Exhibit 10.33
Portions of this exhibit were omitted and filed separately with the Secretary of
the Commission pursuant to an application for confidential treatment filed with
the Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by a series of asterisks.
FIRST AMENDED AND RESTATED
COLLABORATION AND LICENSE AGREEMENT
by and between
WYETH
and
VIROPHARMA INCORPORATED
Effective as of December 9, 1999
And
Restated on June 26, 2003
TABLE OF CONTENTS
Page
----
1. DEFINITIONS ...................................................... 1
1.1 "Acquiring Entity" ........................................ 1
1.2 "Active Collaboration Target" ............................. 1
1.3 "Active Compound" ......................................... 2
1.4 "Affiliate(s)" ............................................ 2
1.5 "Wyeth Chemical Library" .................................. 5
1.6 "Wyeth Know-How" .......................................... 5
1.7 "Wyeth Patent Rights" ..................................... 5
1.8 "Wyeth Technology" ........................................ 5
1.9 "Wyeth Territory" ......................................... 5
1.10 "Annual Commercialization Plan and Budget" ................ 6
1.11 "Annual Development Plan and Budget" ...................... 6
1.12 "Assay and Screening Technology" .......................... 6
1.13 "Assigned Sales Force Effort" ............................. 6
1.14 "Baseline Allocation of Net Profits" ...................... 6
1.15 "Biomolecule" ............................................. 6
1.16 "Calendar Quarter" ........................................ 6
1.17 "Change of Control" ....................................... 6
1.18 "Class A Product" ......................................... 6
1.19 "Class B Product" ......................................... 6
1.20 "Collaboration Inventions" ................................ 6
1.21 "Collaboration Know-How" .................................. 7
1.22 "Collaboration Patent Rights" ............................. 7
1.23 "Collaboration Target" .................................... 7
1.24 "Collaboration Technology" ................................ 7
1.25 "Commercialization" ....................................... 7
1.26 "Commercially Reasonable Efforts" ......................... 7
1.27 "Compound" ................................................ 7
1.28 "Confidential Information" ................................ 8
1.29 "Control" or "Controlled" ................................. 8
1.30 "Copromotion Territory" ................................... 8
1.31 "Copromotion Territory Commercialization Plan" ............ 8
1.32 "Copyright" ............................................... 8
1.33 "Cost of Goods Manufactured for Sale" ..................... 8
1.34 "Derivative" .............................................. 8
1.35 "Detail" .................................................. 8
1.36 "Development" ............................................. 9
1.37 "Development Candidate" ................................... 9
1.38 "Development Expenses" .................................... 9
1.39 "Development Phase" ....................................... 9
1.40 "Effective Date" .......................................... 9
1.41 "Executive Steering Committee" or "ESC" ................... 9
1.42 "Extra Effort" ............................................ 9
1.43 "Extra Effort Expense" .................................... 9
1.44 "FDA" ..................................................... 9
1.45 "FD&C Act" ................................................ 9
1.46 "Field" ................................................... 9
1.47 "First Commercial Sale" ................................... 10
1.48 "FTE" ..................................................... 10
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June 26, 2003 Restated & Amended Collaboration Agreement Page i
1.49 "Full Royalty Rate Period" ................................ 10
1.50 "Fully-Absorbed Standard Cost" ............................ 10
1.51 "Global Development Plan" ................................. 10
1.52 "Good Clinical Practice" or "GCP" ......................... 11
1.53 "Good Laboratory Practice" or "GLP" ....................... 11
1.54 "HCV" ..................................................... 11
1.55 "Hit" ..................................................... 11
1.56 "Incremental Sales Force Effort" .......................... 11
1.57 "Incremental Sales Force Effort Expense" .................. 11
1.58 "IND" ..................................................... 11
1.59 "Initial Term of the Screening Phase" ..................... 11
1.60 "Invention" ............................................... 11
1.61 "Joint Steering Committee" or "JSC" ....................... 12
1.62 "Know-How" ................................................ 12
1.63 "Lapse Quarter" ........................................... 12
1.64 "Lapse Year" .............................................. 12
1.65 "Lead Compound" ........................................... 12
1.66 "Major European Country" .................................. 12
1.67 "Marketing Account" ....................................... 12
1.68 "Marketing Steering Committee" or "MSC" ................... 12
1.69 "NDA" ..................................................... 12
1.70 "Net Profits" ............................................. 12
1.71 "Net Sales" ............................................... 13
1.72 "Non-Collaboration Invention" ............................. 14
1.73 "Option Period" ........................................... 14
1.74 "Patent Rights" ........................................... 14
1.75 "Penalty Year" ............................................ 14
1.76 "Phase I Clinical Study" .................................. 14
1.77 "Phase II Clinical Study" ................................. 15
1.78 "Phase III Clinical Study" ................................ 15
1.79 "Post Approval Research and Regulatory Expenses" .......... 15
1.80 "Pre-Development Expenses" ................................ 15
1.81 "Pre-Marketing Expenses" .................................. 15
1.82 "Pre-Marketing Expense Shortfall" ......................... 15
1.83 "Prior Invention" ......................................... 15
1.84 "Product" ................................................. 16
1.85 "Promotion" ............................................... 16
1.86 "R&D Account" ............................................. 16
1.87 "R&D Reimbursement Account" ............................... 16
1.88 "R&D Shortfall" ........................................... 16
1.89 "Reduced Royalty Rate Period" ............................. 16
1.90 "Regulatory Approval" ..................................... 16
1.91 "Regulatory Authority" .................................... 16
1.92 "Research" ................................................ 16
1.93 "Research Phase" .......................................... 17
1.94 "Research Program" ........................................ 17
1.95 "Sales and Marketing Expenses" ............................ 17
1.96 "Sample" .................................................. 17
1.97 "Sample Receipt Forms" .................................... 17
1.98 "Screening" ............................................... 17
1.99 "Screening Phase" ......................................... 18
1.100 "Screening Phase Tail" .................................... 18
1.101 "Small Molecule" .......................................... 18
1.102 "Surviving Entity" ........................................ 18
1.103 "Tail Compound" ........................................... 18
1.104 "Target" .................................................. 18
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June 26, 2003 Restated & Amended Collaboration Agreement Page ii
1.105 "Target Market" .............................................. 18
1.106 "Target Physician" ........................................... 18
1.107 "Term of the Screening Phase" ................................ 18
1.108 "Third Part(y/ies)" .......................................... 18
1.109 "Third Party License Fee" .................................... 18
1.110 "Trademark" .................................................. 19
1.111 "Valid Claim" ................................................ 19
1.112 "ViroPharma Chemical Library" ................................ 19
1.113 "ViroPharma Know-How" ........................................ 19
1.114 "ViroPharma Patent Rights" ................................... 19
1.115 "ViroPharma Technology" ...................................... 19
2. LICENSES ............................................................ 19
2.1 Licenses to Wyeth ............................................ 20
2.2 Licenses to ViroPharma ....................................... 20
2.3 Sublicensing to Third Party Contractors ...................... 21
2.4 Dropped Compounds ............................................ 21
2.5 Direct Licenses to Party Affiliates .......................... 21
2.6 Exclusive Working Relationship ............................... 22
2.6.1 Collaboration Targets ................................. 22
2.6.2 Other Targets ......................................... 23
2.6.3 Limitations ........................................... 23
2.7 Right of Reference ........................................... 23
3. MANAGEMENT OF COLLABORATION ......................................... 24
3.1 Joint Steering Committee ..................................... 24
3.1.1 Formation; Membership ................................. 24
3.1.2 Chairperson; Secretary ................................ 24
3.1.3 Meetings .............................................. 24
3.1.4 Decision Making ....................................... 25
3.1.5 Responsibilities of the JSC ........................... 25
3.2 Marketing Steering Committee ................................. 26
3.2.1 Formation; Membership ................................. 26
3.2.2 Chairperson; Secretary ................................ 26
3.2.3 Meetings .............................................. 26
3.2.4 Decision Making ....................................... 27
3.2.5 Responsibilities of the MSC ........................... 27
3.3 Executive Steering Committee ................................. 27
3.3.1 Formation; Membership ................................. 27
3.3.2 Chairperson; Secretary ................................ 28
3.3.3 Meetings .............................................. 28
3.3.4 Decision Making ....................................... 28
3.3.5 Dispute Resolution .................................... 28
3.4 Authority .................................................... 29
3.5 Project Coordinators ......................................... 29
4. RESEARCH AND DEVELOPMENT ............................................ 29
4.1 The Research Program ......................................... 29
4.1.1 General ............................................... 29
4.2 Research & Development Plans ................................. 30
4.2.1 Global Research and Development Plan .................. 30
4.2.2 Annual Development Plans .............................. 30
4.3 Term of Research Program ..................................... 31
4.3.1 Screening Phase ....................................... 31
4.3.2 Research Phase ........................................ 31
4.3.3 Screening Phase Tail .................................. 31
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June 26, 2003 Restated & Amended Collaboration Agreement Page iii
4.3.4 Development Phase ......................................... 32
4.4 Selection of Additional Targets, Biomolecules, Hits, Lead
Compounds, Development Candidates and Products ................... 33
4.4.1 Selection of Additional Targets ........................... 33
4.4.2 Selection of Biomolecules as Compounds .................... 33
4.4.3 Selection of Hits ......................................... 33
4.4.4 Selection of Lead Compounds ............................... 33
4.4.5 Selection of Development Candidates ....................... 33
4.4.6 Selection of Products ..................................... 34
4.5 Conduct of the Research Program .................................. 34
4.5.1 General ................................................... 34
4.5.2 Discovery Headcount and Development Leadership ............ 34
4.5.3 Performance of Clinical Work .............................. 34
4.5.4 Disagreement about Designation of a Compound as a
Development Candidate ..................................... 35
4.6 Funding of the Research Program .................................. 36
4.6.1 Pre-Development Expenses .................................. 36
4.6.2 Development Expenses ...................................... 36
4.6.3 Payment of Expenses; R&D Accounts ......................... 36
4.6.4 Expense Limitations ....................................... 36
4.6.5 Reconciliation of Expenses ................................ 37
4.6.6 Records and Audits ........................................ 40
4.7 Reporting and Disclosure ......................................... 41
4.7.1 Reports ................................................... 41
4.7.2 Quarterly Meeting ......................................... 41
4.7.3 Disclosure ................................................ 41
5. MANUFACTURING OF PRODUCTS; REGULATORY MATTERS ........................... 41
5.1 Manufacturing .................................................... 41
5.2 Labeling ......................................................... 42
5.3 Regulatory Approvals ............................................. 42
5.4 Regulatory Reporting ............................................. 42
6. COMMERCIALIZATION OF PRODUCTS ........................................... 43
6.1 Commercialization in the Copromotion Territory ................... 43
6.1.1 Principles of Copromotion ................................. 43
6.1.2 Commercialization Plan .................................... 43
6.1.3 Allocation of Target Markets; Sales Effort ................ 44
6.1.4 Incremental Sales Force Effort ............................ 44
6.1.5 Extra Effort .............................................. 45
6.1.6 Performance Metrics ....................................... 45
6.1.7 Sales and Distribution; Recalls ........................... 45
6.1.8 Commercialization Expenses ................................ 46
(a) Pre-Marketing Expenses ................................ 46
(b) Sales and Marketing Expenses .......................... 46
(c) Post-Approval Research and Regulatory Expenses ........ 47
(d) Payment of Expenses; Marketing Accounts ............... 47
(e) Expense Limitations ................................... 47
(f) Reconciliation of Pre-Marketing Expenses .............. 47
(g) Reimbursement of Sales and Marketing Expenses and Post
Approval Research and Regulatory Expenses ............. 48
6.1.9 Marketing and Promotional Materials ....................... 48
6.1.10 Promotional Claims ........................................ 49
6.1.11 Samples ................................................... 49
6.1.12 Communications ............................................ 49
6.1.13 Training .................................................. 50
6.1.14 Compliance ................................................ 50
6.1.15 Generic Product ........................................... 50
6.2 Commercialization in the Wyeth Territory ......................... 51
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June 26, 2003 Restated & Amended Collaboration Agreement Page iv
7. CONSIDERATION; PROFIT SHARING .................................................. 51
7.1 Research Program Expense Reimbursements ................................. 51
7.2 Additional Development Expense Payments ................................. 51
7.3 Purchase of Equity ...................................................... 53
7.4 Royalties ............................................................... 53
7.4.1 Royalty Rates .................................................. 53
7.4.2 Royalty Adjustments ............................................ 55
(a) Unpatented Products ..................................... 55
(b) Competition ............................................. 55
7.4.3 Term of Royalty ................................................ 56
7.5 Profit Sharing .......................................................... 56
7.5.1 Baseline Allocation of Profits; Penalties ...................... 56
7.5.2 Temporary Adjustments to Distribution of Profits ............... 56
7.5.3 Permanent Adjustment to Baseline Allocation of Profits ......... 57
7.5.2 Term of Profit Split Payments .................................. 57
7.6 Reports and Payments .................................................... 57
7.6.1 Cumulative Royalties ........................................... 57
7.6.2 Royalty Statements and Payments ................................ 57
7.6.3 Net Profit Statements and Payments ............................. 58
(a) Estimated Statements .................................... 58
(b) Actual Statements ....................................... 58
7.6.4 Taxes and Withholding .......................................... 59
7.6.5 Currency ....................................................... 59
7.7 Maintenance of Records; Audits .......................................... 59
7.7.1 Record Keeping for the Copromotion Territory ................... 59
7.7.2 Record Keeping for the Wyeth Territory ......................... 60
7.7.3 Audits ......................................................... 60
7.7.4 Underpayments/Overpayments ..................................... 60
7.7.5 Confidentiality ................................................ 61
7.8 Interest ................................................................ 61
8. INTELLECTUAL PROPERTY .......................................................... 61
8.1 Inventions .............................................................. 61
8.2 Patent Rights ........................................................... 62
8.2.1 Prosecution and Maintenance of Patent Rights ................... 62
(a) ViroPharma's Prior Inventions and Non-Collaboration
Inventions .............................................. 62
(b) Wyeth's Prior Inventions and Non-Collaboration
Inventions .............................................. 62
(c) Collaboration Inventions ................................ 63
8.2.2 Enforcement of Patent Rights ...................................... 64
(a) Notice and Discontinuance of Infringement - General ..... 64
(b) Wyeth Patent Rights and ViroPharma Patent Rights ........ 64
(c) Collaboration Patent Rights ............................. 65
(d) Continuance of Infringement of ViroPharma Patent
Rights .................................................. 66
(e) Continuance of Infringement of the Wyeth Patent
Rights .................................................. 66
8.2.3 Infringement and Third Party Licenses .......................... 67
(a) Infringement of Third Party Patents - Course of Action .. 67
(b) Wyeth Option to Negotiate ............................... 67
(c) Third Party Infringement Suit ........................... 67
(d) Other Third Party Licenses .............................. 68
(e) Third Party License Fees ................................ 68
8.2.4 Patent Certifications .......................................... 69
8.2.5 Patent Term Restoration ........................................ 69
8.3 Trademarks .............................................................. 69
9. CONFIDENTIALITY ................................................................ 70
9.1 Confidentiality ......................................................... 70
9.2 Authorized Disclosure and Use ........................................... 70
9.2.1 Disclosure ..................................................... 71
9.2.2 Use ............................................................ 71
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June 26, 2003 Restated & Amended Collaboration Agreement Page v
9.3 SEC Filings................................................ 71
9.4 Publications............................................... 71
9.5 Public Announcements....................................... 72
9.5.1 Coordination...................................... 72
9.5.2 Announcements..................................... 72
10. REPRESENTATIONS AND WARRANTIES...................................... 72
10.1 Representations and Warranties of Each Party............... 72
10.2 Additional Representations and Warranties of ViroPharma.... 73
10.3 Additional Representations and Warranties of Wyeth......... 75
10.4 Representation by Legal Counsel............................ 76
10.5 No Inconsistent Agreements................................. 76
10.6 Disclaimer................................................. 76
11. GOVERNMENT APPROVALS; TERM AND TERMINATION.......................... 76
11.1 Government Approvals....................................... 76
11.1.1 ViroPharma's and Wyeth's Obligations.............. 76
11.1.2 Cooperation....................................... 77
11.2 Term....................................................... 77
11.3 Expiration................................................. 77
11.4 Termination for Cause...................................... 77
11.4.1 Termination for Cause............................. 77
11.4.2 Effect of Termination for Cause on License........ 78
11.5 Termination for Convenience................................ 78
11.5.1 Right to Terminate................................ 78
11.5.2 Effect of Termination for Convenience............. 78
11.6 Termination of ViroPharma's Right to Promote Products...... 79
11.6.1 Failure to Provide Assigned Sales Force Effort.... 79
11.6.2 Payment and Term of Royalty....................... 81
11.6.3 Effect on Other Rights and Obligations............ 81
11.7 Blocking Patents........................................... 81
11.8 Survival of Certain Obligations............................ 81
11.9 Provision for Insolvency................................... 82
11.9.1 Termination....................................... 82
11.9.2 Effect on Licenses................................ 82
11.9.3 Rights to Intellectual Property................... 83
11.9.4 Additional Rights................................. 83
12. INDEMNIFICATION AND INSURANCE....................................... 84
12.1 Indemnification by Wyeth................................... 84
12.2 Indemnification by ViroPharma.............................. 85
12.3 Procedure.................................................. 85
12.4 Insurance.................................................. 86
13. MISCELLANEOUS....................................................... 86
13.1 Assignment................................................. 86
13.2 Further Actions............................................ 86
13.3 Force Majeure.............................................. 86
13.4 Correspondence and Notices................................. 87
13.4.1 Ordinary Notices.................................. 87
13.4.2 Extraordinary Notices............................. 87
13.5 Amendment.................................................. 88
13.6 Waiver..................................................... 88
13.7 Severability............................................... 88
13.8 Descriptive Headings....................................... 88
13.9 Governing Law.............................................. 89
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June 26, 2003 Restated & Amended Collaboration Agreement Page vi
13.10 Entire Agreement of the Parties........................ 89
13.11 Independent Contractors................................ 89
13.12 Debarment.............................................. 89
13.13 Counterparts........................................... 89
LIST OF EXHIBITS
Exhibit 1.7 Wyeth Patent Rights
Exhibit 1.18 Class A Product Chemical Series
Exhibit 1.23 Collaboration Targets
Exhibit 1.50 Elements of Fully-Absorbed Standard Costs
Exhibit 1.114 ViroPharma Patent Rights
Exhibt 4.65(b)(ii-iii) Sample Calculation of Certain Reconciliation Amounts
Exhibit 5.4 Adverse Event Reporting Procedures
Exhibit 7.3 Stock Purchase Agreement
Exhibit 7.4.1 Sample Calculation of Royalty Distributions
Exhibit 7.5.3 Sample Calculation of Net Profit Distributions
Exhibit 10.2(a) Third Party Rights, Title or Interest in ViroPharma
Intellectual Property
Exhibit 10.2(b) Third Party Claims on ViroPharma Patent Rights and
Know-How
Exhibit10.2(c) ViroPharma Intellectual Property Subject to
Government Funding Agreements
Exhibit 10.3(a) Third Party Claims on Wyeth Patent Rights and
Know-How
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June 26, 2003 Restated & Amended Collaboration Agreement Page vii
FIRST AMENDED AND RESTATED
COLLABORATION AND LICENSE AGREEMENT
THIS AMENDED AND RESTATED COLLABORTION AND LICENSE AGREEMENT (the
"Agreement") dated this 26/th/ day of June, 2003 (the "Restatement Date") by and
between Wyeth (formerly known as "American Home Products Corporation")
("Wyeth"), a Delaware Corporation, having a place of business at 0 Xxxxxxx
Xxxxx, Xxxxxxx, Xxx Xxxxxx 00000 and ViroPharma Incorporated ("ViroPharma"), a
Delaware corporation having a place of business at 000 Xxxxxxxxx Xxxxxxxxx,
Xxxxx, Xxxxxxxxxxxx 00000, amends and restates the Collaboration and License
Agreement dated December 9, 1999, by and between Wyeth and ViroPharma (the
"Original Agreement") and itself has an Effective Date of December 9, 1999 (the
"Effective Date"). This Agreement supercedes, merges, and cancels the Original
Agreement. Wyeth and ViroPharma may each be referred to herein individually as a
"Party" and collectively as the "Parties".
WHEREAS, Wyeth is engaged in the research, development and
commercialization of human pharmaceutical products;
WHEREAS, ViroPharma is the owner of certain patent rights and know-how
relating to the hepatitis C virus and compounds and methods for treating humans
infected with the hepatitis C virus;
WHEREAS, Wyeth and ViroPharma have agreed to collaborate, on the terms and
conditions set forth herein, on the development and commercialization of
compounds for the treatment of humans infected with the hepatitis C virus.
NOW THEREFORE, in consideration of the mutual promises and covenants set
forth below and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties hereby agree as
follows:
1. DEFINITIONS.
1.1 "Acquiring Entity" shall mean a Third Party that comes into control
(as such term is defined in Section 1.4 hereof) of a Party or any of a
Party's Affiliates through a Change in Control of such Party or such
Affiliate occurring after the Effective Date hereof, and all other
Third Parties controlling, controlled by or under common control with
such Third Party, which Third Parties are not otherwise an Affiliate
of such Party hereunder.
1.2 "Active Collaboration Target" shall mean a Collaboration Target (a)
that is not discontinued from use in accordance with Section 4.4.1 or
(b) against which an Active Compound has been determined to have
activity during the Screening Phase or Screening Phase Tail, whether
or not such Collaboration Target has been discontinued from use in
accordance with Section 4.4.1. Notwithstanding the foregoing, if, at
any time after the end of the Screening Phase Tail, (a) a
Collaboration Target has been discontinued from use in accordance with
Section
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June 26, 2003 Restated & Amended Collaboration Agreement Page 1
4.4.1, (b) the use of such Collaboration Target has not been
reinstated in accordance with Section 4.4.1, and (c) all Compounds
which, during the Screening Phase or the Screening Phase Tail, were
determined to have activity against such Collaboration Target and all
Derivatives of such Compounds are no longer Active Compounds, then
such Collaboration Target shall thereafter not be an Active
Collaboration Target for purposes of this Agreement. Notwithstanding
anything to the contrary in this Section 1.2, on and after the
Restatement Date "Active Collaboration Target" may include only, but
need not include, ****************.
1.3 "Active Compound" shall mean a Compound that is being Researched,
Developed or Commercialized by either of the Parties pursuant to this
Agreement. For the sake of clarity, when the JSC or the MSC, as
applicable, determines to discontinue the Research, Development or
Commercialization of a Compound, such Compound shall no longer be an
Active Compound for purposes of this Agreement.
1.4 "Affiliate(s)" shall mean, with respect to each Party hereto, any
corporation, company, partnership, joint venture, firm and/or other
entity that controls, is controlled by or is under common control with
such Party. For purposes of Section 1.1 and this Section 1.4,
"control" shall mean (x) in the case of corporate entities, direct or
indirect ownership of at least fifty percent (50%) of the stock or
shares having the right to vote for the election of directors (other
than such ownership by an employee benefit plan (or related trust)
sponsored or maintained by a Party), and (y) in the case of
non-corporate entities, direct or indirect ownership of at least fifty
percent (50%) of the equity interest with the power to direct the
management and policies of such non-corporate entities.
Notwithstanding the foregoing, for purposes of this Agreement, the
term "Affiliate" shall not include
(a) subsidiaries or any other entities in which a Party owns a
majority of the ordinary voting power necessary to elect a
majority of the board of directors or other governing board but
is restricted from electing such majority by contract or
otherwise until such time as such restrictions are no longer in
effect, or
(b) an Acquiring Entity that comes into control of ViroPharma or a
parent company Affiliate of ViroPharma after the Effective Date
hereof, provided that ViroPharma, on or before the date such
Change of Control becomes effective, delivers to Wyeth written
notice stating that such Acquiring Entity shall not be considered
to be an Affiliate of ViroPharma and shall be considered to be a
Third Party for all purposes of this Agreement and, provided
further, that, by written agreement (a copy of which shall be
provided to Wyeth along with the notice described above in this
Section 1.4(b)) between ViroPharma and such Acquiring Entity,
such
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June 26, 2003 Restated & Amended Collaboration Agreement Page 2
written agreement to be entered into either before or promptly
after such Change of Control becomes effective and to designate
Wyeth as a third party beneficiary, such Acquiring Entity shall
have (i) no right, title or interest in or to any Product
hereunder, including, without limitation, the right to
participate in the Copromotion of any Product in the Copromotion
Territory (other than any such right, title or interest that may
be merely incidental to the Acquiring Entity's having an equity
interest in ViroPharma, e.g., an ownership interest in or right
to receive a share of ViroPharma's profits), (ii) no right to
participate in any of the activities to be conducted by or on
behalf of ViroPharma or ViroPharma's Affiliates hereunder or to
exercise any of ViroPharma's rights hereunder (other than any
such right that may exist as a result of a director or employee
of the Acquiring Entity serving as an officer or director of
ViroPharma, provided, however, that each such director or
employee shall not utilize any information gained through
participating in such activities for the benefit of the Acquiring
Entity in any way that the Acquiring Entity is prohibited from
using such information pursuant to this Section 1.4), and (iii)
no access to or right to use, itself or on behalf of any Third
Party or to permit any Third Party to use, in either case for the
discovery, development and/or commercialization of pharmaceutical
products in the Field, any
(A) of the ViroPharma Technology,
(B) Compound included within the ViroPharma Chemical
Library,
(C) of the Wyeth Technology,
(D) Compound included with the Wyeth Chemical Library, or
(E) Confidential Information of either Party relating to
the Field, the Research Program or either Party's
activities under this Agreement,
(except to the extent that any of the foregoing constitute
Permitted Materials (as such term is defined below in this
Section 1.4), it being understood, however, that in the event
that either (xx) the written agreement between ViroPharma and
such Acquiring Entity described above expires or is later
terminated, (yy) ViroPharma provides Wyeth with written notice
that it desires such Acquiring Entity to be considered an
Affiliate hereunder or (zz) such Acquiring Entity otherwise gains
access to or the right to use, itself
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June 26, 2003 Restated & Amended Collaboration Agreement Page 3
or on behalf of any Third Party, any materials or information
included within items A through E, inclusive, described in clause
(iii) above for the discovery, development and/or
commercialization of pharmaceutical products in the Field, except
to the extent that such material or information constitutes
Permitted Materials, such Acquiring Entity thereafter shall be
considered to be an Affiliate of ViroPharma for all purposes of
this Agreement, including, without limitation, the provisions set
forth in Section 2.6 hereof. For purposes of this Section 1.4,
"Permitted Materials" shall mean any of items A through E,
inclusive, described above in this Section 1.4, which
(I) the Acquiring Entity can demonstrate, through written
records created prior to the effective date of the
Change of Control of ViroPharma, was in the Acquiring
Entity's prior possession, other than through receipt,
directly or indirectly from ViroPharma,
(II) the Acquiring Entity can demonstrate, through written
records, was acquired by the Acquiring Entity from a
Third Party who had the right to disclose or transfer
the same to the Acquiring Entity;
(III) the Acquiring Entity can demonstrate, through written
records, was independently developed by employees of
the Acquiring Entity who had no knowledge of or access
to any of items A through E, inclusive, described
above in this Section 1.4;
(IV) becomes part of the public domain after the date this
Agreement was signed by the Parties other than through
any breach of this Agreement by ViroPharma; or
(V) is made available to such Acquiring Entity by Wyeth or
any of Wyeth's Affiliates;
provided, however, that none of the foregoing exclusions shall
result in the Acquiring Entity having any right to:
1. practice any of the ViroPharma Patent Rights for the
discovery, development and/or commercialization of
pharmaceutical products in the Field,
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June 26, 2003 Restated & Amended Collaboration Agreement Page 4
2. practice any of the Wyeth Patent Rights except through
a license granted by Wyeth directly to such Acquiring
Entity,
3. practice any of the Collaboration Patent Rights for the
discovery, development and/or commercialization of
pharmaceutical products in the Field,
4. utilize Compounds included within the ViroPharma
Chemical Library for the discovery, development and/or
commercialization of pharmaceutical product in the
Field, or
5. utilize Compounds included within the Wyeth Chemical
Library, which Compounds are obtained directly or
indirectly from ViroPharma, except through a license
granted by Wyeth directly to such Acquiring Entity.
1.5 "Wyeth Chemical Library" shall mean those Compounds that Wyeth, as of
the Effective Date owns or Controls, or that come into Wyeth's Control
during the term of the Research Program, provided, however, that for
purposes of this Agreement, the Wyeth Chemical Library shall not
include those Compounds in the agricultural chemical library of
Wyeth's subsidiary, American Cyanamid Company, which agricultural
chemical was sold to a Third Party along with the agricultural
business of American Cyanamid Company after the Effective Date and
prior to the Restatement Date.
1.6 "Wyeth Know-How" shall mean Know-How, excluding the Collaboration
Know-How, that Wyeth owns or Controls as of the Effective Date or that
comes into the Control of Wyeth during the term of this Agreement.
1.7 "Wyeth Patent Rights" shall mean Patent Rights that Wyeth owns or
Controls as of the Effective Date or that come into the Control of
Wyeth during the term of this Agreement, which Patent Rights claim any
Wyeth Prior Invention and/or Wyeth Non-Collaboration Invention. Those
Wyeth Patent Rights known to be existing as of the Effective Date are
listed on Exhibit 1.7 attached hereto.
1.8 "Wyeth Technology" shall mean the Wyeth Patent Rights, Wyeth's
interest in the Collaboration Patent Rights, the Wyeth Know-How,
Wyeth's interest in the Collaboration Know-How and the Wyeth Assay and
Screening Technology.
1.9 "Wyeth Territory" shall mean the world other than the countries
included within the Copromotion Territory.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 5
1.10 "Annual Commercialization Plan and Budget" shall have the meaning set
forth in Section 6.1.2.
1.11 "Annual Development Plan and Budget" shall have the meaning set forth
in Section 4.2.2.
1.12 "Assay and Screening Technology" shall mean the Know-How, methods and
technology owned or Controlled by either Party which may be used for
the screening of Compounds for activity against one or more
Collaboration Targets.
1.13 "Assigned Sales Force Effort" shall mean **************** in a
************* during any Calendar Quarter or calendar year, as
applicable, as assigned by the MSC under the then applicable Annual
Commercialization Plan and Budget and in accordance with Section
6.1.3.
1.14 "Baseline Allocation of Net Profits" shall have the meaning set forth
in Section 7.5.1.
1.15 "Biomolecule" shall mean a polypeptide, protein, vaccine or antibody,
any of which is either of natural origin, expressed by recombinant
methodology or chemically synthesized or which may be a chemical
structure derived therefrom, an analog, derivative, congener or the
like.
1.16 "Calendar Quarter" shall mean the respective periods of three
consecutive calendar months ending on March 31, June 30, September 30
or December 31, for so long as this Agreement is in effect.
1.17 "Change of Control" shall mean any of the following: (a) the sale or
disposition of all or substantially all of the assets of a Party to a
Third Party, (b) the acquisition by a Third Party, other than an
employee benefit plan (or related trust) sponsored or maintained by a
Party or any of its Affiliates, of more than 50% of such Party's
outstanding shares of voting capital stock, or (c) the merger or
consolidation of a Party with or into another corporation, other than
a merger or consolidation of a Party in which holders of shares of
such Party's voting capital stock immediately prior to the merger or
consolidation will have at least 50% of the ownership of voting
capital stock of the surviving corporation immediately after the
merger or consolidation.
1.18 "Class A Product" shall mean any Product that:
********************************.
1.19 "Class B Product" shall mean ******************.
1.20 "Collaboration Inventions" shall mean all Inventions owned or
Controlled by either Party which Inventions are made by either Party's
employees, agents or
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June 26, 2003 Restated & Amended Collaboration Agreement Page 6
subcontractors in the performance of such Party's obligations under
the Research Program or in performing any research and development of
a Product, pursuant to this Agreement, after such Product has received
Regulatory Approval, including, without limitation, Phase IV clinical
studies and clinical studies in support of additional indications
within the Field or labeling changes for such Product during the term
of this Agreement, regardless of whether such Inventions are made
solely by such Party's employees, agents or subcontractors or jointly
with the employees, agents or subcontractors of the other Party.
1.21 "Collaboration Know-How" shall mean that Know-How that is created or
developed by or on behalf of either Party, either alone or jointly
with the other Party, in performing its obligations under the Research
Program or in performing any Post-Approval Research.
1.22 "Collaboration Patent Rights" shall mean those Patent Rights that
include claims directed to Collaboration Inventions.
1.23 "Collaboration Target" shall mean any Target that is (a) listed in
Exhibit 1.23 attached hereto, (b) selected by the JSC in accordance
with Section 4.4.1 or (c) used by either Party in its performance of
the Research Program for Screening Compounds for potential activity as
a prophylactic or therapeutic agent in the Field, except that on and
after the Restatement Date, notwithstanding any other provision of
this Agreement, or any decision of the JSC, "Collaboration Target"
shall mean only *************.
1.24 "Collaboration Technology" shall mean the Collaboration Patent Rights
and the Collaboration Know-How.
1.25 "Commercialization" shall mean any and all activities of making,
having made, using, importing, marketing, promoting, distributing,
offering for sale and selling a Product in the Field and shall include
Promotion. When used as a verb, "Commercialize" shall mean to engage
in Commercialization.
1.26 "Commercially Reasonable Efforts" shall mean efforts and resources
normally used by a Party for a product or compound owned by it or to
which it has rights, which is of similar market potential at a similar
stage in its development or product life, taking into account issues
of safety and efficacy, product profile, the competitiveness of the
marketplace, the proprietary position of the compound or product, the
regulatory structure involved, the profitability of the applicable
products, and other relevant factors.
1.27 "Compound" shall mean a chemical compound or substance together with
all complexes, mixtures and other combinations, prodrugs, metabolites,
enantiomers, salt forms, racemates, and isomers thereof. For the sake
of clarity, the term "Compounds" may include both Small Molecules and
Biomolecules, provided, however, that, with respect to Biomolecules,
only those Biomolecules selected for
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June 26, 2003 Restated & Amended Collaboration Agreement Page 7
collaborative Research pursuant to Section 4.4.2, shall be considered
to be Compounds hereunder.
1.28 "Confidential Information" shall mean with respect to each Party,
non-public proprietary data or information which belong in whole or in
part to such Party or its Affiliates and/or information designated as
Confidential Information of such Party hereunder.
1.29 "Control" or "Controlled" shall mean with respect to any (a) item of
information, including, without limitation, Know-How, or (b)
intellectual property right, the possession (whether by ownership or
license, other than pursuant to this Agreement) by a Party of the
ability to grant to the other Party access and/or a license as
provided herein under such item or right without violating the terms
of any agreement or other arrangements with any Third Party existing
before or after the Effective Date.
1.30 "Copromotion Territory" shall mean: (a) the fifty (50) states of the
United States and the District of Columbia, and (b) Canada.
1.31 "Copromotion Territory Commercialization Plan" shall have the meaning
set forth in Section 6.1.2.
1.32 "Copyright" shall mean any copyright owned or Controlled by Wyeth
which copyright pertains to the promotional materials and literature
utilized by the Parties in connection with the Promotion of Products
in the Copromotion Territory pursuant to Section 6.1.
1.33 "Cost of Goods Manufactured for Sale" shall mean Wyeth's actual cost
to acquire Product from a Third Party, or its Fully-Absorbed Standard
Cost to produce the Product, plus (or minus, as the case may be): (a)
Wyeth's costs for Product inventory adjustments and losses, (b) any
manufacturing cost variances allocable to such Product, (c)
amortization of new standard costs for such Product, (d) prior period
adjustments allocable to such Product, and (e) actual distribution
costs (other than those deducted as part of the calculation of Net
Sales pursuant to Section 1.71(a)(v)), warehousing costs and billing,
receiving, collection and other miscellaneous costs incurred by Wyeth
as they relate to distribution of the Products.
1.34 "Derivative" of a given Compound shall mean a chemical compound
derived by addition to or manipulation of a fundamental structure of
such Compound.
1.35 "Detail" shall mean a face-to-face meeting between one or more Target
Physicians and one or more professional sales representative, made in
compliance with the Target Market allocation of the MSC under Section
6.1.3, during which a complete Product presentation, as defined from
time to time by the MSC, is communicated, which Product presentation
is either the first or second product-
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June 26, 2003 Restated & Amended Collaboration Agreement Page 8
related information communicated by such professional sales
representative during such meeting. When used as a verb, "Detail"
shall mean to perform a Detail.
1.36 "Development" shall mean, on a country by country basis, all
activities performed by or on behalf of either Party pursuant to the
Global Research and Development Plan on a Compound in the Field from
the effective date of an IND for such Compound until Regulatory
Approval of such Compound is obtained in such country for the
indication under study. When used as a verb, "Develop" shall mean to
engage in Development.
1.37 "Development Candidate" shall mean a Lead Compound or any Derivative
thereof or any other Compound for use in the Field, that the JSC, in
accordance with Section 4.4.5, selects or otherwise designates for
further development to IND filing.
1.38 "Development Expenses" shall mean, on a Compound by Compound and
Product by Product basis, the expenses (other than Third Party License
Fees) of the Parties incurred in performing the Development Phase of
the Research Program and obtaining Regulatory Approval for such
Compound or Product pursuant to the Global Research and Development
Plan.
1.39 "Development Phase" shall have the meaning set forth in Section 4.3.4.
1.40 "Effective Date" shall mean December 9, 1999.
1.41 "Executive Steering Committee" or "ESC" shall have the meaning set
forth in Section 3.3.1.
1.42 "Extra Effort" shall have the meaning set forth in Section 6.1.5. For
the sake of clarity, Extra Effort shall not include any Incremental
Sales Force Effort.
1.43 "Extra Effort Expense" shall mean the cost to be charged to a Party's
Marketing Account in accordance with Section 6.1.5 due to such Party's
provision of Extra Effort.
1.44 "FDA" shall mean the United States Food and Drug Administration or any
successor agency thereto.
1.45 "FD&C Act" shall mean the United States Federal Food, Drug, and
Cosmetic Act, as amended, and the regulations promulgated thereunder.
1.46 "Field" shall mean the therapeutic and/or prophylactic treatment of
the effects of HCV on humans.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 9
1.47 "First Commercial Sale" shall mean, with respect to any Product and
any country of the world, the first sale of such Product under this
Agreement, for use in the Field, to a Third Party in such country,
after such Product has been granted Regulatory Approval for use in the
Field by the competent Regulatory Authorities in such country.
1.48 "FTE" shall mean a full time equivalent scientific person year
consisting of a minimum of a total of one thousand eight hundred
eighty hours (1,880) per year of scientific work on or directly
related to the Research Program. Work on or directly related to the
Research Program can include, but is not limited to, experimental
preclinical and clinical laboratory and research work, recording and
writing up results, reviewing literature and references, holding
scientific discussions, managing and leading scientific staff,
carrying out management duties related to the Research Program, and,
only to the extent specifically pre-approved in writing by both
ViroPharma and Wyeth, writing up results for publications or
presentation and attending or presenting appropriate seminars and
symposia.
1.49 "Full Royalty Rate Period" for a Product sold in any given country
means the period during which either or both of the following is true:
(a) Wyeth's distribution and/or sale of the applicable Product in the
applicable country, in the absence of the rights and licenses
granted by this Agreement, would have infringed one or more Valid
Claims under Patent Rights, including Collaboration Patent
Rights, then owned in whole or part by ViroPharma;
(b) Wyeth's manufacture of the Product, in the absence of the rights
and licenses granted by this Agreement, would have infringed one
or more Valid Claims under Patent Rights, including Collaboration
Patent Rights, then owned in whole or part by ViroPharma,
provided that, except as may be precluded or limited by applicable
law, the Full Royalty Rate Period for such Product in such country
shall not expire before the tenth (10/th/) anniversary of the First
Commercial Sale of such Product in such country.
1.50 "Fully-Absorbed Standard Cost" shall mean the cost for those items
specified in Exhibit 1.50 attached hereto, which costs are calculated
in accordance with generally accepted accounting principles and have
been incurred by Wyeth or its Affiliates in manufacturing (i)
materials to be used by the Parties in conducting clinical trials of
Compounds or Products hereunder or (ii) Products for sale or
distribution in the Copromotion Territory hereunder.
1.51 "Global Research and Development Plan" shall have the meaning set
forth in Section 4.2.1.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 10
1.52 "Good Clinical Practice" or "GCP" shall mean the then current
standards for clinical trials for pharmaceuticals, as set
forth in the United States Federal Food, Drug and Cosmetics
Act and applicable regulations promulgated thereunder, as
amended from time to time, and such standards of good clinical
practice as are required by the European Union and other
organizations and governmental agencies in countries in which
the Products are intended to be sold, to the extent such
standards are not inconsistent with United States GCP.
1.53 "Good Laboratory Practice" or "GLP" shall mean the then
current standards for laboratory activities for
pharmaceuticals, as set forth in the United States Federal
Food, Drug and Cosmetics Act and applicable regulations
promulgated thereunder, as amended from time to time, and such
standards of good laboratory practice as are required by the
European Union and other organizations and governmental
agencies in countries in which the Products are intended to be
sold, to the extent such standards are not inconsistent with
United States GLP.
1.54 "HCV" shall mean the hepatitis C virus.
1.55 "Hit" shall mean a Compound identified by early screening, in
assays conducted pursuant to protocols approved by the JSC,
during the Screening Phase or the Screening Phase Tail that
the JSC confirms, in accordance with Section 4.4.3 hereof, has
activity against the applicable Collaboration Target that
meets or exceeds an active threshold established by the JSC
for that Collaboration Target.
1.56 "Incremental Sales Force Effort" shall have the meaning set
forth in Section 6.1.4. For the sake of clarity, "Incremental
Sales Force Effort" shall not include any Extra Effort.
1.57 "Incremental Sales Force Effort Expense" shall mean the cost
to be charged to a Party's Marketing Account in accordance
with Section 6.1.4 hereof due to such Party's provision of an
Incremental Sales Force Effort.
1.58 "IND" shall mean an Investigational New Drug Application, as
defined in the FD&C Act, that is required to be filed with the
FDA before beginning clinical testing of a Product in human
subjects, or an equivalent foreign filing.
1.59 "Initial Term of the Screening Phase" shall have the meaning
set forth in Section 4.3.1.
1.60 "Invention" shall mean any invention in the Field that
encompasses or relates to any Assay and Screening Technology,
any Collaboration Target, any Compound that is Screened,
Researched, or Developed under the Research Program, any
Derivatives of any such Compounds, any Product and any method
of making any such Compound, Derivative, or Product and any
method of using any such Compound, Derivative or Product.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 11
1.61 "Joint Steering Committee" or "JSC" shall have the meaning set
forth in Section 3.1.
1.62 "Know-How" shall mean, as each of the following relates to the
Field, all know-how, processes, materials, information, data
and analyses including any copyright relating thereto
Controlled by either Party or its Affiliates as of the
Effective Date or coming into the Control of either Party or
its Affiliates during the term of this Agreement relating to
any Assay and Screening Technology, any Collaboration Target,
any Compound that is at any time screened or developed under
the Research Program, any Derivatives of any such Compounds,
any Product and any method of making any such Compound,
Derivative, or Product and any method of using any such
Compound, Derivative or Product.
1.63 "Lapse Quarter" for a Party shall mean, on a Product by
Product and country by country basis in the Copromotion
Territory, any Calendar Quarter in which: (a) the Party has
delivered less than ********** of its then current Assigned
Sales Force Effort, and (b) such percentage portion of its
then current Assigned Sales Force Effort is at **********
lower than the portion of the other Party's Assigned Sales
Force Effort actually performed by such other Party.
1.64 "Lapse Year" for a Party shall mean, on a Product by Product
and country by country basis in the Copromotion Territory, any
calendar year in which such Party has three (3) or more Lapse
Quarters.
1.65 "Lead Compound" shall mean a Compound with: (a) sufficient
potency and selectivity, based on activity against a
Collaboration Target and activity in secondary selectivity
assays, which activity levels and selectivity indices have
been established by the JSC, (b) chemical tractability, (c) a
preliminary indication of chemical structure-activity
relationships and (d) a clear basis for initiating chemical
optimization.
1.66 "Major European Country" shall mean any of France, Germany,
Italy, or the United Kingdom.
1.67 "Marketing Account" shall have the meaning set forth in
Section 6.1.8(d).
1.68 "Marketing Steering Committee" or "MSC" shall have the meaning
set forth in Section 3.2.
1.69 "NDA" shall mean a New Drug Application, as defined in the
FD&C Act, that is required to be approved by the FDA before
marketing a Product, or an equivalent foreign filing.
1.70 "Net Profits" shall mean, with respect to the sales of any
Product in a country of the Copromotion Territory, the Net
Sales of such Product in such country, less the
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June 26, 2003 Restated & Amended Collaboration Agreement Page 12
following expenses (deducted in the sequence listed) allocable
to such Product in such country: (a) the Cost of Goods
Manufactured for Sale, and (b) the Parties' combined Sales and
Marketing Expenses, a Party's Incremental Sales Force
Expenses, if any, a Party's Extra Effort Expense, if any, and
the Parties' combined Post-Approval Research and Regulatory
Expenses.
1.71 "Net Sales" shall mean the gross amounts charged for sales of
Products by Wyeth, its Affiliates, or sublicensees, as
appropriate, to non-Affiliate Third Parties on which payments
are due under this Agreement, less the sum of (a) and (b)
where (a) is a provision, determined under Generally Accepted
Accounting Principles in the United States, for (i) reasonable
trade, cash and quantity discounts or rebates (other than
price discounts granted at the time of sale), reasonable
service allowances and reasonable broker's or agent's
commissions, if any, actually allowed or paid, (ii) credits or
allowances actually given or made for rejection or return of,
previously sold Products or for retroactive price reductions
(including Medicaid, managed care and similar types of
rebates), (iii) taxes, duties or other governmental charges
levied on or measured by the billing amount (excluding income
and franchise taxes), as adjusted for rebates and refunds, and
(iv) reasonable credits or allowances actually given or made
for wastage replacement, and (v) charges actually incurred for
packing, freight, and shipping from Wyeth's or its Affiliates'
distribution center and insurance directly related to such
packing, freight, and shipping of such Product (excluding
amounts reimbursed by Third Party customers and any amounts
associated with packing, freight, and shipping to and holding
at Wyeth's or its Affiliate's distribution center, which
amounts are included within the Cost of Goods Manufactured for
Sale) and (b) is a periodic adjustment of the provision
determined in (a) to reflect amounts actually incurred for
(i), (ii), (iii), (iv), and (v). A "sale" of a Product is
deemed to occur upon the invoicing, or if no invoice is
issued, upon the earlier of shipment or transfer of title in
the Product to a Third Party. If a Product is sold or
distributed for use in combination with or as a component of
another product or products (a "Combination Product"), the
calculation of "Net Sales" from such Combination Product will
be determined by multiplying the Net Sales for such
Combination Product calculated as set forth above by a
fraction, the numerator of which is the fair market value of
the Product in such Combination Product, and the denominator
of which is the fair market value of the Combination Product.
If a Product is sold as part of a bundle of distinct products
(i.e., not (i) packaged together with another product or (ii)
in a Combination Product form alone,) the Net Sales for such
Product will be based on the discounted unit price of such
Product sales, which discounted unit price shall be
proportional to the total discount provided for the entire
bundle (e.g., if, the price for the bundle of products is
twenty percent (20%) lower than the price that would be
charged by Wyeth, its Affiliates or sublicensees for the same
group of products if sold separately, based on the average
unit price of such products when sold separately, then the
discounted unit price attributable to the Product when sold as
part of such bundle would be eighty percent (80%) of the
average unit price of the Product when sold separately by
Wyeth, its Affiliates or sublicensees.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 13
1.72 "Non-Collaboration Invention" of a Party shall mean an
Invention owned or Controlled by either Party, which Invention
(a) is made solely by such Party's employees, agents or
subcontractors during the term of this Agreement or otherwise
comes into the Control of such Party during the term of this
Agreement and (b) is not made in the performance of the
Research Program.
1.73 "Option Period" means on a Compound-by-Compound basis, for any
Compound that ViroPharma has begun developing on its own
pursuant to Section 4.5.4, the period extending until the
earlier of:
(a) fifteen (15) business days after Wyeth's receipt of
written notice from ViroPharma that the FDA has
accepted for review an NDA for such Compound,
provided that, (i) such notice has been accompanied
by all data regarding such Compound that has not been
previously disclosed to Wyeth, and (ii) at least
thirty (30), and no more than sixty (60) days, before
the submission of such NDA to the FDA, ViroPharma
provided Wyeth with written notice during Wyeth's
normal business hours of its intent to submit such
NDA, accompanied by all data regarding such Compound
that had not been previously disclosed to Wyeth; or
(b) ninety (90) days after Wyeth's receipt of written
notice from ViroPharma that ViroPharma has submitted
an NDA for such Compound to FDA for review, provided
that, (i) such notice has been accompanied by all
data regarding such Compound that has not been
previously disclosed to Wyeth, and (ii) the FDA
accepts such NDA for review in materially the form
submitted.
1.74 "Patent Rights" shall mean any and all (a) patents, (b)
pending patent applications, including, without limitation,
all provisional applications, substitutions, continuations,
continuations-in-part, divisions, renewals, and all patents
granted thereon, and (c) all patents-of-addition, reissues,
reexaminations and extensions or restorations by existing or
future extension or restoration mechanisms, including, without
limitation, supplementary protection certificates or the
equivalent thereof, that, (i) during the Term of this
Agreement, are owned or Controlled by either Party, and (ii)
claim any Invention.
1.75 "Penalty Year" for a Party shall mean the calendar year
following a Lapse Year.
1.76 "Phase I Clinical Study" shall mean a study, conducted in
accordance with a protocol approved by the JSC, of a
Development Candidate in human volunteers or patients with the
endpoint of determining initial tolerance, safety and/or
pharmacokinetic information in single dose, single ascending
dose, multiple dose and/or multiple ascending dose regimens.
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1.77 "Phase II Clinical Study" shall mean a study, conducted in
accordance with a protocol approved by the JSC, of a
Development Candidate in patients to determine initial
efficacy and dose range finding before embarking on Phase III
Clinical Studies.
1.78 "Phase III Clinical Study" shall mean a pivotal study in
patients, conducted in accordance with a protocol approved by
the JSC, which protocol is designed to ascertain efficacy and
safety of a Product for the purpose of preparing and
submitting applications for Regulatory Approval to the
competent Regulatory Authorities in a country of the world.
1.79 "Post-Approval Research and Regulatory Expenses" shall mean
those expenses incurred, on a Product by Product and country
by country basis, by either Party directly attributable to (a)
ongoing research and development of a Product after such
Product has received Regulatory Approval in such country of
the Copromotion Territory, including, without limitation,
Phase IV clinical studies and clinical studies in support of
additional indications within the Field or labeling changes
for such Product in such country and/or (b) complying with its
regulatory reporting obligations in the Copromotion Territory
in accordance with Section 5.4.
1.80 "Pre-Development Expenses" shall mean, on a Compound by
Compound basis, the expenses (other than Third Party License
Fees) incurred by the Parties after the Effective Date in
performing the Screening Phase and the Research Phase of the
Research Program.
1.81 "Pre-Marketing Expenses" shall mean those expenses incurred on
a country by country and Product by Product basis within the
Copromotion Territory, by either Party, other than R&D
Expenses, before Regulatory Approval of a Product in such
country, directly attributable to the carrying out of such
Party's obligations under the Copromotion Territory
Commercialization Plan in preparation for the marketing,
promotion, sale and distribution of such Product in such
country. Such expenses may include, without limitation, costs
incurred for professional education, Product related public
relations, relationships with opinion leaders and professional
societies, market research, health care economics studies, and
establishment of the supply chain for the distribution and
sale of such Product in such country. Such expenses may
include both internal expenses incurred by a Party as well as
out-of-pocket expenses paid to Third Parties by a Party at
reasonable rates pre-approved by the MSC.
1.82 "Pre-Marketing Expense Shortfall" shall have the meaning set
forth in Section 6.1.8(f).
1.83 "Prior Invention" of a Party shall mean an Invention owned or
Controlled by either Party, which Invention is made solely by
the Party's employees, agents or
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subcontractors before the Effective Date or which otherwise
came into the Control of such Party before the Effective Date.
1.84 "Product" shall mean any pharmaceutical product, for use in
the Field, containing one or more Development Candidates as an
active ingredient.
1.85 "Promotion" shall mean those activities, including, without
limitation, Detailing and distributing Samples of a Product,
normally undertaken by a pharmaceutical company's sales force
to implement marketing plans and strategies aimed at
encouraging the appropriate use of a particular Product. When
used as a verb, "Promote" shall mean to engage in such
activities.
1.86 "R&D Account" shall have the meaning set forth in Section
4.6.3.
1.87 "R&D Reimbursement Account" shall have the meaning set forth
in Section 7.1(b).
1.88 "R&D Shortfall" shall have the meaning set forth in Section
4.6.5.
1.89 "Reduced Royalty Rate Period" for a Product in a country means
the period beginning on the expiration of the Full Royalty
Rate Period for the Product in that country, or if there is no
Full Royalty Rate Period for that Product in that country,
then beginning on the First Commercial Sale of the Product in
that Country, and ending on the twenty-fifth (25th)
anniversary of the Effective Date.
1.90 "Regulatory Approval" shall mean the technical, medical and
scientific licenses, registrations, authorizations and
approvals (including, without limitation, approvals of NDAs,
supplements and amendments, pre- and post- approvals, pricing
and third party reimbursement approvals, and labeling
approvals) of any national, supra-national, regional, state or
local regulatory agency, department, bureau, commission,
council or other governmental entity, necessary for the
commercial manufacture, distribution, marketing, promotion,
offer for sale, use, import, export and sale of Product(s) in
a regulatory jurisdiction.
1.91 "Regulatory Authority" shall mean any national (e.g., the
United States Food and Drug Administration), supra-national
(e.g., the European Commission, the Council of the European
Union, or the European Agency for the Evaluation of Medicinal
Products), regional, state or local regulatory agency,
department, bureau, commission, council or other governmental
entity in each country of the world involved in the granting
of Regulatory Approval for the Product.
1.92 "Research" shall mean, on a Compound by Compound basis, those
preclinical activities undertaken by or on behalf of either
Party pursuant to the Global Research and Development Plan
subsequent to Screening and prior to Development of such
Compound, including, without limitation, medicinal
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June 26, 2003 Restated & Amended Collaboration Agreement Page 16
chemistry, pharmacology, preclinical toxicology, and
formulation of such Compound in the Field.
1.93 "Research Phase" shall have the meaning set forth in Section
4.3.2.
1.94 "Research Program" shall have the meaning set forth in Section
4.1.
1.95 "Sales and Marketing Expenses" shall mean those expenses
directly allocable, on a Product by Product and country by
country basis, to the Parties' market development and/or
Promotion of such Product in the Copromotion Territory,
consistent with the Copromotion Territory Commercialization
Plan for such Product. Sales and Marketing Expenses shall
include: (a) costs for Promotion of the Product, excluding
costs of the field sales force personnel (i.e., Detailing
expenses, including, without limitation, salaries, bonus,
benefits, sales force automation, and personnel expenses --
telephone, supplies, postage, meetings, travel and voice mail
including all information technology); (b) out-of-pocket
payments to Third Parties incurred by such Party and
specifically attributable to such Party's performance under
the Copromotion Territory Commercialization Plan, excluding
Third Party License Fees, (c) costs for activities related to
obtaining reimbursement from payers, (d) market research costs
(including, without limitation, actual costs of sales and
marketing data), (e) marketing and advertising costs
(including, without limitation, cost for preparing and
reproducing detail aids and other promotional materials), (f)
professional education, (g) Product related public relations,
(h) costs of pharmacoeconomics studies, (i) costs for
manufacturing and distributing Product Samples, and (j) costs
for conducting seminars and establishing relationships with
opinion leaders and professional societies in connection with
the Product. Such costs will include both internal costs
(e.g., salaries, benefits, supplies and materials, etc.) as
well as the actual amounts paid to outside service providers
(e.g., consultants, agency fees, meeting costs, etc.). Sales
and Marketing Expenses will specifically exclude the cost of
activities that promote either Party's business as a whole
without being Product specific (such as corporate image
advertising) as well as Extra Effort Expenses, and Incremental
Sales Force Expenses.
1.96 "Sample" shall mean a unit of a Product, as used by Wyeth,
that is not intended to be sold and is intended to promote the
sale of such Product. When used as a verb, "Sample" shall mean
to provide Samples to Target Physicians.
1.97 "Sample Receipt Forms" shall mean those multi-part paper forms
(or an electronic version thereof) supplied by Wyeth for the
purpose of recording Detail and Sample activity performed by
ViroPharma sales representatives during Details. These forms
are also used as Sample receipts on which to obtain a
physician's signature in acknowledgment of the physician's
receipt of Samples.
1.98 "Screening" shall mean screening and identification of
Compounds, including, without limitation, Compounds from the
ViroPharma Chemical Library or the
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June 26, 2003 Restated & Amended Collaboration Agreement Page 17
Wyeth Chemical Library to determine whether such Compounds may
have activity against an Active Collaboration Target.
1.99 "Screening Phase" shall have the meaning set forth in Section
4.3.1.
1.100 "Screening Phase Tail" shall have the meaning set forth in
Section 4.3.3.
1.101 "Small Molecule" shall mean any Compound that is not a
Biomolecule.
1.102 "Surviving Entity" of a Change of Control of ViroPharma shall
mean: (a) a Third Party that has acquired substantially all of
the assets of ViroPharma or 100% of the outstanding shares of
voting capital stock of ViroPharma pursuant to a Change of
Control, (b) a company that results from the merger of
ViroPharma and another entity pursuant to a Change of Control,
or (c) ViroPharma if a Third Party acquires more than 50% but
less than 100% of the outstanding shares of voting capital
stock of ViroPharma pursuant to a Change of Control.
1.103 "Tail Compound Series" shall mean a group of Compounds that
are structurally related and share a common pharmacophore, at
least one Compound of which group has been screened and found
by either Party to have any activity against any Collaboration
Target, whether or not such Compound is determined to be a
Hit.
1.104 "Target" shall mean a molecular entity for which there is
sufficient information, data, or valid reason to believe that
perturbation of such entity would be sufficient to prevent or
affect the course of human disease caused by the HCV.
1.105 "Target Market" shall mean the segments of the overall market
for a Product to whom a Party will Promote such Product.
1.106 "Target Physician" shall mean each physician and other health
care professional and organization to whom either Party
Details a Product in the Copromotion Territory.
1.107 "Term of the Screening Phase" shall mean, with respect to any
Compound, the Initial Term of the Screening Phase and all
extensions made thereto with respect to such Compound in
accordance with Section 4.3.1.
1.108 "Third Part(y/ies)" shall mean any person(s) or entit(y/ies)
other than Wyeth, ViroPharma or their respective Affiliates.
1.109 "Third Party License Fee" shall mean license fees, royalties
and other amounts paid to any Third Party for the license
under intellectual property rights of technology necessary or
useful for Screening, Research, Development or
Commercialization, which license is entered into, during the
term of this Agreement, by a Party pursuant to Section 8.2.3.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 18
1.110 "Trademark" shall mean those registered trademarks used in
connection with the Commercialization of any Product by either
Party hereunder, provided, however, that the term "Trademark"
shall not include the tradename of either Party or any
trademark or tradedress of either Party which is not used
exclusively in connection with the Products Commercialized
under this Agreement.
1.111 "Valid Claim" shall mean a claim that (i) in the case of any
unexpired United States or foreign patent, shall not have been
donated to the public, disclaimed, nor held invalid or
unenforceable by a court or government agency of competent
jurisdiction in an unappealed or unappealable decision, or
(ii) in the case of any United States or foreign patent
application, shall not have been canceled, withdrawn, or
abandoned without being refiled in another application or
finally rejected by an administrative agency action from which
no appeal can be taken, or shall not have been pending for
more than five years. For purposes of this definition, time
periods shall be measured cumulatively for claims in a later
filed application in a country which are substantially the
same as claims in an earlier filed application in that
country. If a claim of a patent application that ceased to be
a Valid Claim under (ii) due to the passage of time later
issues as part of a patent described within (i) then it shall
again be considered to be a Valid Claim effective as of the
issuance of such patent.
1.112 "ViroPharma Chemical Library" shall mean those Compounds that
ViroPharma, as of the Effective Date owns or Controls, or that
come into ViroPharma's Control during the term of the Research
Program.
1.113 "ViroPharma Know-How" shall mean Know-How, excluding the
Collaboration Know-How, that ViroPharma owns or Controls as of
the Effective Date or that comes into the Control of
ViroPharma during the term of this Agreement.
1.114 "ViroPharma Patent Rights" shall mean Patent Rights that
ViroPharma owns or Controls as of the Effective Date or that
come into the Control of ViroPharma during the term of this
Agreement, which Patent Rights claim any ViroPharma Prior
Invention and/or ViroPharma Non-Collaboration Invention. Those
ViroPharma Patent Rights known to be existing as of the
Effective Date are listed on Exhibit 1.114 attached hereto.
1.115 "ViroPharma Technology" shall mean the ViroPharma Patent
Rights, ViroPharma's interest in the Collaboration Patent
Rights, the ViroPharma Know-How, ViroPharma's interest in the
Collaboration Know-How, and the ViroPharma Assay and Screening
Technology.
2. LICENSES.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 19
2.1 Licenses to Wyeth. Subject to the terms and conditions of this
Agreement, including, without limitation, Sections 2.4 and 2.6
hereof, ViroPharma hereby grants to Wyeth:
(a) the exclusive worldwide right and license, without
the right to grant sublicenses (except to Wyeth's
Affiliates or ViroPharma), to use the ViroPharma
Technology, the ViroPharma Chemical Library, and the
Collaboration Targets only to the extent necessary
for Wyeth to exercise its rights and perform its
obligations under the Research Program and to
exercise its rights and perform its obligations
during the Screening Phase Tail; and
(b) the exclusive worldwide right and license, with the
right to sublicense one or more of its Affiliates,
ViroPharma and/or Third Parties (provided, however,
that in the Copromotion Territory, Wyeth may only
grant sublicenses to one or more or its Affiliates
and ViroPharma), to use the ViroPharma Technology,
the Collaboration Targets, and the ViroPharma
Chemical Library only to the extent necessary to
Develop and Commercialize Hits, Lead Compounds,
Development Candidates and Products for use in the
Field,
except that the right and license under this Section 2.1 shall
be cancelled on the Restatement Date with respect to any
activities relating to screening, research, development or
commercialization of any Compound directed against a Target
other than the Collaboration Target, and, for the sake of
clarity, the right and license to use the Collaboration
Targets shall include only ***************.
2.2 Licenses to ViroPharma. Subject to the terms and conditions of
this Agreement, including, without limitation, Sections 2.4
and 2.6 hereof, Wyeth grants to ViroPharma:
(a) the nonexclusive right and license, without the right
to grant sublicenses (except to ViroPharma
Affiliates), to use the Wyeth Technology, the Wyeth
Chemical Library, the ViroPharma Technology, the
ViroPharma Chemical Library, and the Collaboration
Targets only to the extent necessary for ViroPharma
to exercise its rights and perform its obligations
under the Research Program and pursuant to Section
4.5.4, and to exercise its rights and perform its
obligations during the Screening Phase Tail;
(b) the nonexclusive right and license, without the right
to grant sublicenses (except to ViroPharma
Affiliates), to use the Wyeth Technology, the Wyeth
Chemical Library, the ViroPharma Technology, the
ViroPharma Chemical Library, and the Collaboration
Targets only to the extent necessary for ViroPharma
to Promote Products in the Copromotion Territory in
accordance with Section 6.1 of this Agreement; and
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June 26, 2003 Restated & Amended Collaboration Agreement Page 20
(c) the nonexclusive right and license, without the right to grant
sublicenses (except to ViroPharma Affiliates), to use the
Trademarks and Copyrights in the Copromotion Territory during the
term of this Agreement only to the extent such license is
necessary for ViroPharma to Promote Products in the Copromotion
Territory in accordance with Section 6.1 of this Agreement.
2.3 Sublicensing to Third Party Contractors. Notwithstanding any provision
to the contrary in this Agreement, if pursuant to Section 4.5, the JSC
approves the utilization of one or more Third Parties to perform
certain tasks under the Research Program, the Party entering into a
contract with such Third Party for the performance of such services,
may, as part of such contract, grant to such Third Party a
nonexclusive, nontransferable, nonsublicensable license or sublicense,
as applicable, under the ViroPharma Technology or the Wyeth
Technology, as applicable, only to the extent and only for so long as
such license or sublicense is necessary for such Third Party to
perform such tasks under the Research Program. Likewise, to the extent
that either Party enters into a contract with a Contract Sales
Organization to perform all or part of its obligations in Promoting
Products pursuant to Section 6.1.1 hereof, such Party may, as a part
of such contract, grant to such Third Party a nonexclusive,
nontransferable, nonsublicensable license or sublicense, as
applicable, under the ViroPharma Terchnology or the Wyeth Technology,
as applicable, only to the extent and only for so long as such license
or sublicense is necessary for such Third Party to perform such
Promotion. All such contracts and sublicenses entered into by either
Party with a Contract Sales Organization shall be subject to the prior
written approval of the MSC, which approval shall not be unreasonably
withheld or delayed.
2.4 Dropped Compounds. Upon the written determination of the JSC not to
advance a Compound further in Screening, Research, Development, or
Commercialization hereunder, such Compound shall no longer be included
in the rights licensed by one Party to the other Party under Section
2.1 or 2.2, provided, however, that for so long as either (a) there is
at least one Development Candidate being studied hereunder during the
Development Phase of the Research Program or (b) a Product is being
marketed in the Field by Wyeth pursuant to this Agreement, neither
Party will develop or commercialize in the Field, independently or in
collaboration with any Third Party, such Compound or any Derivative
thereof without the prior written consent of the other Party.
2.5 Direct Licenses to Party Affiliates. Either Party may at any time
request and authorize the other Party to grant licenses directly to
Affiliates of the requesting Party by giving written notice
designating to whom a direct license is to be granted. Upon receipt of
any such notice, the requested Party shall enter into and sign a
separate direct license agreement with such designated Affiliate of
the requesting Party. All such direct license agreements shall be
consistent with the terms and conditions of this Agreement, except for
such modifications as may be required by the laws and regulations in
the country in which the direct license will
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June 26, 2003 Restated & Amended Collaboration Agreement Page 21
be exercised. In countries where validity of the direct license
agreement requires prior government approval or registration, such
direct license agreement shall not become binding between the parties
thereto until such approval or registration is granted, which approval
or registration shall be obtained by the requesting Party. All costs
of making a direct license under this Section 2.5 shall be borne by
the requesting Party.
2.6 Exclusive Working Relationship.
2.6.1 Collaboration Targets. Notwithstanding the licenses granted
under Sections 2.1 and 2.2 hereof, it is expressly understood
and agreed by the Parties that:
(a) during the Screening Phase and the Screening Phase Tail,
except as otherwise permitted pursuant to Section 4.5.4,
ViroPharma and its Affiliates shall work exclusively with
Wyeth and Wyeth's Affiliates in the Screening, Research,
Development and Commercialization of Compounds and
pharmaceutical products which are directed against any
Collaboration Target for use in the Field, provided,
however, that during the term of the Screening Phase Tail,
either Party and/or its Affiliates shall be free to perform
any of the activities required to bring any Compound in a
Tail Compound Series to Development Candidate status,
either (i) exclusively with the other Party and the other
Party's Affiliates, or (ii) independently, after first
having offered to collaborate with the other Party on such
work, but in any case not with any Third Party, provided,
however, that, in either event a Compound may only be
declared to be a Lead Compound or a Development Candidate
in accordance with the procedures set forth in Section 4.4
hereof;
(b) during the Research Program, Wyeth and its Affiliates shall
work exclusively with ViroPharma and its Affiliates on the
development of Compounds which are directed against Active
Collaboration Targets; and
(c) during the term of this Agreement, neither Party nor its
Affiliates shall develop or commercialize any Active
Compound for use outside of the Field, except in
collaboration with the other Party and such other Party's
Affiliates pursuant to an agreement to be negotiated by the
Parties. Notwithstanding the foregoing, once a Compound has
ceased to be an Active Compound, the Parties and their
respective Affiliates shall be free to develop and/or
commercialize such Compound for use outside of the Field,
provided, however, that with respect to such Compound, as
of the time such Compound ceases to be an Active Compound,
Wyeth and its Affiliates shall have no further rights or
licenses under the
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June 26, 2003 Restated & Amended Collaboration Agreement Page 22
ViroPharma Technology and ViroPharma and its Affiliates
shall have no further rights or licenses under the Wyeth
Technology.
2.6.2 Other Targets. Notwithstanding any other provision in this
Agreement, on and after the Restatement Date, each Party and
its Affiliates would be free to perform on its own any
screening of Compounds against Targets other than the
Collaboration Target, and any research or development of
Compounds directed against Targets other than the Collaboration
Target, except that such right would not include the right to:
(a) use Compounds from the other Party's Chemical Library or
Compounds to which the other Party otherwise has
proprietary rights,
(b) screen Compounds against the Collaboration Target except to
the extent necessary to determine selectivity against
Targets other than the Collaboration Target, or
(c) perform research or development on any Compound that is
active against the Collaboration Target at the level that
would make such a Compound a Hit.
Notwithstanding the foregoing, before December 9, 2004, neither
Party may collaborate on any of the activities permitted under
this Section 2.6.2 with a Third Party who has been granted
rights to commercialize Compounds resulting from such
activities.
2.6.3 Limitations. For the sake of clarity, Wyeth would have no
obligation to work exclusively with ViroPharma,
(a) with respect to any Biomolecule based pharmaceutical
products regardless of the Target of such product,
(b) with respect to Small Molecules based pharmaceutical
products directed against Targets that are not, at such
time, Active Collaboration Targets, and
(c) during the Development Phase, with respect to Small
Molecule based pharmaceutical products directed against
Targets for which no Small Molecule based pharmaceutical
product is then being Developed under this Agreement.
2.7 Right of Reference. Each Party hereby grants the other a "Right of
Reference," as that term is defined in 21 C.F.R. (S) 314.3(b), to any
data developed under this Agreement, and a Party shall provide a
signed statement to this effect, if requested by the other, in
accordance with 21 C.F.R. (S) 314.50(g)(3).
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June 26, 2003 Restated & Amended Collaboration Agreement Page 23
3. MANAGEMENT OF COLLABORATION.
3.1 Joint Steering Committee.
3.1.1 Formation; Membership. Within thirty (30) days after the
Effective Date, ViroPharma and Wyeth shall establish a Joint
Steering Committee (the "JSC") to oversee and control the
collaborative discovery and preclinical and clinical
development of Compounds and Products directed against an
Active Collaboration Target for use in the Field, as further
described below in this Agreement. The JSC shall be composed of
an equal number of from two (2) to four (4) representatives
from each Party as appointed by such Party, which
representatives shall have expertise suitable to the
then-current activities of the collaboration. The JSC shall
initially have two (2) representatives from each Party, but the
JSC may change its size from time to time by mutual consent of
its members, provided, however, that the size of the JSC shall
be no less than four (4) members and no greater than eight (8)
members. A Party may replace one or more of its representatives
from time to time upon written notice to the other Party. From
time to time, the JSC may establish subcommittees to oversee
specific projects or activities and such subcommittees shall be
constituted as the JSC shall determine, but shall always
include at least one (1) member from each Party. The JSC will
exist until the termination of the Research Program, as set out
in Section 4.3, unless the Parties otherwise agree in writing.
3.1.2 Chairperson; Secretary. The chairperson of the JSC shall be
designated by Wyeth. The chairperson will be responsible for
scheduling meetings of the JSC, preparing agendas for meetings,
sending to all JSC members notices of all regular meetings and
agendas for such meetings at least five (5) business days
before such meetings. The chairperson shall appoint a secretary
for each meeting who will record the minutes of the meeting,
circulate copies of meeting minutes to the Parties and each JSC
member promptly following the meeting for review, comment and
approval and finalize approved meeting minutes.
3.1.3 Meetings. The JSC shall meet at least once each Calendar
Quarter during the term of the Research Program, unless
otherwise mutually agreed by the Parties. Either Party may call
a special meeting of the JSC on fifteen (15) days written
notice to the other Party and each of the JSC members. Such
written notice shall include an agenda for the special meeting.
Meetings, including, without limitation, special meetings, of
the JSC will alternate between the offices of the Parties,
unless otherwise agreed by the members of the JSC, or may be
held telephonically or by video-conference. Meetings of the JSC
shall be effective only if at least one (1)
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June 26, 2003 Restated & Amended Collaboration Agreement Page 24
representative of each Party is in attendance or participating
in the meeting. Members of the JSC shall have the right to
participate in and vote at meetings by telephone. The most
senior attending representative of each Party on the JSC shall
have the right to vote on behalf of any members of the JSC from
such Party not attending a JSC meeting in person or by
telephone. Each Party shall be responsible for expenses
incurred by its employees and its members of the JSC in
attending or otherwise participating in JSC meetings.
3.1.4 Decision Making. All decisions of the JSC shall be made by
majority vote.
**************************************************************.
3.1.5 Responsibilities of the JSC. In addition to its general
responsibility to oversee and coordinate the development of
Compounds and Products in the Field according to the Global
Research and Development Plan and ensure a regular flow of
research and development information between the Parties, the
JSC shall in particular:
(a) develop the Global Research and Development Plan and the
Annual Development Plan and Budget for the remainder of
calendar year 1999 and for calendar year 2000 within sixty
(60) days after the Effective Date;
(b) review and update as necessary the Global Research and
Development Plan and develop an Annual Development Plan
and Budget for activities under the Global Research and
Development Plan for subsequent calendar years no later
than the October 31 immediately preceding each such
subsequent calendar year;
(c) oversee the activities of each Party's project team that
is performing such Party's obligations under the Research
Program;
(d) facilitate the flow of information between the Parties
with respect to all development work being conducted for
each Compound and Product in the Field on a worldwide
basis;
(e) review and approve all scientific and clinical protocols,
which shall provide that all preclinical and clinical
development work under this Agreement shall be conducted
in accordance with GLPs and GCPs;
(f) review and approve the contents and filing of INDs,
applications for Regulatory Approval, and related and
supporting submissions to Regulatory Authorities; and
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June 26, 2003 Restated & Amended Collaboration Agreement Page 25
(g) until such time as the MSC is formed, review and approve
premarketing activities and expenses.
3.2 Marketing Steering Committee.
3.2.1 Formation; Membership. As soon as agreed by the JSC, but not
later than thirty (30) days after the initiation of the first
Phase III Clinical Study of a Product, ViroPharma and Wyeth
shall establish a Marketing Steering Committee (the "MSC") to
develop and coordinate a Copromotion Territory
Commercialization Plan and Annual Commercialization Plans and
Budgets and to oversee the execution of each Party's
responsibilities in the Copromotion Territory under the
Copromotion Territory Commercialization Plan and the applicable
Annual Commercialization Plan and Budget. The MSC shall be
composed of an equal number of from two (2) to four (4)
representatives from each Party as appointed by such Party,
which representatives shall have expertise suitable to the
then-current activities of the collaboration. The MSC shall
initially have two (2) representatives from each Party, but the
MSC may change its size from time to time by mutual consent of
its members, provided, however, that the size of the MSC shall
be no less than four (4) members and no greater than eight (8)
members. A Party may replace one or more of its representatives
from time to time upon written notice to the other Party. From
time to time, the MSC may establish subcommittees to oversee
specific projects or activities and such subcommittees shall be
constituted as the MSC shall determine, but shall always
include at least one (1) member from each Party. The MSC will
exist for so long as a Product is Promoted by both of the
Parties in the Copromotion Territory pursuant to this Agreement
unless otherwise agreed, in writing, by the Parties.
3.2.2 Chairperson; Secretary. The chairperson of the MSC shall be
designated by Wyeth. The chairperson will be responsible for
scheduling meetings of the MSC, preparing agendas for meetings,
sending to all MSC members notices of all regular meetings and
agendas for such meetings at least five (5) business days
before such meetings. The chairperson shall appoint a secretary
for each meeting who will record the minutes of the meeting,
circulate copies of meeting minutes to the Parties and each MSC
member promptly following the meeting for review, comment and
approval and finalize approved meeting minutes.
3.2.3 Meetings. After the MSC is formed in accordance with Section
3.2.1, the MSC shall meet at least once each Calendar Quarter,
unless otherwise mutually agreed by the Parties. Either Party
may call a special meeting of the MSC on fifteen (15) days
written notice to the other Party and each of the MSC members.
Such written notice shall include an agenda for the special
meeting. Meetings, including, without limitation, special
meetings, of the MSC will alternate between the offices of the
Parties,
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June 26, 2003 Restated & Amended Collaboration Agreement Page 26
unless otherwise agreed by the members of the MSC, or may be
held telephonically or by video-conference. Meetings of the MSC
shall be effective only if at least one (1) representative of
each Party is in attendance or participating in the meeting.
Members of the MSC shall have the right to participate in and
vote at meetings by telephone. The most senior attending
representative of each Party on the MSC shall have the right to
vote on behalf of any members of the MSC from such Party not
attending a MSC meeting in person or by telephone. Each Party
shall be responsible for expenses incurred by its employees and
its members of the MSC in attending or otherwise participating
in MSC meetings.
3.2.4 Decision Making. All decisions of the MSC shall be made by
majority vote,
**************************************************************.
3.2.5 Responsibilities of the MSC. In addition to its general
responsibility to oversee and coordinate the Commercialization
of Products in the Copromotion Territory according to the
Copromotion Territory Commercialization Plan, the MSC shall in
particular:
(a) not later than sixty (60) days after the filing of the
first application for Regulatory Approval of a Product in
the Copromotion Territory, complete and approve a
Copromotion Territory Commercialization Plan for such
Product and an Annual Commercialization Plan and Budget for
such Product covering the period through the end of the
first full calendar year after anticipated Regulatory
Approval;
(b) oversee and coordinate the activities of the Parties in
marketing, selling and distributing Products in the
Copromotion Territory during the Term of this Agreement
following Regulatory Approval of such Products in the
Copromotion Territory; and
(c) not later than September 30 of each year after formation of
the MSC establish an Annual Commercialization Plan and
Budget describing each of the Parties' Commercialization
activities and forecast the expected sales level of
Products each in the Copromotion Territory during the
following calendar year, which will guide the schedule of
production of Products.
3.3 Executive Steering Committee.
3.3.1 Formation; Membership. Within thirty (30) days after the
Effective Date, ViroPharma and Wyeth shall establish an
Executive Steering Committee (the "ESC") to resolve disputes
arising within the JSC and the MSC. The ESC shall be composed
of two (2) representatives appointed
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June 26, 2003 Restated & Amended Collaboration Agreement Page 27
by each of ViroPharma and Wyeth, provided, however, that no
such representative is also a member of either the JSC or the
MSC. A Party may replace one (1) or more of its representatives
from time to time upon written notice to the other Party. The
ESC shall exist until the expiration or earlier termination of
this Agreement.
3.3.2 Chairperson; Secretary. The chairperson of the ESC shall be
designated by Wyeth. The chairperson will be responsible for
scheduling meetings of the ESC, preparing agendas for meetings,
sending to all ESC members notices of all regular meetings and
agendas for such meetings at least five (5) business days
before such meetings. The chairperson shall appoint a secretary
for each meeting who will record the minutes of the meeting,
circulate copies of meeting minutes to the Parties and each ESC
member promptly following the meeting for review, comment and
approval and finalize approved meeting minutes.
3.3.3 Meetings. The ESC shall meet on an as needed basis, provided,
however, that the ESC shall meet and decide on each matter
presented to it within thirty (30) calendar days after each
such matter is referred to it by the JSC or the MSC, as
applicable. A matter shall be considered referred to the ESC as
of the date that either Party provides each member of the ESC
with a written description of the disputed matter, which
written description shall include the positions taken by each
member of the JSC or MSC, as applicable, as to such matter, all
other information relevant to such matter and a copy of the
minutes of each JSC or MSC meeting, as applicable, at which
such matter was discussed. Within ten (10) days after such
matter is so presented to the ESC, the chairman of the ESC
shall notify each member of the ESC of the date, time and
location of the ESC meeting to address such matter. The
meetings of the ESC will alternate between the offices of the
Parties, unless otherwise agreed by the members of the ESC, or
may be held telephonically or by video-conference. Meetings of
the ESC shall be effective only if at least one (1)
representative of each Party is in attendance or participating
in the meeting. An attending or participating representative of
a Party shall have the right to vote on behalf of non-attending
or non-participating member from such Party. Each Party shall
be responsible for expenses incurred by its employees and its
members of the ESC in attending or otherwise participating in
ESC meetings.
3.3.4 Decision Making. All decisions of the ESC shall be made by
majority vote,
***********************************************************.
3.3.5 Dispute Resolution. If the ESC is unable to reach a decision
with respect to any matter, such matter shall be referred for
resolution ********************. The decision *****************
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June 26, 2003 Restated & Amended Collaboration Agreement Page 28
with respect to such matter pursuant to this Section 3.3.5
shall be final and binding upon each of the Parties.
Notwithstanding the foregoing, if an unresolved matter is
presented ******************** for resolution as provided in
this Section 3.3.5, ******************** refer the matter back
to the ESC or the JSC, as applicable, for further consideration
with a specified date by which the ESC or JSC, as applicable,
must either resolve the matter or resubmit the matter
**************** for final resolution.
3.4 Authority. The Parties agree that, in voting on matters as
described in this Article 3, it shall be conclusively presumed
that each voting member of the JSC, MSC and ESC has the authority
and approval of such member's respective senior management in
casting his or her vote and decisions of the JSC, MSC and ESC
made in accordance with this Article 3 shall be binding upon each
of the Parties.
3.5 Project Coordinators. Each Party shall designate one or two of
its employees as project coordinator(s) for all of the activities
contemplated under this Agreement. Such project coordinators will
be responsible for the day-to-day coordination of the
collaboration contemplated by this Agreement and will serve to
facilitate communication between the Parties. A Party may, from
time to time, replace its designated project coordinator(s) upon
providing the other Party with written notice to that effect.
4. RESEARCH AND DEVELOPMENT.
4.1 The Research Program.
4.1.1 General. Under the terms and conditions set forth herein, Wyeth
and ViroPharma will collaborate in the conduct of a
collaborative research program for the (i) identification and
validation of Targets that may become Collaboration Targets and
assay and screening methods utilizing such Targets and (ii) the
discovery, identification, screening, and pre-clinical and
clinical development of Compounds and Products active against
Collaboration Targets for use in the Field (collectively, the
"Research Program"). The Research Program shall consist of a
Screening Phase, a Screening Phase Tail, if applicable, and
with respect to any Compound identified by the JSC as a Hit
during the Screening Phase, a Research Phase and, if warranted,
a Development Phase. The Screening Phase of the Research
Program (the "Screening Phase") will be focused on the
development of Targets that may become Collaboration Targets,
assays and Screening methods and the Screening of the
ViroPharma Chemical Library, the Wyeth Chemical Library and any
other library selected by mutual agreement of the Parties for
the identification and validation of Hits. The Research Phase
of the Research Program (the "Research Phase") will be focused
on a medicinal chemistry program for the further evaluation of
Hits, the development and validation of Lead
--------------------------------------------------------------------------------
June 26, 2003 Restated & Amended Collaboration Agreement Page 29
Compound candidates, including, without limitation, Derivatives
of Hits, screening and testing of Lead Compound candidates to
identify and validate Lead Compounds, the optimization of Lead
Compounds and their Derivatives, further preclinical Research
and Screening of Lead Compounds to identify and select
Development Candidates, and the further preclinical Development
of Development Candidates. The Development Phase of the
Research Program (the "Development Phase") will be focused on
the clinical Development of Development Candidates and
Products.
4.2 Research & Development Plans.
4.2.1 Global Research and Development Plan. Within thirty (30) days
following its formation, the JSC shall prepare and approve a
global research and development plan (the "Global Research and
Development Plan"). The Global Research and Development Plan
shall consist of those tasks that the Parties agree are
essential to the validation of Targets that may become
Collaboration Targets, the discovery, validation and
preclinical and clinical development of Compounds and Products
which are directed against Active Collaboration Targets for use
in the Field, and obtaining Regulatory Approval for Products in
the world. The Global Research and Development Plan shall be
kept current by the JSC, updated on such schedule as the JSC
may determine but not less often than once per calendar year.
The Global Research & Development Plan may only be modified or
amended upon written approval of the JSC.
4.2.2 Annual Development Plans. Within thirty (30) days following its
formation, the JSC shall prepare and approve an annual
development plan and budget (the "Annual Development Plan and
Budget") addressing the collaborative Screening, Research and
Development activities to be carried out by the Parties during
the remainder of calendar year 1999 pursuant to this Agreement
and the Global Research and Development Plan. Thereafter, on or
before October 31 of each year, the JSC shall prepare and
approve an Annual Development Plan and Budget addressing the
collaborative Screening, Research and Development activities to
be undertaken by the Parties during the following calendar year
pursuant to this Agreement and the then current Global Research
and Development Plan. Each Annual Development Plan and Budget
shall include, without limitation, detailed plans for the
characterization and validation of Targets that may become
Collaboration Targets, the discovery and validation of
Compounds which are directed against Active Collaboration
Targets for use in the Field, the collaborative research and
development of Compounds and Products which are directed
against Active Collaboration Targets for use in the Field,
designation of which Party is responsible for each task,
staffing levels required to carry out such activities, and a
budget setting forth the estimated expenditures required to
carry out such
--------------------------------------------------------------------------------
June 26, 2003 Restated & Amended Collaboration Agreement Page 30
activities. The Annual Development Plan and Budget may only be
modified or amended upon written approval of the JSC.
4.3 Term of Research Program. The Research Program shall extend until the
termination of the latest of all of the following, including, if
applicable, the last meeting of the JSC necessary to determine whether
Hits in the Screening Phase Tail should be advanced to Development.
4.3.1 Screening Phase. The Screening Phase of the Research Program
shall begin on the Effective Date and, on a Collaboration
Target by Collaboration Target basis, unless extended in
accordance with this Section 4.3.1, shall extend until the five
(5) year anniversary of the Effective Date (the "Initial Term
of the Screening Phase") unless this Agreement is earlier
terminated in its entirety in accordance with Sections 11.4,
11.5, or 11.9.1 or with respect to such Collaboration Target in
accordance with Section 11.7. The Initial Term of the Screening
Phase of the Research Program may be extended by mutual
agreement of the Parties on terms substantially the same as
those set forth herein, unless otherwise agreed in writing by
the Parties. On or before the day one hundred eighty (180) days
before the expiration of the Initial Term of the Screening
Phase of the Research Program or the then current extension
thereof, as applicable, either Party may provide to the other
Party written notice of its desire to extend the Screening
Phase of the Research Program by one (1) additional year.
Promptly after the other Party's receipt of such written notice
the Parties shall commence discussions of the need and desire
to extend the Screening Phase of the Research Program and if
both Parties do not agree, in writing, to such extension on or
before the day sixty (60) days before the expiration of the
Initial Term of the Screening Phase or the then current
extension thereof, the Term of the Screening Phase shall expire
at the end of the Initial Term of the Screening Phase or the
then current extension thereof, as applicable.
4.3.2 Research Phase. The Research Phase of the Research Program
shall commence, on a Compound by Compound basis, upon the JSC's
designation of such Compound as a Hit, and shall extend until
the later of (a) the initiation of the Development Phase for
such Compound, or (b) such time as the JSC determines, in
writing, to discontinue all Research on such Compound and not
to advance such Compound to the Development Phase, unless
earlier terminated in accordance with Sections 11.4, 11.5, 11.7
or 11.9.1.
4.3.3 Screening Phase Tail. The Screening Phase Tail shall begin
during the term of this Agreement, on a Compound-by-Compound
basis, when such Compound is first screened and found by either
Party to have any activity against any Collaboration Target,
whether or not such Compound is determined to be a Hit, and
shall extend until the one (1) year anniversary
June 26, 2003 Restated & Amended Collaboration Agreement Page 31
of the end of the Term of the Screening Phase, unless this
Agreement is earlier terminated in its entirety in accordance
with Section 11.4 or 11.9.1 or pursuant to Section 11.7, with
respect to any Collaboration Target identified pursuant to
Section 11.7(b) for which the Research Program has been
terminated in accordance with Section 11.7, but regardless of
whether this Agreement is earlier terminated in accordance with
Section 11.5. Within thirty (30) days after the end of the
Screening Phase and within thirty (30) days after the end of
the Screening Phase Tail, each Party shall prepare an inventory
of Hits, Leads, Development Candidates, and Compounds in
Development. Within ten (10) business days after the end of
each Calendar Quarter during the Screening Phase Tail each
Party shall provide to the other a written report detailing all
data and information obtained by such Party with respect to any
Compound from a Tail Compound Series studied by such Party
during such Calendar Quarter. For the Calendar Quarter during
which the Screening Phase Tail ends, such written reports shall
be provided within ten (10) business days after the last day of
the Screening Phase Tail. At any time during the Screening
Phase Tail, either Party may propose in writing to the JSC that
a Compound from a Tail Compound Series subject to the Screening
Phase Tail be designated a Hit or Lead Compound and be further
developed. Additionally, within thirty (30) days after the last
day of the Screening Phase Tail, the JSC shall meet to
determine whether any of the Compounds from Tail Compound
Series studied by the Parties during the Screening Phase Tail
shall be designated as a Hit or Lead Compound and further
developed. If the JSC designates a Compound from a Tail
Compound Series as a Hit or Lead Compound, then the Parties
shall collaborate on further, Research, Development and
Commercialization of such Compound consistent with the terms of
this Agreement, regardless of whether this Agreement is earlier
terminated in accordance with Section 11.5, in which event,
such earlier termination shall be void and the effects of any
such termination arising in accordance with Section 11.5.2
shall be reversed such that each Party thereafter has the
rights it had immediately prior to such termination. If the JSC
in good faith determines not to designate any such Compound
from a Tail Compound Series as a Hit or a Lead Compound, then
the Party owning such Compound may further Develop and
Commercialize such Compound independently of the other Party
subject to the restrictions of Section 2.6.
4.3.4 Development Phase. With respect to any Compound, the
Development Phase shall commence on the date an IND is filed
seeking permission from the appropriate Regulatory
Authority(ies) to conduct clinical studies of such Compound and
shall continue until the JSC agrees to cease the clinical
development of such Compound or until a Product containing such
Compound has received Regulatory Approval in the Copromotion
Territory and each country of the Wyeth Territory where Wyeth
determines to apply for Regulatory Approval.
June 26, 2003 Restated & Amended Collaboration Agreement Page 32
4.4 Selection of Additional Targets, Biomolecules, Hits, Lead Compounds,
Development Candidates and Products.
4.4.1 Selection of Additional Targets. During the Screening Phase,
but subject to Section 1.23, the JSC may select one or more
additional Targets as Collaboration Targets against which to
Screen Compounds for activity. Likewise, during the term of the
Screening Program, but subject to Section 1.23, the JSC may
determine to discontinue Screening Compounds for activity
against one or more Targets or to reinstate the screening of
Compounds for activity against one or more Targets that were
previously discontinued from Screening.
4.4.2 Selection of Biomolecules as Compounds. Neither Party shall
Screen or conduct any Research or Development under this
Agreement on any Compound that is a Biomolecule unless the JSC
first approves, in writing, the inclusion of such Biomolecule
as a Compound under this Agreement.
4.4.3 Selection of Hits. The JSC shall review the data obtained by
the Parties in the Screening of Compounds, and, upon agreement
that such data support a determination that such Compound has
activity against the applicable Collaboration Target that meets
or exceeds an active threshold established by the JSC for that
Collaboration Target, such Compound shall be deemed to be a
Hit.
4.4.4 Selection of Lead Compounds. Based on criteria to be determined
by the JSC, the JSC may select Lead Compounds during the
Screening Phase, the Screening Phase Tail or the Research Phase
from (a) Hits in the ViroPharma Chemical Library, the Wyeth
Chemical Library or any other library the Parties shall
mutually agree to screen in connection with the Research
Program, and/or (b) any Derivative of any such Hits.
4.4.5 Selection of Development Candidates. During the Research Phase,
the JSC may select Development Candidates from those Compounds
designated by the JSC as Lead Compounds and any Derivatives
thereof. The JSC's selection of Development Candidates shall be
based upon the JSC's determination to develop such Compound
toward IND filing, based on criteria established by the JSC,
which criteria may include, without limitation, consideration
of the following factors: in vitro efficacy and potency, in
vivo oral activity, efficacy and potency, medicinal chemistry
criteria, toxicology studies required for IND filing, ancillary
pharmacology studies, clinical drug substance stability and
formulation, scale up compound synthesis and other competitive
and commercial factors, including without limitation, the
proprietary position of such Compound.
June 26, 2003 Restated & Amended Collaboration Agreement Page 33
4.4.6 Selection of Products. Development Candidates will become
Products upon the filing of an IND for such Development
Candidate, which filing will be made only after the JSC
determines that such Development Candidate is suitable for
clinical trials based on its preclinical profile and
competitive and other commercial considerations.
4.5 Conduct of the Research Program.
4.5.1 General. ViroPharma and Wyeth shall each use its respective
Commercially Reasonable Efforts to perform its obligations
under the Research Program in accordance with the Global
Research and Development Plan and the then current Annual
Development Plan and Budget and each Party shall perform such
obligations in accordance with applicable GLPs and GCPs.
ViroPharma and Wyeth shall each use its respective Commercially
Reasonable Efforts to together advance up to five (5) Compounds
to Product status by March 18, 2006. All activities to be
undertaken in the performance of the Research Program shall be
carried out by employees of the Parties and/or their respective
Affiliates, provided, however, that if either Party is able to
reasonably demonstrate, and the JSC agrees, that it would be in
the best interests of both Parties to contract with one (1) or
more Third Parties to perform certain tasks under the Research
Program, the Party responsible for such task may enter into a
contract with a Third Party to perform such task, which
contract shall be subject to the prior written approval of the
JSC. In determining whether to utilize the services of any
Third Party in conducting activities under the Research
Program, the Parties shall consider, inter alia, what would be
the most efficient and cost-effective means for accomplishing
the proposed activity, any relevant intellectual property
issues that may impede a Third Party's ability to perform the
proposed activity or that may warrant limiting the performance
of the proposed activity to one of the Parties, and other
relevant factors.
4.5.2 Discovery Headcount and Development Leadership. Wyeth shall
lead Research on any ******** Compounds and ViroPharma shall
lead Research on any ********* Compounds, in each case up to
and including the filing of an IND for such Compounds. The JSC
shall determine which Party will lead the further Development
of these Compounds and of any other Compound families, in each
case in the best interests of the alliance. The Parties shall
collectively devote ******** FTEs to Screening and Research
activities, unless otherwise agreed by unanimous vote of the
JSC. Of these, ViroPharma shall contribute ********* and
***********, and Wyeth shall contribute *********** and
**********, unless otherwise agreed by unanimous vote of the
JSC.
4.5.3 Performance of Clinical Work. The responsibility for performing
clinical studies of each Product will be assigned to Wyeth
and/or Third
June 26, 2003 Restated & Amended Collaboration Agreement Page 34
Party contractors selected by the JSC in accordance with this
Section 4.5. Notwithstanding the foregoing, ViroPharma shall be
given the opportunity to perform three (3) clinical studies in
the Development of Products in the Copromotion Territory under
this Agreement, which clinical studies shall consist of one (1)
Phase I Clinical Study, one (1) Phase II Clinical Study and one
(1) Phase III Clinical Study, ****************************.
Within thirty (30) days of the JSC's deciding that a clinical
study on a Product is warranted, *****************************.
If the JSC agrees, in writing, such agreement not to be
unreasonably withheld, ***************************, the Annual
Development Plan and Budget for the calendar year in which such
clinical study is to take place shall assign responsibility for
such clinical study to ViroPharma, or be amended to reflect
such assignment of responsibility. ****************************
**********************************. Notwithstanding the
foregoing, the JSC may assign to ViroPharma responsibility for
conducting additional clinical trials beyond the three (3)
described above in this Section 4.5.
4.5.4 Disagreement about Designation of a Compound as a Development
Candidate. If, (a) for ************** there has been no
Compound that is in Development Candidate status or beyond (for
the sake of clarity, Compounds which, (i) are being clinically
developed, (ii) for which an NDA or equivalent regulatory
approval is pending, or (iii) are being commercialized, would
all be considered to be in Development Candidate status or
beyond), and (b) the Parties disagree about advancing a
specific Lead Compound (that at such time is an Active Compound
directed against an Active Collaboration Target) to Development
Candidate status, then ViroPharma shall be permitted to develop
such Lead Compound on its own and at its sole expense,
notwithstanding any provision in Section 4.6 below to the
contrary. During the Option Period, (i) ViroPharma shall share
all data on such Compound with Wyeth, including any data
contained in regulatory submissions, (ii) ViroPharma shall not
enter into any agreement with a Third Party whereby such Third
Party obtains any right to develop or commercialize such
Compound other than in connection with an assignment by
ViroPharma of all of ViroPharma's rights and obligations under
this Agreement, to the extent permitted under Section 13.1
hereof, in connection with the transfer or sale of all or
substantially all of ViroPharma's assets, stock or business to
such Third Party or ViroPharma's merger or consolidation with
such Third Party, and (iii) notwithstanding, clause (ii) above,
ViroPharma, at ViroPharma's sole expense, may enter into an
agreement with a Third Party for the sole purpose of such Third
Party performing development work on such Compound on
ViroPharma's behalf, provided, that such Third Party obtains no
commercialization rights with respect to such Compound through
such agreement or otherwise. Until the end of the Option
Period,
June 26, 2003 Restated & Amended Collaboration Agreement Page 35
Wyeth shall have the exclusive option to reacquire the right to
jointly develop and commercialize such Compound as further
described below. If Wyeth exercises such option, Wyeth shall
pay ViroPharma **********************************************.
Thereafter, the Compound shall remain subject to the terms of
this Agreement for its continued Development and
Commercialization. If, before the end of the Option Period,
Wyeth has not exercised such option, ViroPharma shall pay Wyeth
**********************************, and Wyeth shall be entitled
to a royalty of ******************** of the Net Sales obtained
from the sale of such Compound in the world by ViroPharma, its
Affiliates or sublicensees.
4.6 Funding of the Research Program.
4.6.1 Pre-Development Expenses. The Parties shall share the
Pre-Development Expenses ***********.
4.6.2 Development Expenses. The Parties shall share the Development
Expenses, on a Product by Product basis, as follows:
(a) Wyeth shall be responsible for **************** and
ViroPharma shall be responsible for *************** of the
Development Expenses incurred by either Party.
(b) Expenses incurred by the Parties for the continued
development of a Product in a country of the Copromotion
Territory (i.e., for Phase IV clinical studies, studies
supporting approval of additional indications or labeling
changes or other post-marketing studies) will be treated
as Post-Approval Research and Regulatory Expenses pursuant
to Section 6.1.8(c).
4.6.3 Payment of Expenses; R&D Accounts. Subject to reconciliation as
provided in Section 4.6.5, each Party shall be responsible and
pay for the expenses incurred by it in performing its
obligations under the Research Program. Subject to the
limitations set forth in Section 4.6.4, each Party shall charge
all such expenses so incurred by it or its Affiliates to a
separate account created by such Party on its books and records
solely for the purpose of tracking expenses incurred in
connection with the Research Program (each, a "R&D Account").
Within thirty (30) days after the end of each Calendar Quarter,
each Party shall submit to the other Party a written summary of
all expenses charged to its R&D Account during such Calendar
Quarter, which summary shall be accompanied by reasonable
supporting documentation for such expenses.
4.6.4 Expense Limitations. The expenses charged by either Party to
its R&D Account in accordance with Section 4.6.3, shall not be
in an amount in
June 26, 2003 Restated & Amended Collaboration Agreement Page 36
excess of *************** of the amount included for such
expenses in the then current Annual Development Plan and Budget
unless the JSC recommends and the respective R&D management of
each Party approves such excess expenses. Additionally, the
Parties hereby agree that efforts of the employees of a Party
or its Affiliates in performing its obligations under the
Research Program shall be charged to such Party's R&D Account
at the rate of *************************************, or such
other amount as may be agreed to from time to time in writing
by the Parties, for efforts in support of preclinical studies
of a Compound or otherwise performed in the Screening Phase or
the Research Phase of the Research Program and
************************************, or such other amount as
may be agreed to from time to time in writing by the Parties,
for efforts in support of clinical studies of a Compound or
Product or otherwise performed as part of the Development Phase
of the Research Program, provided, however, that only those
efforts that are contemplated by the Global Research and
Development Plan and/or the applicable Annual Development Plan
and Budget shall be chargeable by a Party to its R&D Account,
except as otherwise approved in writing by the JSC. All
payments made by a Party to a Third Party in connection with
the performance of its obligations under the Research Program
shall be charged to such Party's R&D Account at such Party's
actual out-of-pocket cost. Expenses incurred by each Party for
equipment, materials and supplies utilized in performing its
obligations under the Research Program shall not be separately
charged to such Party's R&D Account, except for those expenses
incurred by a Party, with the prior written consent of the JSC,
in the purchase or making of equipment, materials or supplies
(other than common laboratory supplies, e.g., pipettes, test
tubes, petri dishes, reagents, and the like) that are to be
used exclusively in connection with the performance of such
Party's obligations under the Research Program (e.g.,
laboratory animals, compounds that are Development Candidates,
Products, placebo supplies, etc.), which expenses shall be
charged to such Party's R&D Account at such Party's actual
out-of-pocket expense incurred in purchasing or making such
equipment, materials or supplies. Notwithstanding the
foregoing, in the case of materials supplied to the Parties by
Wyeth for use in clinical trials of Compounds or Products,
Wyeth shall charge to its R&D Account its Fully Absorbed
Standard Cost for such materials, as adjusted to account for
manufacturing cost variances allocable to such materials.
4.6.5 Reconciliation of Expenses. Within sixty (60) days after the
end of each Calendar Quarter, Wyeth shall prepare a
reconciliation report, accompanied by reasonable supporting
documents and calculations, which reconciles the amounts
charged to each Party's R&D Account during such Calendar
Quarter pursuant to Section 4.6.3 separately for each of
Pre-Development Expenses and Development Expenses, including,
without limitation, making any necessary adjustments for prior
period
June 26, 2003 Restated & Amended Collaboration Agreement Page 37
manufacturing cost variances allocable to Products utilized in
Development, and the share of the Parties' aggregate
Pre-Development Expenses and separately, the Parties' aggregate
Development Expenses to be allocated to each of the Parties for
such Calendar Quarter in accordance with Sections 4.6.1 and
4.6.2. (For the sake of clarity: two separate reconciliations
will be made - one for Pre-Development Expenses, and one for
Development Expenses, and the amount of any R&D Shortfall
attributable to Pre-Development Expenses shall not be set-off
against the amount of any R&D Shortfall attributable to
Development Expenses.) Within thirty (30) days after Wyeth
delivers such reconciliation report to ViroPharma (the "R&D
Payment Period"), the net amount shown as being due either
Wyeth or ViroPharma for each of Pre-Development Expenses and
Development Expenses (each, an "R&D Shortfall") will be paid by
the Party owing such amount, provided, however, that in the
event ViroPharma is the Party owing either or both such amounts
to Wyeth,
(a) in 2002, if both ViroPharma and Wyeth have an R&D
Shortfall, and ViroPharma's R&D Shortfall is greater, then
ViroPharma may, by written notice to Wyeth provided within
the R&D Payment Period, *********************************;
and
(b) after 2002,
(i) ViroPharma may, by written notice to Wyeth provided
within the R&D Payment Period, ********************,
(ii) if in any single calendar year the sum of
ViroPharma's quarterly R&D Shortfalls for the year
attributable to Development Expenses, if any, less
the sum of Wyeth's
June 26, 2003 Restated & Amended Collaboration Agreement Page 38
quarterly R&D Shortfalls for the year attributable
to Development Expenses, if any, is greater than
********, then
a) ****************************************,
b) the reconciliation report for the last Calendar
Quarter of each calendar year shall include a
reconciliation of Pre-Development Expenses
*************************************, and
(iii) if in any single calendar year the sum of
ViroPharma's quarterly R&D Shortfalls for the year
attributable to Development Expenses, if any, less
the sum of Wyeth's quarterly R&D Shortfalls for the
year attributable to Development Expenses, if any,
is ********, then *********************************.
If, with respect to any calendar year, ViroPharma has an R&D
Shortfall for which it is to reimburse Wyeth, the balance in
the R&D Reimbursement Account has been exhausted, and
ViroPharma is unable or otherwise fails to pay to Wyeth all or
part of the R&D Shortfall before the end of the thirty (30) day
period required by this Section 4.6.5, then the unpaid portion
of the R&D Shortfall (the "Deferred Payment") shall accumulate
interest at the annual interest rate of twelve percent (12%),
compounded monthly, and shall be repaid to Wyeth
***********************************************************,
until all such R&D Shortfalls and any interest accrued thereon
are paid in full. Notwithstanding the foregoing, all Deferred
Payments
June 26, 2003 Restated & Amended Collaboration Agreement Page 39
and all interest accumulating thereon shall be due and payable
to Wyeth within seven (7) years after the end of the thirty
(30) day period described above in this Section 4.6.5. The
failure of ViroPharma to pay to Wyeth all or part of an R&D
Shortfall prior to the end of such seven (7) year period shall
not be a material breach of this Agreement for purposes of
Section 11.4.
4.6.6 Records and Audits. During the term of this Agreement, each
Party shall keep and maintain accurate and complete records
showing the expenses incurred by it in performing its
obligations under the Research Program during the three (3)
preceding calendar years, which books and records shall be in
sufficient detail such that each such expense can be (i)
allocated as a Pre-Development Expense or a Development Expense
and (ii) in the case of Development Expenses, allocated to
particular clinical trials or activities such that each Party's
responsibility for such expenses as provided in Section 4.6.2
can accurately be determined. Upon fifteen (15) days prior
written notice from a Party (the "Auditing Party"), the other
Party (the "Audited Party") shall permit an independent
certified public accounting firm of nationally recognized
standing selected by the Auditing Party and reasonably
acceptable to the Audited Party, to examine the relevant books
and records of the Audited Party and its Affiliates as may be
reasonably necessary to verify the reports submitted by the
Audited Party in accordance with Section 4.6.3 and the accuracy
of the reconciliation report prepared in accordance with
Section 4.6.5. An examination by a Party under this Section
4.6.6 shall occur not more than once in any calendar year and
shall be limited to the pertinent books and records for any
calendar year ending not more than thirty-six (36) months
before the date of the request. The accounting firm shall be
provided access to such books and records at the Audited
Party's facility(ies) where such books and records are normally
kept and such examination shall be conducted during the Audited
Party's normal business hours. The Audited Party may require
the accounting firm to sign a standard non-disclosure agreement
before providing the accounting firm access to the Audited
Party's facilities or records. Upon completion of the audit,
the accounting firm shall provide both Wyeth and ViroPharma a
written report disclosing whether the reports submitted by the
Audited Party are correct or incorrect and the specific details
concerning any discrepancies. No other information shall be
provided to the Auditing Party. If the accountant determines
that, based on errors in the reports so submitted, the
reconciliation report prepared in accordance with Section 4.6.5
is incorrect, the Parties shall promptly revise the
reconciliation report and any additional amount owed by one
Party to the other shall be paid within thirty days after
receipt of the accountant's report, along with interest at the
annual interest rate of twelve percent (12%), compounded
monthly from the date that such additional amount should have
first been paid, provided, however, that no such interest shall
be payable if the errors
June 26, 2003 Restated & Amended Collaboration Agreement Page 40
leading to the reconciliation report being incorrect were in
the reports provided by the Party to receive such additional
amount. Additionally, if the accountant determines that the
reports submitted by the Audited Party overstate the Audited
Party's expenses by more than ten percent (10%), the Audited
Party shall reimburse the Auditing Party for the expenses
incurred by the Auditing Party in conducting the audit.
4.7 Reporting and Disclosure.
4.7.1 Reports. Before each quarterly meeting of the JSC, ViroPharma
and Wyeth will each provide the other with written copies of
all materials they intend to present at the JSC meeting plus,
to the extent not set forth in the JSC materials, a written
report summarizing any other material data and information
arising out of the conduct of the Research Program. If after
receipt of any such report, either Party shall request
additional data or information relating to Research Program
data or Collaboration Technology licensed hereunder, the Party
to whom such request is made shall promptly provide to the
other Party such data or information that such Party reasonably
believes is necessary for the continued conduct of the Research
Program.
4.7.2 Quarterly Meeting. At the quarterly meeting of the JSC, Wyeth
and ViroPharma will review in reasonable detail (i) all data
and information generated in the conduct of the Research
Program by each Party, and (ii) all Collaboration Technology
licensed hereunder developed by the Parties.
4.7.3 Disclosure. During the term of the Research Program, the
Parties will promptly disclose to one another all data,
information, Inventions, techniques and discoveries (whether
patentable or not) arising out of the conduct of the Research
Program and all Inventions, techniques and discoveries (whether
patentable or not) included in Collaboration Technology
licensed hereunder.
5. MANUFACTURING OF PRODUCTS; REGULATORY MATTERS.
5.1 Manufacturing. Pursuant to the licenses granted to Wyeth in Section 2,
Wyeth shall have the exclusive right to manufacture, either itself
and/or through Third Parties selected by Wyeth, Products under the
Agreement. To the extent possible, Wyeth shall notify ViroPharma at
least one (1) year before any anticipated occurrence of the inability
of Wyeth to supply one hundred fifteen percent (115%) of the
commercial demands for Product in the Co-Promotion Territory as
forecast by the MSC. Within fifteen (15) days of such notice the MSC
shall meet to discuss the need to identify and obtain a secondary
source of Product supply to avoid or reduce the effect of any
shortage. Additionally, after the First Commercial Sale of a Product
in the Copromotion Territory, Wyeth shall, by December 1 of each year,
provide ViroPharma with an estimate of Wyeth's
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June 26, 2003 Restated & Amended Collaboration Agreement Page 41
expected Fully Absorbed Standard Cost for manufacturing the full
estimated commercial needs for such Product for sale in the
Copromotion Territory for the upcoming calendar year. Wyeth shall
provide ViroPharma with an updated estimate from time to time if an
unexpected event occurs that significantly raises or lowers the last
estimate that Wyeth provided to ViroPharma.
5.2 Labeling. To the extent permitted by applicable laws and regulations,
as may be reasonably requested by ViroPharma, Wyeth shall include in
all Product Labels, Labeling, and Packaging, as those terms are use in
the FD&C Act, a statement indicating that such Product was developed
in collaboration with ViroPharma.
5.3 Regulatory Approvals. Wyeth shall file, in its own name, all
applications for Regulatory Approval for Products in the Copromotion
Territory and in those countries of the Wyeth Territory where Wyeth,
in its sole discretion, determines it is commercially advantageous to
do so. Wyeth shall have the primary responsibility for communicating
with any Regulatory Authority regarding any application for Regulatory
Approval or any Regulatory Approval once granted, provided, however,
that ViroPharma shall, upon Wyeth's request, and at ViroPharma's
expense, (a) provide Wyeth with advice and reasonable assistance in
(i) developing a Regulatory Approval filing strategy for Products,
(ii) reviewing study reports from clinical trials of Products, (iii)
preparing applications for Regulatory Approval for Products, (iv)
preparing supplements to applications for Regulatory Approval for
Products, (v) responding to questions from Regulatory Authorities
regarding applications for Regulatory Approval or any supplement
thereto and (b) participate in interactions with Regulatory
Authorities concerning the Products.
5.4 Regulatory Reporting. Wyeth shall be responsible for filing all
reports required to be filed in order to maintain any Regulatory
Approvals granted for Products in the world, including, without
limitation, adverse drug experience reports. ViroPharma shall
cooperate with Wyeth in preparing and filing all such reports and,
upon Wyeth's request, provide Wyeth with any information in
ViroPharma's possession or Control which Wyeth reasonably deems to be
relevant to any such reports. Notwithstanding the foregoing, to the
extent ViroPharma has or receives any information regarding any
adverse drug experience which may be related to the use of any
Product, ViroPharma shall promptly provide Wyeth with all such
information in accordance with the Adverse Event Reporting Procedures
(as may be amended from time to time upon mutual agreement of the
Parties) set forth in Exhibit 5.4 attached hereto. Expenses (both
internal expenses and out-pocket costs paid to a Third Party) incurred
by a Party in performing its regulatory reporting obligations under
this Section 5.4 in connection with Regulatory Approvals in the
Copromotion Territory shall be charged by such Party to such Party's
Marketing Account for such Product as a Post-Approval Research and
Regulatory Expense. Wyeth shall be solely responsible for expenses
incurred by it in performing its regulatory reporting obligations
under this Section 5.4 in connection with Regulatory Approvals in the
Wyeth Territory.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 42
6. COMMERCIALIZATION OF PRODUCTS.
6.1 Commercialization in the Copromotion Territory.
6.1.1 Principles of Copromotion. Pursuant to the licenses granted to
Wyeth in Section 2, Wyeth shall have the exclusive right to
Commercialize each Product in the Field in the Copromotion
Territory during the term of this Agreement. Notwithstanding
the foregoing, ViroPharma, subject to this Section 6.1 and
Section 11.6, shall have the right to Promote each Product,
jointly with Wyeth, in the Copromotion Territory, using
professional sales representatives that are full time employees
of ViroPharma or that are employees of Contract Sales
Organizations ("CSOs"). The Parties' marketing activities shall
comply with the terms of this Agreement and the Copromotion
Territory Commercialization Plan.
6.1.2 Commercialization Plan. On a Product by Product basis, not
later than sixty (60) days after the filing of the first
application for Regulatory Approval of a Product in the
Copromotion Territory, the MSC shall prepare and approve a
rolling multiyear (not less than three (3) years) plan for
Commercializing such Product in the Copromotion Territory (the
"Copromotion Territory Commercialization Plan"), which plan
includes a comprehensive market development, marketing, sales,
supply and distribution strategy for such Product in the
Copromotion Territory. The Copromotion Territory
Commercialization Plan shall be updated by the MSC at least
once each calendar year such that it addresses no less than the
three (3) upcoming years. Not later than thirty (30) days after
the filing of the first application for Regulatory Approval of
a Product in the Copromotion Territory and thereafter on or
before September 30 of each calendar year, the MSC shall
prepare an annual commercialization plan and budget (the
"Annual Commercialization Plan and Budget"), which plan is
based on the then current Copromotion Territory
Commercialization Plan and includes a comprehensive market
development, marketing, sales, supply and distribution
strategy, including an overall budget for anticipated
marketing, promotion and sales efforts in the upcoming calendar
year (the first such Annual Development Plan and Budget shall
cover the remainder of the calendar year in which such Product
is anticipated to be approved plus the first full calendar year
thereafter). The Annual Commercialization Plan and Budget will
specify which Target Markets and distribution channels each
Party shall devote its respective Promotion efforts towards,
the personnel and other resources to be devoted by each Party
to such efforts, the number and positioning of Details to be
performed by each Party, as well as market and sales forecasts
and related operating expenses, for the Product in each country
of the Copromotion Territory, and budgets for projected
Pre-Marketing
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June 26, 2003 Restated & Amended Collaboration Agreement Page 43
Expenses, Sales and Marketing Expenses and Post-Approval
Research and Regulatory Expenses. In preparing and updating the
Copromotion Territory Commercialization Plan and each Annual
Commercialization Plan and Budget, the MSC will take into
consideration factors such as market conditions, regulatory
issues and competition.
6.1.3 Allocation of Target Markets; Sales Effort. On a Product by
Product basis, at least ninety (90) days before the launch of
such Product in a country of the Copromotion Territory and
thereafter, at least ninety (90) days before the beginning of
each calendar year, the MSC ************* in such country and
****************** on the following criteria and conditions:
(a) each *************** in each country of the Copromotion
Territory shall, as much as is reasonably possible,
***************** for such Product expected to be made in
such country of the Copromotion Territory in accordance
with the **************************** for the Promotion of
such Product in such country;
(b) the inclusion of ***********************************;
(c) Wyeth's aggregate **********************************; and
(d) the MSC may not, without the prior written consent of the
President of ViroPharma,********************************.
The number of Details assigned to a Party by the MSC in
accordance with this Section 6.1.3 shall be such Party's
***************************.
6.1.4 Incremental Sales Force Effort. If a Party is asked by the MSC
to deliver more sales force effort than that which is agreed by
the Parties to be more than a 50/50 selling effort in any
Calendar Quarter, and if such Party provides such increased
sales force effort (the "Incremental Sales Force Effort"), such
Party shall be entitled to charge the cost of the Incremental
Sales Force Effort to such Party's Marketing Account as an
Incremental Sales Force Effort Expense. The cost to be so
charged shall be at a rate approved by the MSC at the time such
Incremental Sales Force Effort is requested and shall be on a
cost per Detail basis. If Wyeth is the Party providing the
Incremental Sales Force Effort, Wyeth shall be reimbursed for
its Incremental Sales Force Expense by deducting the
Incremental Sales Force Expense incurred for such Calendar
Quarter from the Net Sales of such Product sold during such
Calendar Quarter prior to the allocation of Net Profits for
such Calendar Quarter. If ViroPharma is the Party providing the
Incremental Sales Force Effort, Wyeth shall reimburse
ViroPharma for its Incremental Sales Force Expense by
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June 26, 2003 Restated & Amended Collaboration Agreement Page 44
deducting such Incremental Sales Force Expense from the Net
Sales of such Product sold during such Calendar Quarter prior
to the allocation of Net Products for such Calendar Quarter and
distributing such deducted amount to ViroPharma simultaneously
with the distribution of Net Profits to ViroPharma for such
Calendar Quarter. The Party incurring the Incremental Sales
Force Expense shall report the same to the other Party as part
of the reports submitted under Section 6.1.8(d).
6.1.5 Extra Effort. If a Party expends more effort than originally
required of it by the Copromotion Territory Commercialization
Plan in order to perform Details that were part of the other
Party's Assigned Sales Force Effort, and that the other Party
fails to perform and which additional effort is approved in
advance by the MSC ("Extra Effort"), the first Party shall be
entitled to charge the costs of the Extra Effort ("Extra Effort
Expense") to its Marketing Account on a cost per Detail basis
consistent with Section 6.1.8(d), as well as twelve percent
(12%) annual interest, compounded monthly, accrued on the
amount charged for the period in which the Extra Effort is
expended. If Wyeth is the Party providing the Extra Effort,
Wyeth shall be reimbursed for its Extra Effort Expense by
deducting the Extra Effort Expense incurred for such Calendar
Quarter from the Net Sales of such Product sold during such
Calendar Quarter before the allocation of Net Profits for such
Calendar Quarter. If ViroPharma is the Party providing the
Extra Effort, Wyeth shall reimburse ViroPharma for its Extra
Effort Expense by deducting such Extra Effort Expense from the
Net Sales of such Product sold during such Calendar Quarter
before the allocation of Net Products for such Calendar Quarter
and distributing such deducted amount to ViroPharma
simultaneously with the distribution of Net Profits to
ViroPharma for such Calendar Quarter. The Party incurring the
Extra Effort Expense shall report the same to the other Party
as part of the reports submitted under Section 6.1.8(d).
6.1.6 Performance Metrics. The **************************** or as
part of any ******************* shall be determined according
to Detail reporting mechanisms and methodology that are
approved and applied consistently by the MSC.
6.1.7 Sales and Distribution; Recalls. During the term of this
Agreement, Wyeth shall be responsible for:
(a) distribution of all Products in the Copromotion Territory
hereunder, the booking of all sales with respect to such
Products and the performance of related services. If
ViroPharma receives any order for the Product in the
Copromotion Territory during the term of this Agreement,
it shall promptly refer such orders to Wyeth.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 45
(b) handling and implementing all recalls and market
withdrawals of any Product in the Copromotion Territory.
ViroPharma will make available to Wyeth, upon request, all
of ViroPharma's pertinent records that Wyeth may
reasonably request to assist it in effecting any recall or
market withdrawals. Except as expressly otherwise provided
below in this Section 6.1.7(b), the Parties shall share
equally all other costs of a recall or marketing
withdrawal of a Product in the Co-Promotion Territory.
Notwithstanding the foregoing, a Party shall bear any and
all costs of a recall or market withdrawal of a Product in
the Co-Promotion Territory to the extent such recall or
market withdrawal results from a negligent act or omission
or intentional misconduct on the part of such Party,
including, without limitation, the breach of any of such
Party's warranties under Sections 10.3(d) or 10.3(e)
hereof, and not from a negligent act or omission or
intentional misconduct on the part of the other Party. A
Party shall have no obligation to reimburse or otherwise
compensate the other Party for any lost profits or income
that may arise in connection with any such recall or
market withdrawal.
(c) handling all aspects of order processing, invoicing and
collection, inventory and receivables.
(d) providing customer support, including handling medical
queries, and performing other functions consistent with
consumer practice for pharmaceutical products consistent
with the then current Copromotion Territory
Commercialization Plan and the applicable Annual
Commercialization Plan and Budget.
6.1.8 Commercialization Expenses.
(a) Pre-Marketing Expenses. On a Product by Product and
country by country basis, before Regulatory Approval of
such Product in such country of the Copromotion Territory,
the Pre-Marketing Expenses incurred by the Parties with
respect to such Product in anticipation of obtaining
Regulatory Approval of such Product in such country shall
*****************************. As such Pre-Marketing
Expenses are incurred they shall be paid for by the Party
incurring such expenses, subject to reimbursement as set
forth in Section 6.1.8(g).
(b) Sales and Marketing Expenses. On a Product by Product and
country by country basis, after Regulatory Approval of
such Product in such country of the Copromotion Territory,
the Sales and Marketing Expenses incurred by the Parties
shall **********************. The costs of a Party's
professional
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June 26, 2003 Restated & Amended Collaboration Agreement Page 46
sales representatives and marketing personnel
***********************************.
(c) Post-Approval Research and Regulatory Expenses. On a
Product by Product and country by country basis, after
Regulatory Approval of such Product in such country of the
Copromotion Territory, the Post-Approval Research and
Regulatory Expenses incurred by the Parties in connection
with such Product in such country shall
*************************.
(d) Payment of Expenses; Marketing Accounts. Subject to
reconciliation as provided in Sections 6.1.8(f) or
6.1.8(g), as applicable, **************************.
Subject to the limitations set forth in Section 6.1.8(e),
each Party shall charge all such expenses so incurred by
it or its Affiliates to a separate account created by such
Party on its books and records solely for the purpose of
tracking expenses incurred in connection with the
marketing, Promotion, distribution and sale of Products in
the Copromotion Territory (each, a "Marketing Account").
Within thirty (30) days after the end of each Calendar
Quarter, each Party shall submit to the other Party a
written summary of all Pre-Marketing Expenses, Sales and
Marketing Expenses, Post-Approval Research and Regulatory
Expenses, Incremental Sales Force Expenses and Extra
Effort Expenses incurred by it in performing its
obligations in connection with the marketing, Promotion,
distribution and sale of Products in the Copromotion
Territory, charged to its Marketing Account during such
Calendar Quarter, which summary shall be accompanied by
reasonable supporting documentation for such expenses.
(e) Expense Limitations. The Pre-Marketing Expenses, Sales and
Marketing Expenses and Post-Approval Research and
Regulatory Expenses charged by either Party to its
Marketing Account in accordance with this Section 6.1.8,
shall not be in amount in excess of *********************
of the amount included for such expenses in the then
current Annual Commercialization Plan and Budget, unless
the MSC approves such excess expenses. All payments made
by a Party to any Third Party in connection with the
performance of its obligations in connection with the
Commercialization of a Product in the Copromotion
Territory shall be charged to such Party's Marketing
Account at such Party's actual out-of-pocket cost incurred
in accordance with the MSC approved contract entered into
with such Third Party.
(f) Reconciliation of Pre-Marketing Expenses. Within sixty
(60) days after the end of each Calendar Quarter, Wyeth
shall prepare a
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June 26, 2003 Restated & Amended Collaboration Agreement Page 47
reconciliation report, accompanied by reasonable
supporting documentation and calculations, which
reconciles the Pre-Marketing Expenses charged to each
Party's Marketing Account during such Calendar Quarter
pursuant to this Section 6.1.8 and the share of the
Parties' aggregate Pre-Marketing Expenses to be allocated
to each of the Parties for such Calendar Quarter in
accordance with this Section 6.1.8. Within thirty (30)
days after Wyeth delivers such reconciliation report to
ViroPharma, ***********************************. If, with
respect to any Calendar Quarter, ViroPharma has a
Pre-Marketing Expense Shortfall for which it is to
reimburse Wyeth and ViroPharma is unable or otherwise
fails to pay to Wyeth all or part of the Pre-Marketing
Expense Shortfall before the end of the thirty (30) day
period required by this Section 6.1.8(f), the unpaid
portion of the Pre-Marketing Shortfall would accumulate
interest at the annual interest rate of twelve percent
(12%), compounded monthly, and would be combined with any
R&D Shortfall and repaid to Wyeth in accordance with
Section 4.6.5.
(g) Reimbursement of Sales and Marketing Expenses and
Post-Approval Research and Regulatory Expenses. At the
time Wyeth, pursuant to Section 7.6.3, distributes to
ViroPharma, ViroPharma's share of
Net Profits obtained from the sale of a Product in a
country of the Copromotion Territory during any Calendar
Quarter, Wyeth shall also reimburse each of Wyeth and
ViroPharma for those Sales and Marketing Expenses,
Post-Approval Research and Regulatory Expenses,
Incremental Sales Force Effort Expenses, and Extra Effort
Expenses that are (i) directly allocable to the
Commercialization of such Product in such country during
such Calendar Quarter (ii) properly charged by such Party
to its Marketing Account and (iii) reported to the other
Party in accordance with this Section 6.1.8. Such
reimbursements shall be made solely from revenues obtained
by Wyeth which are attributable to the Net Sales of such
Product in such country of the Copromotion Territory,
**********************************. If the Net Sales
***************************************** shall be carried
over on such Party's Marketing Account into subsequent
Calendar Quarters *****************************.
6.1.9 Marketing and Promotional Materials. The MSC shall determine
the content, quantity and method of distribution of any
promotional materials related to the Product in the Copromotion
Territory, provided, however, that all such marketing and
promotional materials shall be subject to the approval of
Wyeth's and ViroPharma's legal, medical affairs, marketing and
regulatory affairs department before any use thereof by either
Party. Wyeth will be responsible for preparing and duplicating
such marketing
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June 26, 2003 Restated & Amended Collaboration Agreement Page 48
and promotional materials and shall provide reasonable
quantities of the same to ViroPharma for use by ViroPharma in
connection with its Promotion of the Product in the Copromotion
Territory hereunder. Each Party shall use only marketing and
promotional materials approved by the MSC and provided by
Wyeth. All copyright and other intellectual property rights in
said promotional materials shall remain vested in Wyeth.
Neither Party may not independently create, distribute or use
sales, promotion or other similar material relating to a
Product in the Copromotion Territory without the prior written
consent of either the MSC or the other Party.
6.1.10 Promotional Claims. Each Party shall limit the claims of safety
and efficacy that such Party or its sales force makes for a
Product in the Copromotion Territory to those that are
consistent with the approved labeling for such Product in such
country of the Copromotion Territory. Neither Party may add,
delete or modify claims of efficacy or safety in its Promotion
of any Product in the Copromotion Territory nor make any
changes in Promotion materials and literature approved by the
MSC. Each Party's Detailing and Promotion of a Product in the
Copromotion Territory shall be in strict adherence to all
regulatory, professional and legal requirements including,
without limitation, FDA's regulations and guidelines concerning
the advertising of prescription drug products, the American
Medical Association's Guidelines on Gifts to Physicians, the
PhRMA Guidelines for Marketing Practices, the ACCME Standards
for Commercial Support of Continuing Medical Education, the
then current Copromotion Territory Commercialization Plan for
the Product and any updates thereto.
6.1.11 Samples. When Detailing and Sampling the Product, each Party's
professional sales representative shall complete Sample Receipt
Forms provided by Wyeth. A copy of the completed Sample Receipt
Forms shall be left with the Physician receiving the Detail.
Such professional sales representative shall mail to Wyeth, in
pre-addressed, postage-paid envelopes provided by Wyeth, at the
close of each business day the original completed Sample
Receipt Forms for all Details performed by such professional
sales representative that day. A copy of all such Sample
Receipt Forms shall be kept by each such professional sales
representative. Each Party shall ensure that each of its
professional sales representatives fills out the Sample Receipt
Forms accurately, completely and timely. The Fully-Absorbed
Standard Cost incurred by Wyeth in providing and processing
Sample Receipt forms shall be charged by Wyeth to its Marketing
Account as a Sales and Marketing Expense.
6.1.12 Communications. Each Party shall be fully responsible for
disseminating accurate information regarding a Product to its
professional sales
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June 26, 2003 Restated & Amended Collaboration Agreement Page 49
representatives based on the Product's approved labeling and
information provided by the MSC.
6.1.13 Training. Each Party shall be responsible for the training of
its own professional sales representatives, in accordance
with the training requirements and training programs and
using training materials approved by the MSC and shall
require each of its professional sales representatives to
attend sales training for a Product before their Promotion of
such Product in the Copromotion Territory hereunder. After
the initial training meeting, each Party shall periodically
provide additional training, in accordance with the training
requirements and training programs and using training
materials approved by the MSC, to each of its professional
sales representatives Promoting Products hereunder. At the
discretion and upon approval of the MSC, any such training
meetings may be held jointly by the Parties. The expenses
incurred by each Party in training its professional sales
representatives before the launch of a Product shall be
charged to such Party's Marketing Account as a Pre-Marketing
Expense. The expenses incurred by each Party in training its
professional sales representatives after the launch of a
Product shall be charged to such Party's Marketing Account as
a Sales and Marketing Expense.
6.1.14 Compliance. In connection with its Promotion of the Product
in the Copromotion Territory, each Party shall comply and
shall cause each of its employees, representatives and
agents, including, without limitation, each of its
professional sales representatives, to comply with all laws
and regulations of the Copromotion Territory and shall do
nothing which such Party knows or reasonably should know
would jeopardize the goodwill or reputation of either Party
or the reputation of any Product.
6.1.15 Generic Product. On a Product by Product and country by
country (within the Copromotion Territory) basis, no later
than three (3) years before the expiration of the last to
expire of the Patent Rights conferring market exclusivity for
such Product in such country of the Copromotion Territory,
the Parties will determine by mutual agreement after good
faith discussions whether to jointly launch a generic version
of such Product in the Copromotion Territory and what the
terms and conditions regarding such Product will be. If the
Parties, on or before such time, are unable to agree to
jointly launch such a generic Product in such country, then
upon expiration of the relevant Patent Rights in such
country, and notwithstanding any other exclusive or
non-exclusive license granted under this Agreement, each
Party shall have the right and license to utilize the
Collaboration Technology and the other Party's Know-How
solely to the extent necessary to launch and Commercialize
its own generic version of such Product in such country and
thereafter shall have no further obligations to the other
Party with respect to such generic Product.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 50
6.2 Commercialization in the Wyeth Territory. Wyeth shall have the
sole right, either directly or through its Affiliates,
sublicensees and/or distributors, to market, distribute and
sell Products in the Wyeth Territory. Wyeth shall use its
Commercially Reasonable Efforts to sell each Product in those
countries of the Wyeth Territory for which Wyeth has obtained
Regulatory Approval for such Product. Wyeth shall be
responsible for all marketing and selling expenses for the
sale of Products in the Wyeth Territory and Wyeth shall have
the sole right and discretion to determine the price of
Products sold in the Wyeth Territory and to make all other
business decisions concerning the Commercialization of
Products in the Wyeth Territory.
7. CONSIDERATION; PROFIT SHARING.
7.1 Research Program Expense Reimbursements. Wyeth agrees to
provide ViroPharma
**********************************************************:
(a) Wyeth shall pay a nonrefundable fee of five million
dollars ($5,000,000.00) to ViroPharma on the first
business day after the Effective Date in consideration of
ViroPharma's agreement to participate in the JSC,
including the preparation, updating and implementation of
the Global Research and Development Plan and the Annual
Development Plans and Budgets; and
(b) Wyeth shall reimburse ViroPharma for up to
*********************** of ViroPharma's
*****************************************. Wyeth shall
create on its books and records an
******************************** for this purpose, which
********************************************************,
but shall be subject to adjustment, from time to time, by
ViroPharma's election to offset a portion of any R&D
Shortfall against the R&D Reimbursement Account, as
provided in Section 4.6.5.
7.2 Additional Development Expense Payments. Wyeth shall pay to
ViroPharma the following additional development expense
payments, each such payment being due and payable within
thirty (30) days after the occurrence of the corresponding
event:
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June 26, 2003 Restated & Amended Collaboration Agreement Page 51
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********* ***************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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**************************** ********************
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Each of the additional development expense payments set forth
above shall be payable one time only ************************,
except in the case of the additional development expense
payments payable for ********************, which additional
development expense payments shall be payable with respect to
*******************************, provided, however, that, with
respect to any Product that *********************************,
the receipt of *****************************************,
shall not result in
********************************************.
If, with respect to any Product, any of the above events
*********************** does not occur because the JSC
determines that
************************************************, such event
will be
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June 26, 2003 Restated & Amended Collaboration Agreement Page 52
deemed to have occurred on the date the JSC makes such a
determination for purposes of determining
***********************************. Additionally, if certain
of the above stated events occur
********************************, if such later events occur in
connection with the subsequent Development of another Product
hereunder,
*****************************************************. For
example,
**************************************************************.
7.3 Purchase of Equity. On the Effective Date, Wyeth and ViroPharma
shall enter into the Stock Purchase Agreement attached to this
Agreement as Exhibit 7.3, pursuant to which Wyeth shall
purchase, and ViroPharma will sell to Wyeth, shares of the
capital stock of ViroPharma on the terms and conditions set
forth therein.
7.4 Royalties.
7.4.1 Royalty Rates. In consideration for the licenses
granted to Wyeth under Section 2.1 hereof, Wyeth, on
a Product by Product and calendar year by calendar
year basis, will pay to ViroPharma royalties based on
Net Sales obtained by Wyeth or its Affiliates from
the sale of such Product in the Wyeth Territory,
which royalties shall be calculated as follows:
royalty = A + B + C, where:
A = either (i) for *************** of
the portion of Wyeth's and its
Affiliates' Net Sales obtained from the
sale of such ********** in the Wyeth
Territory (excluding Net Sales obtained
from the sale of such Product in any
countries where the obligation to pay
royalties under this Section 7.4.1 has
expired in accordance with Section
7.4.3 with respect to such Product),
which, during the calendar year in
question are less than or equal
********************, or (ii) for
************************** of the
portion of Wyeth's and its Affiliates'
Net Sales obtained from the sale of
such ******************* in the Wyeth
Territory (excluding Net Sales obtained
from the sale of such Product in any
countries where the obligation to pay
royalties with under this Section 7.4.1
has expired in accordance with Section
7.4.3 with respect to such Product)
which, during the calendar year in
question are less than or equal to
**************************************;
B = either (i) for
***************************** of the
portion of Wyeth's and its Affiliates'
Net Sales obtained from the sale of
such ************ in the Wyeth
Territory (excluding Net Sales obtained
from the sale of such
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June 26, 2003 Restated & Amended Collaboration Agreement Page 53
Product in any countries where the
obligation to pay royalties with
under this Section 7.4.1 has expired
in accordance with Section 7.4.3
with respect to such Product),
which, during the calendar year in
question are greater than
***************************** and
less than or equal to
****************************, or
(ii) for *************************
of the portion of Wyeth's and its
Affiliates' Net Sales obtained from
the sale of such
********************** in the Wyeth
Territory (excluding Net Sales
obtained from the sale of such
Product in any countries where the
obligation to pay royalties with
under this Section 7.4.1 has expired
in accordance with Section 7.4.3
with respect to such Product),
which, during the calendar year in
question are greater
*************************************;
and
C = either (i) for
************************************
of the portion of Wyeth's and its
Affiliates' Net Sales obtained from
the sale of such ******************
in the Wyeth Territory (excluding
Net Sales obtained from the sale of
such Product in any countries where
the obligation to pay royalties with
under this Section 7.4.1 has expired
in accordance with Section 7.4.3
with respect to such Product),
which, during the calendar year in
question are greater than
************************ or (ii) for
***************************** of the
portion of Wyeth's and its
Affiliates' Net Sales obtained from
the sale of such
*************************** in the
Wyeth Territory (excluding Net Sales
obtained from the sale of such
Product in any countries where the
obligation to pay royalties with
under this Section 7.4.1 has expired
in accordance with Section 7.4.3
with respect to such Product),
which, during the calendar year in
question are greater than
*************************************.
ViroPharma acknowledges and agrees that nothing in
this Agreement (including, without limitation, any
exhibits or attachments hereto) shall be construed as
representing an estimate or projection of either (i)
the number of Class A Products and/or Class B
Products that will or may be successfully developed
and/or commercialized or (ii) anticipated sales or
the actual value of the ViroPharma Technology, and
Compound or any Product and that the figures set
forth in this Section 7.4 or elsewhere in this
Agreement or that have otherwise been discussed by
the Parties are merely intended to define Wyeth's
royalty obligations to ViroPharma in the event such
sales performance is achieved. Wyeth MAKES NO
REPRESENTATION OR WARRANTY, EITHER EXPRESS OR
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June 26, 2003 Restated & Amended Collaboration Agreement Page 54
IMPLIED, THAT IT WILL BE ABLE TO SUCCESSFULLY DEVELOP
AND/OR COMMERCIALIZE ANY PRODUCT OR, IF
COMMERCIALIZED THAT ANY IT WILL ACHIEVE ANY
PARTICULAR SALES LEVEL OF SUCH PRODUCT(S).
7.4.2 Royalty Adjustments. For each Product sold in each
country of the Wyeth Territory in each Calendar
Quarter, the royalties payable to ViroPharma,
pursuant to Section 7.4.1 and/or, if applicable,
Section 11.5 or 11.6, for the Net Sales of such
Product in such country during such Calendar Quarter
may be reduced as set forth below, provided, however,
that in no event will such royalties in any country
be reduced by more than ************** by reason of
the adjustments set forth below:
(a) Unpatented Products. If in a given Calendar
Quarter during the Full Royalty Rate Period,
neither of Section 1.49(a) or (b) continues
to be true because one or more of Valid
Claims are invalidated in such country, the
royalties payable to ViroPharma, pursuant to
Section 7.4.1 and/or, if applicable, Section
11.5 or 11.6, for the Net Sales of such
Product in such country during such Calendar
Quarter shall be reduced to
********************* of the applicable
marginal rate set forth in Section 7.4.1
and/or, if applicable, Section 11.5 or 11.6.
To calculate such reduced royalty amount in
such countries, Net Sales will be allocated
among the royalty increments in Sections
7.4.1, 11.5 and/or 11.6, as applicable,
based on
********************************************
*********.
(b) Competition. If Competition (as defined
below in this Section 7.4.2 (b)) exists
during a given Calendar Quarter with respect
to a Product in any country, the royalties
payable to ViroPharma, pursuant to Section
7.4.1 and/or, if applicable, Section 11.5 or
11.6, for the Net Sales of such Product in
such country during such Calendar Quarter
shall be reduced to ************************
of the applicable marginal rate set forth in
Section 7.4.1 and/or, if applicable, Section
11.5 or 11.6. To calculate such reduced
royalty amount when Competition exists in
such countries, Net Sales will be allocated
among the royalty increments in Sections
7.4.1, 11.5 and/or 11.6, as applicable,
based on ************************. For
purposes of this Section 7.4.2(b),
Competition shall be deemed to exist if,
during the applicable Calendar Quarter, on a
Product by Product and country by country
basis, (i) one or more Third Parties is
selling a pharmaceutical product for use in
the Field containing as an active
ingredient, the Compound that is an active
ingredient in the Product being sold by or
on behalf of Wyeth, its Affiliates or
sublicensees in such country; and (ii) the
sales of such competing products (measured
on a unit basis) accounts for ************
or
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June 26, 2003 Restated & Amended Collaboration Agreement Page 55
more of the total market in such country.
The total market in such country shall be
the sum of (x) the number of units of the
affected Product sold by Wyeth, its
Affiliates or sublicensees in such country
during such Calendar Quarter and (y) the
number of units of competing products sold
by parties other than Wyeth, its Affiliates
or sublicensees in such country during such
Calendar Quarter.
7.4.3 Term of Royalty. The royalties payable pursuant to
Section 7.4.1 and, if applicable, pursuant to Section
11.5 or 11.6, as adjusted pursuant to Section 7.4.2,
will be payable on a country by country and Product
by Product basis during the Full Royalty Rate Period.
During the Reduced Royalty Rate Period for a Product,
Wyeth shall have an exclusive license, except as
otherwise provided under this Agreement, to use the
ViroPharma Know-How in the Field and ViroPharma's
interest in any Collaboration Know-How in the Field,
to make, have made, use, import, offer to sell and
sell such Product in such country. In consideration
of such license, Wyeth shall pay to ViroPharma a
royalty in the amount of three percent (3%) of the
Net Sales obtained from the sale by Wyeth and its
Affiliates of such Product in such country, which
royalty shall be payable only for sales made during
the Reduced Royalty Rate Period. On a country by
country basis, upon expiration of the Reduced Royalty
Rate Period, the license granted to Wyeth with
respect to such country under this Section 7.4.3
shall continue to be a perpetual license which
thereafter shall become irrevocable, fully-paid and
royalty-free license, exclusive except for the
license granted pursuant to Section 6.1.15.
7.5 Profit Split Payments.
7.5.1 Baseline Allocation of Profits. In consideration for
ViroPharma's provision of services in connection with
the Promotion of Products in the Copromotion
Territory pursuant to Section 6.1, Wyeth, on a
country by country basis, shall pay to ViroPharma
*********************** of the Net Profits obtained
from the sale of a Product in such country of the
Co-Promotion Territory, which percentage may be
adjusted from time to time in accordance with Section
7.5.3, (the most recently updated and adjusted
allocation, ViroPharma's "Baseline Allocation of Net
Profits") which payment shall be made to ViroPharma
at the times and in the manner set forth in Section
7.6.3. Wyeth shall retain the remaining portion of
Net Profits (Wyeth's "Baseline Allocation of Net
Profits"). Notwithstanding the foregoing, in any
Penalty Year, the allocation of Net Profits will be
adjusted in accordance with Section 7.5.2.
7.5.2 Temporary Adjustments to Distribution of Profits. In
a Penalty Year, each Party will be allocated a
portion of Net Profits which allocation will be made
based on the following formula:
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June 26, 2003 Restated & Amended Collaboration Agreement Page 56
*********************************
where
******************************************************.
7.5.3 Permanent Adjustment to Baseline Allocation of Profits.
If a Party incurs *************************, and the
other Party incurs no Lapse Year during this period,
then the Party incurring no Lapse Years may, at its
discretion, impose a permanent change in the Baseline
Allocation of Net Profits established in Section 7.5.1.
The new Baseline Allocation of Profits shall be
equivalent to the average proportion of Net Profits
received by such Party during the ********************
and shall become effective on January 1 of the year
following the
********************************************. Examples
of the calculation of the distribution of Net Profits
during Penalty Years and the imposition of new baseline
distributions are set forth in Exhibit 7.5.3.
7.5.4 Term of Profit Split Payments. With respect to a
Product, Wyeth, on a country by country basis in the
Copromotion Territory, shall pay to ViroPharma a
portion of Net Profits obtained from the sale of such
Product in such country of the Copromotion Territory as
set forth in Section 7.5.1 for so long as both Parties
are Promoting such Product in such country pursuant to
this Agreement.
7.6 Reports and Payments.
7.6.1 Cumulative Royalties. The obligation to pay royalties
under this Agreement shall be imposed only once with
respect to a single unit of a Product regardless of how
many Valid Claims included within the Patent Rights
would, but for this Agreement, be infringed by the
manufacture, use, import, offer for sale or sale of
such Product in the country of such manufacture, use or
sale.
7.6.2 Royalty Statements and Payments. Wyeth, within sixty
(60) days after the end of each Calendar Quarter shall
deliver to ViroPharma a report setting forth for such
Calendar Quarter the following information, on a
Product by Product basis, with respect to Products sold
in the Wyeth Territory, (a) the Net Sales of such
Product in the Wyeth Territory, (b) the basis for any
adjustments to the royalty payable for the sale of such
Product, and (c) the royalty due hereunder for the sale
of such Product. No such reports shall be due for any
Product before the First Commercial Sale of such
Product in the Wyeth Territory. The total royalty due
for the sale of Products during such Calendar Quarter
less any deductions made in accordance with Section
4.6.5 shall be remitted at the time such report is
made.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 57
7.6.3 Net Profit Statements and Payments.
(a) Estimated Statements. Within the later of
(i) thirty (30) days after the end of each
Calendar Quarter or (ii) fifteen (15) days
beyond the date on which Wyeth receives from
ViroPharma the report required under Section
6.1.8(d) with respect to such Calendar
Quarter, Wyeth shall deliver to ViroPharma a
report setting forth the following estimated
information with respect to Products sold in
the Copromotion Territory during such
Calendar Quarter: (i) the Net Sales of such
Product in each country of the Copromotion
Territory, (ii) the Net Profits obtained
from the sale of such Product in each
country of the Copromotion Territory, (iii)
the deductions made from Net Sales in
calculating such Net Profits, including,
without limitation, the computation of Cost
of Goods Manufacture for Sale, each Party's
Sales and Marketing Expenses, Incremental
Sales Force Expenses, if any, Extra Effort
Expenses, if any, and Post-Approval Research
and Regulatory Expenses, and (iv) the amount
of Net Profits to be allocated to each
Party, including an explanation of any
deviation from the Baseline Allocation of
Net Profits made in accordance with Section
7.5.1. No such reports shall be due with
respect to any Product before the First
Commercial Sale of such Product in the
Copromotion Territory.
(b) Actual Statements. After the First
Commercial Sale of a Product in the
Copromotion Territory, Wyeth, within sixty
(60) days after the end of each Calendar
Quarter, shall deliver to ViroPharma a
report setting forth for such Calendar
Quarter the following information, on a
Product by Product and Country by Country
basis: (i) the Net Sales of such Product in
each country of the Copromotion Territory,
(ii) the Net Profits obtained from the sale
of such Product in each country of the
Copromotion Territory, (iii) the deductions
made from Net Sales in calculating such Net
Profits, including, without limitation, the
computation of Cost of Goods Manufactured
for Sale in such detail as Wyeth customarily
uses for its own internal reporting
purposes, or as reasonably requested by
ViroPharma, each Party's Sales and Marketing
Expenses, Incremental Sales Force Expenses,
if any, Extra Effort Expenses, if any, and
Post-Approval Research and Regulatory
Expenses, and (iv) the amount of Net Profits
to be allocated to each Party, including an
explanation of any deviation from the
Baseline Allocation of Net Profits made in
accordance with Section 7.5.1. No such
reports shall be due with respect to any
Product before the First Commercial Sale of
such Product in the Copromotion Territory.
At the time such report is made, Wyeth
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June 26, 2003 Restated & Amended Collaboration Agreement Page 58
shall remit to ViroPharma the amount of Net
Profits allocated to ViroPharma for such
Calendar Quarter less any deductions made in
accordance with Section 4.6.5.
7.6.4 Taxes and Withholding. All payments under this
Agreement will be made without any deduction or
withholding for or on account of any tax unless such
deduction or withholding is required by applicable
laws or regulations. If the paying Party is so
required to deduct or withhold such Party will (i)
promptly notify the other Party of such requirement,
(ii) pay to the relevant authorities the full amount
required to be deducted or withheld promptly upon the
earlier of determining that such deduction or
withholding is required or receiving notice that such
amount has been assessed against the other Party,
(iii) promptly forward to the other Party an official
receipt (or certified copy) or other documentation
reasonably acceptable to the other Party evidencing
such payment to such authorities.
7.6.5 Currency. All amounts payable and calculations
hereunder shall be in United States dollars. As
applicable, Net Sales, Net Profits and any expenses
incurred by either Party shall be translated into
United States dollars in accordance with Wyeth's
customary and usual translation procedures,
consistently applied. If, due to restrictions or
prohibitions imposed by national or international
authority, payments cannot be made as provided in
this Article 7, the Parties shall consult with a view
to finding a prompt and acceptable solution, and
Wyeth will deal with such monies as ViroPharma may
lawfully direct at no additional out-of-pocket
expense to Wyeth. Notwithstanding the foregoing, if
payments arising in connection with the sale of
Products in any country cannot be remitted to
ViroPharma for any reason within six (6) months after
the end of the Calendar Quarter during which they are
earned, then Wyeth shall be obligated to deposit the
royalties in a bank account in such country in the
name of ViroPharma.
7.7 Maintenance of Records; Audits.
7.7.1 Record Keeping for the Copromotion Territory. Wyeth
shall keep and maintain accurate and complete records
in connection with the sale of Products in the
Copromotion Territory hereunder and each Party shall
keep and maintain accurate and complete records
showing the expenses incurred and efforts employed by
or on behalf of it or its Affiliates in Promoting
Products in the Copromotion Territory hereunder,
which books and records shall be in sufficient detail
to permit the accurate determination of Net Sales,
Net Profits (including, without limitation, the
deduction of each Party's expenses from Net Profits
pursuant to Section 1.70), and all other figures
necessary for the verification of the allocation of
Net Profits to be made under Section 7.5. Each Party
shall maintain and cause its Affiliates to maintain
such records for a period of at least
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June 26, 2003 Restated & Amended Collaboration Agreement Page 59
three (3) years after the end of the calendar year in
which they were generated.
7.7.2 Record Keeping for the Wyeth Territory. Wyeth shall
keep and shall cause its Affiliates and sublicensees
to keep accurate books and accounts of record in
connection with the sale of Products in the Wyeth
Territory in sufficient detail to permit accurate
determination of all figures necessary for
verification of royalties to be paid hereunder. Wyeth
and its Affiliates and sublicensees shall maintain
such records for a period of at least three (3) years
after the end of the calendar year in which they were
generated.
7.7.3 Audits. Upon thirty (30) days prior written notice
from a Party (the "Auditing Party"), the other Party
(the "Audited Party") shall permit an independent
certified public accounting firm of nationally
recognized standing selected by the Auditing Party
and reasonably acceptable to the Audited Party, to
examine, at the Auditing Party's sole expense, the
relevant books and records of the Audited Party and
its Affiliates as may be reasonably necessary to
verify the accuracy of the reports submitted by the
Audited Party in accordance with Section 7.6 and the
calculation and allocation of Net Profits or the
payment of royalties hereunder, as applicable. An
examination by a Party under this Section 7.7.3 shall
occur not more than once in any calendar year and
shall be limited to the pertinent books and records
for any calendar year ending not more than thirty-six
(36) months before the date of the request. The
accounting firm shall be provided access to such
books and records at the Audited Party's
facility(ies) where such books and records are
normally kept and such examination shall be conducted
during the Audited Party's normal business hours. The
Audited Party may require the accounting firm to sign
a standard non-disclosure agreement before providing
the accounting firm access to the Audited Party's
facilities or records. Upon completion of the audit,
the accounting firm shall provide both Wyeth and
ViroPharma a written report disclosing whether the
reports submitted by the Audited Party are correct or
incorrect, whether the calculation and allocation of
Net Profits are correct or incorrect, whether the
royalties paid are correct or incorrect, and, in each
case, the specific details concerning any
discrepancies. No other information shall be provided
to the Auditing Party.
7.7.4 Underpayments/Overpayments. If such accounting firm
correctly concludes that additional Net Profits were
due to ViroPharma or that additional royalties were
due to ViroPharma, Wyeth shall pay to ViroPharma the
additional Net Profits or additional royalties, as
applicable, together with any interest that may be
due thereon as provided in Section 7.8 within thirty
(30) days of the date Wyeth receives such
accountant's written report so correctly concluding.
If such underpayment exceeds five percent (5%) of the
Net Profits that were to be distributed to
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June 26, 2003 Restated & Amended Collaboration Agreement Page 60
ViroPharma or the royalties that were to be paid to
ViroPharma, as applicable, Wyeth also shall reimburse
ViroPharma for the out-of-pocket expenses incurred in
conducting the audit, except in the event that such
underpayment was due to any inaccurate information provided by
ViroPharma to Wyeth. If such accounting firm correctly
concludes that additional Net Profits were to be allocated to
Wyeth (i.e., there was an overpayment in the distribution of
Net Profits to ViroPharma) or that Wyeth overpaid royalties to
ViroPharma, ViroPharma will refund such overpayments to Wyeth,
together with any interest that may be due thereon as provided
in Section 7.8, within thirty (30) days of the date ViroPharma
receives such accountant's report so correctly concluding. If
the amount of such overpayment that is due to any inaccurate
information provided by ViroPharma to Wyeth exceeds five
percent (5%) of the Net Profits that were to be paid to
ViroPharma or the royalties that were to be paid to
ViroPharma, as applicable, ViroPharma also shall reimburse
AHCP for any out-of-pocket expenses incurred by Wyeth in
conducting the audit.
7.7.5 Confidentiality. All financial information of a Party which is
subject to review under this Section 7.7 shall be deemed to be
Confidential Information subject to the provisions of Article
9, and such Confidential Information shall not be disclosed to
any Third Party or used for any purpose other than verifying
payments to be made by one Party to the other hereunder,
provided, however, that such Confidential Information may be
disclosed to Third Parties only to the extent necessary to
enforce a Party's rights under this Agreement.
7.8 Interest. Any payment under this Article 7 that is more than
forty-five (45) days past due shall thereafter be subject to interest
at an annual percentage rate of twelve percent (12%). Likewise, any
overpayment that is not refunded within forty-five (45) days after the
date such overpayment was identified shall thereafter be subject to
interest at an annual percentage rate of twelve percent (12%),
provided, however, that if the overpayment is due to errors in reports
provided by the overpaid Party, such interest shall accrue from the
date the overpayment was made.
8. INTELLECTUAL PROPERTY.
8.1 Inventions. Subject to the provisions of Article 2, a Party shall own:
(a) all of its Prior Inventions, (b) all of its Non-Collaboration
Inventions, and (c) all Patent Rights claiming such Prior Inventions
and Non-Collaboration Inventions. Also, subject to the provisions of
Article 2, both Parties shall jointly own all Collaboration
Inventions, Collaboration Patent Rights and Collaboration Know-How.
All determinations of inventorship under this Agreement shall be made
in accordance with United States patent law.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 61
8.2 Patent Rights.
8.2.1 Prosecution and Maintenance of Patent Rights.
(a) ViroPharma's Prior Inventions and Non-Collaboration
Inventions. ViroPharma shall have the first right to
prepare, file, prosecute and maintain, throughout the
world, all Patent Rights claiming ViroPharma's Prior
Inventions and Non-Collaboration Inventions. With
respect to any ViroPharma Prior Invention or
Non-Collaboration Invention that is applicable in the
Field, ViroPharma shall give Wyeth an opportunity to
review and comment upon the text of the applications
before filing, shall consult with Wyeth with respect to
such application, and shall supply Wyeth with a copy of
the applications as filed, together with notice of its
filing date and serial number. ViroPharma shall keep
Wyeth advised of the status of the actual and
prospective patent filings (including, without
limitation, the grant of any Patent Rights that are
applicable in the Field), and shall provide advance
copies of any official correspondence related to the
filing, prosecution and maintenance of such patent
filings. If ViroPharma elects not to file a patent
application or to cease the prosecution and/or
maintenance of any Patent Right claiming a ViroPharma
Prior Invention or Non-Collaboration Invention that
relates to any Collaboration Target, any Active Compound
and/or any Assay and Screening Technology and that is
applicable in the Field, ViroPharma shall provide Wyeth
with written notice immediately upon the decision to not
file or continue the prosecution of such patent
application or maintenance of such patent and at least
sixty (60) days before ceasing prosecution and/or
maintenance of a particular Patent Right that is
applicable in the Field and, in such case, shall permit
Wyeth, at Wyeth's sole discretion, to file and/or
continue prosecution and/or maintenance of such Patent
Right on ViroPharma's behalf and at Wyeth's own expense.
If Wyeth elects to continue prosecution or maintenance,
ViroPharma shall execute such documents and perform such
acts, at Wyeth's expense, as may be reasonably necessary
to permit Wyeth to file, prosecute and/or maintain such
Patent Rights.
(b) Wyeth's Prior Inventions and Non-Collaboration
Inventions. Wyeth, at its own expense, shall have the
sole right to prepare, file, prosecute and maintain,
throughout the world, all Patent Rights claiming any of
Wyeth's Prior Inventions and/or Non-Collaboration
Inventions in countries and regions of the world of
Wyeth's choice. With respect to patent applications
filed or to be filed in the Copromotion Territory
claiming any Wyeth Prior
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June 26, 2003 Restated & Amended Collaboration Agreement Page 62
Inventionor Non-Collaboration Invention that relates to
any Active Compound and is applicable in the Field,
Wyeth shall give ViroPharma an opportunity to review and
comment upon the text of such applications before
filing, shall consult with ViroPharma with respect to
such applications, and shall supply ViroPharma with a
copy of such applications as filed, together with notice
of its filing date and serial number. Wyeth shall keep
ViroPharma advised of the status of such actual and
prospective patent filings (including, without
limitation, the grant of any Patent Rights that are
applicable in the Field), and shall provide advance
copies of any official correspondence related to the
filing, prosecution and maintenance of such patent
filings. If Wyeth elects not to file a patent
application or to cease the prosecution and/or
maintenance of any such Patent Right, Wyeth shall
provide ViroPharma with written notice immediately upon
the decision to not file or continue the prosecution of
such patent application or maintenance of such patent
and at least sixty (60) days before ceasing prosecution
and/or maintenance of a particular Patent Right that is
applicable in the Field and, in such case, shall permit
ViroPharma, at the ViroPharma's sole discretion, to file
and/or continue prosecution and/or maintenance of such
Patent Right on behalf of Wyeth at ViroPharma's own
expense. If ViroPharma elects to continue prosecution or
maintenance, Wyeth shall execute such documents and
perform such acts, at ViroPharma's expense, as may be
reasonably necessary to permit ViroPharma to file,
prosecute and/or maintain such Patent Rights.
(c) Collaboration Inventions. Wyeth shall have the first
right to prepare, file, prosecute and maintain any
Patent Right claiming any Collaboration Invention
throughout the world. Wyeth shall give ViroPharma an
opportunity to review the text of the applications
before filing, shall consult with ViroPharma with
respect thereto, and shall supply ViroPharma with a copy
of the applications as filed, together with notice of
its filing date and serial number. Wyeth shall keep
ViroPharma advised of the status of the actual and
prospective patent filings (including, without
limitation, the grant of any Patent Rights), and shall
provide advance copies of any official correspondence
related to the filing, prosecution and maintenance of
such patent filings. ViroPharma shall reimburse Wyeth
for fifty percent (50%) of the costs incurred by Wyeth
in preparing, filing, prosecuting and maintaining such
Patent Rights, which reimbursement will be made pursuant
to invoices submitted by Wyeth to ViroPharma no more
often than once per Calendar Quarter. If either Party at
any time declines to share in the costs of filing,
prosecuting and maintaining any such Patent Right in the
Field, on a country by country basis, such Party shall
provide the
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June 26, 2003 Restated & Amended Collaboration Agreement Page 63
other Party with thirty (30) days prior written notice
to such effect, in which event, such Party shall (i)
have no responsibility for any expenses incurred in
connection with such Patent Right after the end of such
thirty (30) day period and (ii) if the other Party
elects to continue prosecution or maintenance, assign to
the other Party all of its right, title and interest in
and to such Patent Right and the underlying
Collaboration Invention. If the other Party elects to
continue prosecution or maintenance, the assigning Party
shall execute such documents and perform such acts, at
the receiving Party's expense, as may be reasonably
necessary to effect an assignment of such Patent Rights
to the receiving Party on a country by country basis and
to allow the receiving Party to continue the prosecution
and maintenance of such Patent Right. Any such
assignment shall be completed in a timely manner to
allow the receiving Party to continue such prosecution
or maintenance. Upon the assignment of such Patent Right
to the other Party, such Patent Right shall cease to be
a Collaboration Patent Right on a country by country
basis for purposes of this Agreement, and, thereafter
shall be considered to be a Non-Collaboration Invention
of the Party receiving such assignment for all purposes
of this Agreement.
8.2.2 Enforcement of Patent Rights.
(a) Notice and Discontinuance of Infringement - General. If
either Wyeth or ViroPharma becomes aware of any
infringement, anywhere in the world, of any issued
patent within the Patent Rights, it will notify the
other Party in writing to that effect. Any such notice
shall include evidence to support an allegation of
infringement by such Third Party. The Party responsible
for prosecuting and maintaining such Patent Right in
accordance with Section 8.2.1 shall have the right, but
not the obligation, to take action to obtain a
discontinuance of such infringement or bring suit
against the Third Party infringer within three (3)
months from the date of said notice. ViroPharma shall
bear all the expenses of any suit brought by it claiming
infringement of any ViroPharma Patent Rights. Wyeth
shall bear all the expenses of any suit brought by it
claiming infringement of any Wyeth Patent Rights.
Subject to Section 8.2.2(c), the Parties shall share
equally the expenses of any suit brought by Wyeth
claiming infringement of any Collaboration Patent
Rights.
(b) Wyeth Patent Rights and ViroPharma Patent Rights. With
respect to suits claiming infringement of either the
Wyeth Patent
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June 26, 2003 Restated & Amended Collaboration Agreement Page 64
Rights or the ViroPharma Patent Rights, the Party not
bringing such suit (the "Non-Prosecuting Party") shall
have the right, before commencement of the trial, suit
or action brought by the other Party (the "Prosecuting
Party"), to join any such suit or action, and in such
event shall pay one-half of the costs of such suit or
action. In no event shall the Prosecuting Party enter
into any settlement, consent judgment or other voluntary
final disposition of such suit which would adversely
affect the Non-Prosecuting Party's rights under this
Agreement in any way without first obtaining the
Non-Prosecuting Party's written consent to do so, which
consent shall not be unreasonably withheld.
Additionally, if the Non-Prosecuting Party has joined in
the action and shared in the costs thereof as set forth
above, no settlement, consent judgment or other
voluntary final disposition of the suit may be entered
into without the consent of the Non-Prosecuting Party,
which consent shall not be unreasonably withheld. If the
Non-Prosecuting Party has not joined the suit or action,
the Non-Prosecuting Party will reasonably cooperate with
the Prosecuting Party in any such suit or action and
shall have the right to consult with the Prosecuting
Party and be represented by its own counsel at its own
expense. Any recovery or damages derived from a suit in
which the Non-Prosecuting Party has joined and shared
costs shall be used first to reimburse each of the
Prosecuting Party and the Non-Prosecuting Party for its
respective documented out-of-pocket legal expenses
relating to the suit, with any remaining amounts to be
shared equally by the Parties. Any recovery or damages
derived from a suit that the Non-Prosecuting Party has
not joined shall be retained by the Prosecuting Party.
(c) Collaboration Patent Rights. With respect to suits
claiming infringement of the Collaboration Patent
Rights, Wyeth shall have the first right to bring suit
claiming infringement of the Collaboration Patent
Rights. ViroPharma shall have the right, before
commencement of the trial, suit or action brought by
Wyeth, to join any such suit or action. In no event
shall Wyeth enter into any settlement, consent judgment
or other voluntary final disposition of such suit which
would adversely affect ViroPharma's rights under this
Agreement in any way without first obtaining
ViroPharma's written consent to do so, which consent
shall not be unreasonably withheld. If Wyeth declines to
bring suit, ViroPharma may proceed with an infringement
suit. Any recovery or damages derived from such a suit
shall be used first to reimburse each of Wyeth and
ViroPharma for their respective documented out-of-pocket
legal expenses relating to the suit, with any remaining
amounts to be shared equally by the Parties. If either
Party desires not to proceed with or participate in a
suit
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June 26, 2003 Restated & Amended Collaboration Agreement Page 65
against a Third Party for infringement of a
Collaboration Patent Right, such Party may, by written
notice to the other Party, elect not to share in the
expenses of such suit. In such event, the Party
continuing to prosecute the infringement action shall
have the right, but not the obligation to bring or
continue such suit at its own expense and shall be
entitled to retain any recovery or damages derived from
such suit, and the Party electing not to participate in
the suit shall reasonably cooperate with such other
Party in prosecuting such infringement action. The Party
bringing such action shall incur no liability to the
other Party as a consequence of such litigation or any
unfavorable decision resulting therefrom, including any
decision holding any of the Collaboration Patent Rights
invalid or unenforceable.
(d) Continuance of Infringement of the ViroPharma Patent
Rights. With respect to the ViroPharma Patent Rights,
if, after the expiration of the three (3) month period
specified in Section 8.2.2(a), ViroPharma has not
obtained a discontinuance of infringement of its Patent
Rights, filed suit against any Third Party infringer of
its Patent Rights, or provided Wyeth with information
and arguments demonstrating to Wyeth's reasonable
satisfaction that there is insufficient basis for the
allegation of infringement of ViroPharma's Patent
Rights, then Wyeth shall have the right, but not the
obligation, to bring suit against such infringer under
the ViroPharma Patent Rights and to join ViroPharma as a
party plaintiff, provided that Wyeth shall bear all the
expenses of such suit. ViroPharma will cooperate with
Wyeth in any suit for infringement of ViroPharma's
Patent Rights brought by Wyeth against a Third Party,
and shall have the right to consult with Wyeth and to
participate in and be represented by independent counsel
in such litigation at its own expense. Wyeth shall incur
no liability to ViroPharma as a consequence of such
litigation or any unfavorable decision resulting
therefrom, including any decision holding any of the
ViroPharma Patent Rights invalid or unenforceable.
(e) Continuance of Infringement of the Wyeth Patent Rights.
With respect to the Wyeth Patent Rights in the
Copromotion Territory which claim an Active Compound in
the Field, if, after the expiration of the three (3)
month period specified in Section 8.2.2(a), Wyeth has
not obtained a discontinuance of infringement of such
Patent Rights in the Field, filed suit against any Third
Party infringer of such Patent Rights, or provided
ViroPharma with information and arguments demonstrating
to ViroPharma's reasonable satisfaction that there is
insufficient basis for the allegation of infringement of
such Patent Rights in the Field, then
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June 26, 2003 Restated & Amended Collaboration Agreement Page 66
ViroPharma shall have the right, but not the obligation,
to bring suit against such infringer under such of the
Wyeth Patent Rights and to join Wyeth as a party
plaintiff, provided that ViroPharma shall bear all the
expenses of such suit. Wyeth will cooperate with
ViroPharma in any suit for infringement of such of
Wyeth's Patent Rights brought by ViroPharma against a
Third Party, and shall have the right to consult with
ViroPharma and to participate in and be represented by
independent counsel in such litigation at its own
expense. ViroPharma shall incur no liability to Wyeth as
a consequence of such litigation or any unfavorable
decision resulting therefrom, including any decision
holding any of such Wyeth Patent Rights invalid or
unenforceable.
8.2.3 Infringement and Third Party Licenses.
(a) Infringement of Third Party Patents - Course of Action.
If the making, having made, importing, exporting, using,
distributing, marketing, promoting, offering for sale or
selling any Compound and/or Product in the Field, under
this Agreement, is alleged by a Third Party to infringe
a Third Party's patent, the Party becoming aware of such
allegation shall promptly notify the other Party.
Additionally, if either Party determines that, based
upon the review of a Third Party's patent or patent
application, it may be desirable to obtain a license
from such Third Party with respect thereto so as to
avoid any potential suit between either Party and such
Third Party, such Party shall promptly notify the other
Party of such determination.
(b) Wyeth Option to Negotiate. Wyeth shall in the first
instance have the right to negotiate with said Third
Party for a suitable license or assignment, provided,
however, that Wyeth shall enter into no such agreement
unless it has first obtained ViroPharma's approval of
the terms of such agreement, including the amounts of
any royalties or payments, which approval shall not be
unreasonably withheld. If such negotiation results in a
consummated agreement, Wyeth shall make all payments to
the Third Party and such payments shall be deemed Third
Party License Fees for purposes of this Agreement.
(c) Third Party Infringement Suit. If a Third Party sues a
Party (the "Sued Party") alleging that the Sued Party's,
the Sued Party's Affiliates' or the Sued Party's
sublicensees' use of any Collaboration Target for the
Screening of Compounds pursuant to this Agreement, or
the Screening, Research, Development, or
Commercialization of any Compound and/or Product in the
Field during the term of and pursuant to this Agreement
infringes or will
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June 26, 2003 Restated & Amended Collaboration Agreement Page 67
infringe said Third Party's patent, then upon the Sued
Party's request and in connection with the Sued Party's
defense of any such Third Party infringement suit, the
other Party shall provide reasonable assistance to the
Sued Party for such defense. The Parties shall equally
share in the litigation expenses, including settlement
costs, royalties paid in settlement of any such suit,
and the payment of any damages to the Third Party, other
than Third Party License Fees paid pursuant to Section
8.2.3(e). The Party paying such expenses shall
periodically, but no more than once per Calendar
Quarter, invoice the other Party for its
******************* share of expenses incurred, which
invoices shall be accompanied by supporting
documentation reasonably showing the expenses so
incurred. Such invoices shall be paid within thirty (30)
days of receipt, provided, however, that if Wyeth is the
Sued Party, ViroPharma has earned royalties pursuant to
Section 7.4 or Net Profits pursuant to Section 7.5, and
Wyeth has invoiced ViroPharma for expenses under this
Section 8.2.3(c) but ViroPharma has not yet paid them
Wyeth may deduct ViroPharma's ******************* share
of such expenses from such royalties or Net Profits due
to ViroPharma. The obligation to share expenses pursuant
to this Section 8.2.3(c) shall not apply to activities
conducted by either Party: (a) with respect to any
Collaboration Target after such Target has ceased to be
a Collaboration Target pursuant to Section 4.4.1, (b)
with respect to any Compound that has not been declared
a Hit in accordance with Section 4.4.3, (c) with respect
to any Hit, Lead Compound or Development Candidate after
the JSC, in accordance with Section 4.4 and 2.4, has
determined not to advance the development of such Hit,
Lead Compound, or Development Candidate, or (d) after
the expiration or any termination of this Agreement.
(d) Other Third Party Licenses. If the Parties determine
that, after consultation with intellectual property
counsel, obtaining a license from a Third Party under
such Third Party's intellectual property rights is
necessary or useful for Screening, Research, Development
or Commercialization of any Compound or Product under
this Agreement, the JSC or the MSC shall determine which
Party shall have the responsibility to negotiate and
enter into an agreement with such Third Party for such a
license. The Party entering into such agreement shall
pay the Third Party License Fees due thereunder to such
Third Party, subject to reimbursement in accordance with
Section 8.2.3(e).
(e) Third Party License Fees. ViroPharma shall be
responsible for ******************* of all Third Party
License Fees paid by either Party pursuant to this
Section 8.2.3 and Wyeth shall be
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June 26, 2003 Restated & Amended Collaboration Agreement Page 68
responsible for ******************** of all Third Party
License Fees paid by either Party pursuant to this
Sections 8.2.3. Notwithstanding the foregoing, if,
pursuant to Section 8.2.3(d), Wyeth determines it is
necessary or desirable to obtain a license from a Third
Party to allow the Screening, Research, Development
and/or Commercialization of any Class A Compound or
Product containing a Class A Compound,
*************************. The Party receiving such
invoice shall reimburse the other Party for its share of
such Third Party License Fees within forty-five (45)
days after receiving the invoice therefor.
8.2.4 Patent Certifications. Each Party shall immediately give
written notice to the other of any certification of which it
becomes aware filed pursuant to 21 U.S.C.(S) 355(b)(2)(A),
or(S) 355(j)(2)(A)(vii) (or any amendment or successor statute
thereto) claiming that Patent Rights covering any Product are
invalid or that infringement will not arise from the
manufacture, use or sale of such Product by a Third Party.
Notwithstanding any provision to the contrary, in the event
that the Patent Rights at issue are owned and/or Controlled by
ViroPharma and ViroPharma has failed to bring an infringement
action against such Third Party at least fourteen (14) days
prior to expiration of the forty five (45) day period set
forth in 21 U.S.C.(S)355(c)(3)(C) (or any amendment or
successor statute thereto), Wyeth shall have the right to
bring such an infringement action, in its sole discretion and
at its own expense, in its own name and/or in the name of
ViroPharma. At Wyeth's request, ViroPharma shall, at its own
expense, provide Wyeth reasonable assistance to conduct such
infringement action, including, without limitation, causing
the execution of such legal documents as Wyeth may deem
necessary for the prosecution of such action. Wyeth shall
incur no liability to ViroPharma as a consequence of such
litigation or any unfavorable decision resulting therefrom,
including any decision holding any of the Patent Rights
invalid or unenforceable. In the event that Wyeth recovers any
sums in such litigation by way of damages or in settlement
thereof, Wyeth shall have the right to retain all such sums to
offset its costs, losses and expenses.
8.2.5 Patent Term Restoration. The Parties hereto shall cooperate
with each other in obtaining patent term restoration or its
equivalent in the world where applicable to Patent Rights. If
elections with respect to obtaining such patent term
restoration are to be made, the President, Wyeth-Ayerst Global
Pharmaceuticals, and the President, ViroPharma Incorporated,
or their designees, shall agree to an election and the Parties
shall abide by such election.
8.3 Trademarks. Wyeth shall, in its sole discretion, select and own all
Trademarks, Product names and Compound names to be used in connection
with the marketing, promotion and sale of any Product hereunder.
ViroPharma shall
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June 26, 2003 Restated & Amended Collaboration Agreement Page 69
neither use nor seek to register, anywhere in the world, any
trademarks which are confusingly similar to any Trademark or any other
trademarks, trade names, trade dress or logos used by or on behalf of
Wyeth, its Affiliates or sublicensees in connection with any Product.
Nothing in this Section 8.3 shall prevent or limit ViroPharma in any
way from continuing to use any trademark, trade name, trade dress or
logo adopted by ViroPharma before the date that the same or a
confusingly similar trademark, trade name, trade dress or logo is
adopted by Wyeth.
9. CONFIDENTIALITY.
9.1 Confidentiality. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing, the Parties agree that, for
the term of this Agreement and for five (5) years thereafter, each
Party (the "Receiving Party"), receiving hereunder any Confidential
Information of the other Party (the "Disclosing Party") shall keep
such Confidential Information confidential and shall not publish or
otherwise disclose or use such Confidential Information for any
purpose other than as provided for in this Agreement except for
Confidential Information that the Receiving Party can establish:
(a) was already known to the Receiving Party (other than under an
obligation of confidentiality), at the time of disclosure by the
Disclosing Party and such Receiving Party has documentary
evidence to that effect;
(b) was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the Receiving
Party;
(c) became generally available to the public or otherwise part of the
public domain after its disclosure or development, as the case
may be, and other than through any act or omission of a party in
breach of this confidentiality obligation;
(d) was disclosed to that Party, other than under an obligation of
confidentiality, by a Third Party who had no obligation to the
Disclosing Party not to disclose such information to others;
(e) was independently discovered or developed by or on behalf of the
Receiving Party without the use of the Confidential Information
belonging to the other Party and the Receiving Party has
documentary evidence to that effect.
9.2 Authorized Disclosure and Use.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 70
9.2.1 Disclosure. Notwithstanding the foregoing Section 9.1, each
Party may disclose Confidential Information belonging to the
other Party to the extent such disclosure is reasonably
necessary to:
(a) file or prosecute patent applications claiming Inventions
included within the Collaboration Technology,
(b) prosecute or defend litigation,
(c) exercise rights hereunder provided such disclosure is
covered by terms of confidentiality similar to those set
forth herein, and
(d) comply with applicable governmental laws and regulations.
In the event a Party shall deem it necessary to disclose
pursuant to this Section 9.2.1, Confidential Information
belonging to the other Party, the Disclosing Party shall to the
extent possible give reasonable advance notice of such
disclosure to the other Party and take reasonable measures to
ensure confidential treatment of such information.
9.2.2 Use. Notwithstanding the foregoing Section 9.1, each Party
shall have the right to use the other Party's Confidential
Information in carrying out its respective responsibilities
under this Agreement in both the conduct of the Research
Program and the Development and Commercialization of Lead
Compounds and Products. Similarly, subject to the license
granted in Article 2 and the terms of this Article 9, each
Party shall have the right to use the Joint Confidential
Information for any purpose under this Agreement.
9.3 SEC Filings. Either Party may disclose the terms of this Agreement to
the extent required, in the reasonable opinion of such Party's legal
counsel, to comply with applicable laws, including without limitation
the rules and regulations promulgated by the United States Securities
and Exchange Commission (the "SEC"). Notwithstanding the foregoing,
before disclosing this Agreement or any of the terms hereof pursuant
to this Section 9.3, the Parties will consult with one another on the
terms of this Agreement to be redacted in making any such disclosure.
If a Party discloses this Agreement or any of the terms hereof in
accordance with this Section 9.3, such Party agrees, at its own
expense, to seek confidential treatment of portions of this Agreement
or such terms, as may be reasonably requested by the other Party.
9.4 Publications. During the term of the Research Program, each Party will
submit to the other Party for review and approval all proposed
academic, scientific and medical publications and public presentations
relating to the Research Program, Lead Compounds, Development
Candidates, Products and/or Collaboration Technology for review in
connection with preservation of exclusive Patent Rights
June 26, 2003 Restated & Amended Collaboration Agreement Page 71
and/or to determine whether Confidential Information should be
modified or deleted. Written copies of such proposed publications and
presentations shall be submitted to the nonpublishing Party no later
than sixty (60) days before submission for publication or presentation
and the non-publishing party shall provide its comments with respect
to such publications and presentations within fifteen (15) business
days of its receipt of such written copy. The review period may be
extended for an additional thirty (30) days in the event the
nonpublishing Party can demonstrate a reasonable need for such
extension including, but not limited to, the preparation and filing of
patent applications. By mutual agreement, this period may be further
extended. ViroPharma and Wyeth will each comply with standard academic
practice regarding authorship of scientific publications and
recognition of contribution of other parties in any publications
relating to Research Program, Lead Compounds, Development Candidates,
Products and/or Collaboration Technology.
9.5 Public Announcements.
9.5.1 Coordination. The Parties agree on the importance of
coordinating their public announcements respecting this
Agreement and the subject matter thereof (other than academic,
scientific or medical publications that are subject to the
publication provision set forth above). ViroPharma and Wyeth
will, from time to time, and at the request of the other Party
discuss and agree on the general information content relating
to this Agreement, the Research Program, Lead Compounds,
Development Candidates, Products and/or Collaboration
Technology which may be publicly disclosed.
9.5.2 Announcements. Except as may be expressly permitted under
Sections 9.3 and 9.4, neither Party will make any public
announcement regarding this Agreement, the Research Program,
Lead Compounds, Development Candidates, Products and/or
Collaboration Technology without the prior written approval of
the other Party.
10. REPRESENTATIONS AND WARRANTIES.
10.1 Representations, Warranties of Each Party. As of the Effective Date,
each of ViroPharma and Wyeth hereby represents, warrants, and
covenants to the other Party hereto as follows:
(a) it is a corporation or entity duly organized and validly
existing under the laws of the state or other jurisdiction of
its incorporation or formation;
(b) the execution, delivery and performance of this Agreement by
such Party has been duly authorized by all requisite corporate
action and does not require any shareholder action or approval;
June 26, 2003 Restated & Amended Collaboration Agreement Page 72
(c) it has the power and authority to execute and deliver this
Agreement and to perform its obligations hereunder;
(d) the execution, delivery and performance by such Party of this
Agreement and its compliance with the terms and provisions
hereof does not and will not conflict with or result in a
breach of any of the terms and provisions of or constitute a
default under (i) a loan agreement, guaranty, financing
agreement, agreement affecting a product or other agreement or
instrument binding or affecting it or its property; (ii) the
provisions of its charter or operative documents or bylaws; or
(iii) any order, writ, injunction or decree of any court or
governmental authority entered against it or by which any of
its property is bound;
(e) it shall at all times comply with all applicable material laws
and regulations relating to its activities under this
Agreement;
(f) as of the Effective Date, its Patent Rights and Know-How are
existing and, to the best of its knowledge, are not invalid or
unenforceable, in whole or in part;
(g) it has the full right, power and authority to grant all of the
right, title and interest in the licenses granted to the other
Party under this Agreement;
10.2 Additional Representations and Warranties of ViroPharma. In addition
to the representations and warranties made by ViroPharma elsewhere in
this Agreement, ViroPharma, subject to Section 10.6, hereby
represents, warrants, and covenants to Wyeth that, as of the Effective
Date:
(a) except as disclosed in Exhibit 10.2(a), as of the Effective
Date, no Third Party has any right, title or interest in or to:
(i) any Collaboration Target listed in Exhibit 1.23,
(ii) any Class A Product, or
(iii) any of the ViroPharma Patent Rights, ViroPharma Know-How,
or any of ViroPharma's interest in the Collaboration
Patent Rights to the extent that any of the foregoing in
this Section 10.2(a)(iii) cover any Collaboration Target
listed in Exhibit 1.23, or any Class A Product,
with respect to which Wyeth has been granted or is to be
granted a license hereunder;
June 26, 2003 Restated & Amended Collaboration Agreement Page 73
(b) except as disclosed in Exhibit 10.2(b), it is the sole and
exclusive owner of the ViroPharma Patent Rights listed on
Exhibit 1.114 and the ViroPharma Know-How existing as of the
Effective Date, all of which are free and clear of any liens,
charges and encumbrances, and, with respect to such Patent
Rights and Know-How, ViroPharma has the right to grant to Wyeth
those licenses granted in Section 2.1 hereof;
(c) except as set forth in Exhibit 10.2(c) attached hereto, no
ViroPharma Prior Invention and no ViroPharma Patent Right and
no portion of the ViroPharma Know-How existing as of the
Effective Date and relating to either any Class A Compound or
to any Collaboration Target listed on Exhibit 1.23 is subject
to any funding agreement with any government or government
agency;
(d) to the best of its knowledge, as of November 1, 1999, the
practice of the ViroPharma Patent Rights listed on Exhibit
1.114, the use of the ViroPharma Know-How, the use of the
Collaboration Targets listed in Exhibit 1.23, and the
manufacture, use or sale of any ViroPharma Compound each, as of
the Effective Date, do not infringe on any issued patents owned
or possessed by any Third Party;
(e) to the best of its knowledge, as of the Effective Date, there
are no Third Party pending patent applications (other than
those which have been disclosed, in writing, by ViroPharma to
Wyeth prior to the signing of this Agreement) which, if issued,
would cover the development, manufacture or use of any
Collaboration Target or the development, manufacture, use or
sale of any Class A Compound arising from the ViroPharma
Chemical Library or any Product containing any Class A Compound
arising from the ViroPharma Chemical Library;
(f) as of the Effective Date, there are no claims, judgments or
settlements against or owed by ViroPharma or, to the best of
its knowledge, pending or threatened claims or litigation in
either case relating to the ViroPharma Patent Rights listed in
Exhibit 1.114, the ViroPharma Know-How, any Collaboration
Target, any ViroPharma Class A Compound or any ViroPharma Class
B Compound that ViroPharma, as of the Effective Date, plans to
Screen during the Screening Phase; and
(g) during the Term of this Agreement it will use diligent efforts
not to diminish the rights under the ViroPharma Patent Rights
or the ViroPharma Know-How granted to Wyeth hereunder,
including without limitation, by not committing or permitting
any actions or omissions which would cause the breach of any
agreements between itself and Third Parties which provide for
intellectual property rights applicable to the development,
manufacture or use of any Target or the development,
manufacture, use or sale of any Active Compound arising from
the ViroPharma Chemical
June 26, 2003 Restated & Amended Collaboration Agreement Page 74
Library and/or Product containing any Active Compound arising
from the ViroPharma Chemical Library, that it will provide
Wyeth promptly with notice of any such alleged breach, and that
as of the Effective Date, it is in compliance in all material
respects with any agreements with Third Parties relating to the
ViroPharma Patent Rights, the ViroPharma Know How, the Targets
and/or the Active Compounds arising from the ViroPharma
Chemical Library.
10.3 Additional Representations and Warranties of Wyeth. In addition to the
representations and warranties made by Wyeth elsewhere in this
Agreement, Wyeth, subject to Section 10.6, hereby represents,
warrants, and covenants to ViroPharma that, as of the Effective Date:
(a) except as disclosed in Exhibit 10.3(a), it is the sole and
exclusive owner of the Wyeth Patent Rights listed on Exhibit
1.7 and the Wyeth Know-How existing as of the Effective Date,
all of which are free and clear of any liens, charges and
encumbrances, and, with respect to such Patent Rights and
Know-How Wyeth has the right to grant to ViroPharma those
licenses granted in Section 2.2 hereof;
(b) to the best of its knowledge, as of the Effective Date, the
practice of the Wyeth Patent Rights listed on Exhibit 1.7, the
use of the Wyeth Know-How, and the manufacture, use or sale of
any Wyeth Compound each, as of the Effective Date, do not
infringe on any issued patents owned or possessed by any Third
Party;
(c) as of the Effective Date, there are no claims, judgments or
settlements against or owed by Wyeth or, to the best of its
knowledge, pending or threatened claims or litigation in either
case relating to the Wyeth Patent Rights listed in Exhibit 1.7,
the Wyeth Know-How, or any Wyeth Compound that Wyeth, as of the
Effective Date, plans to Screen during the Screening Phase;
(d) all units of Product supplied in the United States by Wyeth
pursuant to Section 5.1 will, as of the date of shipment or
delivery of such Product to a common carrier, not be
adulterated or misbranded within the meaning of the FD&C Act,
and not be an article which may not, under the provisions of
Sections 404, 505 or 512 of the FD&C Act, be introduced into
interstate commerce;
(e) all units of Product and containers for such Product supplied
by Wyeth pursuant to Section 5.1 for sale in the Copromotion
Territory shall be manufactured, processed, prepared, packed,
and, while in Wyeth's possession, held in accordance with all
applicable federal, state, and local laws and regulations,
including, without limitation, all current Good
June 26, 2003 Restated & Amended Collaboration Agreement Page 75
Manufacturing Practices and with all applicable Regulatory
Approvals in the Copromotion Territory; and
(f) during the Term of this Agreement it will use diligent efforts
not to diminish the rights under the Wyeth Patent Rights or the
Wyeth Know-How granted to ViroPharma hereunder, including
without limitation, by not committing or permitting any actions
or omissions which would cause the breach of any agreements
between itself and Third Parties which provide for intellectual
property rights applicable to the development, manufacture, use
or sale of any Active Compound arising from the Wyeth Chemical
Library and/or Product containing any Active Compound arising
from the Wyeth Chemical Library, that it will provide
ViroPharma promptly with notice of any such alleged breach, and
that as of the Effective Date, it is in compliance in all
material respects with any agreements with Third Parties
relating to the Wyeth Patent Rights, the Wyeth Know How and/or
the Active Compounds arising from the Wyeth Chemical Library.
10.4 Representation by Legal Counsel. Each Party hereto represents that it
has been represented by legal counsel in connection with this
Agreement and acknowledges that it has participated in the drafting
hereof. In interpreting and applying the terms and provisions of this
Agreement, the Parties agree that no presumption shall exist or be
implied against the Party which drafted such terms and provisions.
10.5 No Inconsistent Agreements. Neither Party has in effect and after the
Effective Date neither Party shall enter into any oral or written
agreement or arrangement that would be inconsistent with its
obligations under this Agreement.
10.6 Disclaimer. THE FOREGOING WARRANTIES OF EACH PARTY ARE IN LIEU OF ANY
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION,
ANY IMPLIED WARRANTIES OF NONINFRINGEMENT, ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR ANY IMPLIED WARRANTIES OF FITNESS FOR A PARTICULAR
PURPOSE ALL OF WHICH ARE HEREBY SPECIFICALLY EXCLUDED AND DISCLAIMED.
11. GOVERNMENT APPROVALS; TERM AND TERMINATION.
11.1 Government Approvals.
11.1.1 ViroPharma's and Wyeth's Obligations. Each of ViroPharma and
Wyeth shall use its good faith efforts to eliminate any concern
on the part of any court or government authority regarding the
legality of the proposed transaction, including, if required by
federal or state antitrust
June 26, 2003 Restated & Amended Collaboration Agreement Page 76
authorities, promptly taking all steps to secure government
antitrust clearance, including, without limitation, cooperating
in good faith with any government investigation including the
prompt production of documents and information demanded by a
second request for documents and of witnesses if requested.
11.1.2 Cooperation. ViroPharma and Wyeth will cooperate and use
respectively all reasonable efforts to make all other
registrations, filings and applications, to give all notices
and to obtain as soon as practicable all governmental or other
consents, transfers, approvals, orders, qualifications
authorizations, permits and waivers, if any, and to do all
other things necessary or desirable for the consummation of the
transactions as contemplated hereby. Neither Party shall be
required, however, to divest or out-license products or assets
or materially change its business if doing so is a condition of
obtaining approval under the HSR Act or other governmental
approvals of the transactions contemplated by this Agreement.
11.2 Term. The term of this Agreement will commence on the Effective Date
and extend, unless this Agreement is terminated earlier in accordance
with this Section 11, on a Product by Product and country by country
basis (a) in the Wyeth Territory until such time as the obligation to
pay royalties with respect to the sale of such Product in such country
expires in accordance with Section 7.4.3 and (b) in the Copromotion
Territory, until the later of (i) such time as the Parties are no
longer copromoting such Product in such country or (ii) if the Parties
discontinue the copromotion of Products pursuant to Section 11.6, such
time as the obligation to pay royalties with respect to the sale of
such Product in such country expires in accordance with Section 7.4.3.
11.3 Expiration. If at any time after the expiration of the Screening Phase
Tail, the Parties have determined, in accordance with Section 4.3.3,
not to advance any Compound from a Tail Compound Series as a Hit or
Lead Compound and there is otherwise no Active Compound hereunder,
this Agreement shall expire effective as of the later of (a) the date
the Parties have determined, in accordance with Section 4.3.3, not to
advance any Compound from a Tail Compound Series as a Hit or a Lead
Compound and (b) the date on which all Active Compounds have ceased to
be Active Compounds hereunder.
11.4 Termination for Cause.
11.4.1 Termination for Cause. This Agreement may be terminated
effective immediately by written notice by either Party at any
time during the Term of this Agreement for material breach by
the other Party, which breach remains uncured for ninety (90)
days in the case of nonpayment of any amount due (unless there
exists a bona fide dispute as to whether such payment is owing,
in which case the ninety (90) day period shall be tolled
June 26, 2003 Restated & Amended Collaboration Agreement Page 77
pending resolution of such dispute) and one hundred eighty
(180) days for all other breaches, each measured from the date
written notice of such breach is given to the breaching Party,
provided, however, that if such breach is not susceptible of
cure within the stated period and the breaching Party uses
diligent good faith efforts to cure such breach, the stated
period will be extended by an additional ninety (90) days.
11.4.2 Effect of Termination for Cause on License. If a Party
terminates this Agreement pursuant to this Section 11.4 (the
"Terminating Party"):
(a) all licenses granted by the Terminating Party to the
other Party hereunder will automatically terminate;
(b) all licenses granted by the other Party to the
Terminating Party will become fully paid up, irrevocable,
perpetual, royalty-free licenses;
(c) the other Party will assign the Terminating Party all
right, title and interest in and to: (i) all regulatory
filings and Regulatory Approvals pertaining to any
Product which regulatory filings and Regulatory
Approvals, if any, are owned or otherwise controlled by
the other Party, (ii) all of the other Party's interest
in the Collaboration Patent Rights and the Collaboration
Know-How, (iii) all of the other Party's interest in any
Trademark, including, without limitation, the good will
symbolized by such Trademark used for Products, and (iv)
all of the other Party's interest in any copyrights
necessary or useful for Commercializing Products;
(d) the other Party will have no right to receive royalties,
a share of Net Profits or any other payments which may
result from the sale of any Product, the occurrence of
any event or the conduct of any activity after the
effective date of such termination, provided, however,
that the other Party shall remain entitled to receive any
payments that accrued before the effective date of such
termination.
11.5 Termination for Convenience.
11.5.1 Right to Terminate. After December 9, 2003, either Party may
terminate this Agreement upon one hundred eighty (180) days
prior written notice to the other Party (a "Termination for
Convenience").
11.5.2 Effect of Termination for Convenience. Upon a Termination for
Convenience the non-terminating Party shall have a
royalty-bearing, perpetual, irrevocable, worldwide, exclusive
license under the other Party's Technology and the other
Party's interest in any Collaboration Technology to develop,
make, have made, use, import, offer for sale and sell Products
in the Field in the world. For the sake of clarity, in such
June 26, 2003 Restated & Amended Collaboration Agreement Page 78
event, the non-terminating Party shall have no rights with
respect to any Compound of the terminating Party, which
Compound, before the effective date of such termination, was
not yet designated as a Lead Compound or a Development
Candidate in accordance with Section 4.4. Additionally, in the
event of a Termination for Convenience, the terminating Party
shall assign to the non-terminating Party all right, title and
interest in and to any regulatory filings and Regulatory
Approvals pertaining directly to the Products. If a Termination
for Convenience occurs before the enrollment of the first
patient in a Phase III Clinical Trial in any country of the
world, the non-terminating Party, on a Product by Product
basis, would pay to the terminating Party a royalty of
************** of the Net Sales obtained from the sale of such
Product in the world by the non-terminating Party, its
Affiliates or sublicensees. If a Termination for Convenience
occurs after the completion of the first Phase III Clinical
Trial in any country of the world, the non-terminating Party,
on a Product by Product basis, would pay to the terminating
Party a royalty of ********************* of the Net Sales
obtained from the sale of such Product in the world by the
non-terminating Party, its Affiliates or sublicensees. Any
royalty that becomes payable under this Section 11.5.2 will be
payable on a country by country basis until the later of (i)
the last to expire, in such country, of the Patent Rights
included within the Collaboration Technology containing a Valid
Claim which would be infringed by the manufacture, use, import,
offer for sale, or sale of such Product in such country or (ii)
ten (10) years from the First Commercial Sale of such Product
in such country. The non-terminating Party shall provide
reports and pay such royalties to the terminating Party in the
manner set forth in Section 7.6.2.
11.6 Termination of ViroPharma's Right to Promote Products.
11.6.1 Failure to Provide Assigned Sales Force Effort. If during any
******************* ViroPharma fails ****************, such
failure shall not be considered a material breach for purposes
of Section 11.4, but, Wyeth, upon sixty (60) days prior written
notice to ViroPharma, given within sixty (60) days after Wyeth,
pursuant to Section 7.6.3, distributes to ViroPharma its share
of Net Profits for the last Calendar Quarter of the third such
calendar year, may terminate ViroPharma's right to Promote
Products in the Copromotion Territory hereunder. Upon the
effective date of any such termination, Wyeth shall assume all
of ViroPharma's obligations with respect to the Promotion of
the Product in the Copromotion Territory and thereafter, shall
have the right to sublicense Third Parties the rights granted
to it by ViroPharma in the Copromotion Territory hereunder.
Additionally, if Wyeth, pursuant to this Section 11.6.1,
terminates ViroPharma's right to Promote Products in the
Copromotion Territory hereunder, ViroPharma shall no longer be
entitled to receive any share of Net Profits obtained from the
sale of Products in
June 26, 2003 Restated & Amended Collaboration Agreement Page 79
the Copromotion Territory after the effective date of such
termination, provided, however, that, with respect to the sale
of Products in the Copromotion Territory by Wyeth, its
Affiliates or sublicensees after the effective date of such
termination, Wyeth shall pay to ViroPharma royalties, on a
Product by Product basis, which royalties will be the sum of X,
Y and Z, where
X = either (a) for ***************************** of the
portion of the aggregate Net Sales obtained by Wyeth,
its Affiliates and sublicensees from the sale of such
Product in the Copromotion Territory, which Net
Sales, during the calendar year in question, are less
than or equal to *******************, or (b) for
******************** of the portion of the aggregate
Net Sales obtained by Wyeth, its Affiliates and
sublicensees from the sale of such Product in the
Copromotion Territory, which Net Sales, during the
calendar year in question, are less than or equal to
******************************************,
Y = either (a) for **************************** of the
portion of the aggregate Net Sales obtained by Wyeth,
its Affiliates and sublicensees from the sale of such
Product in the Copromotion Territory, which Net
Sales, during the calendar year in question, are
greater than ******************* and less than or
equal to *******************, or (b) for
********************* of the portion of the aggregate
Net Sales obtained by Wyeth, its Affiliates and
sublicensees from the sale of such Product in the
Copromotion Territory, which Net Sales, during the
calendar year in question, are greater than
******************* and less than or equal to
***************, and
Z = either (a) for ************************* of the
portion of the aggregate Net Sales obtained by Wyeth,
its Affiliates and sublicensees from the sale of such
Product in the Copromotion Territory, which Net
Sales, during the calendar year in question, are
greater than **********************, or (b) for
**************** of the portion of the aggregate Net
Sales obtained by Wyeth, its Affiliates and
sublicensees from the sale of such Product in the
Copromotion Territory, which Net Sales, during the
calendar year in question, are greater than
***********************************************.
June 26, 2003 Restated & Amended Collaboration Agreement Page 80
11.6.2 Payment and Term of Royalty. If ViroPharma's right to Promote
Products in the Copromotion Territory is terminated pursuant
to this Section 11.6, the royalties payable pursuant to this
Section 11.6, and as adjusted pursuant to Section 7.4.2, will
be payable as set forth in Section 7.4.3.
11.6.3 Effect on Other Rights and Obligations. Except as expressly
provided in this Section 11.6, any termination of
ViroPharma's right to Promote Products in the Copromotion
Territory pursuant to this Section 11.6 shall have no effect
on any of the other rights and obligations of the Parties
under this Agreement, including, without limitation, the
rights or obligations of the Parties in conducting the
Research Program or the rights or obligations of the Parties
in the Wyeth Territory.
11.7 Blocking Patents. If during the term of the Research Program:
(a) a Third Party is granted a Patent relating to a Collaboration
Target in the Copromotion Territory;
(b) either Party determines, based on the advice of patent
counsel, that such Patent may be infringed by the activities
of either Party under the Research Program with respect to
one or more Collaboration Targets; and
(c) the Parties, within ninety (90) days of making the
determination in Section 11.7(b) above, determine that no
license is available on commercially reasonable terms after
having attempted in good faith to obtain such a license from
such Third Party;
Wyeth shall have the right, exercisable within sixty (60) days after
the determination in Section 11.7(c) is made, upon thirty (30) days
prior written notice to ViroPharma to terminate that portion of the
Research Program under this Agreement covering the Collaboration
Targets identified in Section 11.7(b). Upon such termination,
subject to Section 11.8 hereof, with respect to such Collaboration
Targets neither Party shall have any further rights or obligations
under this Agreement, each Party shall retain all rights to its
respective Know-How, Prior Inventions and Non-Collaboration
Inventions covering only such Collaboration Targets and each Party
shall be free to practice any Collaboration Invention and use any
Joint-Know-How covering only such Collaboration Targets created by
the Parties prior to such termination.
11.8 Survival of Certain Obligations. Expiration or termination of the
Agreement shall not relieve the Parties of any obligation accruing
before such expiration or termination, and the provisions of
Articles 9 and 12 and Sections 2.6, 4.3.3, 4.6.5, 4.6.6, 6.1.7(b),
6.1.8(f-g), 7.4.3, 7.7, 7.8, 8.1, 8.3, 10.3(d-e), 11.4.2, 11.5.2,
11.8, 13.4, 13.8, 13.9 and 13.11 shall survive the expiration of the
Agreement. Any expiration or early termination of this Agreement
shall be without prejudice to the rights of either Party against the
other accrued or accruing under this Agreement
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June 26, 2003 Restated & Amended Collaboration Agreement Page 81
before termination, including, without limitation, the obligations
to pay royalties and distribute Net Profits for Product(s) sold
before such termination.
11.9 Provision for Insolvency.
11.9.1 Termination. This Agreement may be terminated by written
notice by either Party at any time during the Term of this
Agreement upon the declaration by a court of competent
jurisdiction that the other Party is bankrupt and, pursuant
to the U.S. Bankruptcy Code such other Party's assets are to
be liquidated, the filing or institution of bankruptcy,
liquidation or receivership proceedings (other than
reorganization proceedings under Chapter 11 of the U.S.
Bankruptcy Code), or upon an assignment of a substantial
portion of the assets for the benefit of creditors by the
other Party, or in the event a receiver or custodian is
appointed for such Party's business, or if a substantial
portion of such Party's business is subject to attachment or
similar process; provided, however, that in the case of any
involuntary bankruptcy proceeding such right to terminate
shall only become effective if the proceeding is not
dismissed within sixty (60) days after the filing thereof. To
the extent permitted by applicable law, the effect of a
termination under this section 11.9.1 shall be as described
in Section 11.5.2, i.e., as if the Insolvent Party elected to
Terminate for Convenience.
11.9.2 Effect on Licenses. All rights and licenses granted under or
pursuant to this Agreement by one Party to the other Party
are, for all purposes of Section 365(n) of Title 11 of the
United States Code ("Title 11"), licenses of rights to
"intellectual property" as defined in Title 11. Each Party
agrees that the other Party, as licensee of such rights under
this Agreement shall retain and may fully exercise all of its
rights and elections under Title 11. Each Party agrees during
the Term of this Agreement to create and maintain current
copies or, if not amenable to copying, detailed descriptions
or other appropriate embodiments, to the extent feasible, of
all such intellectual property. If a case is commenced by or
against a Party under Title 11 (the "Title 11 Party"), such
Party (in any capacity, including debtor-in-possession) and
its successors and assigns (including, without limitation, a
Title 11 Trustee) shall,
(a) as the other Party may elect in a written request,
immediately upon such request:
(i) perform all of the obligations provided in this
Agreement to be performed by the Title 11 Party
including, where applicable and without
limitation, providing to the other Party portions
of such intellectual property (including
embodiments thereof) held by the Title 11 Party
and such successors and assigns or otherwise
available to them; or
--------------------------------------------------------------------------------
June 26, 2003 Restated & Amended Collaboration Agreement Page 82
(ii) provide to the other Party all such intellectual
property (including all embodiments thereof) held
by the Title 11 Party and such successors and
assigns or otherwise available to them; and
(b) not interfere with the rights of the other Party under
this Agreement, or any agreement supplemental hereto, to
such intellectual property (including such embodiments),
including any right to obtain such intellectual property
(or such embodiments) from another entity.
11.9.3 Rights to Intellectual Property. If a Title 11 case is
commenced by or against the Title 11 Party, and this
Agreement is rejected as provided in Title 11, and the other
Party elects to retain its rights hereunder as provided in
Title 11, then the Title 11 Party (in any capacity, including
debtor-in-possession) and its successors and assigns
(including, without limitation, a Title 11 Trustee) shall
provide to the other Party all such intellectual property
(including all embodiments thereof) held by the Title 11
Party and such successors and assigns, or otherwise available
to them, immediately upon the other Party's written request.
Whenever the Title 11 Party or any of its successors or
assigns provides to the other Party any of the intellectual
property licensed hereunder (or any embodiment thereof)
pursuant to this Section 11.9, the other Party shall have the
right to perform the obligations of the Title 11 Party
hereunder with respect to such intellectual property, but
neither such provision nor such performance by the other
Party shall release the Title 11 Party from any such
obligation or liability for failing to perform it.
11.9.4 Additional Rights. All rights, powers and remedies of a Party
provided herein are in addition to and not in substitution
for any and all other rights, powers and remedies now or
hereafter existing at law or in equity (including, without
limitation, Title 11) in the event of the commencement of a
Title 11 case by or against the Title 11 Party. A non-Title
11 Party, in addition to the rights, power and remedies
expressly provided herein, shall be entitled to exercise all
other such rights and powers and resort to all other such
remedies as may now or hereafter exist at law or in equity
(including, without limitation, Title 11) in such event. The
Parties agree that they intend the foregoing rights to extend
to the maximum extent permitted by law, including, without
limitation, for purposes of Title 11:
(a) the right of access to any intellectual property
(including all embodiments thereof) of the Title 11
Party, or any Third Party with whom the Title 11 Party
contracts to perform an obligation of the Title 11 Party
under this Agreement, and, in the case of the Third
Party, which is necessary for the Development,
registration,
--------------------------------------------------------------------------------
June 26, 2003 Restated & Amended Collaboration Agreement Page 83
manufacture and Commercialization of licensed Compounds
and/or licensed Products; and
(b) the right to contract directly with any Third Party
described in 11.9.4(a) to complete the contracted work.
12. INDEMNIFICATION AND INSURANCE.
12.1 Indemnification by Wyeth. Wyeth will indemnify, defend and hold
harmless ViroPharma, its Affiliates, and each of its and their
respective employees, officers, directors and agents (each, a
"ViroPharma Indemnified Party") from and against any and all
liability, loss, damage, expense (including reasonable attorneys'
fees and expenses) and cost (collectively, a "Liability") that the
ViroPharma Indemnified Party may be required to pay to one or more
Third Parties resulting from or arising out of:
(a) any claims of any nature, other than claims by Third Parties
relating to patent infringement, arising out of the conduct
of the Research Program by, on behalf of, or under the
authority of Wyeth (other than by ViroPharma);
(b) any Wyeth representation or warranty set forth herein being
untrue in any material respect when made;
(c) the Promotion of any Product by Wyeth in the world;
(d) any claim of any nature, including any products liability
claim, directly arising from the failure of a Product or its
container to have been manufactured, processed, prepared,
packed, or held in accordance with federal, state, and local
laws and regulations, Regulatory Approvals, or Wyeth's
representations or warranties hereunder; and/or
(e) any claims of any nature to the effect that any Trademark
selected by Wyeth in accordance with Section 8.3 and used by
the Parties, their Affiliates, or their sublicensees in
conjunction with the Promotion, marketing or sale of any
Product pursuant to this Agreement infringes the rights of
any Third Party;
except in each case, to the extent caused by the negligence or
willful misconduct of ViroPharma or any ViroPharma Indemnified
Party. Notwithstanding the foregoing, Wyeth shall have no obligation
to defend, indemnify or hold harmless any ViroPharma Indemnified
Party from and
--------------------------------------------------------------------------------
June 26, 2003 Restated & Amended Collaboration Agreement Page 84
against any Liability arising out of or resulting from the
infringement of a Third Party patent.
12.2 Indemnification by ViroPharma. ViroPharma will indemnify, defend and
hold harmless Wyeth, its Affiliates, sublicensees, distributors and
each of its and their respective employees, officers, directors and
agents (each, an "Wyeth Indemnified Party") from and against any and
all Liabilities that the Wyeth Indemnified Party may be required to
pay to one or more Third Parties arising out of:
(a) any claims of any nature, other than claims by Third Parties
relating to patent infringement, arising out of the conduct
of the Research Program by, on behalf of, or under the
authority of ViroPharma (other than by Wyeth);
(b) any ViroPharma representation or warranty set forth herein
being untrue in any material respect when made; and/or
(c) the Promotion of any Product by ViroPharma in the Copromotion
Territory;
except in each case, to the extent caused by the negligence or
willful misconduct of Wyeth or any Wyeth Indemnified Party.
Notwithstanding the foregoing, ViroPharma shall have no obligation
to defend, indemnify or hold harmless any Wyeth Indemnified Party
from and against any Liability arising out of or resulting from the
infringement of a Third Party patent.
12.3 Procedure. Each Party will notify the other in the event it becomes
aware of a claim for which indemnification may be sought hereunder.
In case any proceeding (including any governmental investigation)
shall be instituted involving any Party in respect of which
indemnity may be sought pursuant to this Article 12, such Party (the
"Indemnified Party") shall promptly notify the other Party (the
"Indemnifying Party") in writing and the Indemnifying Party and
Indemnified Party shall meet to discuss how to respond to any claims
that are the subject matter of such proceeding. The Indemnifying
Party, upon request of the Indemnified Party, shall retain counsel
reasonably satisfactory to the Indemnified Party to represent the
Indemnified Party and shall pay the fees and expenses of such
counsel related to such proceeding. In any such proceeding, the
Indemnified Party shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense of
the Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the Indemnifying
Party and the Indemnified Party and
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June 26, 2003 Restated & Amended Collaboration Agreement Page 85
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. All such fees and expenses shall be reimbursed as they are
incurred. The Indemnifying Party shall not be liable for any
settlement of any proceeding effected without its written consent,
but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Party agrees to indemnify the
Indemnified Party from and against any loss or liability by reason
of such settlement or judgment. The Indemnifying Party shall not,
without the written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of
which the Indemnified Party is, or arising out of the same set of
facts could have been, a party and indemnity could have been sought
hereunder by the Indemnified Party, unless such settlement includes
an unconditional release of the Indemnified Party from all liability
on claims that are the subject matter of such proceeding.
12.4 Insurance. Each Party further agrees to use its Commercially
Reasonable Efforts to obtain and maintain, during the term of this
Agreement, Commercial General Liability Insurance, including
Products Liability Insurance, with reputable and financially secure
insurance carriers to cover its indemnification obligations under
Sections 12.1 or 12.2, as applicable, or self-insurance, with limits
of not less than five million dollars ($5,000,000.00) per occurrence
and in the aggregate.
13. MISCELLANEOUS.
13.1 Assignment. Neither this Agreement nor any interest hereunder shall
be assignable by either Party without the prior written consent of
the other Party, except for assignment in connection with a Change
of Control of a Party. This Agreement shall be binding upon the
successors and permitted assigns of the Parties and the name of a
Party appearing herein shall be deemed to include the names of such
Party's successors and permitted assigns to the extent necessary to
carry out the intent of this Agreement. Any assignment not in
accordance with this Section 13.1 shall be void.
13.2 Further Actions. Each Party agrees to execute, acknowledge and
deliver such further instruments, and to do all such other acts, as
may be necessary or appropriate in order to carry out the purposes
and intent of the Agreement.
13.3 Force Majeure. Neither Party shall be liable to the other for delay
or failure in the performance of the obligations on its part
contained in this Agreement if and to the extent that such failure
or delay is due to circumstances beyond its control which it could
not have avoided by the exercise of reasonable diligence. It shall
notify the other Party promptly
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June 26, 2003 Restated & Amended Collaboration Agreement Page 86
should such circumstances arise, giving an indication of the likely
extent and duration thereof, and shall use all Commercially
Reasonable Efforts to resume performance of its obligations as soon
as practicable, provided, however, that neither Party shall be
required to settle any labor dispute or disturbance. Actions taken
by a Party to resume performance of its obligations with respect to
Screening, Research and Development matters shall be taken in
consultation with the JSC, and actions taken by a Party to resume
performance of its Commercialization obligations in the Copromotion
Territory shall be taken in consultation with the MSC.
13.4 Correspondence and Notices.
13.4.1 Ordinary Notices. Correspondence, reports, documentation, and
any other communication in writing between the Parties in the
course of ordinary implementation of this Agreement shall be
delivered by hand, sent by facsimile transmission (receipt
verified), or by airmail to the employee or representative of
the other Party who is designated by such other Party to
receive such written communication.
13.4.2 Extraordinary Notices. Extraordinary notices and other
communications hereunder (including, without limitation, any
notice of force majeure, breach, termination, change of
address, exercise of rights to negotiate additional
agreements, etc.) shall be in writing and shall be deemed
given if delivered personally or by facsimile transmission
(receipt verified), mailed by registered or certified mail
(return receipt requested), postage prepaid, or sent by
nationally recognized express courier service, to the Parties
at the following addresses (or at such other address for a
Party as shall be specified by like notice, provided,
however, that notices of a change of address shall be
effective only upon receipt thereof):
All correspondence to Wyeth shall be addressed as follows:
Wyeth Pharmaceuticals
000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attn: Senior Vice President, Global Business Development
Fax: (000) 000-0000
with a copy to:
Wyeth
0 Xxxxxxx Xxxxx
Xxxxxxx, Xxx Xxxxxx 00000
Attn: General Counsel
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June 26, 2003 Restated & Amended Collaboration Agreement Page 87
Fax: (000) 000-0000
All correspondence to ViroPharma shall be addressed as
follows:
ViroPharma Incorporated
000 Xxxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Attn: Vice President, Business Development
Fax: (000) 000-0000
with a copy to:
ViroPharma Incorporated
000 Xxxxxxxxx Xxxxxxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Attn: General Counsel
Fax: (000) 000-0000
13.5 Amendment. No amendment, modification or supplement of any provision
of this Agreement shall be valid or effective unless made in writing
and signed by a duly authorized officer of each Party.
13.6 Waiver. No provision of the Agreement shall be waived by any act,
omission or knowledge of a Party or its agents or employees except
by an instrument in writing expressly waiving such provision and
signed by a duly authorized officer of the waiving Party.
13.7 Severability. If any clause or portion thereof in this Agreement is
for any reason held to be invalid, illegal or unenforceable, the
same shall not affect any other portion of this Agreement, as it is
the intent of the Parties that this Agreement shall be construed in
such fashion as to maintain its existence, validity and
enforceability to the greatest extent possible. In any such event,
this Agreement shall be construed as if such clause of portion
thereof had never been contained in this Agreement, and there shall
be deemed substituted therefor such provision as will most nearly
carry out the intent of the Parties as expressed in this Agreement
to the fullest extent permitted by applicable law unless doing so
would have the effect of materially altering the right and
obligations of the Parties in which event this Agreement shall
terminate and all the rights and obligations granted to the Parties
hereunder shall cease and be of no further force and effect.
13.8 Descriptive Headings. The descriptive headings of this Agreement are
for convenience only, and shall be of no force or effect in
construing or interpreting any of the provisions of this Agreement.
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June 26, 2003 Restated & Amended Collaboration Agreement Page 88
13.9 Governing Law. This Agreement shall be governed by and interpreted
in accordance with the substantive laws of the State of New Jersey,
without regard to conflict of law principles thereof.
13.10 Entire Agreement of the Parties. This Agreement constitutes and
contains the complete, final and exclusive understanding and
agreement of the Parties and cancels and supersedes any and all
negotiations, correspondence, understandings and agreements prior to
the Effective Date including, without limitation, the Prior
Agreement, and including, in addition, the Letter from L. Xxxxxxx
Xxxx, Ph.D., President, Wyeth Research, to Xxxxxx xx Xxxxx,
President and Chief Executive Officer, ViroPharma Incorporated (June
6, 2002, and countersigned by Xxxxxx xx Xxxxx) whether oral or
written, among the Parties respecting the subject matter hereof and
thereof.
13.11 Independent Contractors. Both Parties are independent contractors
under this Agreement. Nothing herein contained shall be deemed to
create an employment, agency, joint venture or partnership
relationship between the Parties hereto or any of their agents or
employees, or any other legal arrangement that would impose
liability upon one Party for the act or failure to act of the other
Party. Neither Party shall have any express or implied power to
enter into any contracts or commitments or to incur any liabilities
in the name of, or on behalf of, the other Party, or to bind the
other Party in any respect whatsoever.
13.12 Debarment. Each Party agrees that it will not use, in any capacity,
in connection with any of its obligations to be performed under the
Research Program any individual who has been debarred under the FD&C
Act or the Generic Drug Enforcement Act.
13.13 Counterparts. This Agreement may be executed in any number of
counterparts, each of which need not contain the signature of more
than one Party but all such counterparts taken together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, duly authorized representatives of the Parties have
duly executed this Agreement to be effective as of the Effective Date.
WYETH VIROPHARMA INCORPORATED
By /s/ Xxxxxxx X. Xxxxxxx By /s/ Xxxxxx xx Xxxxx
-------------------------------- ----------------------------
Name: Xxxxxxx X. Xxxxxxx Name: Xxxxxx xx Xxxxx
Title: Executive Vice President Title: President, CEO & Chairman
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June 26, 2003 Restated & Amended Collaboration Agreement Page 89
EXHIBIT 1.7
Wyeth PATENT RIGHTS
NONE.
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.7 Page 1
EXHIBIT 1.18
CLASS A PRODUCT CHEMICAL SERIES
****************** **********
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
******************************* ****************
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.18 Page 1
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.18 Page 2
EXHIBIT 1.23
COLLABORATION TARGETS
***********
***********
***********
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.23 Page 1
EXHIBIT 1.50
ELEMENTS OF FULLY-ABSORBED STANDARD COSTS
The following expenses are included in Fully Absorbed Standard Costs for
purposes of this Agreement:
1. Direct Materials
Materials used in the manufacturing process that are traced directly to the
completed materials, Compound or Product, as applicable, and include:
- Inert raw materials or excipients
- Active substances/ingredients at market prices
- Packaging components such as bottles, caps, labels, etc.
2. Direct Labor
The cost of employees engaged in production activities which are directly
identifiable with manufacturing the materials, Compound or Product, as
applicable. Excludes supervision and production support activities such as
inspection, plant and equipment maintenance labor, and material handling
personnel. Direct Labor cost includes:
- Base pay, overtime, vacation and holidays, illness, personal time with
pay and shift differential.
- Cost of employee fringe benefits such as health and life insurance,
payroll taxes, welfare, pension and profit sharing.
3. Allocated Costs
Costs which are allocated to manufacturing the Ingredient based on standard
direct labor hours of the manufacturing process. These allocated costs
include:
- Utilities - expenses incurred for fuel, electricity and water in
providing power for production and other plant equipment
- Maintenance and repairs - amount of expense incurred in-house or
purchased to provide services for plant maintenance and repairs of
facilities and equipment.
- Depreciation - of plant and equipment utilizing the straight-line method
of calculation.
- Insurance - cost of comprehensive and other insurance necessary for the
safeguard of manufacturing plant and equipment.
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.50 Page 1
- Permits and Licenses - fees payable to governmental agencies or
authorities to obtain or maintain permits or licenses that are necessary
for the operation of facilities used to manufacture the materials,
Compound or Product, as applicable.
- Costs of the following manufacturing services
(degree) Purchasing and Accounting
(degree) Production Scheduling
(degree) Inventory Management
(degree) Plant Materials Management
(degree) Supervision and Production Support
Various bases may be used for allocating these costs to manufacturing
operating departments including headcount, square feet, metered
utilities use, estimated services rendered, EDP computer hours, etc.
4. Testing Costs - direct labor costs for Quality Assurance ("QA") testing and
approving materials used in manufacturing and completed manufacturing
batches and finished Products. This includes all manufacturing in-process
testing and testing of finished materials. Excluded costs are QA costs
related to research and development, stability testing, etc.
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.50 Page 2
EXHIBIT 1.114
VIROPHARMA PATENT RIGHTS
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.113 Page 1
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 1.113 Page 2
EXHIBIT 4.6.5(b)(ii-iii)
SAMPLE CALCULATION OF CERTAIN RECONCILIATION AMOUNTS
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit
4.6.5(b)(ii-iii) Page 1
EXHIBIT 5.4
ADVERSE EVENT REPORTING PROCEDURES
The Parties hereby agree that the following terms will govern disclosures
of each Party to the other with respect to adverse event reporting relating to
any Development Candidate or Product as clinically tested or marketed by or on
behalf of either Party.
1. Definitions.
1.1 Adverse Experience or Event (AE): An AE is defined by Wyeth as any
untoward, undesired, or unplanned event in the form of signs,
symptoms, disease, or laboratory or physiological observations
occurring in a human being in a temporal relationship to use of an
Wyeth product regardless of causal relationship. This includes:
. any clinically significant worsening of a pre-existing condition;
. an AE occurring from overdose (i.e., a dose higher than that
prescribed by a health care professional for clinical reasons) of
an Wyeth product, whether accidental or intentional;
. an AE occurring from abuse (i.e., use for non-clinical reasons) of
an Wyeth product;
. an AE that has been associated with the discontinuation of the use
of an Wyeth product;
. any failure of expected pharmacological action (for spontaneous
reports).
If there is any doubt whether the information constitutes an AE, the
information will be treated as an AE.
1.2 Serious AE: A serious AE is defined by Wyeth as an AE occurring at
any dose that: results in death; is life-threatening (see below);
requires inpatient hospitalization or prolongation of an existing
hospitalization; results in a persistent or significant disability or
incapacity (see below); results in cancer; results in a congenital
anomaly or birth defect. Additionally, important medical events that
may not result in death, be life-threatening, or require
hospitalization may be considered a serious AE when, based upon
appropriate medical judgment, they may jeopardize the patient or
subject and may require medical or surgical intervention to prevent
one of the outcomes listed in this definition. Examples of such
medical events include allergic bronchospasm requiring intensive
treatment in an emergency room or at home; blood dyscrasias or
convulsions that do not result in hospitalization; or the development
of drug dependency or abuse.
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 5.4 Page 1
1.2.1 Life-threatening refers to immediate risk of death as the event
occurred. A life-threatening experience does not include an
experience that, had it occurred in a more severe form, might
have caused death but as it actually occurred did not create an
immediate risk of death. For example, hepatitis that resolved
without evidence of hepatic failure would not be considered
life-threatening even though hepatitis of a more severe nature
can be fatal. Similarly, an allergic reaction resulting in
angioedema of the face would not be life-threatening, even
though angioedema of the larynx, allergic bronchospasm, or
anaphylaxis can be fatal.
1.2.2 Disability is defined as a substantial disruption in a person's
ability to conduct normal life functions.
1.2.3 For studies, all pregnancies and all overdoses will be reported
to GSSE in the same time frame as serious AEs.
1.2.4 A serious AE obtained from tests in laboratory animals includes
any experience suggesting a significant risk for human
subjects, including any findings of mutagenicity,
teratogenicity, or carcinogenicity.
1.2.5 If there is any doubt whether the information constitutes a
serious AE, the information will be treated as a serious AE.
1.3 Non-Serious AE: is any AE which does not meet the criteria for a
serious AE.
1.4 Unexpected AE: An unexpected AE is one that is not listed in the
current product labeling. The current product labeling is either the
package insert (for marketed Wyeth products) or the current
investigator's brochure (for investigational Wyeth products). An
unexpected AE includes any event that may be symptomatically and
pathophysiologically related to an event listed in the labeling, but
differs from the labeled event because of greater severity or
specificity. For example, hepatic necrosis would be unexpected (by
virtue of greater severity) if the product labeling referred only to
elevated hepatic enzymes or hepatitis. Similarly, cerebral
thromboembolism and cerebral vasculitis would be unexpected (by virtue
of greater specificity) if the labeling only listed cerebral vascular
accidents.
1.5 Product (Drug, Vaccine, Biological, Device)-Related: For the purposes
of regulatory reporting for investigational products, an AE will be
considered "product-related" (i.e., drug-related, vaccine-related,
etc.) for studies if either the investigator, the Medical Monitor, the
CR&D Clinical Project Team Medical Monitor (or designee), or the Local
Monitor (if applicable) assesses the AE(s) as possibly, probably, or
definitely related.
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June 26, 2003 Restated & Amended Collaboration Agreement - Exhibit 5.4 Page 2
1. An AE will be considered "not product-related" for studies
if the investigator and the medical monitor(s) and the local
monitor (if applicable) assess the AE(s) as probably not
related or definitely not related, or "relationship remote."
2. Whenever the investigator's or monitor's assessment is
unknown or unclear, the AE(s) will be treated as
product-related for the purposes of reporting to regulatory
authorities.
1.6 Protocol-Related: AEs from studies that are not product-related may
nevertheless be considered by the investigator or the medical
monitor(s) or the local monitor (if applicable) to be
protocol-related. For purposes of reporting to GSSE and regulatory
authorities, these will be reported in the same manner as
product-related events.
1.7 NDA Holder is defined as: An "Applicant" as defined in 21 C.F.R.
Section 314.3(b), for regulatory approval of a Product in any
regulatory jurisdiction, including a holder of a foreign equivalent
thereto.
1.8 IND Holder is defined as: A "Sponsor" as defined in 21 C.F.R. Section
312.3(b) of an investigational new drug in any regulatory
jurisdiction, including a holder of a foreign equivalent thereto.
1.9 Capitalized terms not defined in this Exhibit shall have the meaning
assigned thereto in the Agreement.
2. With respect to any Development Candidate or Product, the Parties agree as
follows:
a. All initial reports and any follow-up information (oral or written)
for any and all Serious AEs as defined above, (other than with respect
to animal studies) which become known to either Party (other than from
disclosure by or on behalf of the other Party) must be communicated by
telephone, telefax or electronically directly to the other Party
and/or the NDA Holder, IND Holder (individually and collectively
referred to as "Holders") within forty-eight hours of receipt of the
information. Written confirmation of the Serious AE received by such
Party should be sent to the other Party and/or the Holders as soon as
it becomes available, but in any event within forty-eight hours of
initial report of the Serious AE by such Party.
b. Both Parties shall exchange Medwatch and/or CIOMs forms and other
health authority reports within forty-eight hours of submission to any
Regulatory Authority.
c. All initial reports and follow-up information received for all
Non-Serious AEs for marketed Product which become known to a Party
(other than from disclosure by or on behalf of the other Party) must
be communicated in writing, by telefax or
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 5.4 Page 3
electronically to the other Party within ten days, on Medwatch or
CIOMs forms (where possible).
d. Each Party shall coordinate and cooperate with the other whenever
practicable to prepare a single written report regarding all Serious
and/or Non-Serious AEs, provided, however, that neither Party shall be
obligated to delay reporting of any AE in violation of applicable law
or regulations regarding the reporting of AEs.
3. The Parties further agree that:
a. A written report be forwarded to the other Party within forty-eight
hours of receipt by the Party making the report, for AEs for animal
studies which suggest a potential significant risk for humans;
b. Each Party will give the other Party a report via a print-out or
computer disk of all AEs reported to it and its Affiliates relating to
any Development Candidate or Product within the last year, within
thirty days of receipt of a request from the other Party but not more
often than four times a year;
c. If either Party wishes access to AE Reports of the other Party
relating to a Development Candidate or Product, upon request of that
Party, the other Party shall make available its AE records relating to
the Product or Substance (including computer disks) for viewing and
copying by the other Party. The Parties may discuss the transfer of AE
Reports by computer disk.
d. Disclosure of information hereunder by a Party to the other Party
shall continue as long as either Party and/or its Affiliates or
designees continue to clinically test or market a Development
Candidate or Product.
4. Each Party shall diligently undertake the following further obligations
where both Parties are or will be commercializing the Development Candidate
or Product pursuant to the Agreement and/or performing clinical trials with
respect to the Development Candidate or Product:
a. Upon the Effective Date, each Party shall identify individuals who
shall be responsible for identifying all AE reporting requirements in
all countries of the world as set forth in the Agreement, and any
amendments thereto;
b. To immediately consult with the other Party, with respect to the
investigation and handling of any Serious AE disclosed to it by the
other Party or by a third Party and to allow the other Party to review
the Serious AE and to participate in the follow-up investigation;
c. To immediately advise the other Party of any Development Candidate
and/or Product safety communication received from a health authority
and consult with the other Party with respect to any Product and/or
Substance warning, labeling change
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 5.4 Page 4
or change to an investigators' brochure involving safety issues
proposed by the other Party, including, but not limited to the safety
issues agreed to by the Parties;
d. To diligently handle in a timely manner the follow-up investigation
and resolution of each AE reported to it;
e. To provide the other Party mutually agreed upon audit rights of its AE
reporting system and documentation, upon prior notice, during normal
business hours, at the expense of the auditing Party and under the
confidentiality obligations set forth in the Agreement;
f. To meet in a timely fashion from time to time as may be reasonably
required to implement the adverse event reporting and consultation
procedures described in this Exhibit 5.4, including identification of
those individuals in each Party's Drug Safety group who will be
responsible for reporting to and receiving AE information from the
other Party, and the development of a written standard operating
procedure with respect to adverse event reporting responsibilities,
including reporting responsibilities to investigators;
g. Where possible, to transmit all data electronically;
h. to report to each other any addenda, revisions or changes to the
Agreement (e.g., change in territories, local regulations, addition of
new licensors/licensees to the Agreement, etc.) which might alter the
adverse event reporting responsibilities hereunder;
i. to utilize English as the language of communication and data exchange
between the Parties;
j. to develop a system of exchange of documents and information if the
Agreement involves more than two Parties;
k. to work together to develop an electronic system to transmit AE data.
5. The Parties may meet after the Effective Date of the Agreement to establish
a separate agreement for adverse event exchange which will supersede this
Exhibit 5.4.
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 5.4 Page 5
EXHIBIT 7.3
STOCK PURCHASE AGREEMENT
See attached.
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 7.3 Page 1
EXHIBIT 7.4.1
SAMPLE CALCULATION OF ROYALTY DISTRIBUTIONS
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 7.4.1 Page 1
EXHIBIT 7.5.3
SAMPLE CALCULATIONS OF NET PROFIT DISTRIBUTIONS
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 7.5.3 Page 1
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 7.5.3 Page 2
EXHIBIT 10.2(a)
THIRD PARTY RIGHTS, TITLE OR INTEREST IN
VIROPHARMA INTELLECTUAL PROPERTY
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 10.2(a) Page 1
EXHIBIT 10.2(b)
THIRD PARTY CLAIMS ON
VIROPHARMA PATENT RIGHTS AND KNOW-HOW
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 10.2(b) Page 1
EXHIBIT 10.2(c)
VIROPHARMA INTELLECTUAL PROPERTY SUBJECT TO
GOVERNMENT FUNDING AGREEMENTS
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 10.2(c) Page 1
EXHIBIT 10.3(a)
THIRD PARTY CLAIMS ON
Wyeth PATENT RIGHTS AND KNOW-HOW
None.
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June 26, 2003 Restated & Amended Collaboration Agreement-Exhibit 10.3(a) Page 1
