1
EXHIBIT 10.14
MANUFACTURE AND SUPPLY AGREEMENT
This MANUFACTURE AND SUPPLY AGREEMENT (the "Agreement"), effective as of
December 19, 1996 (the "Effective Date"), is entered into by and between
ADVANCED CORNEAL SYSTEMS, INC., a California corporation having its principal
place of business at 00000 Xxxxx Xxxxxxx, Xxxxx 000, Xxxxxx, Xxxxxxxxxx 00000
("ACS"), and PRIMA PHARM, INC., a California corporation having its principal
place of business at 0000 Xxxxx Xxxxx, Xxxxx X, Xxx Xxxxx, Xxxxxxxxxx 00000
("Prima Pharm").
RECITALS
WHEREAS, ACS is in the business of discovering, developing, and
commercializing products and technology useful in the treatment and prevention
of irregularities, malformations, and diseases of the eye; and
WHEREAS, ACS has developed proprietary technology using the enzyme
Hyaluronidase (as defined below) to correct vision, and desires to have Prima
Pharm manufacture a Product containing Hyaluronidase suitable for human use; and
WHEREAS, Prima Pharm has the manufacturing facilities and technical
expertise to manufacture the Product in conformance with the specifications
provided in Exhibit B attached hereto; and
WHEREAS, ACS desires to purchase from Prima Pharm, and Prima Pharm desires
to sell to ACS, the Product, on the terms and conditions set forth below.
NOW, THEREFORE, ACS and Prima Pharm agree as follows:
ARTICLE - DEFINITIONS
1.1 Definitions. The following capitalized and underlined terms shall
have the following meanings when used herein;
1.1.1 "Affiliate" shall mean any corporation, association, company,
organization or other entity which directly or indirectly controls, is
controlled by, or is under common control with a party. For the purpose of this
definition, the term "control" shall mean the direct or indirect ownership of
fifty percent (50%) or more of the voting power of the subject entity.
1.1.2 "Bulk Material" shall mean that material containing
Hyaluronidase obtained by Prima Pharm.
1.1.3 "Delivery Point" shall mean Prima Pharm's facility located at
the address written above.
2
1.1.4 "FDA" shall mean the United States Food and Drug
Administration, any successor agency thereto, and any foreign equivalent
thereof.
1.1.5 "GMP" shall mean the current Good Manufacturing Practices as
prescribed by applicable FDA regulations, as may be amended from time to time
during the term hereof, and any foreign equivalent thereto which relates to
manufacture, distribution, or sale of Products in a foreign country.
1.1.6 "Hyaluronidase" shall mean that enzyme that catalyzes the
breakdown of hyaluronic acid, which enzyme is produced by recombinant means or
extracted from mammalian tissue and conforms to the specification set forth in
Exhibit A.
1.1.7 "Product" shall mean a lyophilized composition containing
Hyaluronidase as the active ingredient, such composition being capable of being
reconstituted into a liquid formulation which may then be administered to the
eye(s) of a patient in order to effect reshaping of the patient's cornea(s) or
reversibly liquefy the patient's vitreous humor, and which conforms to the
specifications set forth on Exhibit B attached hereto, as may be amended from
time to time.
1.1.8 "U.S. Pharmacopoeia" or "U.S.P." shall mean the compendium of
pharmaceutical standards published by the United States Pharmacopeial
Convention, Inc., as may be updated from time to time during the term hereof.
1.1.9 "Unit" means an International Unit of Hyaluronidase activity,
which corresponds to the hydrolysis of muccopolysaccharides such as hyaluronic
acid, as described by U.S.P. Biozyme Laboratories, Ltd., or as stated in
analytical procedures supplied by ACS to Prima Pharm from time to time.
1.2 Rules of Construction. AS used in this Agreement, all defined terms
used in the singular shall include the plural, and vice versa, as the context
may require. The words "hereof," "herein," and "hereunder" and other words of
similar import refer to this Agreement as a whole. The word "including" when
used herein is not intended to be exclusive and instead shall mean "including,
without limitation," unless otherwise indicated. The descriptive Article,
Section, and Paragraph numbers and headings are used for convenience and
reference only and do not constitute a part of and shall not be utilized in
interpreting this Agreement. This Agreement has been negotiated by the parties
and their respective counsel and shall be fairly interpreted in accordance with
its terms and without any rules of construction relating to which party drafted
the Agreement being applied in favor or against either party.
-2-
3
ARTICLE 2 -- BULK MATERIAL
2.1 Supply.
2.1.1 Obtaining Bulk Material. During the term of this Agreement,
Prima Pharm shall use its best efforts to obtain, and shall obtain either from
a third party manufacturer acceptable to and first approved in writing by ACS
or by itself manufacturing, a supply of Bulk Material sufficient to enable
production of Products in order to meet ACS's purchase requirements, as
provided in Article 4, such Bulk Material to meet the specifications listed in
Exhibit A with respect thereto and any and all applicable U.S.P. requirements
then in effect.
2.1.2 Payment. ACS agrees that it will pay for Bulk Material
ordered by Prima Pharm from a third party manufacturer. Prima Pharm shall
provide ACS with any invoice with regard to Bulk Material ordered by Prima
Pharm within five (5) days of receipt of the invoice, and ACS, at its option,
shall pay those amounts due pursuant to the invoice directly to the third party
manufacturer, or provide such payment to Prima Pharm, which will then
immediately forward such payment to the third party manufacturer. ACS also
reserves the right to at any time enter into a supply agreement with a third
party in respect of Bulk Material, in which event ACS shall become responsible
for the supply of Bulk Material and Prima Pharm shall be relieved of its
obligations under Paragraph 2.1.1, following receipt of notice from ACS to such
effect.
2.2 Specifications. During the term of this Agreement, ACS shall be
responsible for developing, updating, and testing any additions to or
modifications of the specifications and/or formulation of the Product. Prima
Pharm shall have the right to propose any reasonable change(s) to such
specifications or formulation, provided that implementation of any such
change(s) shall be subject to the prior written approval of ACS. As of the
Effective Date, specifications for Bulk Material and the Product are as listed
in attached Exhibit B. Exhibit B will be updated at the time any change to
specification for the Product are implemented in accordance with this Section
2.2.
ARTICLE 3 -- PROCESS DEVELOPMENT
AND MANUFACTURING
3.1 Process Development.
3.1.1 Prima Pharm's Obligations. In conjunction with ACS, Prima
Pharm shall promptly design, develop, and implement a formulation and
lyophilization process acceptable to ACS and which results in the production
of a Product meeting the specifications listed in Exhibit B (the "Process").
Prima Pharm shall be responsible for obtaining supplies of raw materials and
constituents for the Product and any related equipment necessary to manufacture
and supply the Product in accordance with the terms of this Agreement. Prima
Pharm shall perform its obligations hereunder using employees with proper
training and skill in accordance with GMPs and the Product specifications as
provided in Exhibit B or otherwise then in effect.
-3-
4
3.1.2 Suppliers. During the term of this Agreement, Prima Pharm
will purchase or otherwise acquire raw materials and constituents for the
Product only from vendors listed on a mutually agreed approved vendor list
("AVL"). In the event Prima Pharm wishes to add a vendor to the AVL, ACS must
first consent in writing, and ACS reserves the right from time to time to
review, inspect, or otherwise evaluate a proposed or existing vendor and their
corresponding constituent(s) incorporated into the Product.
3.1.3 Initial Lot. On or before April 1, 1997, Prima Pharm shall
produce and provide to ACS four (4) to six (6) initial lots of Product
consisting of one thousand (1,000) vials of each of the following: (i) eight
thousand (8,000) Units of Hyaluronidase per vial; and (ii) eleven thousand
(11,000) Units of Hyaluronidase per vial, to validate the Process, which
Product shall meet the specifications therefor and all applicable U.S.P.
requirements. In addition, Prima Pharm shall concurrently provide to ACS (i) a
detailed written report acceptable to ACS describing the Process used,
including copies of all GMP documentation relating thereto, (ii) a full
chemical analysis of such Product, and (iii) such other information as ACS may
reasonably request or which is needed to support ACS's submission to the FDA
with respect to the Product. Within thirty (30) days of accepting the foregoing
information and the initial lot and in accordance in Article 5, ACS shall pay
Prima Pharm a mutually agreed upon price in U.S. dollars.
3.4.4 Scale Up. Upon receipt of notice of ACS's acceptance of the
initial lot which yields those vials of Product produced in accordance with
Paragraph 3.1.3, Prima Pharm shall promptly begin scale-up of the Process to
demonstrate that commercially practicable yields of Product can be achieved
with the Process so as to meet ACS's Product requirements. On or before July 1,
1997, Prima Pharm shall provide to ACS (i) a written report confirming the use
of the Process to successfully make at least three (3) consecutive lots of
seven thousand (7,000) vials of Product containing eleven thousand (11,000)
Units of Hyaluronidase for corneaplasty and seven thousand (7,000) vials of
Product containing eight thousand (8,000) Units of Hyaluronidase for use in the
vitreous humor, in each case meeting all U.S.P. requirements, (ii) a full
chemical analysis of each such lot of Product, (iii) a one hundred (100) vial
sample from each such lot of Product, and (iv) such other information as ACS
may reasonably request. Within sixty (60) days following receipt of such
report, analysis, and information, ACS shall notify Prima Pharm whether the
development of the Process is complete. In the event that ACS notifies Prima
Pharm that further development of the Process is required, the parties shall
confer to determine what further development activities are necessary, and the
compensation, if any, that Prima Pharm shall receive for such development.
3.1.5 Progress Reports. From the Effective Date until the
completion of Process development and scale-up in accordance with Paragraphs
3.1.1, 3.1.3, and 3.4.4, Prima Pharm shall provide ACS with monthly written
progress reports, within ten (10) days following the end of each month. Such
reports shall describe Prima Pharm's activities with respect to Process
development in the preceding month.
3.1.6 Process Development Documentation. Prima Pharm shall prepare
and maintain in good scientific manner detailed written records regarding the
activities performed pursuant to Paragraphs 3.1.3 and 3.1.4. Such records shall
include, without limitation, each
-4-
5
formulation lyophilized relating to Hyaluronidase and the corresponding
results, and a detailed description of each invention or discovery made in
connection with the development and scale-up of the Process. Upon ACS's written
request, Prima Pharm shall promptly provide copies of such records to ACS.
3.2 Manufacturing. During the term of this Agreement and following
completion of process development and scale-up of the Process as provided in
Section 3.1, Prima Pharm shall manufacture quantities of Product sufficient to
meet ACS's requirements for Product Units ordered hereunder in accordance with
GMPs then in effect.
ARTICLE 4 - REGULATORY COMPLIANCE AND QUALITY ASSURANCE
4.1 Drug Master File. Upon ACS's request, Prima Pharm shall provide to
ACS a drug master file for Hyaluronidase, and shall assist ACS, at ACS's
expense, in preparing any addendum thereto in respect of Products made using the
Process and which shall contain all information necessary to comply with FDA,
U.S. Environmental Protection Agency, and all U.S. and European Pharmacopoeia
standards with respect to the Process and Product. Within thirty (30) days of
ACS's receipt of the drug master file, it shall notify Prima Pharm of its
acceptance of such file or that the file is unacceptable in the form presented,
identifying the deficiencies. In the event the drug master file is unacceptable,
Prima Pharm agrees to assist ACS, at ACS's expense, in correcting any
deficiencies identified by ACS.
4.2 Audit Rights. ACS shall have the right to review and audit Prima
Pharm's records and facilities relating to the development of the Process and
production of Products on an ongoing basis to evaluate and monitor: (i) the
feasibility of scaling-up the Process to obtain commercially practicable yields
and thereafter to assure GMP compliance, (ii) Prima Pharm's compliance with
governmental standards in the U.S. and abroad, and (ii) Prima Pharm's
performance of its obligations under this Agreement. At ACS's election, any
such reviews and/or audits may be performed by a third party consultant
designated by ACS, subject to the execution of a reasonable confidentiality
agreement between Prima Pharm and such consultant. Prima Pharm agrees to
promptly provide ACS (or ACS's consultant) with all information and/or access
to Prima Pharm's facilities as they may request.
4.3 Subcontracts. Prima Pharm shall not subcontract any aspect of the
Process or production of the Product from Bulk Material without ACS's prior
written consent. In the event that Prima Pharm wishes to subcontract any
portion of its obligations hereunder, Prima Pharm shall notify ACS of the
proposed subcontractor and the work to be performed by such subcontractor. ACS
shall approve or disapprove such proposed subcontractor within thirty (30)
days. Each approved subcontractor shall execute a confidentiality and
proprietary rights agreement in a form acceptable to ACS before beginning work
relating to this Agreement.
4.4 Facility Approval. Upon ACS's request, Prima Pharm shall assist ACS
in obtaining FDA (and the approval of foreign counterparts to the FDA) approval
for the manufacture of Products in the facility in which the Product subject to
this Agreement will be manufactured pursuant to
-5-
6
Article 5. ACS shall have no obligation to purchase any Products from Prima
Pharm until ACS receives final FDA approval of Prima Pharm's manufacturing
facility. Prima Pharm shall advise ACS in writing immediately if an agent of
any regulatory body having jurisdiction over the manufacture and/or marketing
of the Product visits Prima Pharm's manufacturing facility, and shall specify
what, if any, inquiry was made in respect of the Process or Product.
4.5 Country of Origin Certification. Upon ACS's request, Prima Pharm will
provide ACS with an appropriate certification stating the county of origin for
the Product sufficient to satisfy the requirements of any applicable export
licensing regulations and the custom authorities of the country to which ACS
intends to ship the Product.
4.6 Quality Assurance.
4.6.1 Program. Prima Pharm agrees to assure the quality level of
the Product through the use of a formal quality assurance program in
conformance with industry standards. Such program shall require Prima Pharm to
prepare and maintain written records sufficient to enable ACS to trace the
history of each Product lot. During the term of the Agreement, ACS shall have
the right to audit such quality assurance program, at its expense, during
regular business hours.
4.6.2 Certificates of Analysis. Prima Pharm shall test, or cause
to be tested for conformance to the specifications then in effect, each lot of
Product manufactured pursuant to this Agreement before delivery to ACS. A
certificate of analysis for each batch delivered shall set forth the items
tested, the specifications therefor, and the test results (the "Q.A. Data
Sheet"). The Q.A. Data Sheet shall include at least the following information:
(i) manufacturing records, including an indication that all lot production and
control records have been reviewed and approved by the appropriate quality
control unit; (ii) Hyaluronidase assay data and results; (iii) tyrosine assay
data and results; (iv) pyrogenicity data; (v) container closure integrity; (vi)
sterility data; and (vii) pyrogen test results as per U.S.P. Prima Pharm shall
send, or cause to be sent, such Q.A. Data Sheets, to ACS prior to each shipment
of Products. As may be required by the FDA, ACS shall assume full
responsibility for final release of each lot of Product and shall be
responsible for all contact with the FDA in connection with the Product, except
as relates to FDA inspection and approval of Prima Pharm's Product
manufacturing facilities, for which Prima Pharm will be responsible.
4.7 Permits. Prima Pharm shall obtain and maintain all licenses, permits
and registrations necessary to manufacture the Products and supply the same to
ACS hereunder.
ARTICLE 5 - SUPPLY
5.1 Obligation to Supply. Subject to the terms and conditions of this
Agreement, Prima Pharm shall sell Products to ACS which shall conform fully
with the Product specifications listed in Exhibit B or otherwise in effect.
Subject to the terms of this Agreement, Prima Pharm shall sell to ACS all
Products ordered by ACS pursuant to this Agreement; provided, however, that ACS
shall have no obligation to purchase any Products from Prima Pharm pursuant to
this Section 5.1 unless
-6-
7
(i) the Products conform to the specifications therefor set forth in Exhibit B
or otherwise then in effect, (ii) meet the warranties set forth in Section 7.1,
and (iii) Prima Pharm timely fills ACS's purchase orders and delivers Products
to ACS pursuant to this Article 5. During the term of this Agreement following
completion of scale up of the Process, Prima Pharm shall manufacture in
accordance with GMP quantities of Product sufficient to meet ACS's orders.
5.2 Non-Competition. During the term of this Agreement and for a period
of three (3) years thereafter, Prima Pharm agrees that it shall not supply any
third party directly or indirectly Products or Hyaluronidase or any derivative
thereof which Prima Pharm knows such third party is using, selling, or
distributing for ophthalmic applications.
5.3 Price. During the term of this Agreement, the price paid by ACS for
Products produced by Prima Pharm shall be as provided in Exhibit C attached
hereto.
5.4 Capacity. Prima Pharm shall make available to ACS for production of
the Product sufficient capacity to satisfy at least fifty percent (50%) of ACS's
Product requirements, and in no event shall such capacity be less than Three
Hundred Fifty Thousand (350,000) vials of Product per year. In the event ACS
desires Prima Pharm to increase the capacity dedicated to ACS, it must provide
written notice to Prima Pharm specifying the date and desired increased level of
capacity at least seven (7) months prior to the date at which such level of
capacity is to be made available, and Prima Pharm shall make such capacity
available on such date.
5.5 Forecasts.
5.5.1 Rolling Forecasts. During the term of this Agreement, ACS
shall provide to Prima Pharm within ten (10) days of the beginning of each
calendar quarter a rolling, non-binding forecast of ACS's anticipated
requirements for Products for the following twelve (12) month period.
5.5.2 Product Commitment. During the term of this Agreement, ACS agrees
that it will order fifty percent (50%) of its Product requirements from Prima
Pharm, provided that Prima Pharm is in full compliance with the terms of this
Agreement.
5.6 Orders for Products. ACS may initiate Product purchases under this
Agreement by telephone contact, e-mail, fax or by submitting written purchase
orders to Prima Pharm at the address first listed above, or such other address
as may be specified by Prima Pharm. Any purchase order initiated by telephone or
e-mail must be confirmed within ten (10) working days by a written purchase
order. In the event of a conflict between the terms of this Agreement and the
terms of a purchase order submitted by ACS to Prima Pharm in respect of a
Product, the terms of this Agreement shall control.
5.7 Acceptance. Prima Pharm shall acknowledge each purchase order in
writing within ten (10) business days of receipt. Within such ten (10) day
period, Prima Pharm may reject a purchase order which does not conform with the
terms and conditions of this Agreement. Any
-7-
8
rejection of a purchase order must be in writing. If a purchase order is
neither confirmed nor rejected within ten (10) business days of receipt by
Prima Pharm, it shall be deemed to have been accepted.
5.8 Product Lead Times. To facilitate Prima Pharm's production
scheduling, ACS will submit purchase orders for Products to Prima Pharm with a
lead time of at least ninety (90) days prior to the specified delivery date
with respect to Products ordered therein, and Prima Pharm shall deliver any such
Products in accordance with the terms of the corresponding purchase order. For
those Product purchase orders for which ACS fails to provide a lead time of at
least ninety (90) days, Prima Pharm agrees to use its reasonable efforts to
attempt to fill such orders by the delivery date specified therein by ACS, and
in any such event shall promptly notify ACS of the date on which such Product
shall be delivered. In the event ACS places a purchase order for Products
specifying a delivery date of less than sixty (60) days from the date of such
purchase order, and the same is accepted by Prima Pharm, or if ACS, subject to
Sections 5.9 and 5.10, cancels or reschedules an order in accordance with the
terms of this Article 5 fewer than sixty (60) days from specified delivery date
therefor, ACS agrees to pay for any additional costs incurred by Prima Pharm in
filing such orders, to the extent such costs are invoiced to ACS at the time
the Product invoice therefor is issued, as provided in Section 5.13.
5.9 Rescheduling.
5.9.1 By ACS. ACS may reschedule delivery of shipments of
Products covered by any purchase order as follows:
(a) for Products due to be delivered less than ninety (90)
days from the date Prima Pharm receives ACS's notice of rescheduling, any such
rescheduling must be mutually agreed;
(b) for Products due to be delivered between ninety (90)
and one hundred twenty (120) days from the date Prima Pharm receives ACS's
notice of rescheduling. ACS may reschedule delivery therefor one (1) time,
subject to Paragraph 5.9.2; provided, however, that if after rescheduling
delivery of such Products once, ACS again wishes to reschedule delivery, Prima
Pharm must consent thereto; and
(c) for Products due to be delivered more than one hundred
twenty (120) days after the date Prima Pharm receives ACS's notice of
rescheduling, subject to Paragraph 5.9.2, ACS shall be free to reschedule such
delivery at any time, provided that Prima Pharm must consent to any delivery
rescheduled to occur within ninety (90) days of such notice of rescheduling.
5.9.2 Limitations. In no event shall ACS have the right to
reschedule delivery of any Products ordered hereunder for a delivery date later
than nine (9) months after the date the purchase order corresponding thereto
was accepted by Prima Pharm, and, unless canceled pursuant to Section 5.10, any
Products ordered pursuant to a purchase order shall be delivered to ACS within
nine (9) months from the date such purchase order was accepted by Prima Pharm.
-8-
9
5.9.3 Changes in Numbers. With respect to a purchase order
specifying more than one Product delivery date, ACS may increase or decrease
the number of Products to be delivered on a specified delivery date, but only
to the extent such change does not change the number of Products to be
delivered on a delivery date specified in the corresponding purchase order by
more than twenty-five percent (25%), unless otherwise mutually agreed. For any
change in delivery dates made pursuant to this Paragraph 5.9.3, ACS shall, in
addition to specifying changed delivery dates and the number of Products to be
delivered, specify the corresponding decrease(s) or increase(s) in the number
of Products to be delivered on the other dates specified in the corresponding
purchase order.
5.10 Cancellation or Reduction. ACS may cancel, in whole or in part,
delivery of Products ordered pursuant to purchase orders submitted hereunder to
Prima Pharm, or reduce the number of Products ordered; provided, however, that
the delivery of any Product cannot be canceled without Prima Pharm's written
consent within sixty (60) days of such Product's scheduled delivery date.
5.11 Delivery. Prima Pharm shall make deliveries of the Products to the
destination designated by ACS in its purchase order on the date requested in
such purchase order, provided such requested delivery date is at least sixty
(6) days after the date of such purchase order, unless (i) ACS indicates a
later delivery date on the purchase order, or (ii) ACS notifies Prima Pharm in
writing requesting delayed delivery of such Products.
5.12 Packaging and Shipping. Products shall be supplied to ACS in lots (a)
allocated as requested by ACS in its purchase order for such Products, and (b)
contained within airtight and moisture proof Type 1 glass containers, and (c)
packaged in low temperature containers of a type approved in writing in advance
by ACS. Each such glass container shall be individually labeled. In accordance
with GMPs, Prima Pharm will label each vial of Product with a permanent,
non-erasable label containing only that information which ACS directs Prima
Pharm to include, it being understood that ACS retains the right to provide
such labels to Prima Pharm, and in the event ACS so provides such labels, Prima
Pharm agrees to apply them to each vial of Product ordered by ACS hereunder.
Each such glass container shall be resealable and protected from light and
breakage. All Products subject to this Agreement shall be suitably packed for
shipment in containers adequate to insure safe arrival of such goods at ACS's
designated Delivery Point, and delivered to a carrier or forwarding agent
chosen by ACS. Prima Pharm shall xxxx all containers with necessary lifting,
handling and shipping information, purchase order numbers, and date of
shipment. An itemized packing list must accompany each shipment. In the event
that ACS requests special packaging or finishing for any Product ordered
hereunder, ACS shall pay the incremental cost for such special packaging or
finishing; provided, however, that Prima Pharm agrees to include any special
documentation regarding the Products requested by ACS at no additional charge.
Shipment will be F.O.B. the Delivery Point. All shipping papers and/or invoices
shall include the purchase order number and lot numbers of Products shipped. A
copy of the Q.A. Data Sheet for each Product lot in a shipment shall accompany
such shipment. A second copy of such certificate of analysis shall be
separately sent to ACS.
5.13 Payment. Prima Pharm shall issue ACS individual invoices for each lot
of Product produced and shipped. Each such invoice, or billing statement
accompanying the invoice, shall
-9-
10
separately list the purchase order number, product descriptions, the number
vials of Product shipped, and the number of vials containing different
quantities of Product, the individual and total prices therefore, and any
special packaging or finishing charges. ACS shall pay each invoice within
thirty (30) days of the date of such invoice or the delivery date, whichever is
later. Payment of an invoice shall not constitute implied acceptance of
Products listed thereon.
5.14 Payment Method. ACS shall, at its discretion, make payment for
Products to Prima Pharm by check or by wire transfer to an account specified by
Prima Pharm.
5.15 Taxes. ACS shall not be responsible for the payment of any excise,
sales, use, value added, withholding or other taxes, tariffs or duties that may
be applicable to the transfer of products to ACS hereunder, all of which shall
be Prima Pharm's responsibility.
ARTICLE 6 - RECEIPT OF PRODUCT
6.1 Rejection. ACS shall have sixty (60) days following its receipt of a
shipment of Products to reject such Products on the grounds that all or part of
the shipment fails to conform to the applicable specifications or otherwise
fails to conform to the warranties given by Prima Pharm in Section 7.1, which
rejection shall be accomplished by giving written notice to Prima Pharm
specifying the manner in which all or part of such shipment fails to meet the
foregoing requirements. ACS reserves the right to reject any unauthorized early
or over/shipment of Products received without prior written approval from ACS.
If ACS rejects a shipment before the date on which payment therefor is due, it
may withhold payment for such shipment or the rejected portion thereof. All
shipments or portions thereof not rejected by ACS before payment is due
hereunder shall be paid for in accordance with Section 5.13. The warranties
given by Prima Pharm in Section 7.1 shall survive any failure to reject by ACS
under this Section 6.1.
6.2 Defects and Recalls.
6.2.1 Latent Defects. It is recognized that it is possible for a
shipment of Products to have defects ("defects" meaning that such Products fail
to conform to the applicable specifications or otherwise fail to conform to the
warranties given by Prima Pharm under Section 7.1) which would not be
discoverable upon reasonable physical inspection or testing (the "Latent
Defects"). As soon as either party becomes aware of a Latent Defect in any lot
of Products, it shall immediately notify the other party, and the lot or batch
involved, at ACS's election, shall be deemed rejected as of the date of such
notice. In the event of a rejection by ACS under this Section 6.2 due to a
Latent Defect attributable to Prima Pharm, Prima Pharm shall refund all monies
paid for such Products to the extent such Products have not been sold by ACS.
To the extent such Products have been sold by ACS, Prima Pharm shall reimburse
ACS for its acceptance of returns from its customers. At its election, ACS may
recover amounts to which it may become entitled under this Section 6.2 by
offsetting such amounts from amounts then due or that may subsequently become
due to Prima Pharm.
-10-
11
6.2.2 Product Recalls. In the event: (a) any government authority
issues a request, directive, or order that the Product, or a lot or lots
thereof, be recalled; (b) a court of competent jurisdiction orders such a
recall; or (c) ACS reasonably determines that the Product, or a lot or lots
thereof, should be recalled because the Product does not conform to
specifications or is found to contain a Latent Defect, the parties shall take
appropriate corrective action. In no event shall Prima Pharm be responsible for
regulatory compliance in connection with any recall, except to the extent
required hereunder or by law. All costs and expenses incurred in connection
with a recall shall be the responsibility of ACS, unless caused solely by the
negligence, willful act or omission, or breach hereof by Prima Pharm.
6.3 Disposal. All Products rejected by ACS under Section 6.1 or 6.2 may be
returned by ACS to Prima Pharm at Prima Pharm's expense. ACS shall give Prima
Pharm reasonable prior notice of such return. Within thirty (30) days of ACS's
request, Prima Pharm shall refund to ACS all amounts paid by ACS to return such
rejected Products to Prima Pharm or, with the agreement of the parties, credit
such amount to ACS against future purchases of Products.
6.4 Samples and Lot Records. Prima Pharm shall prepare and maintain lot
records and an archival sample, properly stored, from each lot of Products
manufactured and shipped hereunder sufficient to perform each quality control
test identified in the specifications at least twice. Prima Pharm shall comply
with all requirements of 21 C.F.R. Section 211.180 in preparing and maintaining
lot records and with the requirements of 21 C.F.R. Section 211.170 in
maintaining and storing samples.
6.5 Presence at Facility. During the term of this Agreement, ACS shall
have the right from time to time to have a reasonable number of representatives
of ACS selected by ACS to be present at the Prima Pharm facilities at which
Products are being manufactured; provided, however, that such representatives
shall (i) not interfere in the other activities being carried out at the
facility, and (ii) observe all rules and regulations applicable to individuals
employed at the facility. The presence of ACS's representative(s) shall in no
way relieve Prima Pharm of any of its obligations under this Agreement.
6.6 Inspections by Government Agencies. Prima Pharm shall promptly notify
ACS of any inspections by federal or national; state, province, or regional; or
local regulatory representatives (including, without limitation, FDA, EPA,
EEOC, OSHA, similar state agencies or building code inspectors) of any facility
at which Products are being or will be manufactured, and shall so cause the
supplier(s) of Bulk Material to do the same, and shall send ACS copies of the
results of any such inspections, including actions taken by Prima Pharm or any
other entity to remedy conditions cited in such inspections. Without limiting
the generality of the foregoing, Prima Pharm shall provide, and cause the
supplier(s) of Bulk Material to provide, ACS with copies of any written
inspection reports issued by such agencies and all correspondence between Prima
Pharm or the Bulk Material to do the same, and the agency involved, including,
but not limited to, FDA Form 483 and all correspondence relating thereto. Prima
Pharm shall permit, and cause Bulk Material Suppliers to permit, the FDA to
conduct whatever inspections of the facilities at which Products or Bulk
Material are to be manufactured as the FDA may reasonably request in connection
with ACS's obtaining and maintaining market approval for the Products, and
shall cooperate fully with the FDA during any such inspections.
-11-
12
Prima Pharm shall give, and cause the supplier(s) of Bulk Material to give, ACS
prompt written notice of any such inspections and allow representatives of ACS
to be present at such facilities during any such inspections.
ARTICLE 7 - REPRESENTATIONS AND WARRANTIES
7.1 PROCESS AND PRODUCTS WARRANTIES. Prima Pharm warrants and represents
that:
7.1.1 all Products sold by Prima Pharm to ACS hereunder shall (i)
comply with the specifications for such Products, (ii) conform with the
information shown on the Q.A. Data Sheet provided for the particular shipment,
and (iii) not contain any Latent Defect attributable to Prima Pharm;
7.1.2 none of the Products sold hereunder shall be adulterated or
misbranded within the meaning to ACS of the United States Food, Drug, and
Cosmetic Act, as amended and in effect at the time of shipment (the "Act"), or
within the meaning of any state or municipal laws in the United States
applicable to the Products and containing terms with substantially similar
meanings as the meaning of adulteration or misbranding under the Act; provided,
however, that this Paragraph 7.1.2 shall not apply to, and Prima Pharm shall
have no responsibility for, misbranding caused directly by ACS as a result of
labels or package texts specified or provided by ACS for the Products;
7.1.3 all Products delivered to ACS hereunder shall have been
manufactured within eight (8) weeks prior to receipt by ACS;
7.1.4 Prima Pharm, all Products sold by Prima Pharm to ACS
hereunder, and all facilities used by Prima Pharm to manufacture the Products
hereunder shall meet all United States regulatory requirements for
commercialization, including, without limitation, compliance with then current
GMPs, demonstration of commercial production capability, and demonstration of
acceptable stability of such Products; all ISO 9000 regulatory requirements.
7.1.5 Prima Pharm will provide written notice to ACS of any proposed
alterations to the Process; provided, however, that under no circumstances
shall any such alteration be implemented without ACS's express prior written
consent.
7.1.6 title to all Products sold hereunder shall pass to ACS as
provided herein free and clear of any security interest, lien, or other
encumbrance; and
7.1.7 the Products sold by Prima Pharm to ACS hereunder shall have
been manufactured, packaged, and stored in facilities which are approved by the
FDA at the time of such manufacture, packaging, and storage, to the extent such
approval is required by law or regulation.
7.2 DISCLAIMER. EXCEPT AS EXPRESSLY PROVIDED IN THIS ARTICLE 7, PRIMA
PHARM MAKES NO REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO
-12-
13
THE PRODUCTS, AND PRIMA PHARM HEREBY EXPRESSLY DISCLAIMS ANY AND ALL IMPLIED OR
STATUTORY WARRANTIES, INCLUDING WITHOUT LIMITATION, WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NONINFRINGEMENT OF THE
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.
7.3 Authority. Prima Pharm represents and warrants on a continuing basis
that it: (a) has the right to enter this Agreement, is a corporation duly
organized, validly existing, and in good standing under the laws of the state
in which it is incorporated; (b) has the power and authority to execute and
deliver this Agreement and to perform its obligations hereunder; (c) it has by
all necessary corporate action duly and validly authorized the execution and
delivery of this Agreement and the performance of its obligations hereunder
including approval of the execution of this Agreement by the requisite number
if disinterested directors; (d) any employee or other personnel affiliated with
Prima Pharm who will be involved in development of the Process, its scale-up
and/or the manufacture of Products has executed a proprietary information and
technology agreement in favor of Prima Pharm, pursuant to which such employee
or other personnel is obligated to assign his/her entire right, title, and
interest in and to any invention, discovery, technology, or related
intellectual property conceived of, reduced to practice or otherwise developed
in the course of their employment to Prima Pharm; and (e) has not and will not
during the term of this Agreement enter into any agreement which conflicts with
or which will result in any breach of, or constitute a default under, any note,
security agreement, commitment, contract or other agreement, instrument or
undertaking to which Prima Pharm is a party.
7.4 Effect of Product Warranty.
7.4.1 Options. If any Product purchased hereunder does not meet the
warranties specified herein or otherwise applicable, ACS may, at its option and
subject to Section 7.5 (i) require Prima Pharm to replace or correct at no cost
to ACS any non-conforming Products, (ii) return any non-conforming Products to
Prima Pharm and recover from Prima Pharm the full purchase price paid in
respect thereof, or (iii) replace non-conforming Products itself and charge
Prima Pharm the reasonable cost of such correction. The foregoing remedies are
in addition to all other remedies at law or in equity or under this Agreement
and shall not be deemed to be exclusive thereof.
7.4.2 No Waiver. No inspection or acceptance, approval, acquiescence,
or payment by ACS with respect to non-conforming Products shall relieve Prima
Pharm from any portion of its warranty obligations hereunder, nor shall waiver
by of any specification requirement for one or more Products constitute a
waiver of such requirements for remaining Products unless expressly agreed by
ACS in writing.
7.5 Warranty Procedures. Subject to Section 7.4 above, ACS may send
non-conforming Products (or Products with Latent Defects) covered by the
foregoing warranties to Prima Pharm's facility at the address specified herein.
ACS shall request authorization from Prima Pharm prior to the return of each
non-conforming Product for repair or replacement by Prima Pharm. Upon such
request, Prima Pharm shall provide ACS with a return Authorization (RA) number
to be prominently displayed on the shipping container for the non-conforming
vial(s) of Product. Once ACS receives an
-13-
14
RA number for any non-conforming Product, ACS may ship such Product to Prima
Pharm's facility, at Prima Pharm's expense, in its original shipping container
of equivalent protective constitution. If an RA number in respect of such a
non-conforming Product is requested by ACS during the applicable warranty
period, Prima Pharm shall, at its sole expense, replace the defective or
non-conforming Products upon receipt form ACS, and shall ship the replaced
Products to ACS in accordance with Section 5.12. Upon receipt of any replaced
Product, ACS shall be entitled under Article 6 to inspect and reject any such
Product failing to conform to the warranties set forth in Section 7.1.
7.6 Indemnification.
7.6.1 By Prima Pharm. Subject to Paragraph 7.6.3, in the event of a
breach of the representatives and warranties under this Article 7 by Prima
Pharm, Prima Pharm shall indemnify, defend, and hold ACS, it directors,
officers, employees, agents, distributors, and customers harmless from and
against all liabilities, damages (including personal injury and property
damage), expenses, and costs (including reasonable attorney's and other
professional fees) arising or resulting therefrom.
7.6.2 By ACS. Subject to Paragraph 7.6.3, ACS shall indemnify,
defend, and hold Prima Pharm, its directors, officers, employees, and agents
harmless from and against all liabilities, damages, (including personal injury
and property damage) expenses, and costs (including reasonable attorney's and
other professional fees) resulting from personal injury, property damage, or
any other loss irrespective of the theory of liability, relating to or arising
from the use or sale of Products by ACS, its Affiliates, sublicenses, or
distributors, unless and to the extent such injury or damage is attributable to
the acts or omissions of Prima Pharm, or results from a breach of the
representations and warranties under this Article 7 by Prima Pharm.
7.6.3 Notification. The parties shall promptly notify each other of
any claim or suit with respect to which indemnification is sought hereunder;
provided, however, that if such notification is provided to the party from whom
indemnification is sought after such time as the rights of the indemnifying
party have been prejudiced by the passage of time, the provisions of this
Section 7.6 shall not apply to any such claim or suit. The party seeking
indemnification shall permit the indemnifying party to assume control of the
defense, including settlement, of such claims or suits, at the expense of the
indemnifying party. During the course of any proceeding for which
indemnification is provided hereunder, the indemnified party shall cooperate
with the indemnifying party, upon request by the indemnifying party. No
settlement or compromise shall be binding on a party hereto without such
party's prior written consent, and such consent shall not be unreasonably
withheld.
7.7 Limitation of Liability. IN NO EVENT WILL EITHER PARTY HERETO BE
LIABLE FOR ANY SPECIAL, CONSEQUENTIAL, OR INCIDENTAL DAMAGES SUFFERED BY THE
OTHER PARTY ARISING IN ANY WAY OUT OF THIS AGREEMENT, HOWEVER CAUSED AND
IRRESPECTIVE OF THE THEORY OF LIABILITY.
-14-
15
ARTICLE 8 - INTELLECTUAL PROPERTY: LICENSE
8.1 Ownership. ACS shall own the Process and any and all methods,
machines, articles of manufacture, compositions of matter, other inventions,
discoveries, works of authorship, computer programs, show-how, know-how, trade
secrets and other intellectual property (whether or not patentable or
copyrightable) conceived, reduced to practice, authored, discovered or
developed by or on behalf of Prima Pharm in connection with the development of
the Process of the manufacture of Products hereunder (the "Intellectual
Property" and Prima Pharm shall promptly notify ACS in writing of any such
Intellectual Property. Prima Pharm hereby assigns its entire worldwide right,
title, and interest in and to any such Intellectual Property to ACS. In the
even that ACS elects to file patent applications with respect to the
Intellectual Property, Prima Pharm shall cooperate fully with ACS in such
filing, and shall execute such documents and take such other actions as ACS
requests, and Prima Pharm shall cooperate with and assist ACS, as requested by
and at the expense of ACS, to evidence, perfect, enforce, and defend such
Intellectual Property and ACS's ownership thereof.
8.2 Prima Pharm Employees. Prima Pharm will require any and all of its
employees involved in the development of the Process, its scale-up, or the
manufacture of Products hereunder to enter into a written agreement acceptable
to ACS, assigning and transferring to Prima Pharm or ACS all of the employee's
right, title, and interest in all Intellectual Property conceived, reduced to
practice, authored, discovered or developed by such employee and which relates
to the subject matter of this Agreement, and to otherwise assist ACS as
contemplated in Section 8.1 above.
8.3 License. ACS hereby grants to Prima Pharm a fully paid,
non-transferable, non-exclusive license under the Intellectual Property to
make, use, and sell products, other than Products, for any purpose other than
opthalmic applications; it being understood that with respect to Products,
Prima Pharm shall manufacture and sell the same only for the account of ACS.
Except as expressly granted herein, ACS retains all rights in respect of the
Intellectual Property.
ARTICLE 9 - CONFIDENTIALITY
9.1 Confidentiality. Except as expressly authorized hereunder, Prima
Pharm shall not use for any purpose, or disclose to any third party, any
Intellectual Property, or any information regarding the Process, the
development of the Process and the use of the Process to manufacture Products,
except as expressly provided in this Agreement. All such information and/or
Products shall be ACS Confidential Information (as defined in Section 9.2
below) subject to this Article 9. Prima Pharm shall require each of its
employees which will be involved in the development of the Process or the
manufacture of Products hereunder to enter a confidentiality agreement with
ACS, in a form acceptable to ACS, and in any event Prima Pharm shall use its
best efforts to maintain the confidentiality of all information described in
this Article 9.
9.2 Confidential Information. The parties may from time to time disclose
to each other Confidential Information. "Confidential Information" shall mean
any proprietary information owned by a party or which a party controls which is
disclosed to the other party hereto which is designated
-15-
16
as confidential at the time of disclosure or is otherwise identified as
Confidential Information. Nothing contained in this Article 9 shall prevent
either party from disclosing any Confidential Information of the other party to
(i) regulatory agencies for the purpose of obtaining approval to distribute and
market the Products; provided, however, that all reasonable steps are taken to
maintain the confidentiality of such Confidential Information to be disclosed;
(ii) accountants, banks, or another financing source (or their advisors), or in
connection with a merger, acquisition or securities offering, subject in each
case to the recipient entering into an agreement to protect such Confidential
Information from disclosure; or (iii) is required by law or regulation to be
disclosed; provided, however, that the party subject to such disclosure
requirement has provided has provided written notice to the other party promptly
upon receiving notice of such requirement in order to enable the other party to
seek a protective order or otherwise prevent disclosure of the other party's
Confidential Information.
9.3 Process Disclosures. Unless required pursuant to the terms of this
Agreement or otherwise requested by ACS in writing: (i) Prima Pharm shall not
disclose to any third party any Confidential Information relating in any way to
the Process or ACS's business; and (ii) all disclosures by Prima Pharm of ACS
Confidential Information with respect to the Product or Process shall be made to
a third party only after ACS has agreed in writing to such disclosure and the
third party to whom such disclosure is to be made has agreed in writing to be
bound by the terms of a confidentiality agreement reasonably acceptable to ACS,
and which names ACS as an intended third party beneficiary thereof.
ARTICLE 10 - TERM AND TERMINATION
10.1 Term. Unless earlier terminated, this agreement shall continue in
full force and effect until the fifth anniversary of the Effective Date. The
parties may renew or otherwise extend this Agreement for an additional period
upon the agreement of the parties.
10.2 Termination for Cause. This Agreement may be terminated:
10.2.1 by either party, upon a material breach of this Agreement by the
other party, upon sixty (60) days' prior written notice to the breaching party,
which notice shall become effective at the end of the sixty (60) day period;
provided, however, that prior to the effective date of such termination, the
breaching party shall have the right to cure any such breach, and if the
breaching party timely cures such breach, this Agreement shall not terminate.
10.2.2 by either party upon thirty (30) days notice, if the other party
becomes the subject of a voluntary on involuntary petition for bankruptcy or any
proceeding relating to insolvency, receivership, or liquidation, if such
proceeding is not dismissed with prejudice within thirty (30) days after any
such filing.
16
17
10.3 Effect of Termination or Expiration.
10.3.1 Accrued Rights and Obligations. In the event of termination
or termination or expiration of this Agreement, the provisions hereof shall
continue to apply to all purchase orders accepted by Prima Pharm prior to the
effective date of such termination or expiration, and Prima Pharm shall honor
any such purchase order(s) and deliver to ACS such Products corresponding to
such purchase orders, and ACS shall pay Prima Pharm the purchase price therefor
as provided herein. Termination or expiration of this Agreement shall not
relieve or release either party from making payments for obligations accrued
prior to such termination. In the event Prima Pharm terminates for cause, ACS
shall also be responsible for payment in respect to raw materials,
work-in-progress, and finished Products made by Prima Pharm and for which
purchase orders corresponding thereto have been accepted by Prima Pharm prior
to such termination.
10.3.2 Return of Confidential Information. Upon any termination or
expiration of this Agreement, Prima Pharm shall promptly return to ACS any
Confidential Information received from ACS prior to such termination or
expiration, and Prima Pharm shall no longer be entitled to use any Confidential
Information of ACS for any purpose.
10.4 No Liability For Expiration. ACS will not, by reason of the
expiration of this Agreement, be liable to Prima Pharm for compensation,
reimbursement, or damages on account of any residual inventory of materials
(including Bulk Material) purchased by Prima Pharm for the manufacture of
Product, for which no purchase order was accepted by Prima Pharm prior to such
expiration or termination.
10.5 Survival. The provisions of Articles 7, 8, 9, and 11, Sections 1.2,
5.2, 6.2, 6.4, 10.3, 10.4, and 10.5, and Paragraph 3.1.6 shall survive the
termination or expiration of this Agreement.
ARTICLE 11 - MISCELLANEOUS
11.1 Governing Law. The Agreement shall be governed by the laws of the
state of California, without reference to conflicts of law principles.
11.2 Arbitration. If a dispute arises between the parties relating the
interpretation or performance of this Agreement or the grounds for the
termination thereof, representatives of the parties with decision-making
authority shall meet to attempt in good faith to negotiate a resolution of the
dispute prior to pursuing other available remedies. If within thirty (30) days
after such meeting the parties have not succeeded in negotiating a resolution of
the dispute, such dispute shall be submitted to final and binding arbitration
under the then current Commercial Arbitration Rules of the American Arbitration
Association ("AAA"), by one (1) arbitrator in Orange County, California. Such
arbitrator shall be selected by the mutual agreement of the parties, or failing
such agreement, shall be selected according to the aforesaid AAA rules. The
arbitrator will be instructed to prepare and deliver a written, reasoned
opinion stating his decision within thirty (30) days of the completion of the
arbitration. Such arbitration shall be concluded within nine (9) months
following the filing of the
17
18
initial request for arbitration. The parties shall bear the costs of
arbitration equally and shall bear their own expenses, including professional
fees. The decision of the arbitrator shall be final and non-appealable and may
be enforced in any court of competent jurisdiction.
11.3 Notices. Any notice or report required or permitted to be given or
made under this Agreement by either party shall be in writing and delivered to
the other party at its address indicated above (or to such other address as a
party may specify by notice hereunder) by courier or by registered or certified
airmail, postage prepaid, or by facsimile; provided, however, that all
facsimile notices shall be promptly confirmed, in writing, by registered or
certified airmail, postage prepaid. All notices shall be effective as of the
date received by the addressee.
11.4 Force Majeure. Neither party will be liable for its failure to
perform any of its obligations hereunder during any period in which such
performance is delayed by acts of God, fire, war, embargo, riots, strikes or
other similar cause outside the control of the party whose performance is
affected thereby.
11.5 Non-Waiver. Any waiver of the terms and conditions hereof must be
explicitly in writing. The waiver by either of the parties of any breach of
any provision hereof by the other shall not be construed to be a waiver of any
succeeding breach of such provision or a waiver of the provision itself.
11.6 Severability. Should any Article, Section, or Paragraph of this
Agreement, or any portion of any of the foregoing, be held invalid by reason of
any law, statute or regulation existing now or in the future in any
jurisdiction by any court of competent authority or by a legally enforceable
directive of any governmental body, such Article, Section, Paragraph, or
portion thereof shall be validly reformed so as to approximate the intent of
the parties as nearly as possible and, if practicable, shall be deemed
divisible and the invalid portion deleted with respect to such jurisdiction,
but the Agreement shall not otherwise be affected.
11.7 Independent Contractors. The relationship of the parties under the
Agreement is that of independent contractors. Neither party shall be deemed to
be the agent of the other, and neither is authorized to take any action binding
upon the other.
11.8 Assignment. This Agreement may not be assigned by Prima Pharm without
the prior written consent of ACS. ACS may assign this Agreement, and the rights
granted herein, to a third party who agrees to be bound by the terms hereof.
11.9 Publicity. Should a party be required by law to make a public
disclosure about this Agreement, then the party so required may do so;
provided, however, that it gives at least three (3) business days' prior
written notice to the other party. Otherwise, neither party shall issue any
press release or other public disclosure about this Agreement or its terms
without the prior written consent of the other party.
-18-
19
11.10 Trademarks. ACS, in its sole discretion, shall select the
trademarks, trade names and trade dresses to be used in connection with the
Products and all such trademarks, trade names and trade dresses shall be and
become the exclusive property of ACS. Prima Pharm shall use said trademarks,
trade names and trade dresses for the sole purpose of manufacturing the Products
for sale to ACS and at no time shall adopt any trademark, trade name or trade
dress that may be confusingly similar therewith. Prima Pharm shall acquire no
rights in and to any trademarks, trade names and trade dresses selected by ACS
under this Section 11.10.
11.11 Financial Statements. Prima Pharm shall provide to ACS on an annual
basis a copy of its annual financial statements.
11.12 Entire Agreement. The terms and provisions contained in the
Agreement, including the Exhibits hereto, constitute the entire agreement
between the parties and shall supersede all previous communications,
representations, agreements or understandings, either oral or written, between
the parties with respect to the subject matter hereof. ACS shall not have any
other obligations to Prima Pharm other than as specifically and expressly
provided herein. No agreement or understanding varying or extending this
Agreement shall be binding upon either party hereto, unless set forth in a
writing which specifically refers to the Agreement signed by duly authorized
officers or representatives of the respective parties, and the provisions hereof
not specifically amended thereby shall remain in full force and effect.
11.13 Counterparts and Headings. The Agreement may be executed in
counterparts, each of which shall be deemed to be an original and both together
shall be deemed to be one and the same agreement. All headings in the Agreement
are inserted for convenience of reference only and shall not affect its meaning
of interpretation.
IN WITNESS WHEREOF, Prima Pharm and ACS have executed the Agreement in
duplicate as of the day and year first above written.
ADVANCED CORNEAL SYSTEMS, INC. PRIMA PHARM INC.
By: /s/ Xxxx X. Xxxxxx By: /s/ [SIGNATURE ILLEGIBLE]
--------------------------------- ----------------------------------
Title: COO Title: President and CEO
Date: 12/19/96 Date: 1-2-97
------------------------------- --------------------------------
-19-
20
EXHIBIT A
SPECIFICATIONS FOR HYALURONIDASE
Bulk Supply
1. Microbioload of Hyaluronidase:
a. No E. coli Contamination;
b. No Salmonella Contamination; and
c. Total Microbial contamination less than 10(3) organisms/grams of
Hyaluronidase.
2. Tyrosine Content not to exceed 0.25ug for every U.S.P. Unit of
Hyaluronidase.
3. Level of pyrogen in bulk Hyaluronidase not to exceed an amount to be
determined by ACS and provided to Prima Pharm in writing.
4. Hyaluronidase Activity to Exceed 5000 Units of activity/mg of lyophilized
Product.
5. To be Supplied in Frozen Form.
Specifications for Phosphate Buffer
and Lactose + U.S.P. Water for Injection
1. All materials to be U.S.P. certified and meet or exceed all applicable
U.S.P. specifications.
-20-
21
EXHIBIT B
SPECIFICATIONS FOR FINAL PRODUCTS
Product 1 - For application to the Vitreous Humor
1. 8,000 Units of Hyaluronidase/vial (specifications to be finalized within
sixty (60) days of the Effective Date).
2. Tyrosine content less than 0.25ug/Unit of Hyaluronidase.
3. Pyrogen Test - meets or exceeds U.S.P. requirement.
4. Sterility test - meets or exceeds U.S.P. Sterility Requirements.
5. Container Closure Integrity test - Passes set requirements.
6. Vacuum Test - Seal Integrity of container to maintain vacuum at or below
conditions to be determined by ACS and provided to Prima Pharm in writing.
7. Level of water content in the lyophilized product not to exceed seven
percent (7%).
Product 2 - For Corneaplasty
1. 11,000 Units of Hyaluronidase/vial (specifications to be finalized within
sixty (60) days of the Effective Date).
2. Tyrosine content less than 0.25ug/Unit of Hyaluronidase.
3. Pyrogen Test - meets or exceeds U.S.P. requirement.
4. Sterility test - meets or exceeds U.S.P. Sterility Requirement.
5. Container Closure Integrity test - Passes set requirements.
6. Vacuum Test - Seal Integrity of container to maintain vacuum at or below
conditions to be determined by ACS and provided to Prima Pharm in writing.
7. Level of water content in the lyophilized product not to exceed seven
percent (7%).
22
EXHIBIT C
PRODUCT PRICING
The parties agree that the prices listed in this Exhibit C shall be based
on cumulative totals of Products ordered in the twelve (12) month period
immediately preceding that in which the purchase order corresponding to the
particular Products ordered therein was received by Prima Pharm, unless
otherwise agreed by the parties.
12 MONTH CUMULATIVE TOTAL PRICE PER VIAL
OF PRODUCTS ORDERED VITRASE(TM) CORNEAPLASTY
------------------------- ----------------------------
0 - 100,000 vials $10.50 $10.50
100,001 - 125,000 vials $9.45 $9.45
125,001 - 150,000 vials $9.00 $9.00
150,001 - 175,000 vials $8.00 $8.00
> 175,000 vials
