EXHIBIT 4.31
COLLABORATION AGREEMENT BETWEEN
PROCHON BIOTECH AND SAVYON DIAGNOSTICS
FOR THE DEVELOPMENT OF PRONTO(TM) FGFR3 KIT
1. ProChon Biotech Ltd. ("ProChon") is engaged in the development and possesses
the rights to certain therapeutic agents which may be utilized in the treatment
of FGFR-associated cancers. ProChon is also engaged in the development of assays
for the detection of specific FGFR point mutations in patients suffering from
the aforementioned cancers.
2. Savyon Diagnostics Ltd, ("Savyon") is engaged in the development and
commercialization of diagnostic kits for the detection of mutations in genetic
diseases, utilizing its proprietary "Pronto(TM)" technology.
3. The parties have agreed to enter into a collaborative relationship whereby
the parties will jointly develop and commercialize a diagnostic kit for
screening and monitoring FGFR mutations in mutant FGFR-associated diseases such
as cancer (the "Diagnostic Product"), under the principle terms and conditions
set forth below. In the event, the Feasibility Kit Development is successful, to
the extent that a test kit has been developed meeting the specifications as to
its performance set forth in appendix II, attached, hereto and forming an
integral part hereof, than the parties shall enter into a definitive agreement
(the "Definitive Agreement") consistent with the provisions of this Agreement,
within 60 (sixty) days of the end of the Feasibility Period, as defined below.
4. Over a period of 3 months beginning not later than 30 days following the
signature of this Agreement (the "Feasibility Period), ProChon and Savyon agree
to carry out a feasibility study and perform kit development in order to
evaluate the applicability of Savyon's technology in the detection of the
following FGFR3 point mutations - S249C, Y373C, S371C, S248C - in patient
samples ("Feasibility Kit Development"), In the event that, on the last day of
such period of 3 months, either party shall notify the other party than the
Feasibility Kit Development has not in its reasonable opinion been successfully
completed in accordance with the specifications set forth in Appendix II, the
Feasibility Period may be extended by mutual written agreement between the
parties to such extent as they shall define therein. In the event of such
extension, one or more subsequent extensions may if necessary, be agreed in the
same manner. However, in the absence of any such extension or should the
Feasibility Kit Development not have been successfully completed by the last day
of any and all such extensions, then this Agreement shall terminate
automatically on the last day of the Feasibility Period (as extended, where
applicable) and the respective rights and obligations, of the parties hereunder
shall cease in all respects, except to the extent of any amount or amounts then
accrued due and owing by one party to the other and those provisions hereof
which by their terms or of their nature survive such termination.
5. During the Feasibility and Kit Development period, Period, each party shall
assume the following responsibilities:
5.1. ProChon will contribute know-how, clinical material and samples and
perform a comparative evaluation of samples by genetic screening utilizing
direct sequencing and SSCP in addition to the Pronto(TM) technology.
ProChon will be responsible for the clinical evaluation of the kits.
5,2. Savyon will be responsible for:
5.2.1 Design of PCR primers,
5.2.2 Design of primer-extension reagents.
5.2.3 Calibration of multiplex PCR reaction.
5.2.4 Calibration of the primer extension reaction.
5,2 5 Validation of prototype assay with samples of known genotypes
and delivery of prototype kits for 100 tests to ProChon, for further
validation.
5.2.6 Supply of kits to ProChon for clinical studies of up to 500
tests.
5.2.7 Providing ProChon with all documents needed for registering the
kits with Israeli and Internal! mal regulatory authorities.
5.2.8 Inclusion in the Diagnostic Products improvements in the
Pronto(TM) technology as they become available.
6. In consideration for the performance of the work by Savyon as detailed in
5.2, ProChon will pay Savyon according to the following schedule;
o $5,000 upon the initiation of the work (the date to be agreed by both
parties and in any case, not later than 30 days from signature of this
document). Agreement).
o $10,000 upon successful completion of the Feasibility and Kit Development
stage according to the mutually agreed upon specifications of the kit
performance, as set forth on Appendix II, attached hereto as an integral
part hereof. ProChon shall pay Savyon, no later than 30 days after delivery
of the prototype kit, as per 5.2.5.
o $5,000 for work to be performed by Savyon related to section 5,2.6 to be
paid not later than 90 days following the order of 500 tests by ProChon.
Savyon shall deliver the tests to ProChon within 45 days of receipt of
order.
6.1 Except as explicitly stipulated above, each party shall bear its own
costs and expenses in the course of the Feasibility Period.
6.2 Value added tax, if applicable, shall be added to all payments made
hereunder, against receipt of a valid tax invoice.
7. Licensing, Manufacturing and Supply
7.1 With effect from the successful completion of the Feasibility kit
development, Savyon hereby grants ProChon, under the terms of this agreement, a
worldwide exclusive license to test, use, promote, distribute and sell products
based on the Pronto(TM) technology in the field of screening and detection of
mutations in FGFR3 as shall be defined in Appendix I from time to time (the
"License"), with the right to sublicense provided that every such sub-license
shall be governed by a written agreement consistent in all respects with the
terms of tills Agreement, a copy of such agreement to be forwarded to Savyon
promptly following its execution.
7.2 In consideration of the License granted by Savyon to ProChon hereunder,
ProChon shall pay Savyon royalties in an amount equal to five percent 5% of the
Net Sales of the Diagnostic Product by ProChon (the "Royalties"). [SEE ADDITION
IN 'Net Sales' shall mean the net amount invoiced and actually collected by
ProChon. or any of its Affiliates from unaffiliated third parties for sales of
Diagnostic Product, less:
1. value-added and other sales taxes.
2. customs and excise duties;
3. cash, trade or quantity credits end discounts given in the normal course
of trade;
4. Freight and insurance costs separately identified on invoices,
5. Returns for credit;
The Royalties shall be payable from the first commercial sale to the life of
this agreement.
'Affiliate" shall mean any company controlling, controlled by or under common
control with a party, 'control' for the purposes hereof meaning the holding of
fifty per cent (50%) or more of the ordinary or common voting shares or stock of
the controlled entity, whether directly or through one or more intermediary
controlled companies, or the power otherwise to appoint one half (1/2) or more
of the members of its board of directors.
7.2.1 In the event that ProChon shall at any time intend to sub-license any of
its rights hereunder with respect to the Diagnostic Product, it shall before
contracting with any third panty to that effect first negotiate and enter into
with Savyon an agreement concerning the compensation to which Savyon will be
entitled by reason of such sub- license. For the purpose of such negotiations,
it is hereby agreed that royalties to be paid to Savyon on Net Sales of
Diagnostics Product by any sub license of ProChon shall be at a rate not
exceeding 4%.
7.3 Savyon will be responsible for the manufacture and supply of the kits to
ProChon at the agreed transfer price (FOB) as per the following table:
Number of Kits/order Price per mutation US$ Kit Price (36 tests) US $
10-49 3.5 504
50-99 2.5 360
100-499 2,0 288
>500 1,5 216
7.4 ProChon commits to sourcing the kits solely from Savyon, and not (directly
or indirectly) to research, manufacture, distribute or sell any competitive
products. ProChon also commits to launch each product commercially within 90
days of its transfer by Savyon to manufacturing, and to achieve a level of
minimum purchases, which level should be agreed upon by the parties and subject
to annual review, no later than the end of October of each year. The parties
agree to adjust the prices in the event ProChon's orders from Savyon exceed
5,000 kits per annum.
In case ProChon requests adaptation of the Diagnostic Product to specific
mutations in particular populations and/or countries, ProChon will pay Savyon an
additional $3,000 for every such mutation Should the adaptation of specific
mutations necessitate the recalibration of the assay, the direct costs expected
in connection therewith will be negotiated in good faith prior to the incurrence
thereof.
7.5 If for any reason whatsoever, Savyon will not be able to manufacture and
supply the Diagnostic Products to ProChon in the required quantities and/or
within the time schedule and over a period of time as agreed upon, then Savyon
shall transfer to ProChon the appropriate manufacturing technology and know-how
related to the Diagnostic Products (collectively the "Manufacturing
Technology"). In such case, ProChon shall be granted a license, with the right
to sub-contract, to manufacture the Diagnostic Products. In order to guarantee
the transfer of the Manufacturing Technology to ProChon Savyon shall disclose to
an escrow agent the Manufacturing Know how upon execution of the Definitive
Agreement. Should this section be invoked, ProChon must continue to pay
royalties on sales of its own-manufactured Diagnostic Product.
8. Confidentiality
All proprietary or otherwise confidential information made available by one
party to the other pursuant to this Agreement including (without exception)
scientific, technical and commercial information necessary or desirable for the
performance hereof, shall be kept secret and confidential by the recipient
thereof and shall not be used by such recipient other than in the performance of
this Agreement in accordance with its terms, nor disclosed other than to
directors, officers, employees and consultants of that recipient who are engaged
directly or indirectly in its operations relating to the Diagnostic Products and
who have been properly instructed by such recipient to maintain such information
in confidence.
These obligations of confidentiality shall not apply, however, in respect of
information:
1. Which is required to be disclosed to a duly authorized governmental
authority
2. Which was already in the recipient's possession prior to disclosure
hereunder, as evidenced by its prior written records;
3. Which is now or hereafter becomes public knowledge through no fault of
the recipient;
4. is received by the recipient in good faith on a non-confidential basis
from an un affiliated third party;
5. after its disclosure hereunder is independently developed by an employee
or consultant of the recipient who does so without reference to or
knowledge of any such information, in a manner capable of reasonable proof
by the recipient.
Each party shall take all steps as shall be reasonably necessary to ensure that
its directors, officers, employees and consultants to whom it discloses any
proprietary or otherwise confidential information of the other party shall not
disclose such information to any unauthorized person, or use the same other than
in strict accordance herewith.
These provisions with respect to confidentiality shall survive the termination
of this Agreement or Definitive Agreement, whichever is later, howsoever caused,
for a period of five (5) years.
9. Intellectual Property
Any and all data and results relating to the Diagnostic Products shall be sole
property of ProChon. Any and all data and results relating to the Pronto(TM)
technology shall be sole property of Savyon. Any discovery and other invention
conceived, reduced to practice or otherwise, made solely by one of the parties
will be solely owned by the respective party. Any such intellectual property
made jointly by ProChon and Savyon will be owned by both parties.
10. Warranty
Savyon warrants that the Diagnostic Products will in every case be manufactured
in accordance with generally accepted good manufacturing practices, will meet
their respective specifications (as defined in Appendix II) and will be free
from defects in materials and workmanship.
Savyon makes no other express warranty with respect to the Products and
expressly excludes and disclaims (to the extent permitted by applicable law) any
and all implied warranties, including (without limitation) those concerning the
merchantability of the Products or their fitness for any particular purposes or
use.
ProChon undertakes to defend, indemnify and hold harmless Savyon against any and
all claims, suits, proceedings, judgments, awards, settlements, liabilities,
damages and expenses (including the reasonable costs of legal counsel) arising
in any way out of the promotion, distribution, sale or use of the Diagnostic
Products, wheresoever occurring, except to the extent that any such claims,
demands, losses and/or expenses are attributable to the negligence or other wise
wrongful action or inaction of Savyon, its directors, officers, employees or
consultants or to the manufacture by or on behalf of Savyon of the Diagnostic
Products.
ProChon shall in the same manner defend, indemnify and hold harmless Savyon
against any and all claims alleging that the promotion, distribution, sale or
use of the Products in any part or parts of the world infringes the patent or
other intellectual property rights of any third party.
Diagnostic Products, wheresoever occurring, to the extent that any such claims,
demands, losses and/or expenses are attributable to the negligence or otherwise
wrongful action or inaction of Savyon, its directors, officers, employees or
consultants or to the manufacture by or on behalf of Savyon of the Diagnostic
Products.
11. Patents and Infringement of Third Party Rights
In the Definitive Agreement the parties shall determine the rights and
obligations with respect to the preparation, filing, prosecution and maintenance
of any new patents for the Diagnostic Products. In addition, the parties shall
set forth their rights and obligations if the manufacture, use or sale of the
Diagnostic Products constitutes an infringement of the rights of third parties.
12. Term and Termination
Subject to the provisions of Section 4, this agreement and the license granted
hereunder as well as the respective rights and obligations of the parties
pursuant hereto, shall be in full force and effect from the Date of this
Agreement and continue with respect to ProChon's rights for 30 long as ProChon
continues to exercise the License, whether directly or through its Affiliate or
sub-licensees, and with respect to Savyon's rights as long as Savyon remains
able to manufacture the Diagnostic Product in accordance with the terms of this
Agreement. In the event that either party shall be in material breach of any of
its obligations hereunder and shall fail to remedy such breach within ninety
(90) days on, in the case of the breach of a financial obligation, in thirty
(30) days of receipt of a written notice of such breach served by the other
party, such other party shall be entitled forthwith, to terminate this Agreement
with immediate effect by serving upon the party in default a further written
notice to such effect. Notwithstanding the foregoing, this Agreement shall
expire upon the execution of the Definitive Agreement.
ProChon Biotech Ltd. Savyon Diagnostics Ltd.
By: __________________ By: __________________
Xxxxx Xxxxx, Ph.D, M.D Nir Navot, Ph.D
Date: Date:
By:__________________ By: __________________
Xxxxxx Xxxxxx, Ph.D Xxxx Xxxxxx
Senior Vice President
Corporate Development
Date: Date:
RE: Collaboration Agreement between ProChon Biotech and Savyon Diagnostics for
the Development of Pronto(TM)FGFR3 Kit
The following issues related to the aforementioned agreement were discussed and
agreed between the parties on January 11,2003:
1. ProChon will transfer lo Savyon the sum of $5,000 on account of the
$10,000 payment related to the successful completion of the Feasibility and
Prototype Kit Development stage stipulated in clause 6 of the Agreement.
2. Savyon hereby confirms the obligation to complete within two weeks, and
in any case not later that four weeks, the final optimization of the
prototype kit in order to lower the background according to acceptable
standards of Savyon's Pronto Kits.
3. ProChon's acceptance of the final prototype kit is contingent upon
validation by three independent technicians at ProChon.
4. In the case that the prototype kit will not meet the standards defined
above, Savyon Diagnostics will not have the right to pursue any activities
regarding said kit without a written consent by ProChon, according to the
ProChon and Savyon collaboration agreement.
PROCHON BIOTECH LTD.
By: _____________________
Date Signed: _____________
SAVYON DIAGNOSTICS LTD.
By: _____________________
Date Signed: _____________
EXTENSION TO THE COLLABORATION AGREEMENT BETWEEN PROCHON AND SAVYON
DIAGNOSTICS FOR THE DEVELOPMENT OF PRONTO(TM) FGFR3 KIT (FIBROTEST)
1. Due to unforeseen circumstances, development of the FGFR3 kit, by Savyon, has
been delayed. ProChon agrees to pay Savyon an additional $4,000 for the extended
development period. Thus payment will be due only if the development milestones
are reached by the 10th of December 2002 and upon the delivery at ProChon of the
finality (as per 5.2.6 of the original agreement).
2. Savyon expects to complete the development of the kit and deliver to ProChon
prototype kits for 100 tests (four mutations per test) by the end of November
2002.
3. Savyon will provide ProChon up to 200 additional tests to the 500 tests
specified in 5.2.6. of the original agreement, upon ProChon's request. (Some of
these tests will be of the four mutations and some for each mutation
separately).
4. Savyon will provide training for the use of Pronto(TM) FGFR3 (FibroTest) kit
at ProChon and at any hospital lab that will use the kit at no cost.
Date:
For ProChon For Savyon Diagnostics
Agreed and signed by: Agreed and signed by:
__________________ ____________________
