPC agree
upon a resolution or disposition of the matter, they shall each sign a statement
which sets out the terms of their agreement. If, however, the Parties'
designated senior officers are still unable to resolve their differences within
10 business days of its being referred to them ("Deadlock"), either Party may
request in a written notice to the other Party that such controversy (the
Dispute) be resolved by binding arbitration either (i) in Ontario in accordance
with the rules of the Arbitration Act (1991) as amended, or (ii) in the State of
New York in accordance with the rules of the American Arbitration Association,
as the Complainant may then choose.
14.3 Where such arbitration is in Ontario, the parties agree that
the Dispute shall be submitted to arbitration (an "Arbitration") by a single
arbitrator (the "Arbitrator") with the Arbitration to take place in the City of
Toronto, pursuant to the provisions of the Arbitration Act, 1991 (Ontario) (the
"Arbitration Act"). If the parties are unable to agree on the identity of an
Arbitrator within 10 days of the written proposal of an Arbitrator by one of
them, either party may, with 10 days' prior notice to the other party, apply to
the Court to appoint an Arbitrator pursuant to the Arbitration Act. The
Arbitration shall take place and be completed expeditiously with written and
verbal submissions by the Parties to the Arbitrator to be completed within 45
days of the Arbitrator's appointment. Pending a final determination by the
Arbitrator, the costs of the Arbitration shall be paid by the parties [ ]
and the parties shall separately pay their own respective costs. The
determination of the Arbitrator with regard to any Dispute shall be final and
binding upon the parties and there shall be no appeal therefrom. The Arbitrator
shall
18
have jurisdiction to award the costs of the Arbitration, including the fees of
the Arbitrator as between the parties, and to direct the payment of interest in
respect of any amount, at such rates and from and to such dates as are
determined by the Arbitrator to be appropriate.
14.4 Nothing contained herein shall be deemed to limit or restrict a
Party from seeking equitable remedies, such as a preliminary or permanent
injunction, if necessary, from a court of competent jurisdiction located in
either the State of New Jersey, under the laws of the State of New York, or in
the Province of Ontario, under the laws of Ontario, as the complainant Party may
then choose.
15. NON-COMPETITION
15.1 For so long as the Product to be developed herein remains under
active development or on sale in the marketplace in any country of the Territory
under the terms of the Agreement herein, the respective Parties covenant and
agree that they will not, whether alone or in co-operation with any other
person, develop, formulate, manufacture or commercialize any other drug product
which is a generic of [ ].
16. MISCELLANEOUS
16.1. Neither Party shall be liable for any failure to deliver or
receive or any delay to perform its obligations hereunder when such failure or
delay shall be caused (directly or indirectly) by fire; flood; accident;
explosion; equipment or machinery breakdown; sabotage; strike, or any labor
disturbance (regardless of the reasonableness of the demands of labor); civil
commotions; riots; invasions; wars (present or future); acts, restraints,
requisitions, regulations, or directions of any governmental entity; voluntary
or mandatory compliance with any request of any governmental entity; facility
shut down; voluntary or mandatory compliance with any request for material
represented to be for purposes of (directly or indirectly) producing articles
for national defense or national defense facilities; shortage of labor, fuel,
power or raw materials; inability to obtain raw materials or supplies; failures
of normal sources of supplies; inability to obtain or delays of transportation
facilities; any act of God; any act of the other Party; or any cause (whether
similar or dissimilar to the foregoing) beyond the reasonable control of such
Party (each cause a "Force Majeure Event").
16.2. Either Party hereto may assign this Agreement in whole or in
part to any Affiliate or Affiliates who shall be substituted directly in whole
or in part for it hereunder, provided, however, that the assignor shall
guarantee the performance of its Affiliate assignee hereunder. This Agreement
shall not otherwise be assignable by either Party without the prior written
consent of the other Party, which consent shall not be unreasonably withheld.
16.3. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of New York, United States of America
without regard to their conflict of laws principles, and should legal action
become necessary to enforce its terms, the prevailing Party shall be entitled to
reasonable costs and attorneys' fees.
19
16.4. The terms and provisions contained in this Agreement, together
with the Existing CDA as amended hereby, constitute the entire Agreement between
the Parties hereof, shall supersede all previous communications,
representations, agreements or understandings, either oral or written, between
the Parties hereto with respect to the subject matter hereof and no agreement or
understanding varying or extending these Agreements shall be binding upon either
Party hereto, unless in writing which specifically refers to the Agreement,
signed by fully authorized officers or Representatives of the respective Parties
and the provisions of these Agreements not specifically amended thereby shall
remain in full force and effect.
16.5. Any waiver must be explicit and in writing. The waiver by
either of the Parties to this Agreement of any breach of any provision hereof by
the other Party shall not be construed to be a waiver of any succeeding breach
of such provision or a waiver of the provision itself.
16.6. If and to the extent that any court or tribunal of competent
jurisdiction holds any of the terms, provisions or conditions or part thereof of
this Agreement, or the application hereof of any circumstances, to be invalid or
to be unenforceable in a final non-appealable order, the remainder of this
Agreement and the application of such term, provision or condition or part
thereof to circumstances other than those as to which it is held invalid or
unenforceable shall not be affected thereof, and each of the other terms,
provisions and conditions of this Agreement shall be valid and enforceable to
the fullest extent of the laws.
16.7. The relationship of ELITE and IPC under this Agreement is that
of independent contractors. Neither Party shall be deemed to be the agent of the
other, nor authorized to take any action binding upon the other.
16.8. This Agreement may be executed in counterparts, each of which
shall be deemed to be an original and all together shall be deemed to be one and
the same Agreement. All headings in this Agreement are inserted for convenience
of reference only and shall not affect its meaning or interpretation.
16.9. All of the obligations, undertakings, agreements,
representations and warranties of ELITE, as set out herein, or in the referenced
CDA of July 14, 2003, are jointly and severally the obligations of each of Elite
Laboratories, Inc., and Elite Pharmaceuticals, Inc.
20
IN WITNESS WHEREOF, ELITE and IPC have executed this Agreement in
duplicate as of the day and year first above written.
ELITE LABORATORIES, INC.
By: ____________________________________
Name:
Title:
ELITE PHARMACEUTICALS, INC.
By: ____________________________________
Name:
Title:
INTELLI PHARMACEUTICS CORP.
By: ____________________________________
Name:
Title:
21
EXHIBIT A
DEVELOPMENT PLAN
Product Development Activity Schedule [ ] [( )], [ ]
Strengths. The [ ] strength is RLD.
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RESPONSIBILITY
# ACTIVITIES ----------------------- COMMENTS
ELITE IPC
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[ ] [ ] [ ]
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[ ] [ ] [ ] [ ]
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[ ] [ ] [ ]
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[ ] [ ] [ ]
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[ ] [ ] [ ] [ ]
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[ ] [ ] [ ]
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[ ] [ ] [ ] [ ] [ ]
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[ ] [ ] [ ] [ ]
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[ ] [ ] [ ] [ ]
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[ ] [ ] [ ] [ ] [ ]
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