EXHIBIT 10.40
CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
SALES AND MARKETING AGREEMENT
THIS SALES AND MARKETING AGREEMENT is made as of December 10, 2002
(the "EFFECTIVE DATE"), by and between WOMEN FIRST HEALTHCARE, INC., a Delaware
corporation, having a place of business at 00000 Xx Xxxxxx Xxxx, Xxxxx 000, Xxx
Xxxxx, Xxxxxxxxxx 00000 ("WFHC"), and VENTIV HEALTH U.S. SALES L.L.C., a limited
liability company organized under the laws of the State of New Jersey, having a
place of business at 000 Xxxxxxxxxx Xxxx, Xxxxxxxx, Xxx Xxxxxx 00000 ("VENTIV").
WITNESSETH
Whereas, WFHC markets and distributes the prescription form of
VANIQA(R) (eflornithine hydrochloride) Cream, 13.9% (the "PRODUCT"), which has
been approved by the U.S. Food and Drug Administration ("FDA") for the reduction
of unwanted facial hair in women (as more fully specified in the labeling for
the Product); and
Whereas, Ventiv is engaged in the business of marketing
pharmaceutical products to physicians; and
Whereas, WFHC wishes to expand the promotion of the Product to
certain dermatologists who are "Covered Physicians," as defined below, and
Ventiv desires to have the right to promote such products to such "Covered
Physicians", upon the terms specified herein.
Now, Therefore, in consideration of the mutual covenants herein set
forth, and intending to be legally bound hereby, the parties hereto agree as
follows:
1. DEFINITIONS.
For purposes of this Agreement, the following terms shall have the
corresponding meanings set forth below:
"AFFILIATE" means, with respect to any Person, any other Person
which directly or indirectly controls, is controlled by, or is under common
control with, such Person. A Person shall be regarded as in control of another
Person if it/he/she owns, or directly or indirectly controls, more than fifty
percent (50%) of the voting securities (or comparable equity interests) or other
ownership interests of the other Person, or if it/he/she directly or indirectly
possesses the power to direct or cause the direction of the management or
policies of the other Person, whether through the ownership of voting
securities, by contract or any other means whatsoever.
"AGREEMENT" means this agreement, together with all appendices,
exhibits and schedules hereto, and as the same may be amended or supplemented
from time to time hereafter by a written agreement duly executed by authorized
representatives of each party hereto.
"AGREEMENT QUARTER" means each three-month period commencing on the
first day of January, April, July or October, as the case may be, during the
Term. The first Agreement Quarter shall commence on January 1, 2003 and end on
March 31, 2003. For purposes of calculating the Royalty to Ventiv in Section 10
of this agreement, the first Agreement Quarter's Derm Gross Sales will be
calculated as [***].
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
"AGREEMENT YEAR" means each 12-month period commencing on January 1
and each anniversary thereof during the Term.
"ANNUAL DERM BASELINE PRESCRIPTIONS" means [***].
"ANNUAL DERM BASELINE SALES" means the product of (a) Annual Derm
Baseline Prescriptions, multiplied by (b) Baseline Average Selling Price per
Prescription.
"AVERAGE SELLING PRICE PER PRESCRIPTION" means, for any Agreement
Year (or any Agreement Quarter or six-month or nine-month period prior to the
end of an Agreement Year), (a) the total Gross Sales divided by (b) the total
number of prescriptions (TRx) for the Product that are written or ordered in
such applicable period by all physicians of all specialties and practices. The
number of prescriptions (TRx) shall be determined by NDCHealth.
"BASELINE AVERAGE SELLING PRICE PER PRESCRIPTION" means (a) the Derm
Gross Sales for the period used to determine the Annual Derm Baseline
Prescriptions [***] (b) the total number of prescriptions (TRx) for the Product
that are written or ordered in such period by all physicians of all specialties
and practices. The number of prescriptions (TRx) shall be determined by
NDCHealth.
"CALL ACTIVITY REPORT" has the meaning set forth in Section 3(c)
hereof.
"CHANGE OF CONTROL" means, with respect to either party, any sale of
voting securities or sale of assets (whether by sale, merger, consolidation,
share exchange, or otherwise) which, directly or indirectly, (i) transfers over
50% of the assets of such party to any Person (or group of Persons) other than
an Affiliate of such party, (ii) results in any Person (or group of Persons)
becoming the beneficial owner, directly or indirectly, of securities of such
party representing over fifty percent (50%) of the combined voting power of such
party's then outstanding securities, or (iii) in the case of WFHC only, the sale
or transfer of all or substantially all of WFHC's business assets relating to
the Product to any Person (or group of Persons) other than an Affiliate of WFHC.
"CLAIM NOTICE" has the meaning set forth in Section 13(c) hereof.
"CONFIDENTIAL OR PROPRIETARY INFORMATION" has the meaning set forth
in Section 14 hereof.
"COSTS" has the meaning specified in Section 6(d) hereof.
"COVERED PHYSICIAN" means any dermatologist in the Territory (as
defined below).
"DERM GROSS SALES" means, for any Agreement Year (or any Agreement
Quarter or six-month or nine-month period prior to the end of an Agreement
Year), the Average Selling Price per Prescription multiplied by the total number
of prescriptions (TRx) for the Product that are written or
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***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
ordered in such applicable period by Covered Physicians. The number of
prescriptions (TRx) shall be determined by NDCHealth.
"DETAIL" or "DETAILS" and "DETAILING" means, with respect to the
Product, the activity undertaken by a sales representative during a face-to-face
sales call on physicians or other health care professionals with prescribing
authority to provide information on the use, safety, effectiveness,
contraindications, side effects, warnings and other relevant characteristics of
the Product, in a fair and balanced manner consistent with the requirements of
the Food, Drug and Cosmetic Act, including, but not limited to, the regulations
of 21 CFR Part 202, and using, as necessary or desirable, labeling or
promotional materials, in an effort to increase physician prescribing
preferences of the Product.
"EFFECTIVE DATE" has the meaning set forth in the Preamble above.
"FDA" has the meaning set forth in the Recitals above.
"XXXXXXXX LICENSE" means that certain License Agreement dated June
25, 2002 by and among WFHC, Xxx Xxxxxxxx Xxxxxxx and Xxxxxxx-Xxxxx Squibb
Company.
"GROSS SALES" means, for any Agreement Year (or any Agreement
Quarter or six-month or nine-month period prior to the end of an Agreement
Year), the total gross sales by WFHC of the Product in the Territory for the
applicable period determined in accordance with generally accepted accounting
principles and WFHC's customary practice which accounts for applicable discounts
[***].
"INITIAL TRAINING SESSION" has the meaning in Section 7(a) hereof.
"MARKETING PLAN" has the meaning set forth in Section 5(d) hereof.
"NDCHEALTH" means NDCHealth Corporation or any other health
information services company mutually agreed upon by the parties.
"PERSON" means an individual, corporation, partnership, limited
liability company, trust, business trust, association, joint stock company,
joint venture, pool, syndicate, sole proprietorship, unincorporated
organization, governmental authority, or any other form of entity not
specifically listed herein.
"PRODUCT" has the meaning set forth in the Preamble above.
"QUARTERLY DERM BASELINE SALES" has the meaning set forth in Section
10(c) hereof.
"SALES PLAN" has the meaning set forth in Section 5(e) hereof.
"SALES/MARKETING COMMITTEE" has the meaning specified in Section
5(a) hereof.
"SERIOUS ADVERSE EVENT" and "NONSERIOUS ADVERSE EVENT" have the
meanings set forth in Section 8(h) hereof.
"TERM" has the meaning specified in Section 12(a) hereof.
"TERRITORY" means the United States of America and its territories.
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***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
"THIRD PARTY" means any Person other than (i) WFHC and any of its
Affiliates and (ii) Ventiv and any of its Affiliates.
"TRADEMARK" means the VANIQA(R) trademark and any other trademark or
trade name (whether registered or unregistered) used on or with the Product or
in any promotional material related to the Product in the Territory during the
Term.
"ROYALTY" has the meaning specified in Section 10(b) hereof.
"RULES" has the meaning specified in Section 18(c) hereof.
"VENTIV FUNDED ACTIVITIES" has the meaning specified in Section 6(b)
hereof.
"WFHC FUNDED ACTIVITIES" has the meaning specified in Section 6(a)
hereof.
2. GRANT OF RIGHTS TO VENTIV.
(a) WFHC hereby engages Ventiv to promote the Product during the
Term on an exclusive basis to Covered Physicians, upon the terms and conditions
set forth to this Agreement.
(b) In furtherance of Ventiv's sales activities contemplated by this
Agreement and subject to the terms and conditions of this Agreement and the
Xxxxxxxx License, WFHC hereby grants to Ventiv a sublicense under U.S. Patents
4,720,489 and 5,648,394 and all divisionals, continuations,
continuations-in-part, reissues, extensions, reexaminations, or renewal
applications to use, have used, offer for sale and sell the Product to the
Covered Physicians for the indication of unwanted facial hair in women in the
Territory during the Term. The foregoing sublicense shall be exclusive to Ventiv
with respect to the Covered Physicians for the indication of unwanted facial
hair in women in the Territory during the Term, but shall be non-transferable
and non-sublicensable.
Notwithstanding the foregoing, the sublicense set forth in this
Section 2(b) shall be subject to WFHC's receipt of the consent of Xxx Xxxxxxxx
Xxxxxxx pursuant to the Xxxxxxxx License. WFHC shall use its commercially
reasonable efforts to obtain such consent on or prior to January 10, 2003. If
WFHC fails to obtain such consent for any reason, this Agreement shall be deemed
null and void ab initio and no party shall have any obligation to the other
hereunder except that: (a) Ventiv shall return to WFHC all sales, training,
promotional, marketing material, and WFHC call lists and computer files that may
have been supplied to Ventiv by WFHC under this Agreement and (b) WFHC shall
reimburse Ventiv for actual costs incurred to recruit and train the sales force
incurred through the date of such non-consent notification to Ventiv, up to a
maximum of [***] (i.e., the Start-up Fee in accordance with Section 10 (a) of
this Agreement).
(c) Subject to the terms and conditions of this Agreement, WFHC
hereby grants to Ventiv the non-exclusive right to use the Trademark during the
Term solely to promote the Product to Covered Physicians in accordance with this
Agreement. Ventiv shall promptly notify WFHC in writing of any alleged or
threatened infringement of the Trademark in the Territory of which it becomes
aware. As between WFHC and Ventiv, WFHC shall have the right to prosecute any
infringement action with respect to the Trademark. Ventiv shall comply with any
terms of use with respect to the Trademark that WFHC may implement from time to
time.
(d) WFHC reserves all rights not expressly granted hereunder.
Without limiting the generality of the foregoing, (i) WFHC reserves the right to
promote the Product or to grant to one or more Third Parties the right to
promote the Product within the Territory to physicians and health care providers
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***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
other than Covered Physicians and (ii) the parties acknowledge and agree that
all trade secrets, ideas and information, research, methods, improvements and
patented, copyrighted or other proprietary material relating to the Product and
the goodwill associated therewith shall belong exclusively to WFHC. Ventiv
further acknowledges that this Agreement does not constitute any form of
assignment or transfer of ownership in the Trademark and any other trademark or
trade name (whether registered or unregistered) used on or with the Product or
in any promotional material related to the Product.
3. PROMOTION BY VENTIV.
(a) During the Term, Ventiv shall diligently promote the Product in
the Territory to Covered Physicians in accordance with the terms of this
Agreement.
(b) During the Term, Ventiv shall deploy a sales force comprised of
at least forty (40) committed sales representatives and three (3) district
managers to Detail the Product to Covered Physicians. Ventiv shall also
designate and maintain a Product Manager for the Product, who shall be dedicated
exclusively to the promotion of the Product on a full-time equivalent basis of
not less than forty (40) hours per regular work week. Each sales representative
shall be equipped with a handheld PDA device to be provided by Ventiv. Ventiv
shall place the Product in a first product (P1) position within the Ventiv sales
force and shall ensure that the Product represents, on average, at least 50% of
the time spent by Ventiv sales representatives on Covered Physicians during each
Detail.
(c) During the Term, Ventiv will make a minimum of [***] sales calls
to Covered Physicians in each Agreement Year (on an annualized basis for the
first Agreement Year). Ventiv shall provide to WFHC a monthly summary report in
a form to be mutually agreed upon by the parties (the "CALL ACTIVITY REPORT")
detailing the calls of its sales representatives and certifying to Ventiv's
compliance with the minimum sales calls requirements of this Section 3(c). Each
Call Activity Report shall be signed by an executive officer of Ventiv and shall
be provided to WFHC within thirty (30) days after the completion of each month.
(d) During the Term, Ventiv will achieve a certain minimum growth in
total prescriptions attributable to the Covered Physicians as follows:
(i) First Agreement Year: [***] incremental units over the
Annual Derm Baseline Prescriptions; and
(ii) Second Agreement Year: [***] incremental units over the
Annual Derm Baseline Prescriptions.
(e) Except as provided for in Sections 6 and 10 of this Agreement
and subject to the terms and conditions of this Agreement, Ventiv shall be
solely responsible for the costs and expenses of establishing and maintaining
its sales force and conducting its other activities under this Agreement and
shall have sole authority to control its sales force and direct the activities
of its sales force. It is understood that the Ventiv sales force will not be
composed, in any material part, of contract sales personnel or telemarketers
hired by Ventiv without the prior written consent of WFHC.
(f) Ventiv shall instruct its sales force not to, and shall ensure
that its sales force does not, promote or detail the Product outside the
Territory or to any physician, osteopath or health care professional who is not
a Covered Physician. Ventiv shall provide WFHC, within five (5) business days of
transmission, complete copies and/or transcripts of all home office generated
communications (whether written, electronic or visual aids) to all or any
portion of Ventiv's sales representatives or detail personnel concerning the
product strategy, positioning or selling messages of the Product (for example,
those sent
5
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
out by Ventiv's Sales, Marketing and Sales Training departments). The individual
to whom these shall be sent will be designated by WFHC upon execution of this
Agreement. All such written, electronic and visual communications provided to a
majority of Ventiv sales representatives regarding product strategy, positioning
or selling messages shall be consistent in all respects with the positioning
strategy and selling messages then approved by the Sales/Marketing Committee,
shall comply with the product labeling, and shall be in accordance with
applicable law.
(g) WFHC shall retain sole responsibility for contractual and other
relationships with managed care organizations, formularies, insurers, and
governmental agencies and instrumentalities (including without limitation
Medicare, Medicaid, the Veterans Administration, and military entities). If any
information derived from such relationships would be pertinent to the
development of the Covered Physician market by Ventiv hereunder, WFHC will,
where legally able to do so, share such pertinent information with Ventiv under
an obligation of confidentiality.
(h) During the Term and for one year (1) year thereafter, Ventiv
shall not market, promote or otherwise sell any other prescription (Rx) product
for the reduction of unwanted facial hair in women other than the Product,
unless Ventiv terminates the Agreement pursuant to Sections 12(c) or 12(d)
below. Without limiting the generality of the foregoing, Ventiv shall not
develop, manufacture, sell, distribute or promote any cream containing
eflornithine hydrochloride as the sole active ingredient during the Term and for
one year (1) year thereafter, unless Ventiv terminates the Agreement pursuant to
Sections 12(c) or 12(d) below.
4. RESPONSIBILITIES OF WFHC.
(a) Except as may be provided for in Section 6 of this Agreement,
WFHC shall be solely responsible for the costs and expenses of conducting its
activities under this Agreement.
(b) WFHC will provide reasonable and customary selling and
promotional materials to Ventiv for use with Covered Physicians. WFHC is under
no obligation to develop custom materials for use with dermatologists.
(c) WFHC will budget a minimum of two million dollars ($2,000,000)
to support marketing programs, exclusive of field force costs, for the Product
for all specialties, including dermatologists, in 2003. WFHC will budget
substantially equivalent amounts for 2004 and 2005.
(d) As between WFHC and Ventiv, WFHC shall have the sole authority
to determine the price of the Product sold by WFHC, including price increases or
decreases and the timing thereof.
(e) As between WFHC and Ventiv, WFHC shall have the sole
responsibility, at its cost and expense, for manufacturing or acquiring the
Product, as the case may be, and shipping, distributing and warehousing of the
Product, for the invoicing and billing of purchasers of the Product, for order
confirmation (if any) in accordance with WFHC customary practices, and for the
collection of receivables. WFHC will book all sales of the Product sold by WFHC
and its Affiliates. This Agreement shall not be construed as creating or
implying any obligation on WFHC's part to supply Ventiv with the Product.
However, in the event WFHC establishes a sample size for the Product for its own
sales force and Ventiv requests such samples for its promotion efforts
hereunder, the Sales and Marketing Committee (defined below) shall determine the
quantities and terms of supply of Product samples to Ventiv and allocate an
agreed-upon portion of the marketing budget funded by WFHC to defray the related
costs. In addition, in the event Ventiv requests trade-size samples for its
promotion efforts hereunder, the Sales and Marketing Committee shall determine
the quantities and terms of supply of such trade samples to Ventiv and allocate
an agreed-upon portion of the marketing budget funded by WFHC to defray the
related costs.
6
(f) WFHC shall use commercially reasonable efforts, including
maintaining reasonable levels of inventory in light of customary industry
practice, to ensure that sufficient stock of the Product will be available in
its inventory to fill orders from the trade in accordance with normal industry
practices.
(g) WFHC shall use reasonable efforts consistent with applicable
legal requirements to maintain all necessary authorizations with the FDA to
market the Product in the Territory, provided that Ventiv does not engage in any
act or omission inconsistent with such legal requirements.
(h) WFHC will use its commercially reasonable efforts to ensure that
the Xxxxxxxx License will remain in effect.
5. SALES/MARKETING COMMITTEE.
(a) A marketing committee will be established promptly by WFHC and
Ventiv after execution of this Agreement (such committee being referred to
herein as the "SALES/MARKETING COMMITTEE") to coordinate the marketing strategy
and promotional plans for the Product in the Territory to Covered Physicians.
(b) The Sales/Marketing Committee shall be composed of four (4)
persons, with Ventiv and WFHC each being entitled to designate two (2)
individuals. The initial members shall be designated by each party in writing
promptly following execution of this Agreement and shall include WFHC's Vice
President, Pharmaceuticals or designate and Ventiv's Senior Vice President,
Business Development or designate. Each party may change its designated members
at any time upon advance written notice to the other party (for WFHC, notice
must be sent to its Vice President, Pharmaceuticals; for Ventiv, notice must be
sent to its Senior Vice President, Business Development). Decisions and
recommendations of the Sales/Marketing Committee will be made by vote of Ventiv
and WFHC, with each party having one vote. Subject to the requirements regarding
Ventiv's incentive compensation and annual incentive sales contest of Section
5(e) and (f) below, in the event of a tie regarding incentive compensation and
annual incentive sales contest matters, Ventiv's Senior Vice President, Business
Development shall have the deadlock breaking vote. For all other decisions made
by the Sales/Marketing Committee, in the event of a tie, WFHC's Vice President,
Pharmaceuticals shall have the deadlock breaking vote. Other than as provided
herein, WFHC shall retain ultimate authority with respect to all strategic
matters involving or relating to the Product.
(c) The Sales/Marketing Committee shall meet not less than once in
each Agreement Quarter during the Term or as otherwise agreed by the parties in
writing, at such locations as are designated by each party alternatively. Each
party shall bear the costs and expenses of its designated members that are
incurred in connection with the Sales/Marketing Committee meetings.
(d) Ventiv shall develop and present a marketing plan for the
Product (the "MARKETING PLAN") to the Sales/Marketing Committee for review and
discussion not less frequently than annually. The initial Marketing Plan must be
presented to the Sales/Marketing Committee no later than March 1, 2003. Each
Marketing Plan shall describe Ventiv's marketing plans, strategies and tactics
for targeting the Covered Physicians and the consumers that visit dermatological
offices as well as detailed marketing programs to implement such plans,
strategies and tactics, including the costs and projected impact of such
programs. WFHC shall have the sole and exclusive right to determine which, if
any, programs described in the Marketing Plan to fund.
(e) Ventiv shall develop and present a sales plan for the Product
(the "SALES PLAN") to the Sales/Marketing Committee for review and discussion
prior to implementation and, thereafter, not
7
less frequently than annually. Each Sales Plan shall: (i) set forth Ventiv's
call plan for a targeted list of physicians within the Covered Physicians group;
(ii) reflect Ventiv's proposed selling tactics for Details; and (iii) include
Ventiv's proposed incentive compensation plan for sales representatives and
shall describe the criteria for awarding bonuses to sales representatives based
on prescriptions written for the Product by physicians to whom such
representatives have made Details. The incentive compensation plan set forth in
the Sales Plan shall be designed so that the Product will be weighted equal to
or greater than any product promoted by Ventiv's Sales Force in calculating
compensation. In connection with the annual review of the Sales Plan, the
Sales/Marketing Committee shall, among other things, review the targeted list of
physicians within the Covered Physicians group.
(f) Ventiv shall present its proposed annual incentive sales
contests to the Sales/Marketing Committee for review and discussion prior to
implementation and, thereafter, not less frequently than annually. The annual
incentive sales contests shall be designed so that the Product will be weighted
equal to or greater than any product promoted by Ventiv's Sales Force in
calculating the winners of the annual incentive contests.
(g) Notwithstanding anything in this Section 5 or that might
otherwise imply to the contrary in this Agreement, WFHC shall have strategic
responsibility and sole authority and responsibility for obtaining all legal,
regulatory and medical approvals related to the selling and use of promotional
materials prepared or approved by the Sales/Marketing Committee.
6. FUNDING OF PROMOTIONAL ACTIVITIES.
(a) WFHC shall be solely responsible during the Term for the Costs
incurred by it with respect to the following activities related to the promotion
of the Product in the Territory to Covered Physicians (collectively, the "WFHC
FUNDED ACTIVITIES"):
(i) Costs of reasonable and customary selling and promotional
materials provided by WFHC to Ventiv for use with Covered Physicians (except as
otherwise provided in Section 6(b) below);
(ii) Costs of the master copy of the Product training materials
and reasonable quantities of copies to cover the Ventiv sales force, as set
forth in Section 7(a) below; and
(iii) funding of marketing programs approved by WFHC in
accordance with Section 5(d) (not to exceed the amount set forth in Section
4(c)); and
(iv) the purchase and related Cost of all third-party data
purchases reasonably required to perform call planning and analytics of the
sales force on a monthly basis, including NDC Health physician level data and
other necessary data to support the calculation of the Royalty under Section 10
of this Agreement; provided that WFHC shall have no obligation to purchase IMS
Exponent data.
(b) Ventiv shall be solely responsible during the Term for the Costs
incurred by it with respect to the following activities related to the promotion
of the Product in the Territory to Covered Physicians (collectively, "VENTIV
FUNDED ACTIVITIES"):
(i) Costs of recruitment of sales representatives (subject to
reimbursement by WFHC in accordance with Section 10(a) below); and
(ii) Costs of distributing the Product training materials
provided by WFHC.
8
(c) Except as stated in this paragraph and in accordance with
Section 5 of this Agreement, WFHC shall be under no obligation to conduct or
develop symposia, seminars, technical and scientific exhibits and other
professional relations events with respect to the Product or to conduct
additional clinical trials with respect to the Product. As part of the funding
allocated pursuant to the Marketing Plan, WFHC shall provide necessary funding
to support Ventiv's attendance and exhibition at the AAD Summer and Winter
meetings.
(d) For purposes of Sections 6, 7 and 10 hereof, the terms "COST"
and "COSTS" means, in the case of the WFHC Funded Activities or Ventiv Funded
Activities, the direct, out-of-pocket costs and expenses paid by WFHC or Ventiv
in connection with such activities during the period in question.
7. TRAINING OF VENTIV SALES FORCE.
(a) Ventiv will hold one initial training session (the "INITIAL
TRAINING SESSION"), at its Cost, for its sales representatives in January 2003
and will launch the Product no later than January 20, 2003. WFHC shall determine
and be solely responsible for the content, development, and associated Cost of
the master copy of the Product training materials and reasonable quantities of
copies to cover the Ventiv sales force used in the Initial Training Session. All
members of the Ventiv sales force (including detail personnel, management, and
sales representatives) shall attend a training program related to the Product,
whether as part of the Initial Training Session or a subsequent training
program. Ventiv will include the Product training in all new hire training
programs and will provide an annual refresher course on the Product for the
field sales organization.
(b) Ventiv shall bear the full Cost and expense of all of its sales
force personnel (including management, detail personnel, sales representatives,
and contractors) who attend training programs related to the Product, without
contribution from WFHC. WFHC shall provide an appropriate number of its staff
assistants to assist with training at the Initial Training Session and shall
bear the full Cost and expense of such its staff assistants.
(c) Ventiv will be responsible for providing product training
materials to members of its sales force who attend subsequent training programs.
(d) From time to time as sales or training materials for the Product
may be developed or revised by WFHC (the timing and content of which shall be
determined by WFHC in the exercise of its sole and absolute discretion or as
mandated by regulatory agencies or as directed by the Sales/Marketing
Committee), WFHC will make such training materials available to Ventiv, and
Ventiv shall be responsible for modifying its own training materials accordingly
and providing them to members of Ventiv's sales force.
(e) WFHC reserves and retains title and all rights, including
copyright rights, in and to all written, visual and electronic works and other
materials provided by it to Ventiv hereunder, as well as any adaptations thereof
or "derivative works" (as such term is defined in the U.S. Copyright Code, 17
U.S.C. Section 101 et. seq.) derived or developed by Ventiv from or with such
works and materials. Subject to the foregoing and to its obligations under other
terms and conditions of this Agreement, Ventiv is granted the nonexclusive right
under this subsection to use, copy, modify, and distribute such materials only
in furtherance of this Agreement and the rights granted to it hereunder, for the
Term of this Agreement. Ventiv will ensure that appropriate copyright notices
appear on all copies of the written materials provided by WFHC and all
adaptations and derivative works thereof.
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8. CERTAIN REGULATORY MATTERS.
(a) As between WFHC and Ventiv, all regulatory matters regarding the
Product shall remain under the exclusive control of WFHC, subject to the
participation by Ventiv in matters related to the marketing of the Product to
Covered Physicians. WFHC will have the sole responsibility, at its cost and
expense, to respond to complaints about the Product and to handle all returns
and recalls of the Product.
(b) Beginning as of the Effective Date of this Agreement, each party
shall promptly notify the other party of any significant event(s) that affect
the marketing of the Product, including, but not limited to, adverse drug
reactions and governmental inquiries, whether within or outside the Territory.
WFHC shall have the responsibility for evaluating such events and reporting such
events to applicable regulatory health authorities in the Territory.
Ventiv shall report all such adverse events involving the
Product learned by it to:
Director of Regulatory Affairs
Women First HealthCare, Inc.
0000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
A MedWatch form or a CIOMS-I form that contains the data elements required for
adverse event reporting is required and will be provided by WFHC to Ventiv.
Serious adverse events that affect the labeling or promotion of
the Product learned by WFHC shall be reported by WFHC to Ventiv by way of WFHC
providing to Ventiv labeling supplements or quarterly or annual Adverse Drug
Event reports submitted by WFHC to the FDA at the time WFHC reports such events
to the FDA, and shall be sent to:
President
Ventiv Health U.S. Sales L.L.C.
000 Xxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
Telephone No.: (000) 000-0000
Serious adverse events for the Product (as defined in Section 8(h) below)
learned by Ventiv shall be submitted to WFHC within three (3) business days but
no more than four (4) calendar days from the receipt date by Ventiv.
Non-serious adverse events for the Product (as defined in
Section 8(h) below) that are spontaneously reported to Ventiv shall be submitted
to WFHC no more than one (1) month from the date received by Ventiv; provided,
however, that medical and scientific judgment should be exercised in deciding
whether expedited reporting is appropriate in other situations, such as
important medical events that may not be immediately life-threatening or result
in death or hospitalization but may jeopardize the patient or may require
intervention to prevent a serious adverse event outcome.
(c) Beginning as of the Effective Date of this Agreement, each party
shall promptly notify the other party in writing of any order, request or
directive of a court or other governmental
10
authority to recall or withdraw the Product in any jurisdiction. As between WFHC
and Ventiv, WFHC shall be responsible, at its sole cost and expense, for the
costs of any recall or withdrawal of the Product.
(d) Upon being contacted by the FDA or any other federal, state or
local agency for any regulatory purpose pertaining to this Agreement or to the
Product, Ventiv shall, if not prohibited by applicable law, immediately notify
WFHC and will not respond to the agency until consulting with WFHC, to the
maximum feasible extent; provided, however, that the foregoing shall not be
construed to prevent Ventiv in any way from complying, and Ventiv may permit
unannounced FDA or similar inspections authorized by law and respond to the
extent necessary to comply, with its obligation under applicable law.
(e) Ventiv shall inform WFHC's Customer Service at the address set
forth in Section 8(h) below of any Product Quality Complaint received within two
(2) business days from the receipt date by Ventiv. A "PRODUCT QUALITY COMPLAINT"
is defined as any complaint that questions the purity, identity, potency or
quality of the Product, its packaging, or labeling, or any complaint that
concerns any incident that causes the drug product or its labeling to be
mistaken for, or applied to, another article or any bacteriological
contamination, or any significant chemical, physical, or other change or
deterioration in the distributed drug product, or any failure of one or more
distributed batches of the drug product to meet the specifications therefor in
the NDA for the Product. Such information shall be sent to the same address as
set forth in Section 8(b) above.
(f) A "SERIOUS ADVERSE EVENT" for a Product is defined as any
untoward medical occurrence that at any dose for a Product: (i) results in
death; (ii) is life-threatening (as defined below); (iii) requires inpatient
hospitalization or prolongation of existing hospitalization; (iv) results in
persistent or significant disability/incapacity; (v) is a congenital
anomaly/birth defect; (vi) results in drug dependency or drug abuse; (vii) is
cancer; (viii) is a serious medical event (as defined below); or (ix) is an
overdose. A "nonserious adverse event" is defined as that which is not serious.
A "LIFE-THREATENING" adverse event is defined as an event in
which the patient or subject was at immediate risk of death at the time of the
event; it does not refer to an event which hypothetically might have caused
death if it were more severe.
A "SERIOUS MEDICAL EVENT" is defined as a medial event that may
not be immediately life-threatening or result in death or hospitalization but,
based on appropriate medical and scientific judgment, may jeopardize the
patient/subject or may require intervention (e.g., medical, surgical) to prevent
one of the other outcomes listed as a serious definition.
(g) WFHC and Ventiv will cooperate and establish a mutually
acceptable procedure designed to ensure access by WFHC to samples forming the
basis of a complaint regarding the Product received by WFHC.
(h) As between WFHC and Ventiv, WFHC shall be responsible for
handling all medical inquiries concerning off-label uses of the Product within
the Territory, including those forwarded by sales representatives and field
force personnel promoting the Product. Ventiv shall refer all off-label medical
information requests in writing to:
Customer Service
Women First HealthCare, Inc.
0000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Facsimile No.: (000) 000-0000
11
Telephone No.: (000) 000-0000
Urgent off-label medical information requests shall be referred
by telephone to:
Customer Service
Women First HealthCare, Inc.
Telephone No.: (000) 000-0000
9. COMPLIANCE WITH LAW AND LABELING.
(a) Each party shall maintain in full force and effect all necessary
licenses, permits and other authorizations required by law to carry out its
duties and obligations under this Agreement. Each party shall comply with all
laws, ordinances, guidelines, rules and regulations (collectively, "LAWS")
applicable to its activities under this Agreement, including without limitation,
any requirements of any product license applicable to the Product in the
Territory; provided, however, that Ventiv shall be solely responsible for
compliance with those Laws pertaining to the activities conducted by it
hereunder (including, without limitation, the Prescription Drug Marketing Act,
as amended), notwithstanding that the FDA may, as a matter of law, be entitled
to hold WFHC accountable or responsible (whether primarily or secondarily) for
failure of Ventiv to comply with such Laws. Furthermore, Ventiv shall ensure
that its sales representatives comply with such Laws. The parties will
reasonably cooperate with one another with the goal of ensuring full compliance
with Laws. WFHC shall be responsible for all labeling changes to the Product.
(b) Ventiv shall make no representations or warranties relative to
the Product that conflict or are inconsistent with the NDA, applicable Laws, and
the FDA-approved label for the Product. Ventiv shall be responsible for any
Costs incurred by WFHC resulting from statements made by Ventiv's sales
representatives that relate to the safety or efficacy of the Product that are
not in compliance with applicable Laws or have not been authorized by WFHC in
advance in writing.
10. PROMOTION COMPENSATION.
(a) WFHC shall pay to Ventiv a one-time, start-up fee of [***] (the
"START-UP FEE") within thirty (30) days of the execution of this Agreement to
cover the initial Costs of recruitment of the sales organization.
(b) As compensation for services rendered by Ventiv with respect to
the Product during the Term and its agreements hereunder, WFHC shall pay to
Ventiv a graduated royalty (the "ROYALTY") on cumulative Derm Gross Sales to
Covered Physicians above agreed Annual Derm Baseline Sales with respect to each
Agreement Year during the Term. The Royalty shall be based on the following
cumulative quarterly baseline sales amounts:
"CUMULATIVE BASELINE"
1st Agreement Quarter............... [***] of Annual Derm Baseline Sales
2nd Agreement Quarter............... [***] of Annual Derm Baseline Sales
3rd Agreement Quarter............... [***] of Annual Derm Baseline Sales
4th Agreement Quarter............... [***] of Annual Derm Baseline Sales
12
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
The Royalty due to Ventiv is equal to the amount calculated for the
applicable Agreement Quarter in accordance with Section 10(c) below less the
amount of Royalty paid cumulative, year-to-date for the related Agreement Year.
Except as stated in Section 10(d) below, if the resulting amount due to Ventiv
is zero or less than zero, WFHC will not be required to pay a Royalty for the
applicable Agreement Quarter and Ventiv will not be required to refund any
previous Royalty payments made by WFHC.
(c) WFHC shall make Royalty payments to Ventiv for the applicable
Agreement Quarter in each Agreement Year as follows:
(i) First Agreement Quarter (Royalty payments for the first
Agreement Quarter of the first Agreement Year shall be calculated as indicated
in the definition of "Agreement Quarter" in Section 1 above):
(A) Zero percent (0%) on Derm Gross Sales through such Agreement
Quarter that are equal to or less than the Cumulative Baseline for such
Agreement Quarter;
(B) [***] on Derm Gross Sales through such Agreement Quarter
that are greater than the Cumulative Baseline for such Agreement Quarter and
equal to or less than [***];
(C) [***] on Derm Gross Sales through such Agreement Quarter
that are greater than [***] and equal to or less than [***];
(D) [***] on Derm Gross Sales through such Agreement Quarter
that are greater than [***] and equal to or less than [***]; and
(E) [***] on Derm Gross Sales through such Agreement Quarter
that are greater than [***].
(ii) Second Agreement Quarter:
(A) Zero percent (0%) on cumulative, year-to-date Derm Gross
Sales through such Agreement Quarter that are equal to or less than the
Cumulative Baseline for such Agreement Quarter;
(B) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than the Cumulative Baseline for such
Agreement Quarter and equal to or less than [***];
(C) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***];
(D) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***]; and
13
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
(E) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***].
(iii) Third Agreement Quarter:
(A) Zero percent (0%) on cumulative, year-to-date Derm Gross
Sales through such Agreement Quarter that are equal to or less than the
Cumulative Baseline for such Agreement Quarter;
(B) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than the Cumulative Baseline for such
Agreement Quarter and equal to or less than [***];
(C) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***];
(D) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***]; and
(E) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater [***].
(iv) Fourth Agreement Quarter:
(A) Zero percent (0%) on cumulative, year-to-date Derm Gross
Sales through such Agreement Quarter that are equal to or less than the
Cumulative Baseline for such Agreement Quarter;
(B) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than the Cumulative Baseline for such
Agreement Quarter and equal to or less than [***];
(C) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***];
(D) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater than [***] and equal to or less than
[***]; and
(E) [***] on cumulative, year-to-date Derm Gross Sales through
such Agreement Quarter that are greater [***].
(d) No separate payments shall be made for the fourth Agreement
Quarter in any Agreement Year. Instead, at the end of each such Agreement Year,
a final reconciliation shall be conducted by comparing the amount to which
Ventiv is otherwise entitled for such Agreement Year pursuant to Section 10(b)
above against the sum of all amounts (if any) previously paid to Ventiv pursuant
to Section 10(c) for prior Agreement Quarters during such Agreement Year. If the
calculation
14
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
(e) determines that Ventiv is due further compensation (or has been
overcompensated by WFHC) as a result of any quarterly payments made by WFHC with
respect to the first three Agreement Quarter of any Agreement Year, the balance
due to Ventiv (or to be refunded by Ventiv) shall be computed and paid by the
applicable party to the other within sixty (60) days after the end of such
Agreement Year.
(f) WFHC shall bear the Costs of obtaining the NDCHealth data
required to calculate the Baseline Average Selling Price per Prescription and
the Average Selling Price per Prescription and number of Covered Physician
prescriptions for the Product.
11. PAYMENTS AND REPORTING.
(a) Royalty payments, including the amounts payable under Section
10(d) above, shall be calculated and paid within sixty (60) days after the end
of each Agreement Quarter during the Term. In addition, WFHC shall furnish
Ventiv, within sixty (60) days after the end of each Agreement Quarter, a report
setting forth in reasonable detail the calculation of Derm Gross Sales for such
Agreement Quarter, and the calculation of Ventiv's compensation under Section 10
with respect to such period and, in addition to a report for the fourth
Agreement Quarter, with respect to the entire Agreement Year.
(b) All payments to a party under this Agreement shall be made by
wire transfer in immediately available funds in legal currency of the United
States and shall be delivered to the account of such party designated by it in
writing from time to time.
(c) The parties will maintain complete and accurate books and
records in sufficient detail to enable verification of the Gross Sales and the
basis for calculating the compensation paid by WFHC to Ventiv hereunder. Either
party may demand an audit of the other party's relevant books and records in
order to verify the other's reports on the aforesaid matters. Upon reasonable
prior notice to the party to be audited, the independent public accountants of
the other party shall have access to the relevant books and records of the party
to be audited in order to conduct a review or audit thereof. Such access shall
be available during normal business hours not more than once each calendar year
during the Term and only until two (2) years after the relevant period in
question. The accountants shall be entitled to report their conclusions and
calculations to the party requesting the audit, except that in no event shall
the accountants disclose the names of customers of either party or the prices,
discounts, rebates, or other terms of sale charged by WFHC for the Product.
The party requesting the audit shall bear the full cost of the
performance of any such audit except as hereinafter set forth. If, as a result
of any inspection of the books and records of either party, it is shown that
such party's payments to the other under this Agreement were less than the
amount which should have been paid, then the audited party shall make all
payments required to be made to eliminate any discrepancy revealed by said
inspection within thirty (30) days after the other party's demand therefor.
Furthermore, if the payments were less than the amount which should have been
paid by an amount in excess of five percent (5%) of the payments actually made
during the period in question, the party responsible for the discrepancy shall
also reimburse the auditing party for its out-of-pocket costs of such
inspection.
12. TERM AND TERMINATION.
(a) The Term shall begin on the Effective Date and shall end on
December 31, 2005, unless terminated earlier in accordance with Section 12(b),
12(c), 12(d), 12(e) or 12(f) below or unless extended by the parties' mutual
agreement in accordance with Section 12(h) below (the "TERM").
15
(b) WFHC may terminate this Agreement upon thirty (30) days written
notice of termination given to Ventiv upon the occurrence of any of the
following:
(i) Failure to meet the minimum sales calls described in Section
3(c) above;
(ii) Failure to meet the minimum total prescriptions described
in Section 3(d) above; or
(iii) Failure to meet the incentive compensation design
requirements described in Sections 5(e) or 5(f) above.
(c) Ventiv may terminate this Agreement upon thirty (30) days
written notice of termination given to WFHC at such time as the monthly pipeline
supply of Product falls below 0.5 for three (3) consecutive months as determined
by the International Marketing Services Prescription Reporting Service (IMS).
(d) Either party may terminate this Agreement upon written notice to
the other party in the event the other party materially breaches an obligation
or duty under this Agreement that is not cured within thirty (30) days after
such notice.
(e) At any time during the first Agreement Year, WFHC will have the
right to terminate this Agreement upon ninety (90) days' prior written notice to
Ventiv, in the event of a Change of Control of WFHC.
(f) After the first Agreement Year, each of WFHC and Ventiv will
have the right to terminate this Agreement without cause and for any reason or
no reason upon ninety (90) days' prior written notice to the other party.
(g) If WFHC exercises its rights to terminate this Agreement under
Section 12(e) in the first Agreement Year or Section 12(f) in the second
Agreement Year, Ventiv will receive a termination payment equal to the [***],
not to exceed [***]. In order to determine the exact amount of the termination
payment, Ventiv shall provide to WFHC a reasonably detailed statement of costs,
including supporting documentation evidencing actual expenses for the
termination payment amount.
(h) The Term may be extended upon the mutual agreement of the
parties, it being understood that neither party shall be under any obligation,
express or implied, to do so. In order to be binding upon either party, any such
extension, and the terms governing such extension, must be evidenced by a
written agreement executed by duly authorized representatives of both parties.
(i) Neither the termination nor expiration of the Term shall release
or operate to discharge either party from any liability or obligation that may
have accrued prior to such termination or expiration. Any termination of the
Term by a party shall not be an exclusive remedy, but shall be in addition to
any legal or equitable remedies that may be available to the terminating party.
(j) If the Term is terminated by either party prior to the
completion of an Agreement Quarter, Ventiv shall be entitled to receive a pro
rata portion of the compensation which it would have been entitled to receive
under Section 10 had the Term been in effect for the entire Agreement Quarter
(based on the number of days that Ventiv was responsible for marketing the
Product to Covered Physicians during such Agreement Quarter).
16
***Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
(k) Upon the termination or expiration of the Term, Ventiv shall
promptly cease all of its promotion activities pursuant to this Agreement,
discontinue any use of the Trademark, return to WFHC all sales training,
promotional, marketing material and WFHC call lists and computer files that may
have been supplied to Ventiv by WFHC under this Agreement. WFHC shall be
entitled to promote the Product to all Covered Physicians thereafter without
compensation or obligation to Ventiv. It is understood that the names and
addresses of any Covered Physicians to whom Ventiv may have made calls are not
considered Confidential Information.
(l) Notwithstanding the expiration or termination of the Term, this
Agreement shall be deemed to continue and shall not be deemed terminated in its
entirety and of no further force and effect unless and until neither party has
any further obligation to the other party in accordance with the terms hereof.
13. INDEMNIFICATION AND INSURANCE.
(a) WFHC shall defend, indemnify and hold Ventiv and its employees,
agents, officers, directors and affiliates (each a "VENTIV PARTY") harmless from
and against any and all losses, liabilities, obligations, claims, fees
(including, without limitation, attorneys fees) and expenses incurred by a
Ventiv Party that are claimed by any Third Party and that result from or arise
in connection with (i) the breach of any covenant, representation or warranty of
WFHC contained in this Agreement, (ii) any product liability claim related to
the Product, including, without limitation, the use by any person of the Product
that was manufactured, sold or distributed by WFHC, (iii) any contamination of
or defect in the Product, and (iv) breach by WFHC of its obligations under
Section 14 hereof. Notwithstanding anything in this Section 13(a), WFHC shall
not be obligated to indemnify a Ventiv Party for any liability related to the
Product for which Ventiv has assumed an indemnification obligation with respect
to Product Liability claims under Section 13(b) below.
(b) Ventiv shall defend, indemnify and hold WFHC and its employees,
agents, officers, directors and affiliates (each, a "WFHC PARTY") harmless from
and against any and all losses, liabilities, obligations, claims, fees
(including, without limitation, attorneys' fees), expenses and lawsuits brought
against or incurred by a WFHC Party by a Third Party resulting from or arising
in connection with (i) the breach by Ventiv of any covenant, representation or
warranty of Ventiv contained in this Agreement, (ii) any misrepresentation by
Ventiv or its sales representatives of Product claims, and/or (iii) breach by
Ventiv of its obligations under Section 14 hereof.
(c) To receive the benefits of the indemnity under clauses (a) or
(b) above, as applicable, an indemnified party must (i) give the indemnifying
party written notice of any claim or potential claim promptly after the
indemnified party receives notice of any such claim (the "CLAIM NOTICE"); (ii)
allow the indemnifying party to assume the control of the defense and settlement
(including all decisions relating litigation, defense and appeal) of any such
claim (so long as it has confirmed its indemnification obligation responsibility
to such indemnified party under this Section 13); and (iii) so long as such
cooperation does not vitiate any legal privilege to which it is entitled,
reasonably cooperate with the indemnifying party in its defense of the claim
(including, without limitation, making documents and records available for
review and copying and making persons within its/his/her control available for
pertinent testimony). If the indemnifying party defends the claim, the
indemnified party may participate in, but not control, the defense of such claim
at its/his/her sole cost and expense. If the indemnifying party fails to assume
the defense of the claim within fifteen (15) calendar days after receipt of the
Claim Notice, the indemnified party will (upon delivering notice to such effect
to the indemnifying party) have the right to undertake, at the indemnifying
party's cost and expense, the defense, compromise or settlement of the claim on
behalf of and for the account and risk of the indemnifying party. In the event
the indemnified party assumes the defense of the claim, the indemnified party
will keep the indemnifying
17
party reasonably informed of the progress of any such defense, compromise or
settlement. The indemnifying party shall be liable for any settlement of any
action effected pursuant to and in accordance with this Section 13 and for any
final judgment (subject to any right of appeal), and the indemnifying party
agrees to indemnify and hold harmless an indemnified party from and against any
damages by reason of such settlement or judgment. In any event, any compromise
or settlement of a claim shall be made only with the written consent of the
indemnified party, such consent not to be unreasonably withheld.
(d) Ventiv acknowledges and agrees that any Ventiv sales force
personnel (including contract sales personnel, telemarketers, detail personnel,
independent contractors, employees, and agents) used by Ventiv to fulfill its
obligations under this Agreement are not, and are not intended to be or be
treated as, employees of WFHC or any of its Affiliates, and that such
individuals are not eligible to participate in any "employee benefit plans," as
such term is defined in section 3(3) of ERISA, that are sponsored by WFHC or any
of its Affiliates. WFHC shall not be responsible to Ventiv, to any employees,
agents, contractors, telemarketers, or other personnel of Ventiv used by it to
perform its obligations under this Agreement, or to any governmental entity for
any compensation or benefits (including, without limitation, vacation and
holiday remuneration, healthcare coverage or insurance, life insurance, pension
or profit-sharing benefits and disability benefits), payroll-related taxes or
withholdings, or any governmental charges or benefits (including without
limitation unemployment and disability insurance contributions or benefits and
workmen' compensation contributions or benefits) that may imposed upon or be
related to the performance by Ventiv and any of its employees, agents,
contractors, telemarketers, detail or other personnel used by Ventiv to
discharge its obligations under this Agreement, all of which shall be the sole
responsibility of Ventiv, even if it is subsequently determined by any court,
the IRS or any other governmental agency that such individual may be a common
law employee of WFHC or any of its Affiliates. All such matters of compensation,
benefits and other terms of employment for any employee, agent, contractor,
telemarketer, detail or other personnel used by Ventiv to fulfill its
obligations hereunder shall be solely a matter between Ventiv and such
individual(s) or entities.
Ventiv will indemnify, defend, and hold harmless each WFHC Party
from and against any damages, liability, loss and costs that may be paid or
payable by any such WFHC Party resulting from or in connection with any claim or
other cause of action asserted by:
(i) any employees, agents, contractors, telemarketers, detail
personnel, or other personnel of Ventiv used by it to perform its obligations
under this Agreement, or
(ii) by any Third Party (including federal, state or local
governmental authorities) with respect to:
(A) any payment or obligation to make a payment to any
employees, agents, contractors, telemarketers, or other personnel used by Ventiv
to perform its obligations under this Agreement with respect to any
compensation, benefits of any type under any employee benefit plan (as such term
is defined above), and any other bonus, stock option, stock purchase, incentive,
deferred compensation, supplemental retirement, severance and other similar
fringe or employee benefit plans, programs or arrangements that may be sponsored
at any time by WFHC or any of its Affiliates or by Ventiv or any of its
Affiliates, even if it is subsequently determined by any court, the IRS or any
other governmental agency that any such employee, agent, contractor,
telemarketer, detail and other personnel used by Ventiv to discharge its
obligations hereunder may be a common law employee of WFHC or any of its
Affiliates, except to the extent language in a WFHC employee benefit plan is
deemed to cover a Ventiv employee and such language is not required by law; and
18
(B) the payment or withholding of any contributions, payroll
taxes, or any other payroll-related item by or on behalf of Ventiv or any of its
employees, agents, contractors, telemarketers, and other personnel with respect
to which WFHC, Ventiv or any of Ventiv's employees, agents, contractors,
telemarketers, and other personnel may be responsible hereunder or pursuant to
applicable law to pay, make, collect, withhold or contribute, even if it is
subsequently determined by any court, the IRS or by any other governmental
agency that any such employee, agent, contractor, telemarketer, and other person
used by Ventiv to discharge its obligations hereunder may be a common law
employee of WFHC or any of its Affiliates.
Nothing contained in this Section 13(d) is intended to or will effect or limit
any compensation payable by WFHC to Ventiv for the services rendered by Ventiv
pursuant to this Agreement.
(e) Each of WFHC and Ventiv shall use commercially reasonable
efforts to maintain insurance against such risks (including product liability)
and upon such terms (including coverages, deductible limits and self-insured
retentions) as is customary for the activities to be conducted by it under this
Agreement and is appropriate to cover its indemnification obligations hereunder.
Without limiting the foregoing, each of WFHC and Ventiv shall carry and
maintain, during the Term of this Agreement and for one (1) year thereafter, (i)
Workers Compensation Insurance as will protect such party from claims by its
employees under any Workers Compensation or similar acts and (ii) comprehensive
general liability insurance in an amount of not less than $5,000,000 per
occurrence and $10,000,000 in the aggregate, including, in the case of WFHC, a
product liability endorsement, and in the case of both parties, contractual
liability endorsements. Each party's comprehensive general liability insurance
policy shall name the other party as an additional insured party thereunder and
shall be endorsed to provide for thirty (30) days notice to the other party of
cancellation in the coverage before such cancellation takes effect. Such
insurance shall be with insurance companies having a Best's Insurance rating of
A:X or better. Each party shall furnish to the other party evidence of such
insurance, upon request. Such insurance information shall be kept in confidence
in the same manner as any other confidential information disclosed by the
parties hereunder.
14. CONFIDENTIALITY.
(a) Each party acknowledges that it may receive confidential or
proprietary information of the other party in the performance of this Agreement.
Each party shall hold confidential and shall not, directly or indirectly,
disclose, publish or use for the benefit of any Third Party or itself, except in
carrying out its duties hereunder, any confidential or proprietary information
of the other party, without first having obtained the furnishing party's written
consent to the such disclosure or use. "CONFIDENTIAL OR PROPRIETARY INFORMATION"
shall include, inter alia, know-how, scientific information, clinical data,
efficacy and safety data, adverse event information, formulas, methods and
processes, specifications, pricing information (including discounts, rebates and
other price adjustments) and other terms and conditions of sales, customer
information, business plans, and all other intellectual property. This
restriction shall not apply to any information within the following categories:
(i) information that is known to the receiving party or its
Affiliates prior to the time of disclosure to it, to the extent evidenced by
written records or other competent proof;
(ii) information that is independently developed by employees,
agents, or independent contractors of the receiving party or its Affiliates
without reference to or reliance upon the information furnished by the
disclosing party, as evidenced by written records or other competent proof;
(iii) information disclosed to the receiving party or its
Affiliates by a Third Party that has a right to make such disclosure;
19
(iv) information that is contained in any written promotional
material prepared by WFHC for use in connection with the Product; or
(v) any other information that becomes part of the public domain
through no fault or negligence of the receiving party.
The receiving party shall also be entitled to disclose the other
party's Confidential Information that is required to be disclosed in compliance
with applicable laws or regulations (including, without limitation, to comply
with SEC, Nasdaq or stock exchange disclosure requirements), or by order of any
governmental body or a court of competent jurisdiction; provided that the party
required to disclose such information shall use all reasonable efforts to obtain
confidential treatment of such information by the agency or court.
(b) This obligation shall survive the termination or expiration of
this Agreement for five (5) years.
(c) The confidentiality obligations described above shall supersede
the Confidentiality Agreement dated as of February 2, 2002 between the parties
and shall govern any and all information disclosed by either party to the other
pursuant thereto, and shall be retroactively effective to the date of such
Confidentiality Agreement.
(d) It is expressly understood and agreed that Ventiv may disclose
confidential information to members of its board of directors who are not
employees of Ventiv (and to consultants who have received WFHC's prior written
approval), provided that Ventiv shall ensure that such directors and consultants
are bound by a written obligation of confidentiality to Ventiv as regards
confidential information hereunder that is disclosed to them that is reasonably
satisfactory to WFHC.
15. REPRESENTATIONS AND WARRANTIES.
(a) WFHC represents and warrants to Ventiv that (i) the execution,
delivery and performance of this Agreement by WFHC does not conflict with, or
constitute a breach of or under, any order, judgment, agreement or instrument to
which WFHC is a party, including, without limitation, the Xxxxxxxx License; (ii)
the execution, delivery and performance of this Agreement by WFHC does not
require the consent of any person or the authorization of (by notice or
otherwise) any governmental or regulatory authority and (iii) to WFHC's
knowledge, the promotion of the Products by Ventiv does not infringe the
intellectual property rights of any Third Party.
(b) Ventiv represents and warrants to WFHC that (i) the execution,
delivery and performance of this Agreement by Ventiv does not conflict with, or
constitute a breach of or under, any order, judgment, agreement or instrument to
which Ventiv is a party; and (ii) the execution, delivery and performance of
this Agreement by Ventiv does not require the consent of any person or the
authorization of (by notice or otherwise) any governmental or regulatory
authority.
16. LIMITATION OF LIABILITY.
(a) EXCEPT WITH RESPECT TO THE PARTIES' RESPECTIVE INDEMNIFICATION
OBLIGATIONS FOR THIRD PARTY CLAIMS PURSUANT TO SECTION 13 AND WITHOUT LIMITING
THE PARTIES ABILITIES TO SEEK INJUNCTIVE RELIEF OR SPECIFIC PERFORMANCE OF THIS
AGREEMENT, THE PARTIES EXPRESSLY AGREE THAT, WITH RESPECT TO ANY CLAIM BY EITHER
WFHC OR VENTIV AGAINST THE OTHER ARISING OUT OF ANY BREACH OF THIS AGREEMENT,
THE LIABILITY OF THE BREACHING
20
PARTY TO THE NON-BREACHING PARTY FOR SUCH BREACH SHALL BE LIMITED UNDER THIS
AGREEMENT OR OTHERWISE AT LAW OR EQUITY TO DIRECT MONEY DAMAGES ONLY, AND IN NO
EVENT SHALL A PARTY BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL, PUNITIVE,
EXEMPLARY OR CONSEQUENTIAL DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY OF THE
SAME.
(b) Ventiv acknowledges and agrees that WFHC shall not be liable and
shall have no responsibility to Ventiv (except as contemplated by Section 4(f)
above) in the event WFHC receives insufficient quantities of the Product from
its supplier(s) to meet demand for the Product.
17. NOTICES. Unless otherwise explicitly set forth herein, any notice
required or permitted to be given hereunder shall be in writing and shall be
delivered personally by hand, or sent by reputable overnight courier, signature
required, to the addresses of each party set forth below or to such other
address or addresses as shall be designated in writing in the same matter:
(a) If to WFHC:
Women First HealthCare, Inc.
00000 Xx Xxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attention: President & CEO
(b) If to Ventiv:
Ventiv Health U.S. Sales L.L.C.
000 Xxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: President
All notices shall be deemed given when received by the addressee.
18. MISCELLANEOUS PROVISIONS.
(a) Assignment. Neither party shall assign or otherwise transfer
this Agreement or any interest herein or right hereunder without the prior
written consent of the other party, and any such purported assignment, transfer
or attempt to assign or transfer any interest herein or right hereunder shall be
void and of no effect; except that (i) each party may assign its rights and
obligations hereunder to an Affiliate without the prior consent of the other
party (although, in such event, the assigning party shall remain primarily
responsible for all of its obligations and agreements set forth herein,
notwithstanding such assignment) and (ii) WFHC may assign its rights and
obligations to a successor (whether by merger, consolidation, reorganization or
other similar event) or purchaser of all or substantially all of its business
assets relating to the Product, provided that such successor or purchaser has
agreed in writing to assume all of WFHC's rights and obligations hereunder and a
copy of such assumption is provided to Ventiv hereunder. A Change of Control of
Ventiv involving a competitor of WFHC (e.g., any pharmaceutical or device
company active in women's health and/or dermatology) shall be deemed to be an
assignment of this Agreement. Therefore, the assignment of this Agreement in
connection with such a Change of Control shall require the prior written consent
of WFHC.
(b) Non-Waiver. Any failure on the part of a party to enforce at any
time or for any period of time any of the provisions of this Agreement shall not
be deemed or construed to be a waiver of
21
such provisions or of any right of such party thereafter to enforce each and
every such provision on any succeeding occasion or breach thereof.
(c) Dispute Resolution.
(i) If any dispute arises under this Agreement which cannot be
resolved expeditiously by the Sales/Marketing Committee after due consideration,
the matter shall be submitted to the President of Ventiv and the President of
WFHC for resolution. If such personnel are unable to resolve such dispute within
thirty (30) days of initiating such negotiations, then, subject to Section
18(c)(iii) below such dispute shall be finally resolved by binding arbitration
under Section 18(c)(ii) below.
(ii) Any such arbitration shall be held in Chicago, Illinois,
according to the Commercial Arbitration Rules (the "RULES") of the American
Arbitration Association. Any arbitration herewith shall be conducted in the
English language. The arbitration shall be conducted by one arbitrator who is
knowledgeable in the subject matter which is at issue in the dispute and who is
selected by mutual agreement of the parties or, failing such agreement, shall be
selected according to the AAA rules. The parties shall have such discovery
rights as the arbitrator may allow, but in no event broader than that discovery
permitted under the Federal Rules of Civil Procedure. In conducting the
arbitration, the arbitrator shall apply the California Evidence Code, and shall
be able to decree any and all relief of an equitable nature, including but not
limited to such relief as a temporary restraining order, a preliminary
injunction, a permanent injunction, or replevin of property, as well as specific
performance. The reasonable fees and expenses of the arbitrator along with the
reasonable legal fees and expenses of the prevailing Party (including all expert
witness fees and expenses), the fees and expenses of a court reporter, and any
expenses for a hearing room, shall be paid as follows: If the arbitrator rules
in favor of one Party on all disputed issues in the arbitration, the losing
Party shall pay 100% of such fees and expenses; if the arbitrator rules in favor
of one Party on some issues and the other Party on other issues, the arbitrator
shall issue with the rulings a written determination as to how such fees and
expenses shall be allocated between the Parties. The arbitrator shall allocate
fees and expenses in a way that bears a reasonable relationship to the outcome
of the arbitration, with the Party prevailing on more issues, or on issues of
greater value or gravity, recovering a relatively larger share of its legal fees
and expenses. The decision of the arbitrator shall be final and may be entered,
sued on or enforced by the Party in whose favor it runs in any court of
competent jurisdiction at the option of such Party. Whether a claim, dispute or
other matter in question would be barred by the applicable statute of
limitations, which statute of limitations also shall apply to any claim or
disputes subject to arbitration under this Section 18(c), shall be determined by
binding arbitration pursuant to this Section.
(iii) Notwithstanding anything to the contrary in this Section
18(c), either Party may seek immediate injunctive or other interim relief or
other equitable remedies without resort to arbitration from any court of
competent jurisdiction as necessary to enforce and prevent infringement of the
patent rights, copyright rights, trademarks, trade secrets, or other
intellectual property rights owned or controlled by a Party or its Affiliates or
to prevent breach of any of Sections 2(b), 2(c), 3(g), 7(e), 9 or 14 hereof.
(d) Entire Agreement. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof and
thereof and supersedes all previous and contemporaneous verbal and written
agreements, representations and warrantees with respect to such subject matter.
This Agreement (or any provision or term hereof) may be released, waived,
changed or supplemented only by a written agreement signed by an officer or
other authorized representative of the party against whom enforcement of any
release, waiver, change or supplement is sought. This Agreement shall not be
strictly construed against either party hereto.
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(e) Public Announcements. The form and content of any public
announcement to be made by one party regarding this Agreement, or the subject
matter contained herein, shall be subject to the prior written consent of the
other party (which consent may not be unreasonably withheld), except as may be
required by applicable law (including, without limitation, disclosure
requirements of the SEC, Nasdaq, or any other stock exchange) in which event the
other party shall endeavor to give the other party reasonable advance notice and
review of any such disclosure.
(f) Governing Law. This Agreement shall be governed by and construed
in accordance with the internal laws of the State of California, without regard
to its conflicts of law principles.
(g) Relationship of the Parties. In making and performing this
Agreement, the parties are acting, and intend to be treated, as independent
entities and nothing contained in this Agreement shall be construed or implied
to create an agency, partnership, joint venture, or employer and employee
relationship between WFHC and Ventiv. Except as otherwise provided herein,
neither party may make any representation, warranty or commitment, whether
express or implied, on behalf of or incur any charges or expenses for or in the
name of the other party. No party shall be liable for the act of any other party
unless such act is expressly authorized in writing by both parties hereto.
(h) Ventiv Parent Company Matters. Ventiv hereby represents to WFHC
that it is owned and controlled 100% by Ventiv Health, Inc. ("PARENT"). Parent,
by signing below, hereby agrees to cause Ventiv to perform each of its
obligations hereunder and further agrees that if, after notice, Ventiv fails to
meet any obligation hereunder (including, without limitation, its
indemnification obligations under Section 13 above), Parent shall be responsible
and liable for such performance.
(i) Counterparts. This Agreement shall become binding when any one
or more counterparts hereof, individually or taken together, shall bear the
signatures of each of the parties hereto. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original as against the
party whose signature appears thereon, but all of which taken together shall
constitute but one and the same instrument.
(j) Force Majeure. Neither party shall be liable to the other party
for any failure to perform as required by this Agreement if the failure to
perform is due to circumstances reasonably beyond such party's control,
including, without limitation, acts of God, civil disorders or commotions, acts
of aggression, fire, explosions, floods, drought, war, sabotage, embargo,
unexpected safety or efficacy results obtained with a Product, utility failures,
supplier failures, material shortages, labor disturbances, a national health
emergency, or appropriations of property. A party whose performance is affected
by a force majeure event shall take prompt action using its reasonable best
efforts to remedy the effects of the force majeure event.
(k) No Implied Rights. Nothing in this Agreement is intended to
create or imply any right or license in the other Party under any patent rights,
copyrights, trademarks or other intellectual property rights owned or controlled
by a Party, except as expressly set forth herein.
(l) Partial Invalidity. If any provision of this Agreement is held
to be invalid, illegal, or unenforceable by a court of competent jurisdiction,
then: (a) such provision will be deemed amended to conform to applicable laws of
such jurisdiction so as to be valid and enforceable, or, if it cannot be so
amended without materially altering the intention of the Parties, it will be
stricken; (b) the validity, legality and enforceability of such provision will
not in any way be affected or impaired thereby
23
in any other jurisdiction; and (c) the remaining provisions of this Agreement
will remain in full force and effect.
[Remainder of Page Intentionally Left Blank]
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In Witness Whereof, the parties hereto have duly executed this
Agreement in multiple counterparts through their duly authorized
representatives.
VENTIV HEALTH U.S. SALES L.L.C. WOMEN FIRST HEALTHCARE, INC.
By: /s/ XXXXXXX XXXXXXX By: /s/ XXXXXXX X. XXXXXXXX
------------------------- -------------------------------
Name: Xxxxxxx Xxxxxxx Name: Xxxxxxx X. Xxxxxxxx
Title: President, U.S. Sales Title: Vice President, Chief Financial
Officer, Treasurer and Secretary
Acknowledged and agreed for
purposes of Section 18(h) above:
VENTIV HEALTH, INC.
By: /s/ XXXX XXXXXX
--------------------------
Name: Xxxx Xxxxxx
Title: Chief Executive Officer
Address:
000 Xxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Facsimile No.: (000) 000-0000
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