EXHIBIT 10.2
EXECUTION COPY
PRODUCT SUPPLY AGREEMENT
This PRODUCT SUPPLY AGREEMENT ("Agreement") is entered into as of the
12th day of February, 2006 (the "Effective Date") among Selamine Limited, a
corporation organized under the laws of Ireland with its principal place of
business at Xxxx 0/0, Xxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxx 00, Xxxxxxx
("Selamine"), Xxxxx Xxxx Holdings Limited, a corporation organized under the
laws of Malta with its principal place of business at 00 Xx. Xxxxxxxxxxx Xxxxxx,
Xxxxxxxx VLT 08, Malta ("Xxxxx Xxxx"), Arrow Pharm Malta Limited, a corporation
organized under the laws of Malta with its principal place of business at 00 Xx.
Xxxxxxxxxxx Xxxxxx, Xxxxxxxx VLT 00, Xxxxx ("Xxxxx Xxxxx"), and King
Pharmaceuticals, Inc., a corporation organized under the laws of Tennessee with
its principal place of business at 000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000
XXX ("King"). Selamine, Xxxxx Xxxx and Arrow Malta, on the one hand, and King,
on the other hand, are sometimes referred to individually as a "Party" and
collectively as the "Parties."
WHEREAS, Selamine, Xxxxx Xxxx, Xxxx, and Xxxx Pharmaceuticals Research
and Development, Inc. ("King R&D") have entered into a Ramipril Patent License
Agreement ("License Agreement"), of even date herewith, whereby Selamine granted
to King a license under the Ramipril Patents (as that term is defined in
Appendix A) to market, sell and distribute [***] within the Territory;
WHEREAS, Arrow International Limited ("Arrow") (the indirect parent of
Selamine), Xxxxx Xxxx, Xxxx and Xxxx R&D have entered into a Ramipril
Application License Agreement (the "Application Agreement"), of even date
herewith, whereby Arrow granted to King a license under the Ramipril Application
and Ramipril Know-How (as those terms are defined Appendix A) to market, sell
and distribute [***];
WHEREAS, King has agreed to exclusively purchase its entire
requirements of [***] from Selamine pursuant to the terms hereof; and
WHEREAS, Selamine is willing arrange the manufacture and supply of
[***] to King under the terms and conditions set forth hereinafter;
NOW, THEREFORE, in consideration of the rights and obligations set
forth in this Agreement, the Parties agree as follows:
1. DEFINITIONS
Capitalized terms used in this Agreement have the meanings ascribed to
such terms in Appendix A attached hereto.
2. PURCHASE AND DELIVERY
2.1 GENERAL OBLIGATION TO PURCHASE.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
(a) During the term of this Agreement, except as provided in Article 4
and Section 2.8(b), King, its Affiliates and its sublicensees shall exclusively
purchase from Selamine [***] for use in the Territory, and Selamine through
Arrow Malta, its manufacturing Affiliate, shall arrange for the manufacture,
sale and delivery to King and its Affiliates, of such quantities of [***] as
King, its Affiliates and its sublicensees shall order from Selamine, with such
purchasing, manufacturing, sale and delivery to be in accordance with the terms
of this Agreement and as follows:
(i) During the Aventis Agreement Term, [***] manufactured using
Ramipril API purchased from Aventis and supplied to Selamine by King; and
(ii) Upon expiration or termination of the Aventis Agreement Term
and thereafter, [***] manufactured using Ramipril API supplied by Selamine.
(b) Selamine and Arrow Malta covenant and agree that neither Selamine,
Arrow Malta, or any Selamine Designees (as defined in Section 2.12(a)(i) below)
nor any of their Affiliates shall manufacture or sell, directly or indirectly,
[***] within the Territory on their own behalf or on behalf of anyone other than
King, its Affiliates and its sublicensees.
(c) King shall use reasonable efforts to market, sell and distribute
[***] within the Territory; provided that King may choose which indications and
dosage strengths to market and sell, and Selamine understands and agrees that
King may choose not to sell or market the [***] for the same indications or
dosages for which King's Altace(R) product is currently sold; provided further
that King does agree to label the [***] for hypertension. For the avoidance of
doubt, King agrees to sell and market the [***] for all currently existing and
future indications (in addition to hypertension) that (1) do not obligate King
to purchase Ramipril API from Aventis pursuant to the terms of King's
pre-existing agreements with Aventis and (2) with respect to which King is not
contractually, under King's pre-existing agreements with Aventis, or legally
prohibited from making, having made, using, selling or offering to sell [***] in
the Territory, except such [***] that are made from Ramipril API supplied by
Aventis.
(d) Except with the prior written consent of King, such consent not to
be unreasonably withheld or delayed, Selamine shall perform its manufacturing,
sale and delivery obligations hereunder in Arrow Malta's Maltese facility. Arrow
Malta consents to the use of its Maltese facility for the purposes of Selamine
performing its obligations hereunder, and Arrow Malta agrees to abide by, and
assist Selamine in fulfilling, the obligations of Selamine and its Affiliates
set forth in this Agreement. For the avoidance of doubt, subject to King's prior
written consent, Selamine has the right to propose and qualify additional
manufacturing, sale and delivery locations, and King shall not unreasonably
withhold or delay its consent to such locations; provided that Selamine shall
bear all costs for such qualification.
2.2 FORECASTS. King shall provide Selamine with rolling [***] forecasts as
follows:
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
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(a) King shall provide Selamine with a non-binding [***] forecast at
least [***] before the expected Launch of [***] within the Territory. King shall
provide Selamine with a non-binding [***] forecast within [***] after receipt of
Regulatory Approval for the [***]. Neither of the foregoing forecasts shall be
binding.
(b) After receipt of Regulatory Approval for the [***], King shall
provide Selamine with a rolling [***] forecast [***] prior to the start of each
Calendar Quarter. Each of such quarterly [***] forecasts shall constitute
binding commitments of King, with respect to the first [***], to purchase the
percentages of [***] set forth below pursuant to purchase orders issued in
accordance with Section 2.3:
Period of Forecast Percentage Required to be Purchased
------------------ -----------------------------------
First [***] period [***]%
Second [***] period [***]%
(c) Each of King's forecasts shall specify the quantities of and
delivery dates for [***] within the Territory (by dosage strength) and include
such other information agreed upon by the Parties, with the first such forecast
also to include the anticipated Launch date.
2.3 PURCHASE ORDERS. King shall place orders for [***] no later than the
[***] day of the month by delivering a duly completed Purchase Order to Selamine
in writing. Each Purchase Order shall include, but not be limited to, the
information set forth in Appendix 2. Each Purchase Order shall be for at least
the minimum quantities specified in the Packaging Quantity, set forth in
Appendix 1. In the event of any conflict between the terms of this Agreement and
the terms of any Purchase Order, the terms of this Agreement shall prevail.
2.4 ACCEPTANCE BY SELAMINE. No Purchase Order shall be binding on Selamine
until accepted in writing with the confirmation of the date of shipment.
Selamine shall accept the Purchase Order as presented and confirm date of
shipment within ten (10) business days of receiving King's written Purchase
Order; provided that Selamine shall not be obligated to accept a Purchase Order
to the extent it exceeds (i) [***] [***] during the first [***] period for
which a Purchase Order is submitted and (ii) thereafter [***]% of the average
monthly forecasts of [***] supplied by King pursuant to Section 2.2(b) over the
prior [***]. Selamine shall be obligated to manufacture and deliver the
specified quantity of [***] in accordance with the delivery schedule set forth
in such Purchase Order, subject to the terms and conditions of this Agreement.
Selamine shall not be required to accept Purchase Orders for quantities of [***]
(a) below the quantities specified in the Packaging Quantity, (b) in excess of
the amount specified in the forecast for the relevant month, (c) during the
Aventis Agreement Term, to the extent Selamine is unable to manufacture the
[***] as a result of King's failure to provide Selamine with sufficient Aventis
API, or (d) the delivery lead time for the Purchase Order is less than [***], or
[***] with respect to the first month's supply.
2.5 CHANGES IN REQUESTS.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
3
(a) King may request that Selamine increase the quantity of [***] for
Purchase Orders already placed or to change the date of shipment. Upon receipt
of such request, Selamine shall inform King within [***] whether it can accept
such additional purchase orders, wholly or in part, or comply with the requested
date of shipment. In case of partial acceptance, Selamine shall specify
quantities and date of shipment. Selamine will use commercially reasonable
efforts to accept such requested changes, subject to the terms and conditions of
this Agreement.
(b) If an event occurs that significantly affects the market
conditions for [***], King may request that Selamine decrease the quantity of
[***] for Purchase Orders already placed or to change the date of shipment. Upon
receipt of such request, Selamine and King shall meet within [***] to discuss
whether Selamine can accept such changes or to otherwise determine how to
address such market conditions. Each Party will negotiate in good faith to reach
a reasonable resolution.
2.6 PACKAGING QUANTITY MINIMUM. If King wishes to order a quantity of
[***] of less than the minimum quantities specified in the Packaging Quantity,
Selamine shall notify King within [***] of receipt of any such Purchase Order of
the revised price of the [***] to reflect the increased costs to Selamine of
producing such smaller batch quantities. King may either confirm the Purchase
Order and shall pay such revised price for the [***] or may increase the
Purchase Order to the minimum batch quantities specified in the Packaging
Quantity.
2.7 DELIVERY.
(a) Selamine shall deliver the [***] FOB manufacturing, packaging site
or warehouse. Title and risk of loss as to the [***] purchased by King shall
pass to King upon the earlier of (i) a common carrier accepting possession or
control of such [***] and (ii) the passage of such [***] from the loading dock
of Selamine's site or warehouse to any employee, agent or contractor of King or
such common carrier. Regarding the first month's supply of [***], the delivery
lead time shall be within a maximum of [***] counted from the date of Selamine's
Purchase Order confirmation, thereafter the maximum delivery lead time shall be
[***] from the date of Selamine's Purchase Order confirmation. Selamine shall
tender the [***] in full on the dates for tender specified in the Purchase
Orders. If Selamine is unable for any reason to fulfill any Purchase Order for
the [***] on the specified date, Selamine shall immediately inform King in
writing. If such inability is partial, Selamine shall fulfill Purchase Orders
with such quantities of [***] as are available.
(b) [***], Selamine shall ship [***] on a carrier or carriers
specified by King under the designated procedures provided by King for
transportation of [***]. The costs of all freight, insurance, handling, fees,
taxes and other costs associated with the shipment of [***} shall be borne
[***].
(c) Selamine shall, and King will cooperate with Selamine to, prepare,
obtain, and maintain all necessary export and import registrations relating to
[***]. The
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
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costs of all export licenses, import licenses and customs formalities for the
import and export of goods shall be borne [***], provided that any VAT shall be
[***].
2.8 CAPACITY.
(a) If Selamine, upon receiving a forecast under Section 2.2 or a
Purchase Order under Section 2.3, is, or anticipates that it will be, unable to
meet such forecast or Purchase Order, either in whole or in part, due to any
reason, Selamine shall give written notice of such inability to King within
[***] of receipt of such forecast or Purchase Order. If such inability is
partial, Selamine shall fulfill Purchase Orders with such quantities of [***] as
are available. Selamine shall use its commercially reasonable efforts to ensure
that Purchase Orders are supplied in full on a timely basis.
(b) If Selamine is unable to meet King's Purchase Orders, except in
the case of the gross negligence or willful misconduct of Selamine, its
Affiliates, or any Selamine Designee, Selamine and King shall negotiate, for a
period of up to [***] from the date of notification given by Selamine pursuant
to Section 2.8(a), to consider alternative arrangements for meeting King's
requirements for [***] until Selamine is able to resume meeting such
requirements for King, including obtaining King's unfulfilled requirements from
a Third Party. Any alternative arrangement entered into pursuant to this Section
2.8(b) shall not exceed a commercially reasonable term. Any alternative
arrangements entered into pursuant to this Section 2.8(b) shall act in no way as
a waiver of any other rights or remedies that King or Selamine may have under
this Agreement or otherwise (unless expressly agreed otherwise in writing in
such alternative arrangements); provided, however, King shall have no obligation
to pay for orders of [***] that Selamine is unable to provide. If, at the end of
the [***] period, the Parties are not able to agree upon an alternative
arrangement, King may proceed with an alternative arrangement it selects. During
the [***] period, King may negotiate with Third Parties, and begin preparing its
own site, for the manufacture of [***], such that King will be in the position
to obtain supply from such Third Party or from King itself immediately after the
end of such [***] period.
(c) If Selamine's inability to meet Purchase Orders or forecasts is
due to a shortage of production capacity at Selamine's or the Selamine
Designee's facility, in addition to the requirements of Sections 2.8(a) and
2.8(b) above, Selamine shall promptly notify King of such shortage of production
capacity, and, if possible, the date such shortage of production capacity is
expected to end. Selamine shall give priority to King's Purchase Orders and
satisfy and fulfill deliveries of [***] ordered pursuant to King's Purchase
Orders prior to utilizing such production capacity to produce products for any
other person, including Selamine and its Affiliates.
(d) Selamine shall notify King as soon as possible of the date upon
which such shortage of production capacity will cease. Upon resumption of
production of [***], King shall resume obtaining its requirements, and those of
its Affiliates and its sublicensees, for [***] from Selamine to the extent such
resumption is consistent with any contractual arrangements entered into with
Third Parties pursuant to Section 2.8(b).
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
5
2.9 CERTIFICATE OF ANALYSIS. Each delivery shall be accompanied by a
certificate of analysis, containing the types of information approved by mutual
agreement of the Parties, for each lot delivered and any other documents as
required under the Applicable Law within the Territory and pursuant to the
Quality Agreement to be entered into by the Parties within [***] following the
Effective Date. In addition, Selamine will supply King with reference standards,
at Selamine's expense, for normal commercial testing, which King may conduct
[***]. All other reference standards reasonably requested by King shall be
provided by Selamine to King [***].
2.10 STOCK. Subject to any failure by Selamine to fulfill its supply
obligations hereunder, King shall at all times maintain a [***] stock of King's
requirements for [***] as indicated in its [***] forecasts.
2.11 LATE DELIVERY. Notwithstanding anything herein to the contrary,
Selamine shall not be liable to King for late delivery of [***] or failure to
fulfill a Purchase Order in part or in full:
(a) If fulfillment of such Purchase Order would result in Selamine
delivering [***] in any [***] period in excess of [***]% of the forecast given
by King in accordance with Section 2.2(b), unless Selamine has agreed to supply
the [***] in excess of [***]% of such forecast, as evidenced by Selamine's
acceptance of such Purchase Order in accordance with Section 2.4; provided that
Selamine must fulfill the Purchase Order up to [***]% of such forecast in
accordance with the terms and conditions of this Agreement;
(b) If the required delivery dates in the Purchase Order are less than
[***], or [***] with respect to the first month, unless Selamine has accepted a
Purchase Order with a delivery date that is less than such periods;
(c) If King fails to supply Selamine with sufficient API from Aventis
during the Aventis Agreement Term (including as a result of failing to supply
sufficient API that conforms with specifications, cGMP and Applicable Laws), to
the extent of such failure; or
(d) If King fails to provide Selamine with artwork and camera ready
proofs for the [***].
2.12 PRICES.
(a) FEE FOR [***]. Within [***] after the end of each Calendar
Quarter, King shall pay Selamine the fee set forth in this Section 2.12(a) based
on Net Sales of King, its Affiliates and its sublicensees in the Territory, and
based on whether or not Wyeth Participates with respect to the [***] and when
the sale occurs, as follows:
(i) SELAMINE DESIGNEES MANUFACTURE. If Selamine procures [***]
for King, whether through Selamine's Affiliates, including Arrow Malta, or
through Third Parties qualified in accordance with Section 4.1 (collectively,
the "Selamine Designees"), King shall pay Selamine as follows:
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
6
SELAMINE DESIGNEES MANUFACTURE
WYETH DOES NOT PARTICIPATE WYETH PARTICIPATES
-------------------------- ------------------
2007-2008 [***] [***]
2009 AND THEREAFTER [***] [***]
(ii) KING MANUFACTURES OR SOURCES. If King manufactures [***],
causes a Third Party to manufacture [***] in accordance with Section 4.2, or
obtains [***] under an alternative arrangement, as described in Section 2.8(b),
King shall pay Selamine as follows:
KING MANUFACTURES OR SOURCES
WYETH DOES NOT PARTICIPATE WYETH PARTICIPATES
-------------------------- ------------------
2007-2008 [***] [***]
2009 AND THEREAFTER [***] [***]
The Parties agree that, in order to allocate the additional costs that are
incurred by King as a result of King's manufacturing or sourcing of [***], the
following deductions will be taken from either King's Net Sales or Selamine's
payments under this Section 2.12(a)(ii):
(A) If King manufactures or sources in accordance with
Section 4.2(ii) or (iii), for purposes of determining King's Net Sales under
this Section 2.12(a)(ii), Net Sales will be reduced by [***].
(B) If King manufactures or sources in accordance with
Section 4.2(i), (iv), or (v), the fees owed by King to Selamine under this
Section 2.12(a)(ii) will be reduced by [***].
(C) For purposes of this Section 2.12(a)(ii), "King's
[***] Manufacturing Costs" shall equal USD $[***] plus USD $[***] for packaging,
which amounts are to be adjusted annually according to the rate of inflation in
the relevant country of manufacture or packaging with 2008 as the base year.
(D) For purposes of this Section 2.12(a)(ii), the "Cost of
Non-Aventis API" will equal the API Cost paid to Selamine or its Affiliates, or
any Third Party, with respect to any Ramipril API obtained by Selamine or its
Affiliates after the Aventis Agreement Term; provided that Selamine and its
Affiliates agree that they will sell such Ramipril API to King [***].
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
7
(b) UNDERSTANDING REGARDING RAMIPRIL API FROM AVENTIS.
(i) To the extent King is obligated to purchase Ramipril API from
Aventis in 2008, Selamine agrees to reimburse King, on a quarterly basis, for
[***]% of the amount paid by King to Aventis for Ramipril API that is actually
used in the manufacture of [***] that are actually sold to Third Parties. Such
payment will be deducted from King's payment under Section 2.12(a), as confirmed
by written quarterly reports from King, until all such reimbursements are made.
(ii) If Selamine manufactures [***] for King, or King is
manufacturing [***], to the extent King is obligated to purchase Ramipril API
from Aventis in 2007, Selamine agrees to reimburse King, on a quarterly basis,
for [***]% of the amount paid by King to Aventis for Ramipril API that is
actually used in the manufacture by Selamine or King of [***] that are actually
sold to Third Parties. Such payment will be deducted from King's payment due
under Section 2.12(a), as confirmed by written quarterly reports from King,
until all such reimbursements are made.
(iii) The determination of the amount of [***] that are actually
sold to Third Parties pursuant to clauses (i) and (ii) above will be based on
both King's sales to Third Parties and no more than [***] of inventory sold to
wholesalers; provided that the Parties quarterly will compare King's sales to
Third Parties to the amounts prescribed to patients based on IMS prescription
data during the relevant period, and, if there is a discrepancy of more than
[***]% between such amounts, the Parties will negotiate in good faith to correct
such discrepancy in order for the Parties, as closely as possible, to
approximate actual prescriptions written for [***] during the relevant period.
(iv) After expiration or termination of the Aventis Agreement
Term, King and its Affiliates agree, and King or the relevant King Affiliate
shall cause each sublicensee to agree, that it shall not purchase bulk Ramipril
API for use in [***] from any Third Party, including but not limited to Aventis.
(v) If, prior to the end of 2008, King is able to negotiate with
Aventis an early termination of King's obligations for bulk Ramipril API for use
in [***], pursuant to King's agreements with Aventis, Selamine agrees to
reimburse King for [***]% of any payments due to Aventis in connection with such
early termination; provided that in no event will Selamine be obligated to
reimburse King for any amount paid to Aventis that is in excess of an amount
equal to Selamine's [***]% payment obligation otherwise payable hereunder for
2007 or 2008 (adjusted to take into account the payments already made by
Selamine pursuant to Sections 2.12(b)(i) and (ii) above) minus, if either of the
two events described in Section 2.12(c) has not occurred, the API Cost to
Selamine of purchasing bulk Ramipril API from another source for use in 2007 or
2008. For the avoidance of doubt, if, at the time King is able to negotiate such
early termination, the two events described in Section 2.12(c) both have
occurred, the maximum amount of Selamine's reimbursement under this Section
2.12(b)(v) will be equal to Selamine's [***]% payment obligation otherwise
payable hereunder for 2007 or 2008.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
8
(c) ADJUSTMENT FOR GENERIC COMPETITION. The fees payable to Selamine,
as described in Section 2.12(a) above, shall be payable until such date as both
of the following have occurred:
(i) [***]; and
(ii) [***].
Upon the occurrence of both events set forth in (i) and (ii) above, King shall
no longer be obligated to pay Selamine fees pursuant to Section 2.12(a), and
King shall thereafter purchase [***] from Selamine at [***] with Section 2.12(d)
below. In addition, upon the occurrence of both events set forth in (i) and (ii)
above, Selamine's reimbursement obligations to King pursuant to Section 2.12(b)
shall be reduced from [***]% to [***]%.
(d) EXCESS API. If, at the end of the Aventis Agreement Term, King
owns Ramipril API purchased from Aventis, Selamine will purchase such API from
King at the price of USD $[***] for use in [***] sold hereunder.
(e) [***]. The Parties anticipate that, as a result of the Launch of
[***], King will receive [***]. In order to compensate King, in part, for such
{***], the Parties agree that they will [***] the costs of all returns of
Capsule Product, excluding any [***]. As such, Selamine agrees to reimburse King
for [***] percent ([***]%) of King's wholesale acquisition cost attributable to
the [***] following the Launch of [***], excluding [***], not to exceed USD
$[***]. Selamine may audit King's books and records with respect to such costs
in accordance with Section 2.13 hereof. The amounts reimbursable by Selamine to
King hereunder shall be deducted from King's payment under this Section 2.12, as
confirmed by written quarterly reports from King, until all such reimbursements
are made.
2.13 AUDITING. During the term of this Agreement and for a period of [***]
following its expiration or termination, upon the request of a Party (but not
more frequently than once in each Calendar Year), an independent public
accountant selected by the requested Party and reasonably acceptable to the
other Party shall be allowed access, during ordinary business hours, to the
records, documents, bookkeeping systems, financial statements, records and any
other resources, materials and data of the audited Party and its Affiliates, or
Third Parties providing services hereunder on behalf of such Party, relevant to
verify the accuracy of the payments made or payable by King hereunder or the
Costs or API Costs incurred by Selamine during any of the [***] before the
audit. The cost of such audit shall be paid by the auditing Party unless the
audit reveals an under-reporting of payments in excess of [***] of the amount
due or cost incurred, as applicable, for any one-year period, in which case the
cost of the audit shall be paid by audited Party. If an audit discloses any
underpayment by King, King shall promptly make payment to Selamine of such
underpayment plus accrued interest, [***]. If the audit discloses any
overpayment by King, Selamine shall promptly repay such overpayment to King
plus, if the overpayment was a result of on over-reporting of Costs or API Costs
by Selamine, accrued interest, [***].
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
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2.14 PAYMENTS. All payments to be made hereunder shall be made in United
States Dollars ("USD") and shall be paid within [***] from receipt of invoice;
provided that invoices shall not be issued before the date of tender of the
[***]. Interest shall be payable upon all amounts not paid on the due date at
the rate of [***]% over the base rate of interest reported in the Wall Street
Journal, New York edition, on the due date and shall accrue from the due date
until such sum is paid, [***].
2.15 [***]. As set forth in the Application Agreement, King is entitled to
Develop a [***] that is a [***]; provided that King may only launch such [***]
in accordance with the terms and conditions of Section 3.3 of the Application
Agreement. Until such time as King elects to launch such [***], the Parties will
perform their obligations hereunder in anticipation of manufacturing and selling
a [***] that is not a [***]. At such time as King elects to launch, in
accordance with the Application Agreement, such [***], the Parties will perform
their obligations hereunder with respect to such [***], including qualifying
manufacturing facilities with respect to such [***] in accordance with Section
4.1, which qualification the Parties will promptly seek to obtain following
King's notification to Selamine that King intends to launch such [***] or at
such other time as King reasonably determines. In addition, if King elects to
launch such [***], King will grant Selamine such license to King's Patents and
Technology as is needed for Selamine to perform its obligations hereunder.
3. MANUFACTURE AND QUALITY
3.1 GENERAL OBLIGATION TO MANUFACTURE. Selamine, as manufacturer of
[***], shall supply the [***] to King as finished packed [***]. Selamine
warrants that [***] sold to King by Selamine pursuant to this Agreement are
manufactured in accordance with the Specifications and in material compliance
with all cGMP and Applicable Laws with respect to the manufacturing of [***] to
be marketed and sold in the Territory. Upon Regulatory Approval, Appendix 3 of
this Agreement will be modified to include the Specifications for the [***],
which will be based on such Regulatory Approval.
3.2 PACKAGING AND LABELING. King shall provide Selamine with all artwork
and camera ready proofs of applicable labeling and packaging materials for the
[***]. Selamine shall not make any changes thereto. Should changes be necessary
to artwork and proofs, King shall supply new materials promptly.
3.3 SPECIFICATIONS.
(a) For changes to the Specifications or manufacturing processes that
are required by Applicable Laws ("Required Manufacturing Changes"), Selamine and
King shall cooperate in making such changes in a timely manner.
(b) For changes to the Specifications or material manufacturing
process that are not required by Applicable Laws ("Discretionary Manufacturing
Changes"), Selamine and King must each agree to any such changes and shall, to
the extent commercially reasonable under the circumstances, cooperate in making
such changes, and each agrees that it shall not
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unreasonably withhold its consent to such changes. Notwithstanding the
foregoing, King's standard change control procedures will be utilized in
reviewing such changes.
(c) Notwithstanding the foregoing, all internal and external costs,
including, without limitation, obsolete raw materials, work-in-process,
packaging and labeling materials (i) associated with Required Manufacturing
Changes shall be borne by King, provided that such costs will be limited to the
levels of materials that are reasonable based on current forecasts, and (ii)
associated with Discretionary Manufacturing Changes shall be borne by the Party
initiating such changes; provided that, in each case, all such costs shall be
commensurate with costs common in the industry for the types of changes being
made.
(d) In the event of any changes to the Specifications or manufacturing
processes, as provided in this Section 3.3, King undertakes to update its
Regulatory Approval in the Territory with any modifications. The pertaining
Specifications shall be updated accordingly.
3.4 SHORTCOMINGS AND DEFECTS. King shall notify Selamine in writing within
[***] after receipt of [***] delivered by Selamine of any complaint regarding
obvious qualitative faults and/or quantitative shortcomings, and King shall
simultaneously send samples of faulty [***] to Selamine. If King fails to notify
Selamine within such period, King shall be deemed to have accepted the order
with respect to such obvious faults or shortcomings. King shall notify Selamine
in writing within [***] of King becoming aware of any defects in the [***] which
may not or would not have been obvious at delivery by visual inspection of such
[***] made with reasonable care.
(a) In cases of properly notified objections on the ground of
defective quality, which objections are agreed upon by both Parties or have been
confirmed by an independent party pursuant to clause (b) below, Selamine shall
replace the faulty consignment free of charge at the next practical delivery
date agreed to by the Parties. All quantitative deficiencies shall be made up
free of charge at the next practical delivery date. If only a limited supply of
[***] is available to replace or supply such rejection or shortage, then
Selamine shall ship to King such quantities of [***] as are available, and King
will be promptly reimbursed or credited against future orders, at King's option,
for amounts paid for the remaining quantity of rejected [***].
(b) If Selamine disagrees with the defect of such [***] that King has
found to be defective, the Parties shall endeavor to settle such disagreement
amicably and constructively between themselves. If they fail to agree within
[***] after receipt of the notice of defects, the Parties agree to nominate an
independent, reputable laboratory within the Territory, acceptable to both
Parties, which shall examine representative samples taken from such consignment,
using the methods of analysis specified in the Specifications, and the result
shall be binding on both Parties. The charges for such examination shall be
borne by the Party found to be at fault.
(c) Selamine's entire responsibility for defective [***] supplied to
King hereunder is limited to the replacement, refund or credit mentioned in
Section 3.4(a) only. This, however, does not limit Selamine's responsibility
pursuant to Section 6 of this Agreement.
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(d) King shall make arrangements with Selamine for the return or
disposal of any [***] rejected in accordance with this Section 3.4; the costs of
such return or disposal shall be paid by Selamine.
3.5 SELAMINE STOCK AND RAW MATERIALS.
(a) During the Aventis Agreement Term, King shall supply Selamine with
Ramipril API from Aventis required to manufacture [***], and Selamine shall be
solely responsible for obtaining all other Raw Materials. During the Aventis
Agreement Term, King's supply to Selamine of Ramipril API from Aventis shall be
as follows:
(i) [***] prior to the start of each Calendar Quarter, Selamine
shall provide King with rolling [***] forecasts of Selamine's Ramipril API
requirements; provided that the first such forecast shall be provided to King
[***] after the receipt of King's forecast for [***] pursuant to Section 2.2.
Selamine shall place orders for Ramipril API no later than the [***] of the
month by delivering a duly completed purchase order to King in writing. Each
purchase order shall include, but not be limited to, the information set forth
in Appendix 5. Each purchase order shall be for at least the minimum quantities
specified on Appendix 5. In the event of any conflict between the terms of this
Agreement and the terms of any purchase order, the terms of this Agreement shall
prevail. No purchase order shall be binding on King until accepted in writing
with the confirmation of the date of shipment. King shall accept the purchase
order as presented and confirm date of shipment within [***] of receiving
Selamine's written purchase order; provided that King shall not be obligated to
accept a purchase order to the extent it exceeds the amounts necessary for
Selamine to meet its supply obligations with respect to Purchase Orders for
[***] accepted by Selamine pursuant to Section 2.4. The delivery lead time for
Ramipril API shall be within a maximum of [***] counted from the date of King's
purchase order confirmation. Selamine shall provide King with monthly and annual
inventory reports with respect to Selamine's stock of Ramipril API, with the
monthly reports provided on the [***] of each month and the annual report
provided on January 31st of each year.
(ii) King shall deliver the Ramipril to Selamine's manufacturing
site. Title and risk of loss as to the Ramipril API shall pass to Selamine upon
delivery to Selamine's site. The costs of all freight, insurance, handling,
fees, taxes, export licenses, import licenses, customs formalities and other
costs associated with the shipment of Ramipril API from King shall be borne
[***], provided that any VAT shall be [***]. Each delivery shall be accompanied
by a certificate of analysis, containing the types of information approved by
mutual agreement of the Parties, for each lot of Ramipril API delivered and any
other documents as required under Applicable Law within the Territory and
pursuant to the Quality Agreement.
(iii) Selamine shall provide King with a receipt of delivery with
respect to each shipment of Ramipril API supplied to Selamine by King hereunder.
Selamine shall be and remain responsible for the proper care and handling of all
quantities of Ramipril API so supplied and shall account to King for the
handling and disposition of all such quantities. Without limiting the preceding
sentence, Selamine shall promptly report to King any and all incidents or
occurrences pursuant to which any shipment of Ramipril API is not manufactured
into finished [***], including, without limitation, spillage, accident, waste,
spoilage
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or other disposition. Selamine shall reimburse King or credit King's account,
as King may elect, for the replacement cost of all quantities of Ramipril API
that are not manufactured into finished [***] as a consequence of Selamine's
negligence or any other breach by Selamine of its obligations hereunder.
(iv) Selamine shall notify King in writing within [***] after
receipt of Ramipril API delivered by King of any complaint regarding obvious
qualitative faults and/or quantitative shortcomings, and Selamine shall
simultaneously send samples of faulty Ramipril API to King. Selamine shall
notify King in writing within [***] of Selamine becoming aware of any defects in
the Ramipril API which may not or would not have been obvious at delivery by
visual inspection of such Ramipril API made with reasonable care. Selamine will
assist King in substantiating any defects or shortcomings and otherwise assist
King in order for King to obtain replacement API or a refund or credit from
Aventis.
(v) Selamine shall reimburse King for the replacement cost of any
Ramipril API supplied by King that has been used by Selamine in [***] that have
been rejected by King in accordance with the provisions of Section 3.4. Selamine
shall use Ramipril API supplied by King solely for the purpose of performing
Selamine's obligations under this Agreement and shall not provide such materials
to any Third Party.
(b) Following the Aventis Agreement Term, Selamine shall be solely
responsible for obtaining all Raw Materials, including Ramipril API, required
for the manufacture of [***], which Raw Materials will be obtained from cGMP and
FDA-qualified suppliers.
(c) Subject to King supplying Selamine with sufficient Ramipril API
during the Aventis Agreement Term, Selamine shall maintain sufficient supplies
of Raw Materials and other required resources to perform the services required
under this Agreement.
(d) In addition, at all times during the Term, Selamine shall maintain
at its facility [***] of inventory of [***], calculated as the [***] sales for
the [***] period.
3.6 RECALL POLICIES. King shall comply, and Selamine shall assist King as
appropriate in complying, with [***] recall policies regarding [***] issued from
time to time by King or any applicable Regulatory Authority and communicated to
King. In the event of a [***] recall, the Party instituting the recall shall
promptly advise the other Party, and the Parties shall take all appropriate
corrective actions.
3.7 RECALLS.
(a) [***] shall bear the expenses of any recall resulting from (i)
damages to or defects in the [***] occurring after Selamine's shipment of the
[***], (ii) the King layout for packaging and labeling of the [***], (iii) the
King actions or in-actions as seller, sublicensor to its sublicensees, and
distributor of the [***], (iv) infringement claims regarding any trademarks,
trade names or trade dress to be used with the [***], or (v) during the Aventis
Agreement Term, damages to or defects in the Ramipril API supplied to Selamine
by King occurring or in existence prior to King's shipment of such API to
Selamine.
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(b) [***] shall bear the expenses for recalls resulting from (i)
Selamine's, its Affiliates', or any Selamine Designee's negligence or willful
misconduct, (ii) their failure to manufacture, test, store or handle [***] in
accordance with cGMP and the Specifications, or (iii) during the Aventis
Agreement Term, damages to or defects in the Ramipril API supplied to Selamine
by King occurring after King's shipment of such API to Selamine.
(c) For the purpose of this Agreement expenses of recall include,
without limitation, the value of the recalled [***], expenses of notification
and destruction or return of the recalled [***]. In addition, during the Aventis
Agreement Term, expenses of recall shall include the costs of the API supplied
by King that are borne by the Party not bearing the expenses of the recall,
taking into account each Party's contribution to the purchase price for such
API, as described in Section 2.12.
4. REGULATORY, ACCESS AND OTHER MATTERS
4.1 QUALIFICATION OF MANUFACTURING FACILITIES. King and Selamine shall
each, at their own expense, use reasonable efforts to qualify their own
manufacturing facilities with respect to both finished [***] that contain
Ramipril API supplied by Aventis and finished [***] that contain Ramipril API
supplied by Selamine, it being understood and agreed that Selamine will qualify
Arrow Malta's Maltese facility. In addition, Selamine shall use its best efforts
to qualify a second manufacturing facility with respect to finished [***] that
contain each type of Ramipril API, with the identity of such facility to be with
King's prior written consent, not to be unreasonably withheld or delayed, as
provided in Section 2.1(d). King shall supply Selamine with any Ramipril API
from Aventis necessary in connection with such qualification, at its Maltese
manufacturing facility, at no charge; and Selamine shall supply King with any
Ramipril API from Selamine necessary in connection with such qualification, at
no charge. Qualification of each manufacturing facility with respect to finished
[***] that contain Ramipril API supplied by Aventis will begin as soon as
practicable after the Effective Date, and qualification with respect to Ramipril
API supplied by Selamine will begin at such time as the Parties agree, taking
into account the anticipated date of expiration or termination of the Aventis
Agreement Term.
4.2 EXCEPTIONS TO EXCLUSIVE SUPPLY. Notwithstanding Section 2.1, King may
manufacture, or purchase from another Third Party, [***] under the following
limited circumstances: (i) Selamine cannot get any manufacturing facility
qualified (its own or that of a Selamine Designee) with respect to [***], as
provided in Section 4.1; (ii) to the extent Selamine is unable to supply [***]
pursuant to this Agreement because such supply would likely result in a breach
of King's pre-existing agreements with Aventis, as determined by King, acting
reasonably and in good faith; (iii) King wishes to launch the [***] before 2008
using its own facilities, and King and Selamine, acting reasonably and in good
faith, agree to such use of King's facilities; (iv) there is an interruption of
commercial supply from Selamine, including as a result of Selamine's breach of
this Agreement, except where such interruption is due to King's breach of this
Agreement; or (v) to the extent Selamine is unable to supply all of the
quantities of [***] requested by King, except where such interruption is due to
King's breach of this Agreement; provided that with respect to clauses (iv) and
(v), except in the case of the gross negligence or willful misconduct of
Selamine,
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its Affiliates, or any Selamine Designee, the Parties will comply with the
procedures set forth in Section 2.8(b).
4.3 NOTICE OF FAILURE TO MEET SPECIFICATIONS. Upon Selamine's or any
Selamine Designee's discovery that any batch or lot of [***] fails to conform to
the applicable Specifications, Selamine will notify King within [***] of
discovery of such failure to meet the applicable Specifications and of the
nature thereof in detail, including, but not limited to, supplying King with all
investigatory reports, data, and communications, out-of-specification reports
and data and the results of all outside laboratory testing and conclusions, if
any. Selamine shall investigate all such failures promptly, and at its expense,
cooperate with King in determining the cause for the failure and a corrective
action to prevent future failures.
4.4 RECORDS. Selamine shall maintain all manufacturing, packaging,
analytical and stability records, all records of shipment, and all validation
data relating to the [***] to the extent and for the time periods required by
Applicable Laws with respect to the [***].
4.5 REGULATORY COMPLIANCE. Selamine shall advise King promptly if an
authorized agent of a Regulatory Authority visits, or if Selamine or any
Selamine Designee receives notice that a Regulatory Authority plans to visit,
the manufacturing facilities where the [***] are being manufactured or quality
tested. Selamine shall furnish to King all material information supplied to, or
supplied by, any Regulatory Authority, including the Form 483 observations and
responses, to the extent that such report relates to the [***], or the ability
of Selamine to supply such [***], within [***] of Selamine's or a Selamine
Designee's receipt of such information or delivery of such information, as the
case may be. To the extent allowable under Applicable Law, King shall have [***]
to review and provide comments to Selamine prior to Selamine or any Selamine
Designee responding to any Regulatory Authority. Should Selamine choose not to
include or address King's comments when responding to the Regulatory Authority,
then Selamine shall provide King a reason as to why King's comments were not
included or addressed. To the extent allowable under Applicable Law, before
Selamine or any Selamine Designee responds to any Regulatory Authority, King
shall have the right to review and approve such final response, such approval
not to be unreasonably withheld or delayed.
4.6 CHANGES. In addition to the requirements of Section 3.3, Selamine and
the Selamine Designees shall not change the critical specified raw materials,
packaging materials, their source, analytical test procedures or critical
manufacturing conditions or critical manufacturing equipment used in the
manufacture of [***] without the prior written consent of King, such consent not
to be unreasonably withheld or delayed.
4.7 ACCESS TO FACILITIES. Upon the reasonable prior written request of
King, King shall have the right to inspect those portions of the manufacturing,
storage and testing facilities of Selamine and Selamine Designees where [***]
are being manufactured, stored or tested, as the case may be, during regular
business hours and without undue interference to Selamine's and the Selamine
Designees' business operations, to ascertain compliance with cGMPs and the
Specifications, such inspections to be held [***], unless additional inspections
are required as mutually determined by the Parties. If the FDA or other
applicable Regulatory
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Authority asserts any notice to the effect that Selamine, its Affiliates, or
any Selamine Designees have failed to comply with any Applicable Law in
connection with the manufacture of the [***], or if Selamine delivers [***] that
do not meet the applicable Specifications, then King shall have the right to
inspect such portions of the manufacturing facilities of Selamine, its
Affiliates, or the Selamine Designee that relate to the manufacture and testing
of such [***] upon reasonable notice and during normal business hours.
Notwithstanding the provisions of this Section 4.7, King shall have no
obligation nor be deemed to have an obligation to inspect the facilities of
Selamine, its Affiliates, or the Selamine Designee.
4.8 PRODUCT INQUIRIES AND COMPLAINTS. Selamine will promptly submit to King
all [***] safety and efficacy inquiries, [***] quality complaints and adverse
drug event reports received by Selamine, any Affiliate, or any Selamine
Designee, together with all available evidence and other information relating
thereto, in accordance with procedures to be agreed upon by the Parties. Except
as otherwise required by Applicable Law, King, as the party holding the
applicable NDA, will be responsible for investigating and responding to all such
inquiries, complaints and adverse events regarding [***]. It shall be the
responsibility of King, as the party holding the applicable NDA, to comply with
all applicable national, federal, state and local governmental reporting
requirements regarding adverse drug events and [***] quality matters.
4.9 RESPONSE TO COMPLAINTS AND/OR ADVERSE DRUG EVENTS. Pursuant to a
reported complaint or adverse drug event, if the nature of the reported
complaint or adverse drug event requires testing during the period, Selamine
will, upon King's request and approval and at Selamine's reasonable expense,
perform analytical testing of corresponding retention samples and provide the
results thereto to King as soon as reasonably practicable. King, as the party
holding the applicable NDA, shall remain responsible for reporting to the FDA or
any other Regulatory Authority. Such testing shall be performed using NDA
approved testing procedures as set forth in the applicable NDA.
4.10 ADDITIONAL INFORMATION. Each Party shall provide to the other in a
timely manner, but in no event less than [***] prior to the due date of such
Party's annual report to the FDA or any other Regulatory Authority with respect
to the [***], all information in written form which such Party requests
regarding the [***] in order to comply with Applicable Laws.
4.11 QUALITY AGREEMENT. Each Party shall perform the duties required of it
pursuant to the Quality Agreement to be entered into by the Parties. To the
extent the Quality Agreement conflicts with this Agreement with respect to a
quality issue, this Agreement shall control.
4.12 STABILITY TESTING. Selamine shall be responsible for maintaining a
stability program according to the protocol and commitments outlined on Appendix
4 attached hereto and conducting stability testing for the [***] that are
manufactured or packaged by Selamine. The costs for such stability testing, as
set forth on Appendix 4, shall be borne by King.
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4.13 REIMPORTATION. Selamine shall, and shall cause its Affiliates and
Selamine Designees to, use commercially reasonable efforts to prevent, in the
Territory, directly or indirectly, the making of any [***] by Selamine, its
Affiliates, Selamine Designees, licensees, or customers and the selling,
distribution, offer for sale and importation of [***] by Selamine, its
Affiliates, Selamine Designees, licensees, or customers.
4.14 XXXXX XXXX GUARANTEE. To the extent any of the obligations herein
apply to Affiliates of Selamine or Arrow Malta, Xxxxx Xxxx agrees (a) to abide
by such obligations as an Affiliate of Selamine and Arrow Malta and (b) to cause
each other Affiliate of Selamine and Arrow Malta to abide by such obligations,
including through the exercise of all Xxxxx Xxxx'x corporate power and authority
to cause such Affiliates to perform their obligations hereunder.
5. REPRESENTATIONS AND WARRANTIES
5.1 SELAMINE'S REPRESENTATIONS AND WARRANTIES. In addition to the Parties'
representations and warranties set forth in the Application Agreement, which
representations and warranties are incorporated herein by reference, Selamine
and Arrow Malta, jointly and severally (with the exception of Subsection (e), to
which only Selamine shall represent and warrant, and provided that, with respect
to Subsection (f), Arrow Malta shall only represent as to itself and not as to
Selamine or its other Affiliates), represent and warrant to King as follows:
(a) COMPLIANCE WITH CGMP. [***] sold to King by Selamine pursuant to
this Agreement will be manufactured in conformity with cGMP.
(b) CONFORMITY WITH SPECIFICATIONS. [***] sold to King by Selamine
pursuant to this Agreement will meet, in all material respects at the time of
delivery to the common carrier, the Specifications for such [***] in effect at
the time of manufacture.
(c) COMPLIANCE WITH THE ACT. All [***] delivered to King in accordance
with Section 2.7(a) will, at the time of such delivery, not be adulterated
within the meaning of the Act and will not be an article that may not, under the
provisions of such Act, be introduced into interstate commerce.
(d) NO LIENS. All [***] delivered to King in accordance with Section
2.7(a) will, at the time of such delivery, be free and clear of all
Encumbrances.
(e) RAW MATERIALS AND COMPONENTS. Subject to King supplying Ramipril
API during the Aventis Agreement Term, Selamine currently has access to
sufficient supplies of Raw Materials and other required resources to perform the
services required under this Agreement.
(f) COMPLIANCE WITH APPLICABLE LAWS. During the term of this
Agreement, Selamine, its Affiliates, and Selamine Designees shall comply in all
material respects with all Applicable Laws with respect to the conduct of its
business in the performance of this Agreement.
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(g) FDA DEBARMENT. As of the Effective Date, none of Selamine, its
Affiliates, or any of their respective employees or agents, in their capacity as
such, have been disqualified or debarred by the FDA, pursuant to 21 U.S.C.
Sections 335(a) or (b), or been charged with or convicted under United States
law for conduct relating to the development or approval, or otherwise relating
to the regulation of any [***] under the Generic Drug Enforcement Act of 1992,
or any other relevant law, rule, or regulation or been disbarred, disqualified,
or convicted under or for any equivalent or similar applicable foreign law,
rule, or regulation.
5.2 KING'S REPRESENTATIONS AND WARRANTIES. In addition to the Parties'
representations and warranties set forth in the Application Agreement, which
representations and warranties are incorporated herein by reference, King
represents and warrants to Selamine that Selamine may exercise its rights and
perform its obligations hereunder, in accordance with the terms and conditions
of this Agreement (and, to the extent applicable to such performance, the terms
and conditions of any other agreements entered into between or among Arrow or
its Affiliates, on the one hand, and King or its Affiliates, on the other hand,
relating to [***]), without violating the terms of King's and/or its Affiliates'
pre-existing agreements with Aventis and/or its Affiliates or Wyeth and/or its
Affiliates and without infringing or misappropriating the intellectual property
of Aventis and/or its Affiliates that is licensed to King and/or its Affiliates
under its pre-existing agreements with Aventis and/or Affiliates.
6. INDEMNIFICATION
6.1 GENERAL PROVISIONS. In addition to the indemnification provisions set
forth in the Application Agreement, the Parties agree to the provisions of this
Article 6.
6.2 INDEMNIFICATION BY KING. Except as otherwise specifically provided,
King agrees to defend, indemnify and hold harmless Selamine, its Affiliates, and
their respective directors, officers, employees, and agents (the "Selamine
Indemnitees") against [***] Liabilities resulting from any claims by a Third
Party, arising out of or relating to:
(a) any material misrepresentation or breach of a representation or
warranty made by King in this Agreement;
(b) any breach of any covenant or obligation by King, its Affiliates
or its sublicensees contained in this Agreement;
(c) the willful misconduct or negligence of King, its Affiliates or
its sublicensees in the use, testing, marketing, manufacture, storage,
distribution, handling or sale of [***];
(d) the willful misconduct or negligence of King, its Affiliates or
its sublicensees in the testing, manufacture, storage or handling of API
supplied by King to Selamine;
(e) Aventis' failure to comply with the specifications agreed upon by
King and Aventis, cGMP, or Applicable Laws with respect to API from Aventis;
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(f) any labeling or packaging of any [***] to the extent that such
labeling or packaging has been supplied by or at the direction of King, its
Affiliates or its sublicensees and applied in accordance with any instructions
from King; and
(g) any representation or warranty made by King, its Affiliates or its
sublicensees to its customers or users with respect to [***], other than
representations or warranties made by Selamine hereunder;
provided, however, that King will not be required to indemnify any Selamine
Indemnitee with respect to any such Liability hereunder to the extent the same
is caused primarily by any breach of contract, negligent act or omission or
intentional misconduct by Selamine, any of its Affiliates, or any of the
Selamine Designees or is otherwise covered by Selamine's and Xxxxx Xxxx'x
indemnification obligation in Section 6.3.
6.3 INDEMNIFICATION BY SELAMINE AND XXXXX XXXX. Except as otherwise
specifically provided, Selamine and Xxxxx Xxxx each agrees to defend, indemnify
and hold harmless King, its Affiliates, and their respective directors,
officers, employees, and agents (the "King Indemnitees") against [***]
Liabilities resulting from any claims by a Third Party, arising out of or
relating to:
(a) Selamine's, its Affiliates', or the Selamine Designees' failure to
comply with the Specifications, cGMP, or Applicable Laws;
(b) any material misrepresentation or breach of a representation or
warranty made by Selamine or Arrow Malta in this Agreement;
(c) any breach of any covenant or obligation by Selamine, its
Affiliates, or the Selamine Designees contained in this Agreement;
(d) the willful misconduct or negligence of Selamine, its Affiliates,
or the Selamine Designees in the manufacture, testing, storage and handling of
[***]; and
(e) the willful misconduct or negligence of Selamine, its Affiliates,
or the Selamine Designees in the manufacture, testing, storage and handling of
Ramipril API;
provided, however, that Selamine and Xxxxx Xxxx will not be required to
indemnify the King Indemnitees with respect to any such Liability hereunder to
the extent the same is caused primarily by any breach of contract, negligent act
or omission or intentional misconduct by King or any or its Affiliates or is
otherwise covered by King's indemnification obligation in Section 6.2.
6.4 PROCEDURES FOR INDEMNIFICATION FOR THIRD-PARTY CLAIMS. A party (the
"indemnitee") that intends to claim indemnification under this Article 6 will
notify the indemnifying party (the "indemnitor") within a reasonable time in
writing of any action, claim, or liability in respect of which the indemnitee
believes it is entitled to claim indemnification; provided that the failure to
give timely notice to the indemnitor will not release the indemnitor from any
liability to the indemnitee except to the extent the indemnitor is actually
prejudiced thereby. The indemnitor will have the right, by notice to the
indemnitee, to assume the defense
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19
of any such action or claim within the [***] period after the indemnitor's
receipt of notice of any action or claim with counsel of the indemnitor's choice
and at the sole cost of the indemnitor. If the indemnitor does not so assume the
defense of such Third Party claim, the indemnitee may assume such defense with
counsel of its choice [***] the indemnitor. If the indemnitor so assumes such
defense, the indemnitee may participate therein through counsel of its choice,
but at the sole cost of the indemnitee. The party not assuming the defense of
any such claim will render all reasonable assistance to the party assuming such
defense, and all reasonable out-of-pocket costs of such assistance will be for
the account of the indemnitor. No such claim will be settled other than by the
party defending the same, and then only with the consent of the other party,
which will not be unreasonably withheld; provided that the indemnitee will have
no obligation to consent to any settlement of any such action or claim that
imposes on the indemnitee any liability or obligation that cannot be assumed and
performed in full by the indemnitor, and the indemnitee will have no right to
withhold its consent to any settlement of any such action or claim if the
settlement involves only the payment of money by the indemnitor or its insurer.
6.5 DISTRIBUTION/PRODUCT LIABILITY INSURANCE. Upon Launch of the [***],
both Parties shall obtain and maintain in effect, for the term of this Agreement
and for a period of [***] thereafter, liability insurance or indemnity policies,
in an amount not less than [***] USD ($[***]) in the aggregate with an indemnity
to principals clause with respect to products liability and distribution. Such
policies shall be blanket policies and shall insure against liability on the
part of the Parties and their Affiliates, as their interests may appear, due to
injury, disability or death of any person or persons, or injury to property,
arising from the distribution of [***]. Upon Launch of the [***] and thereafter
on January 1 of each year during the term of this Agreement, each Party shall
provide to the other a copy of its certificate of insurance (i) summarizing the
insurance coverage and (ii) identifying any exclusions. Each Party shall
promptly notify the other of any material adverse alterations to the terms of
this policy or decreases in the amounts for which insurance is provided.
6.6 PRODUCT LIABILITY CLAIMS. As soon as it becomes aware, each Party will
give the other prompt written notice of any defect or alleged defect in any
[***], any injury alleged to have occurred as a result of the use or application
of the [***], and any circumstances that may give rise to litigation or recall
of a [***] or regulatory action that may affect the sale or manufacture of a
[***], specifying, to the extent the Party has such information, the time, place
and circumstances thereof and the names and addresses of the persons involved.
Each Party will also furnish promptly to the other copies of all papers received
in respect of any claim, action or suit arising out of such alleged defect,
injury or regulatory action.
6.7 LIMITATION OF LIABILITY. EXCLUDING EACH PARTY'S OBLIGATIONS UNDER
ARTICLE 6, NEITHER PARTY NOR ANY AFFILIATE THEREOF SHALL BE LIABLE TO THE OTHER
FOR ANY AMOUNTS REPRESENTING THEIR RESPECTIVE LOSS OF PROFITS, LOSS OF BUSINESS,
INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL, OR PUNITIVE DAMAGES,
(EVEN IF PREVIOUSLY APPRISED OF THE POSSIBILITY THEREOF) ARISING FROM THE
PERFORMANCE OR NONPERFORMANCE OF THIS AGREEMENT OR ANY ACTS OR OMISSIONS
ASSOCIATED THEREWITH OR RELATED TO THE USE OF ANY
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
20
MATERIALS OR SERVICES FURNISHED HEREUNDER, WHETHER THE BASIS OF THE LIABILITY IS
BREACH OF CONTRACT, TORT, STATUTES, OR ANY OTHER LEGAL THEORY, UNLESS SUCH ACT
OR OMISSION ARISES FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH
PARTY.
7. TERM & TERMINATION
7.1 TERM. This Agreement shall remain in effect until the end of the life
of the last to expire of the Ramipril Patents, including any patent term
extensions or restorations, unless previously terminated as provided in this
Agreement.
7.2 TERMINATION. This Agreement may only be terminated upon mutual written
agreement of Selamine and King or upon three (3) months' prior written notice if
one Party is in material breach of this Agreement and fails to cure that breach
within such three (3)-month period; provided that, if Selamine, its Affiliates,
or the Selamine Designees materially breach this Agreement, other than as a
result of the gross negligence or willful misconduct of Selamine, its
Affiliates, or the Selamine Designees, King shall have no right to terminate
this Agreement (although it shall, as provided in Section 2.8(b), have the right
to make alternative arrangements to obtain [***]), but King's right to recover
damages or otherwise seek remedies for Selamine's, its Affiliates', or the
Selamine Designees' breach shall otherwise not be limited.
7.3 TERMINATION FOR BANKRUPTCY. This Agreement may be canceled upon fifteen
(15) days prior written notice by either Party at any time during this Agreement
if: (a) the other Party shall file in any court, pursuant to any statute of any
government in any country, a petition in bankruptcy or insolvency or for
reorganization, or for an arrangement or for the appointment of a receiver or
trustee of the Party or of its assets; (b) any other Party proposes a written
agreement of composition for extension of its debts; (c) the other Party shall
be served with an involuntary petition against it, filed in any insolvency
proceeding, and such petition shall not be dismissed within sixty (60) days
after filing thereof; (d) the other Party shall be a Party to any dissolution or
liquidation; (e) the other Party shall make a general assignment for the benefit
of its creditors; or (f) if the other Party is subject to any final order of
debarment which can be expected to have a material adverse effect on the
Development or commercialization of [***]. A termination pursuant to this
Section 7.3 shall constitute a termination for material breach, and the
non-breaching party shall be entitled to seek damages or equitable relief for
such material breach.
7.4 ACCRUED OBLIGATIONS. Any termination of this Agreement for any reason
does not relieve any Party of any obligation or liability accrued prior to the
termination or rescind anything done by any Party, and the termination does not
affect in any manner any rights of any Party arising under this Agreement prior
to the termination.
7.5 SURVIVAL. The terms and conditions of the following provisions shall
survive termination or expiration of this Agreement for as long as necessary to
permit their full discharge: Sections 2.13, 2.14, 3.6, 3.7, 4.4, 4.8, 4.9, and
4.14 and Articles 5, 6, 7, 8, and 9.
7.6 TECHNICAL ASSISTANCE. Upon termination of this Agreement due to a
breach by Selamine or upon expiration of this Agreement, upon the request of
King and at Selamine's
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
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21
expense in the event of such termination or at King's expense in the event of
such expiration, Selamine and its Affiliates shall provide King with the
assistance of their employees and access to their other internal resources
reasonably necessary to provide King with a reasonable level of technical
assistance and consultation with the transfer of the [***] to, and the
regulatory qualification of, a finished goods supplier of King's election.
8. INTELLECTUAL PROPERTY RIGHTS & CONFIDENTIALITY
8.1 INTELLECTUAL PROPERTY RIGHTS. The Parties acknowledge and agree that
the intellectual property and inventions provisions of Article 4 of the License
Agreement and Sections 2.7, 2.8, and 2.9 of the Application Agreement will apply
to the Parties' rights and obligations under this Agreement.
8.2 CONFIDENTIALITY. All Confidential Information provided by the
Disclosing Party to the Receiving Party in connection with this Agreement is
proprietary to the Disclosing Party and shall be maintained in strict confidence
by the Receiving Party. Such Confidential Information shall remain the property
of the Disclosing Party, and the Receiving Party shall not use the same for or
on behalf of any entity other than the Disclosing Party. At the termination of
this Agreement, the Parties shall promptly return to the Disclosing Party any
physical embodiments (including copies) of any such Confidential Information or,
at the Disclosing Party's sole election, destroy the same under the Disclosing
Party's supervision.
8.3 DISCLOSURE. Nothing in this Agreement shall be construed as preventing
or in any way inhibiting either Party from disclosing Confidential Information
necessary to comply with applicable laws. In the event a Party shall deem it
reasonably necessary to disclose Confidential Information belonging to the other
Party pursuant to this Section 8.3, the Disclosing Party shall to the extent
possible give reasonable advance notice of such disclosure to the other Party,
and shall consider in good faith the other Party's objections to such
disclosure, including suggestions to redact Confidential Information, and take
reasonable measures to ensure confidential treatment of such information.
8.4 PERIOD OF OBLIGATION. This Article shall survive expiration or
termination of this Agreement for a period of [***] from the Effective Date.
8.5 EQUITABLE RELIEF. Selamine and King each acknowledges that a breach by
it of Article 8 cannot reasonably or adequately be compensated in damages in an
action at law and that such a breach may cause the other Party irreparable
injury and damage. By reason thereof, each Party agrees that the other Party may
be entitled, in addition to any other remedies it may have under this Agreement
or otherwise, to preliminary and permanent injunctive and other equitable relief
to prevent or curtail any breach of Article 8 by the other Party; provided,
however, that no specification in this Agreement of a specific legal or
equitable remedy shall be construed as a waiver or prohibition against the
pursuing of other legal or equitable remedies in the event of such a breach.
Each Party agrees that the existence of any claim, demand, or cause of action of
it against the other Party, whether predicated upon this Agreement, or
otherwise, shall not constitute a defense to the enforcement by the other Party,
or its successors or assigns, of the covenants contained in Article 8.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
22
9. MISCELLANEOUS
9.1 PUBLIC ANNOUNCEMENTS. Neither Party nor any Affiliate thereof shall
make any publicity releases, interviews, or other dissemination of information
concerning this Agreement or its terms, or either Party's or any Affiliate's
performance hereunder, to communication media, financial analysts, or others
without the approval of the other Party, which approval shall not unreasonably
be withheld. Either Party and any Affiliate thereof may upon notice to the other
Party make any disclosure in filings with regulatory agencies as required by law
or applicable court order; provided that the other Party and its Affiliates
shall have the opportunity to consult in advance on such disclosures and
filings.
9.2 FORCE MAJEURE. Neither Party nor any Affiliate thereof shall be liable
for any default or delay in such Party's or any Affiliate's performance if such
default or delay is caused by an event beyond the reasonable control of such
Party or Affiliate, including, but not limited to: act of God; war or
insurrection; civil commotion; destruction of essential facilities or materials
by earthquake, fire, flood or storm; labor disturbance; epidemic; or other
similar event; provided, however, that the Party or Affiliate so affected will
give prompt notice of such event, and shall use its commercially reasonable
efforts to avoid, remove or alleviate such causes of nonperformance and shall
continue performance hereunder with the utmost dispatch whenever such causes are
removed.
9.3 ENTIRE AGREEMENT. This Agreement and the documents referred to herein,
including without limitation all Appendices hereto (which are hereby
incorporated by reference), constitute the entire agreement between the Parties
and the Affiliates of each pertaining to the subject matter hereof, and this
Agreement supersedes, on its Effective Date, any other agreements,
understandings, promises and representation, whether written or oral, between
the Parties and such Affiliates relating to the same subject matter save for
where otherwise expressed in this Agreement. No agent of either Party or any
Affiliate of either is authorized to make any representation, promise, or
warranty not contained in this Agreement.
9.4 AMENDMENT AND WAIVER. This Agreement may only be amended by the Parties
in writing, making specific reference to this Agreement, provided that the same
is signed by all Parties. No course of dealing between the Parties any their
Affiliates or failure by either Party or any Affiliates thereof to exercise any
right or remedy hereunder shall constitute an amendment to this Agreement or a
waiver of any other right or remedy or the later exercise of any right or
remedy.
9.5 GOVERNING LAW. This Agreement shall be construed in accordance with the
laws of the State of New York, without regard to any choice of law provisions.
Each Party and each Affiliate of each Party hereby submits itself for the sole
purpose of this Agreement and any controversy arising hereunder to the
jurisdiction of the courts located in the Southern District of New York and any
courts of appeal therefrom, and waives any objection on the grounds of lack of
jurisdiction (forum non conveniens or otherwise) to the exercise of such
jurisdiction over it by any such courts.
9.6 DISPUTE RESOLUTION. Any controversy, claim, or dispute arising out of
or relating to this Agreement (collectively "Dispute") shall be attempted to be
settled by the Parties and
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
23
their Affiliates, in good faith. In the event that there is no resolution of
such Dispute, it shall further be submitted to appropriate senior management
representatives of each Party in a good faith effort to effect a mutually
acceptable resolution thereof. Only if such efforts are not successful shall
such Dispute be resolved by binding arbitration. Such arbitration shall take
place in New York, New York and it shall proceed in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. Within
[***] from the filing of the demand or submission, or longer if the Parties
mutually agree, Selamine and King shall each select one arbitrator; the two
arbitrators so appointed shall select and appoint a third neutral arbitrator.
Judgment upon the award rendered by arbitration shall be binding and may be
entered in any court having jurisdiction thereof. Costs of arbitration are to be
divided by the Parties in the following manner: Selamine shall pay for the
arbitrator it chooses, King shall pay for the arbitrator it chooses, Selamine
and King shall equally share the cost of a neutral arbitrator, and each shall
otherwise bear its own costs.
9.7 ASSIGNMENT. No Party nor any Affiliate thereof may assign any right or
obligation hereunder without the written consent of the other Parties, such
consent not to be unreasonably withheld, provided that each Party may assign
this Agreement and the rights, obligations, and interests of such Party, in
whole or in part, only to any of its Affiliates (for so long as they remain
Affiliates) or to any Third Party that succeeds to all or substantially all of a
Party's business or assets relating to this Agreement and any other agreement
entered into between or among Arrow or its Affiliates, on the one hand, and King
or its Affiliates, on the other hand, relating to [***], whether by sale,
merger, operation of law, or otherwise, or to one or more financial institutions
providing financing to such Party, pursuant to the terms of the relevant
security agreement, and, upon the occurrence of any such succession, shall make
such assignment; provided that such assignee or transferee shall also promptly
agree in writing to be bound by the terms and conditions of this Agreement. This
Agreement shall be binding upon and inure to the benefit of the Parties hereto
and their respective successors and assigns. Any attempted assignment in
violation of this provision shall be void and of no effect.
9.8 NATURE OF AGREEMENT. In operating under the Agreement, each Party shall
act independently and this Agreement shall not be construed as creating any
partnership, joint venture or incorporated business entity. No Party shall have
any authority to incur any liability or obligation whatsoever on behalf of any
other Party.
9.9 NOTICE. Any notice, demand, waiver, consent, approval or other
communication which is required or permitted to be given to any Party under this
Agreement shall be in writing, shall specifically refer to this Agreement, and
shall be effective on receipt, as evidenced in writing, when given by registered
airmail or certified mail, postage prepaid, or overnight courier, and addressed,
unless otherwise specified in writing, to the addresses of the Parties described
below, and effective upon sending if sent by facsimile confirmed by a written
transmission report:
IF SELAMINE:
Xxxx 0/0, Xxxxxxxxxxxx Xxxxxxx,
Xxxxxxxxxx, Xxxxxx 00, Xxxxxxx
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
24
Fax: 000 0 000 0000
Attention: Xxxx Power and Xxxx Xxxxxxxx
COPY TO:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx, Esq.
IF XXXXX XXXX OR ARROW MALTA:
00 Xx. Xxxxxxxxxxx Xxxxxx
Xxxxxxxx XXX00,
Xxxxx
Fax: 000 0000 0000
Attention: Xxxxxxx Xxxxxx
copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxxx, Esq.
IF KING:
000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Fax: 000-000-0000
Attention: General Counsel
COPY TO:
Xxxxx Day
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: F. Xxxxxxx Cerrito, Esq.
9.10 SEPARABILITY.
(a) In the event any portion of this Agreement shall be held illegal,
void or ineffective, the remaining portions hereof shall remain in full force
and effect.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
25
(b) If any of the terms or provisions of this Agreement are in
conflict with any applicable statute or rule of law, then such terms or
provisions shall be deemed inoperative to the extent that they may conflict
therewith and shall be deemed to be modified to conform with such statute or
rule of law, and the remaining portions hereof shall remain in full force and
effect.
(c) In the event that the terms and conditions of this Agreement are
materially altered as a result of Sections 9.10(a) or 9.10(b), the Parties will
renegotiate the terms and conditions of this Agreement to resolve any
inequities.
9.11 EXECUTION IN COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be an original and all of which shall
constitute together the same instrument.
9.12 RECORDING. Either Party shall have the right, at any time, to record,
register, or otherwise notify this Agreement in appropriate governmental or
regulatory offices anywhere within the Territory, and the other Parties shall
provide reasonable assistance to the recording, registering or notifying Party
in effecting such recording, registering or notifying and provided that the
other Parties shall have the opportunity to consult in advance on such
disclosures and filings.
** REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK **
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
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26
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to
be executed on the date first written above by their respective duly authorized
officers, on the date first written above.
SELAMINE LIMITED
By: (signature)
-----------------------------
Name:
---------------------------
Title:
--------------------------
KING PHARMACEUTICALS, INC.
By: (signature)
-----------------------------
Name:
---------------------------
Title:
--------------------------
ARROW PHARM MALTA LIMITED
By: (signature)
-----------------------------
Name:
---------------------------
Title:
--------------------------
XXXXX XXXX HOLDINGS LIMITED
By: (signature)
-----------------------------
Name:
---------------------------
Title:
--------------------------
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE
SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION REQUESTING
CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934.
APPENDIX A
DEFINITIONS
1.1 "ACT" shall mean the United States Federal Food, Drug and Cosmetic Act,
as amended.
1.2 "AFFILIATE" shall mean any corporation, firm, partnership or other
entity that directly or indirectly controls or is controlled by or is under
common control with a Party to an agreement. For purposes of this definition,
"control" means ownership, directly or through one or more Affiliates, of (a)
fifty percent (50%) or more of the shares or voting rights in case of a
corporation or limited company, (b) fifty percent (50%) or more of the shares of
stock entitled to vote for the election of directors, in the case of a
corporation, (c) fifty percent (50%) or more of the equity or controlling
interests in the case of any other type of legal entity (including, without
limitation, joint ventures) or status as a general partner in any partnership,
or (d) any other arrangement whereby a Party controls or has the right to
control the Board of Directors or equivalent governing body of an entity.
1.3 "AMENDED RAMIPRIL APPLICATION" shall mean an amended Ramipril
Application seeking Regulatory Approval of a [***] made using the King
Materials as API, and all amendments and supplements thereto.
1.4 "API" shall mean active pharmaceutical ingredient.
1.5 "API COST" shall mean the price of Ramipril API for use in the
manufacture of the [***], which shall not exceed [***] Selamine shall initially
identify [***] subject to King's right to challenge [***].
1.6 "APPLICATION AGREEMENT" shall mean that certain Ramipril Application
License Agreement entered into among Arrow, Xxxxx Xxxx, Xxxx and Xxxx R&D on
February 12, 2006.
1.7 "APPLICABLE LAW" shall mean applicable U.S. and foreign laws, rules,
regulations, guidelines and standards, including but not limited to those of the
FDA and comparable foreign governmental and Regulatory Authorities, including
without limitation the Act.
1.8 "ARROW" shall mean Arrow International Limited, a corporation organized
under the laws of the Republic of Malta with its principal place of business at
00 Xx. Xxxxxxxxxxx Xxxxxx, Xxxxxxxx VLT 08, Malta.
1.9 "ARROW MALTA" shall mean Arrow Pharm Malta Limited, a corporation
organized under the laws of Malta with its principal place of business at 00 Xx.
Xxxxxxxxxxx Xxxxxx, Xxxxxxxx VLT 08, Malta.
1.10 "AVENTIS" shall mean Sanofi Aventis or any of its Affiliates.
1.11 "AVENTIS AGREEMENT TERM" shall mean (i) the period during which King
is obligated to purchase Ramipril API from Aventis pursuant to King's agreements
with Aventis or
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
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(ii) the period during which King is legally or contractually prohibited from
making, having made, using, selling or offering to sell [***] in the
Territory, except such [***] that are made from Ramipril API supplied by
Aventis.
1.12 "BANKRUPTCY CODE" shall mean the U.S. Bankruptcy Code, 11 U.S.C.
Sections 101 et seq.
1.13 "CALENDAR QUARTER" shall mean the period of three (3) consecutive
calendar months ending on each March 31, June 30, September 30 or December 31,
as the case may be, of a year; provided that the first Calendar Quarter of an
agreement shall begin on the Effective Date and end on the last day of the
calendar quarter within which the Effective Date falls.
1.14 "CALENDAR YEAR" shall mean each successive twelve (12)-month period
commencing on January 1 and ending on December 31; provided that the first
Calendar Year of any agreement shall begin on the Effective Date and end on
December 31, 2006. In the event that the termination of any agreement does not
fall on the last day of a Calendar Year, the "Final Calendar Year" shall mean
the period from the last day of the most recent complete Calendar Year through
the applicable date of termination of such agreement.
1.15 "CAPSULE PRODUCT" shall mean any capsule formulation of pharmaceutical
products containing Ramipril as the active ingredient as approved by the FDA
under New Drug Application Number [***].
1.16 "CGMP" shall mean the minimum standards for methods to be used in, and
the facilities or controls to be used for, the manufacture, processing, packing,
or holding of a drug to assure that such drug meets the requirements of the Act
as to safety, and has the identity and strength and meets the quality and purity
characteristics that it purports or is represented to possess. cGMP, or current
Good Manufacturing Practices, are established through FDA regulations (including
but not limited to 21 CFR Parts 210-211), FDA guidance and FDA current review
and inspection standards and current industry standards.
1.17 "CONFIDENTIAL INFORMATION" shall mean the existence and contents of
this Agreement and any information, in whatever form, disclosed by a Party or
its Affiliates (the "Disclosing Party"), to the other Party or its Affiliates
(the "Receiving Party"), in connection with the performance or implementation of
this Agreement including, but not limited to, any Technology and Patents,
Ramipril Application, Amended Ramipril Application, Ramipril Know-How, [***],
the Ramipril drug master file, Ramipril Patents, including without limitation
any pending patent applications, patent office correspondence, FDA applications
and submissions, FDA correspondence, technical or clinical data, trade secrets,
and know-how, including, but not limited to research, product plans, products,
services, suppliers, customer lists and customers, prices and costs, markets,
software, developments, ideas, techniques, business methods, photographs,
sound-recordings, algorithms, inventions, laboratory notebooks, processes,
formulas, technology, specifications, test results, designs, drawings,
engineering, hardware configuration information, marketing, licenses, finances,
budgets and other actual or anticipated business, research or development
information or any information provided pursuant to Section 3.4, 3.7, 4.5 or 4.9
of this Agreement which is disclosed by the Disclosing Party to the
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
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Receiving Party whether or not specifically designated as confidential.
Confidential Information shall not include:
(a) information which at the time of disclosure is publicly known;
(b) information which, after the time of disclosure, becomes part of
the public domain, except by breach of an agreement between the Disclosing Party
or any Affiliate thereof and the Receiving Party or any Affiliate thereof;
(c) information which is or was in the possession of the Receiving
Party or any Affiliate thereof at the time of disclosure by the Disclosing Party
and was not acquired directly or indirectly from the Disclosing Party or any
Affiliate thereof or from any other party under an agreement of confidentiality
to the Disclosing Party or any Affiliate thereof; and
(d) information which the Receiving Party can show through written
documentation is or was developed by the Receiving Party or its Affiliates
independently of receipt hereunder.
1.18 "CONTROL" OR "CONTROLLED" shall mean, with respect to patents,
know-how or other intellectual property rights of any kind, the possession by a
Party of the ability to grant a license or sublicense of such rights as provided
herein without the payment of additional consideration and without violating the
terms of any agreement or arrangement between such Party and any Third Party.
1.19 "COST(S)" shall mean the fully absorbed manufacturing and packaging
costs, which includes [***].
1.20 "DEVELOPMENT" or "DEVELOP" shall mean, with respect to [***], the
conduct of research, preclinical, clinical and other development activities,
including but not limited to such activities undertaken prior to Regulatory
Approval of such products in order to obtain Regulatory Approval of such
products in accordance with this Agreement and any other agreement entered into
between or among Selamine or its Affiliates, on the one hand, and King or its
Affiliates, on the other hand, relating to [***]. These activities may include
clinical drug development and stability testing, statistical analysis and report
writing, clinical trial design and performance prior to obtaining Regulatory
Approvals, and regulatory affairs related to the foregoing.
1.21 "ENCUMBRANCE" shall mean any mortgage, pledge, assessment, security
interest, deed of trust, lease, lien, levy, license, restriction on
transferability, defect in title, charge or other encumbrance on any kind or any
conditional sale or title retention agreement or other agreement to give any of
the foregoing in the future.
1.22 "FDA" shall mean the United States Food and Drug Administration or any
successor organization and all agencies under their direct control.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
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1.23 "KING" shall mean King Pharmaceuticals, Inc., a corporation organized
under the laws of Tennessee with its principal place of business at 000 Xxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxxx 00000 XXX.
1.24 "KING R&D" shall mean King Pharmaceuticals Research and Development,
Inc., a corporation organized under the laws of Delaware with its principal
place of business at 0000 XxxxxxXxxxx Xxx, Xxxxx 000, Xxxx, Xxxxx Xxxxxxxx.
1.25 "[***]" shall mean any [***] that is owned or Controlled by King
or any Affiliate thereof at any time during the term of this Agreement or any
other agreement entered into between or among Selamine or its Affiliates, on the
one hand, and King or its Affiliates, on the other hand, relating to [***].
1.26 "LAUNCH," "LAUNCHES" or "LAUNCHED" shall mean the date of the first
commercial sale of [***] by King or any Affiliate thereof to a Third Party in
the Territory.
1.27 "LIABILITIES" shall mean claims, liabilities, damages, costs or
expenses (including any liability arising out of the injury or death of any
person or damage to any property and including reasonable attorney's fees).
1.28 "LICENSE AGREEMENT" shall mean that certain Ramipril Patent License
Agreement entered into among Selamine, Xxxxx Xxxx, Xxxx and Xxxx R&D on February
12, 2006.
1.29 "NET SALES" shall mean the gross amount invoiced to non-Affiliate
Third Parties for sale of [***], less, to the extent deducted from or on such
invoice consistent with generally accepted accounting principles, consistently
applied, the following items: (i) [***]; (ii) [***]; (iii) [***]; and (iv)
[***]. If any [***] are sold to Third Parties in transactions that are not at
arm's-length between the buyer and seller, then the gross amount to be included
in the calculation of Net Sales for such sales shall be the amount that would
have been invoiced had the transaction been conducted at arm's-length, [***]. If
any [***] are sold to Third Parties for consideration other than cash or for
consideration that is not readily ascertainable, then the gross amount to be
included in the calculation of Net Sales for such sales shall be determined
based on [***]. Any goods or services provided in exchange of the supply,
disposal of [***] for, or use of [***], in clinical or preclinical trials or as
free samples (such samples to be in quantities common in the industry for this
sort of product) [***]
1.30 "PACKAGING QUANTITY" shall mean the minimum quantities of [***], as
set forth in Appendix 1 to this Agreement, that must be purchased under each
Purchase Order.
1.31 "PARTICIPATE(S)" shall mean that Wyeth has elected, under its
pre-existing agreement with King, to co-promote [***] in the Territory. If Wyeth
is deemed, pursuant to Article 5 of the Application Agreement, not to have
elected to co-promote for purposes of the Application Agreement, then Wyeth
shall also be deemed, effective on the same date, not to have so elected for
purposes of this Agreement.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
A-4
1.32 "PATENT(S)" shall mean and collectively include United States and
foreign patent applications, including any provisional applications, and any
patents issued from such patent applications, reissues, re-examinations,
extensions, substitutions, divisionals, continuations and continuations-in-part
thereof.
1.33 "PURCHASE ORDER(S)" shall mean the information to be provided by King
when placing an order with Selamine for [***], as set forth in Appendix 2 to
this Agreement.
1.34 "QUALITY AGREEMENT" shall mean the Quality Agreement to be entered
into among King, Selamine, Arrow Malta, and Xxxxx Xxxx with respect to the
[***].
1.35 "RAMIPRIL" shall mean the compound (2S,3aS,6aS)-1[(S)-N-[(S)-1-Carboxy
-3-phenylpropyl]alanyl]octahydrocyclopenta[b]pyrrole-2-carboxylic acid, 1-ethyl
ester.
1.36 "RAMIPRIL APPLICATION" shall mean Application Number [***], prepared,
owned and filed by Arrow and its Affiliates with the FDA, and all amendments and
supplements thereto.
1.37 "RAMIPRIL KNOW-HOW" shall mean all Technology relating to the
manufacture, finishing, formulation, or packaging of [***] that is owned or
Controlled by Arrow or any Affiliate thereof at any time during the Term of this
Agreement and any other agreement entered into between or among Arrow or its
Affiliates, on the one hand, and King or its Affiliates, on the other hand,
relating to [***] including, without limitation, methods of production or use
of, and structural and functional information pertaining to or disclosed in,
Ramipril, the Ramipril Application and the Amended Ramipril Application.
1.38 "RAMIPRIL PATENTS" shall mean any and all of the following owned or
Controlled by Selamine or any of its Affiliates at any time during the Term of
this Agreement or any other agreements entered into between or among Selamine or
its Affiliates, on the one hand, and King or its Affiliates, on the other hand,
relating to [***], whether protected, created or arising under the Laws of the
United States or the Laws of any other jurisdiction: patents, patent
applications (along with all patents issuing thereon), statutory invention
registrations, in each case as specified in the other agreements entered into
between or among Selamine or its Affiliates, on the one hand, and King or its
Affiliates, on the other hand, relating to [***], as such agreements may be
amended by the parties thereto from time to time by mutual agreement to reflect
newly issued patents that claim [***] or uses or indications of or methods of
making Ramipril or products with Ramipril as the sole active ingredient, and any
and all continuations, continuations-in-part, and divisions of the foregoing,
along with any and all reissues, reexaminations, and extensions of the
foregoing, and all rights therein provided by international treaties or
conventions owned or Controlled by Selamine or any of its Affiliates. Ramipril
Patents shall include, without limitation, any and all patent applications and
issued patents generated by or on behalf of Selamine or any Affiliate thereof,
jointly or solely, in connection with performance under this Agreement and any
other agreement entered into between or among Selamine or its Affiliates, on the
one hand, and King or its Affiliates, on the other hand, relating to [***],
including without limitation performance of the
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
A-5
Permitted Uses, or otherwise in connection with the [***] or with
generating or obtaining Regulatory Approval of the [***].
1.39 "[***]" shall mean [***], including, but not limited to, all articles
claimed in the Ramipril Patents and the [***], but expressly excluding any
combinations of Ramipril together with any other active ingredient(s) or any
Ramipril formulation indicated for the treatment or prevention of diabetes.
1.40 "RAW MATERIALS" shall mean all API, excipients, components, labeling
and packaging materials and other materials required to manufacture [***].
1.41 "REGULATORY APPROVAL" shall mean final approval by the FDA or other
applicable Regulatory Authority to market a product in the Territory.
1.42 "REGULATORY AUTHORITY" shall mean the FDA or any counterpart of the
FDA outside the United States, or other national, supra-national, regional,
state or local regulatory agency, department, bureau, commission, council or
other governmental entity with authority over the distribution, importation,
exportation, manufacture, production, use, storage, transport or clinical
testing, pricing and/or sale of a product, including without limitation any
device incorporating the [***].
1.43 "XXXXX XXXX" shall mean Xxxxx Xxxx Holdings Limited, a corporation
organized under the laws of Malta with its principal place of business at 00 Xx.
Xxxxxxxxxxx Xxxxxx, Xxxxxxxx VLT 08, Malta.
1.44 "SELAMINE" shall mean Selamine Limited, a corporation organized under
the laws of Ireland with its principal place of business at Xxxx 0/0,
Xxxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxx 00, Xxxxxxx.
1.45 "SPECIFICATIONS" shall mean the specifications for manufacturing,
packaging, labeling and testing [***] set forth in Appendix 3 to this Agreement,
as may be amended from time to time.
1.46 "TECHNOLOGY" shall mean non-patented, proprietary know-how, trade
secrets, inventions, discoveries, improvements, methods, materials and
information, including, without limitation, basic research data, clinical and
pre-clinical data, designs, formulas, materials, compounds, formulations,
pre-formulation experiments, and process information.
1.47 "TERRITORY" shall mean the United States.
1.48 "THIRD PARTY" shall mean any person other than a Party or an Affiliate
of a Party.
1.49 "WYETH" shall mean Wyeth, acting through its Wyeth Pharmaceuticals
Division (formerly American Home Products Corporation, acting through its
Wyeth-Ayerst Laboratories Division) or any of its Affiliates.
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
A-6
APPENDIX 1
PACKAGING QUANTITY
Minimum quantity of [***] per order are as follows:
[***]
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
APPENDIX 2
PURCHASE ORDER
All Purchase Orders from King for [***] shall include the following
information:
- [***]
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
APPENDIX 3
SPECIFICATIONS
Finished Specifications for [***]: [to be provided upon obtaining Regulatory
Approval]
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
APPENDIX 4
STABILITY TESTING
The following tests are performed at each specified time point:
[***]
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
APPENDIX 5
API PURCHASE ORDER
All purchase orders from Selamine to King for Ramipril API shall include the
following information:
[***]
PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH
THE SECRETARY OF THE COMMISSION PURSUANT TO THE COMPANY'S APPLICATION
REQUESTING CONFIDENTIAL TREATMENT UNDER RULE 24B-2 OF THE SECURITIES
EXCHANGE ACT OF 1934.
